SMA Solar Revises Annual Earnings Forecast For 2022

• SMA Solar has offered an upward revision to its annual forecast for 2022 citing increase in incoming orders and improving supply of electronic components
• The supply situation for electronic components is expected by the management to further improve by the end of the year
• Product related order backlog at the end of September 2022 had increased to over €1.2 billion

SMA Solar Technology AG, Europe's prime solar PV inverter manufacturer from Germany, has increased its annual EBITDA forecast for 2022 to €60 million to €70 million, from €10 million to €60 million, riding on high level of incoming orders and gradually improving supply of electronic components (see SMA Solar's Q1/2022 Financial Results).

These factors, it added, should lead to a business performance in Q4/2022 that exceeds previous expectations.

Sales are guided to be within a ranger of €975 million and €1,050 million and not between €900 million and €1,050 million as forecast previously. Now, it also expects EBIT to be in the positive, ranging between €22 million to €37 million as against €-30 million to €20 million.

SMA CEO Jürgen Reinert counts its product-related order backlog at the end of September 2022 to have grown to over €1.2 billion, and demand growing for its Home Solutions and Commercial & Industrial Solutions segments.

Going forward, it expects order intake to pick up in the Large Scale & Project Solutions segment, 'which has been repeatedly impacted by project postponements recently, so that we should be able to better utilize our production capacity than we could so far this year'.

"In addition, the supply situation for electronic components is improving continuously, and we are increasingly able to supply our customers. The situation should ease further by the end of the year," added Reinert.

A special effect in the lower double-digit million euro range from the sale of a real estate asset has also been guided for Q3/2022 earnings, Actual financial results for 9M/2022 will be announced on November 10, 2022.

Jeffrey Osborne of Cowen cited official sources from SMA to add that the 40% sequential growth in product backlog is due to robust demand from Europe and additionally activity is picking up for the US utility scale market. The management is hopeful of continued strength in bookings in Q4/2022 and into early next year.

"Guidance was only offered for the full year and our assumption is the bulk of the upside emanates from increased residential demand in Germany, Italy and the BeneLux with a moderate benefit from FX given that 45-50% of revenue is typically exported from Germany and sold in USD," added Osborne.