DGAP-News: S.A.G. Solarstrom AG on target despite general

DGAP-News: S.A.G. Solarstrom AG / Key word(s): Quarter Results S.A.G. Solarstrom AG on target despite general market slump 07.11.2013 / 07:30 --------------------------------------------------------------------- S.A.G. Solarstrom AG on target despite general market slump - Installation volume in Europe slumps by over 50% - Overall performance of S.A.G. Solarstrom AG only 11.5% below previous year - Sales in the first nine months at EUR74.5 million - EBIT at -EUR2.8 million - Operative result marked by international expansion and project activity - Forecast for entire year confirmed Freiburg i. Br., November 7, 2013. S.A.G. Solarstrom AG (German security identification number: 702 100, ISIN: DE0007021008) has achieved sales of EUR74.5 million (Q1-Q3 2012: EUR90.1 million) in continuing operations in the first nine months of 2013 despite the very adverse market environment, with a market slump in Europe of over 50%. The Group has continued to implement projects successfully in Europe despite massive market turbulence and has developed new markets outside of Europe. EBIT was still in the negative range at -EUR2.8 million (Q1-Q3 2012: +EUR0.8 million) due to the preproduction costs of project activity and accelerated international expansion. 25.2% of sales were achieved in Germany, 63.1% in the UK and 11.7% in other foreign countries - demonstrating the success of the international expansion strategy. Projects that were already planned for Q3 in the UK have been delayed, partially due to the unclear general conditions regarding the punitive tariffs on Chinese module imports, and as a result sales in Q3 2013 were at EUR11.7 million and EBIT at -EUR0.7 million. Altogether, the S.A.G. Solarstrom Group succeeded in the first nine months of 2013 in compensating for the massive market slump of over 50% in Europe to a large extent. Overall performance at EUR76.2 million (Q1-Q3 2012: EUR86.1 million) was only 11.5% below the previous year's period. The company is still expecting to achieve an installation and sales volume of more than 117 MWp and a positive operating result in fiscal year 2013. 'The European market has, as expected, collapsed by more than 50%, due to regulatory changes and the introduction of punitive tariffs and minimum import prices on Chinese module imports', says Dr. Karl Kuhlmann, CEO of S.A.G. Solarstrom AG. 'We therefore had to significantly accelerate our international expansion, in order to develop future growth markets for our Group. This has left its mark on our result and our balance sheet.' The group period result was -EUR6.9 million, and taking into account the discontinued operations in Partner Sales, -EUR8.1 million. 'However, we are convinced that our aggressive expansion strategy has laid crucial foundations for profiting from market growth at the end of the consolidation phase'. Although several projects planned for Q3 in the UK have been delayed, S.A.G. Solarstrom AG is currently anticipating achieving its forecast, an ambitious one under the present market conditions. 'We also implemented a large part of our installation volume in Q4 last year', continues Kuhlmann, 'which is why we are confirming our forecast, particularly in view of our current project pipeline and the advanced project situation.' Plant Construction: Installation volume slightly above previous year's level Despite the massive market slump in Europe, the business area Plant Construction succeeded in retaining a very stable installation volume. In the first nine months of 2013, 44.4 MWp was installed, mainly in the UK and Germany (Q1-Q3 2012: 42.8 MWp). Sales reached EUR56.0 million (Q1-Q3 2012: EUR69.9 million) - this reflects the decrease in price for photovoltaic systems following the drop in component prices during 2012 and the first few months of 2013. At -EUR6.3 million (Q1-Q3 2012: -EUR3.3 million), EBIT shows not only the usual, in some cases considerable preproduction costs of project activity due to the size of the projects, but also the costs of accelerated foreign expansion in new markets such as Latin America, Africa and Turkey. Sales in Q3 were EUR4.5 million (Q3 2012: EUR44.9 million) and EBIT -EUR2.6 million (Q3 2012: +EUR0.7 million). As projects in the UK were delayed, the costs mentioned were only offset by low sales. Partner Sales discontinued - Project Sales is being prepared for the market S.A.G. Solarstrom AG discontinued the loss-making business area Partner Sales in June 2013. With an installation volume of only 3 MWp from Q1 2013, sales in the first nine months were EUR1.2 million (Q1-Q3 2012: EUR18.5 million), and EBIT added up to -EUR1.2 million (Q1-Q3 2012: -EUR0.4 million). Other significant costs of closure are not expected, and depreciation on goodwill has already been taken into account for the balance sheet at -EUR0.3 million. Although a higher sales volume in the business area Partner Sales would have increased the installation and sales volume, the margin would have been negative. For the newly created business area Project Sales, which covers the secondary market business with photovoltaic systems, power production projects for own consumption and integrated energy projects, further projects for the secondary market have already been identified and negotiations initiated, which should lead to contributions to sales and results by the end of 2013, according to current estimates. Plant Operation