Phoenix Solar (PS4-FF)

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Hermann S

Phoenix Solar AG is a german company with headquarters at Sulzemoos, near Munich. Phoenix Solar AG is selling complete solar power systems and components. After a successful internationalisation the company has subsidiaries in Southern Europe, Asia and Australia. The shares of Phoenix Solar AG (ISIN DE000A0BVU93) are listed on the official market (Prime Standard) of the Frankfurt Stock Exchange and were admitted to the TecDAX technology index of Deutsche Börse AG on 25 March 2008.

Company Overview

As a specialist wholesaler, Phoenix Solar AG sells solar modules, inverters, accessories and complete solar power systems. The components are sourced from the international market. The supply base includes Solyndra, First Solar, Schott Solar, Signet Solar, Yingli Solar, Trina Solar, Suntech, Sharp, Mitsubishi Electric, Mitsubishi Heavy Industries and the inverter suppliers Xantrex, Fronius and SMA.

The Ulm subsidiary is specialised in the planning and construction of large solar power plants. For this purpose, it employs specially developed assembly systems and components, which substantially reduce assembly times. The team at Ulm also conceives special solutions for solar power plants.

Phoenix Solar Energy Investments AG is developing and issuing Solar Funds. ^[1]

Business and Financial Metrics

The company follows the IFRS standard and all numbers are reported in Euro. Fiscal year is from 1st of January to 31st of December.

The graphics show the data from the available audited annual reports.^[2] In April 2008 the company issued 607,500 new shares and received 20.8 million EUR gross proceeds to fund growth and internationalisation. In November 2008 a syndicated loan of 150 million EUR with a three year term was secured to further improve working capital conditions. ^[3]

Business Segments

Phoenix Solar is selling components and assembly systems. Increasing importance has the power plant business in non domestic markets. Most of the non domestic (German) revenue in 2007 was made in Spain with 37.5 million Euro contribution of the La Solana Power Plant.

Solar Components

In the Components & Systems segment Phoenix Solar is offering tailored systems, solutions and support in planning, logistics and other services (e.g. training) as a specialist wholesaler for grid-connected photovoltaic systems and components. The customers of this segment are resellers: electrical installation businesses, electrical retailers and wholesalers, heating/sanitary and roof companies as well as solar retailers.

Solar Power Plants

Phoenix Solar is offering turn-key solutions from concept to operation and maintenance of the systems. Attached is a picture of the La Solana Power Plant in Spain (6530 kWp).^[4] The customers of the Power Plant segment are private individuals, companies of the retail market, industry and commerce, local authorities as well as fund initiators and financial investors.

Key Trends and Forces

Key trends of the photovoltaic market in general are shown in the article Solar Power and in the IEA Photovoltaic Power Systems Programme report^[5]. Here is a description of those trends and forces acting specifically on the business of Phoenix Solar.

Wholesaler and Developer

Phoenix Solar is not acting as a producer of photovoltaic modules or inverters and is not directly affected by capacity/demand cycles of the market or the supply of raw material. Wholesalers and developers benefit from oversupply because declining prices ease decisions of investors to implement systems. Undersupply by the producers is limiting the growth of the business. As a non-producer Phoenix Solar is able to change selected technology more quickly and efficiently in comparison to the producers which are constrained by the required capital spending and intellectual property barriers. In Oktober 2008 the company announced the start of sales of Solyndra's CIGS based thin film modules being the first in the European market. The corresponding framework agreement had been signed in July 2008.

Market Selection

The company acts in markets with favourable conditions regarding to feed-in tariffs, tax rebates or other support programmes. The company has subsidiaries in Germany, Spain, Italy, Greece, Singapore and Australia. A description of the conditions in this markets can be found in the IEA-PVPS report ^[5]. Feed-in tariffs conditions in the maturing countries are worsening over time to take price reductions for the PV components into account. Being active in several countries is mitigating the risk to be adversely affected by the legislation.

Competition

The following table shows the position of the different European companies within the value chain. Competitive activities are in the fields Distribution, Installation and Service.

References

1. ↑ Webpage of Phoenix Solar
2. ↑ Phoenix Solar Financial Reports
3. ↑ Corporate News 08-11-20
4. ↑ Solar Park La Solana, Phoenix Solar Case Study
5. ↑ ^{5.0 5.1} Trends in Photovoltaic Applications, Report IEA-PVPS T1-17:2008
6. ↑ Aleo Roadshow Mai 2009, Page 4 (Source: Goldman Sachs Global Investment Research)