SMA Solar (S92) Q2 2024 earnings summary

Executive summary

• H1 2024 sales were EUR 759 million, down from EUR 779 million in H1 2023, with strong growth in Large Scale & Project Solutions offset by sharp declines in Home and C&I segments due to high inventories and postponed investments.

• EBITDA fell to EUR 80.6 million from EUR 125 million, reflecting margin pressure, lower production utilization, and inflationary effects.

• Free cash flow was -EUR 203 million, mainly due to increased net working capital from reduced Home and C&I sales.

• Order backlog at end of June 2024 stood at EUR 1.35 billion, down from EUR 2.45 billion year-over-year, with Large Scale segment dominating.

• Guidance for 2024 was revised downward due to weak demand and high inventories in key segments.

Financial highlights

• Home segment revenues fell 66% year-over-year to EUR 110 million; C&I revenues dropped to EUR 113.6 million, while Large Scale sales more than doubled to EUR 536 million.

• EBITDA margin was 11% (vs. 16% last year), including a EUR 19 million one-time gain from the sale of elexon stake.

• Group EBIT margin was 7%, down from 14% in 2023.

• Net cash decreased from EUR 283 million at 2023 year-end to EUR 66 million, mainly due to working capital build-up.

• Gross cash flow dropped to EUR 53 million in H1 2024 from EUR 143 million in H1 2023.

Outlook and guidance

• 2024 sales guidance revised to EUR 1.55–1.7 billion, with EBITDA expected between EUR 80–130 million and EBIT of EUR 20–85 million.

• Large Scale sales expected to remain strong; Home and C&I demand softer than forecast due to prolonged inventory clearance and market uncertainties.

• Inventory reduction of EUR 80–100 million targeted by year-end to improve cash flow.

• Net cash expected to reach EUR 100 million by year-end, driven by inventory reduction and cost controls.

• Net working capital expected at 27–30% of sales by year-end.