3W Power Holdings/AEG Power Solutions Announces First Half 2010 Financial Results
3W Power Holdings, the holding company of AEG Power Solutions, announced its financial results for the first six months of 2010. First half orders were €153.7 million, up 30% from €118 million in the first-half of 2009. The company posted sales of €141 million, down 41% from the previous year, primarily due to an oversupply of poly silicon manufacturing impacting demand for its power control systems.
Second quarter orders were €85 million, up 23% over the first quarter and 55% over the second quarter of 2009. The strongest contributor to growth was solar orders worth €19.2 million vs. €7.7 million in the first quarter. Second quarter sales increased 18% over the first quarter but were down 33% on the second quarter of 2009 due to the weakness in the power control systems. However, two consecutive quarters of renewed orders together with exceptional demand for solar panels and rising spot price for poly silicon indicate a steadily eroding supply overhang that will lead to a resumed capacity expansion and growth for power control systems and modules.
EBITDA fell to -€0.3 million (previous year: €60.5 million on a pro forma basis) and EBIT to -€23.1 million (previous year: €25.1 million on a pro forma basis). The net result was -€7.8 million (previous year: €19.0 million on a pro forma basis), which corresponds to earnings per share of -€0.16 (previous year: €0.17 on a pro forma basis). An increase in the order entry to €153.7 million (prior year: €118.0 million on a pro forma basis) indicates that the Group was able to reverse the downward trend during the reporting period. The results include the consolidation of the converters business which had been held as discontinued.
In the first six months of the year, the Group reorganized its business segments into two operating segments to further enhance its business performance and competitiveness. The Renewable Energy Solutions (RES) segment combines the power control systems and modules business (POC), as well as Group solutions for the solar industry. Combining all activities related to renewable energy sources in the RES segment serves to strengthen the company’s focus on this area. RES segment revenue in the 1st half amounted to €46.1 million (previous year: €143.6 million on a pro forma basis) while EBITDA fell to €9.1 million (previous year: €74.2 million on a pro forma basis) again due to the global oversupply of poly silicon manufacturing capacity. The Energy Efficiency Solutions (EES) segment includes the production and distribution of highly reliable power supply systems for the oil and gas, transportation, energy generation, electricity transmission and distribution, data and information technology, and other industries, as well as the company’s telecommunication solutions. These activities generated revenue of €94.9 million (prior year: €96.1 million on a pro forma basis) and EBITDA of -€0.7 million (prior year: -€3.8 million on a pro forma basis) in the first half of 2010.
In the course of the first half, the Group took the necessary steps to change the corporate holding company’s name from Germany1 Acquisition Limited to 3W Power Holdings SA and to migrate its location of registration from Guernsey to Luxembourg. Trading in the Group’s ordinary shares and warrants under their new ticker symbols (3WP and 3WPW, respectively) began on April 19, 2010, and the migration to the registered office in Luxembourg became effective on June 2, 2010.