SMA Solar Expects Sales To Decline In FY15; Announces Further Job Cuts

(RTTNews) - German solar energy equipment supplier SMA Solar Technology AG (SMTGF.PK) on Monday said it expects a difficult fiscal year 2015 and a decline in sales.

Due to the lower level of sales, SMA Solar said it is planning to cut about 1,600 full-time positions in all functional areas by June 30, 2015. The cutback targets of over 600 full-time positions that were announced last year are included in these figures. About 1,300 full-time positions in Germany and about 300 full-time positions at SMA's international locations are affected. The company had 4,667 full-time positions (excluding temporary employees) as of December 2014.

"We expect to see high price pressure on the global photovoltaic market still in the coming years and a further decline in demand in Europe, particularly in Germany. By contrast, the non-European markets will develop positively. This means, that although the market measured in gigawatts will continue to grow in the medium term, we expect to see a global decline when measured in euros," said SMA Chief Executive Officer Pierre-Pascal Urbon.

"To return to profitability in this environment, we want to make adjustments to SMA's structures in line with the lower sales level. This is the only way that we can break even with reduced sales. In this context, global staff reductions are unfortunately unavoidable. We have already defined extensive measures that we will discuss with the Works Council over the next weeks," said Urbon.

"However, the effects of these measures will not emerge until the second half of the year at the earliest, meaning that SMA will probably not yet return to profitability in the current fiscal year."

For 2014, the company is confirming the upper end of the sales forecast of EUR790 million and a loss of up to EUR115 million (excluding provisions for the planned staff reductions).

With net cash of about EUR220 million, SMA will be able to finance the transformation and the implementation of the strategy with its own resources, Urbon continued.