SMA Solar says railway tech unit sale to boost Q1 earnings
FRANKFURT/BERLIN SMA Solar (S92G.DE), the world's largest maker of solar inverters, agreed to sell its railway technology unit to China's Beijing Dinghan Technology 300011.SZ, shedding a non-core asset as pricing pressure in its main business intensifies.
SMA Solar said last year it saw strong interest from strategic investors for the unit, SMA Railway Technology, which makes power converters for long-distance railway traffic and employs 165 staff.
The sale will have a positive impact on earnings in the first quarter, SMA Solar said, predicting earnings before interest, tax, depreciation and amortization (EBITDA) of 15 million to 18 million euros ($16-$19 million) on sales of 165 million to 175 million.
No financial details were disclosed.
SMA Solar, which is scheduled to hold its annual press conference on Thursday, warned in January of falling core earnings this year, pointing to high pricing pressure from Asian rivals that are flooding markets outside of China.
It confirmed sales would fall to between 830 million and 900 million euros, from 940 million in 2016, while EBITDA will decline to 70 million to 90 million, from more than 140 million last year.
Shares in the group were up 2.3 percent, among the biggest gainers in Frankfurt's technology index .TECDAX, which was 0.3 percent higher.
($1 = 0.9252 euros)
(Reporting by Christoph Steitz and Victoria Bryan; Editing by Sherry Jacob-Phillips and Susan Thomas)