SMA Solar aims to boost market share

FRANKFURT (Reuters) - SMA Solar, already the world's biggest maker of solar inverters, aims to boost its market share this year, its chief executive said on Wednesday, a goal seen as ambitious by industry experts. "Not only do we want to keep our market share stable in 2010, we also want to increase it," Guenther Cramer said at the company's annual news conference.

SMA Solar said it had a share of more than 40 percent of the global market for solar inverters in 2009, far ahead of Kaco new energy GmbH, the global No.2, with a share of below 10 percent.

But this is already down from SMA's outlook from November of gaining 45-50 percent of the global inverter market, raising fears that the company will lose market share to companies from the semiconductor industry this year.

Analysts have cautioned that companies such as Advanced Energy Industries, General Electric, ABB and Siemens are attacking the profitable sector, in which SMA Solar saw its 2009 EBIT margin reach 24.4 percent, one of the highest in the industry.

"Going forward it still a risky conclusion for SMA to aim for increased market share this year. All the inverter companies are adding capacities and this could potentially lead to oversupply," said Jon Sigurdsen, manager of the Renewable Energy fund at Carlson, a unit of Norwegian DnB Nor Group.

Inverters are a key component in the solar industry, converting direct current generated from solar modules into alternating current.

Cramer said he expected the German photovoltaic market to be 4-5 gigawatts this year, up from about 3 gigawatts in 2009, although official figures are still not out.

"For 2011, we see similar volumes for Germany, although it is hard to measure the impact of cuts in solar feed-in tariffs," Cramer said, pointing to planned one-off cuts in solar power subsidies in Europe's biggest economy.

Regarding recurring speculation the company could be taken over by big utilities or industrial conglomerates, Chief Financial Officer Pierre-Pascal Urbon said that the company had been approached.

"It proves that we're doing something right, but we do not have the intention to sell stakes in the company," he said.

SMA earlier on Wednesday proposed raising its dividend to 1.30 euros ($1.75) per share for 2009 from 1.00 euro a year earlier. It confirmed its 2010 outlook of sales at 1.1-1.3 billion euros and an EBIT margin of 20-23 percent.

According to Thomson Reuters I/B/E/S, analysts on average expect 2010 sales to come in at 1.123 billion euros.

Through unmatched flexibility in production, SMA has been able to steer through the industry's oversupply and financing crisis much more effectively than module and cell makers.

According to StarMine, which weights analyst projections based on their track record, the company trades at 17.9 times estimated 12-month forward earnings, a premium to module maker Centrosolar and cell maker Suntech.

Shares in SMA Solar were 0.3 percent lower at 1210 GMT, underperforming the FTSE cleantech index that stood 0.3 percent higher.

($1=.7448 Euro)

(Reporting by Christoph Steitz; Editing by Jon Loades-Carter)