and Services: stable revenue and increasing monitoring figures The business area Plant Operation and Services achieved sales of EUR13.3 million (Q1-Q3 2012: EUR14.1 million) in the first nine months of 2013. The business area was thus very successful in extensively compensating the massive market slump of over 50% in Europe, by which both the hardware business and project-dependent services such as yield reports are affected in Europe, through further expansion. Due to development costs and costs for further internationalization, EBIT was EUR2.1 million (Q1-Q3 2012: EUR2.3 million). With sales of EUR4.8 million (Q3 2012: EUR4.7 million) and an EBIT of EUR0.7 million (Q3 2012: EUR0.7 million), Q3 2013 was above the previous year's level. The number of systems monitored by meteocontrol GmbH rose at September 30, 2013 to around 33,600 with a total output of 7.8 GWp (September 30, 2012: around 29,500 systems, 5.9 GWp), and currently the figure is around 34,000 systems with a total output of 8 GWp. Power Production: Q3 2013 back to normal level As a result of the extraordinarily long winter with little sunlight, sales in the business area Power Production were 15% below the previous year's period (Q1-Q3 2012: EUR6.2 million), at EUR5.2 million in the first nine months of 2013. EBIT was EUR1.5 million due to linear depreciation (Q1-Q3 2012: EUR1.8 million). Q3 2013 contributed EUR2.3 million to sales (Q3 2012: EUR2.4 million) and an EBIT of EUR1.1 million (Q3 2012: EUR1.1 million) and was thus back to its usual level for Q3. The business area is a guarantor of two-digit EBIT margins, even taking into account fluctuations due to the weather. Balance sheet shows costs of foreign expansion and preproduction costs of project activity At the key date of September 30, 2013 S.A.G. Solarstrom AG's balance sheet continued to show a balance sheet total expanded by large-scale projects, with a high working capital. The accumulated net loss at the key date also affected the equity ratio, which was temporarily at 11.8%. Without impact from large-scale projects and financing of the Group's own system park, the equity ratio would have been a solid 29.4%. The current liabilities were covered at September 30, 2013 at 117% by current assets. Despite the preproduction costs of further project activity and the negative EBIT, the operative cash flow was +EUR3.9 million in the first nine months of fiscal year 2013 (Q1-Q3 2012: +EUR96.2 million, mainly due to the purchase price payment for a large-scale project). In Q3 2013, a positive operative cash flow in the amount of EUR2.8 million was achieved (Q3 2012: -EUR8.2 million). Course set for 2014 - forecast for 2013 confirmed Since Q2 2013, S.A.G. Solarstrom AG has driven its foreign expansion beyond Europe at full speed and thus set the course for participating in the market growth of these new markets in the medium term. Despite the delays in projects in the UK and the adverse market conditions, S.A.G. Solarstrom AG is currently anticipating that it will be able to increase its installation and sales volume to over 117 MWp and achieve a positive operating result, as planned. About S.A.G. Solarstrom AG S.A.G. Solarstrom AG (German security identification number: 702 100, ISIN: DE0007021008) of Freiburg i.Br., Germany, is a manufacturer-independent provider of photovoltaic plants configured to customers' individual needs. The Group constructs plants of all sizes both in Germany and abroad. S.A.G. Solarstrom AG also produces solar energy at its own plants. S.A.G. Solarstrom AG's service portfolio covers the entire life cycle of photovoltaic plants, including forecast and energy services, yield reports, and remote service and maintenance, as well as insurance and financing. The Group thus offers a comprehensive value chain in photovoltaics, from yield reports, planning, construction, operations, and monitoring to optimization, repowering, and deconstruction. S.A.G. Solarstrom AG was founded in 1998. Around 200 specialists work at the four locations in Germany and the foreign subsidiaries. S.A.G. Solarstrom AG is listed in the Prime Standard of the Frankfurt Stock Exchange as well as according to the rules and standards M:access of the Munich Stock Exchange. Further information: www.solarstromag.com Contact: S.A.G. Solarstrom AG Sasbacher Stra�e 5 79111 Freiburg Germany www.solarstromag.com Public Relations / Investor Relations Jutta Lorberg phone: +49-(0)761-4770-311 e-mail: pr@solarstromag.com / ir@solarstromag.com End of Corporate News --------------------------------------------------------------------- 07.11.2013 Dissemination of a Corporate News, transmitted by DGAP - a company of EQS Group AG. The issuer is solely responsible for the content of this announcement. DGAP's Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Media archive at www.dgap-medientreff.de and www.dgap.de --------------------------------------------------------------------- Language: English Company: S.A.G. Solarstrom AG Sasbacher Str. 5 79111 Freiburg Germany Phone: + 49 761 4770 0 Fax: + 49 761 4770 555 E-mail: mail@solarstromag.com Internet: www.solarstromag.com ISIN: DE0007021008, DE000A1E84A4, DE000A1K0K53, WKN: 702100, A1E84A, A1K0K5 Listed: Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr in Berlin, Düsseldorf, Hamburg, München (m:access), Stuttgart End of News DGAP News-Service --------------------------------------------------------------------- 238398 07.11.2013