SMA Solar shares fall 30% after profit warning

By Louis van Boxel-Woolf

(Reuters) - Shares in German solar power parts supplier SMA Solar Technology AG plunged by 31.7% on Wednesday after it cut its profit guidance on Tuesday night, citing political uncertainty.

SMA Solar expects 2024 operating earnings (EBITDA) of between 80 and 130 million euros ($85.9 million to $139.6 million), down from 220 to 290 million euros, and sales of between 1.55 and 1.7 billion euros, down from 1.95 to 2.2 billion euros.

Sales and earnings at SMA's Home Solutions and Commercial & Industrial Solutions segments would be "below expectations", the company said, citing high inventories and a volatile market.

The two segments last year made up about 55% of SMA's sales and over 60% of operating profit (EBIT).

SMA said elections to the European parliament earlier this month and upcoming presidential elections in the U.S. contributed to market uncertainty.

A swing to the political right in the European Parliament has raised doubts about the direction of European Union policy on the climate and green energy.

ODDO BHF analyst Anis Zgaya said, however, political uncertainty was unlikely to impact SMA's performance in 2024 and inventories were a bigger issue for the company.

"Destocking is taking much more time than initially anticipated by the group," he said.

"In recent calls, a lot of questions were asked of management about the probably high guidance. And they confirmed each time, saying they have confidence in a rebound in order intake. But they were obviously wrong," he added.

Solarnative, an unlisted German company that also makes power inverters for use in home solar systems, separately said on Wednesday that it was looking for a buyer or investor to remain solvent.

Price pressure from Chinese competitors as well as "very full inventories because of oversupply in the past year" made the move necessary, it said, adding that it would cut 35 jobs and withdraw its guidance for the year.

($1 = 0.9314 euros)

(Editing by Ludwig Burger, Miral Fahmy and Barbara Lewis)