Meyer Burger Drops to 2.5-Year Low on Solar Woes
Meyer Burger fell as much as 6 percent, to 9.37 Swiss francs, the lowest intraday value since March 2009. Shares of the Baar, Switzerland-based company have dropped for six days.
“Investors are increasingly concerned about the balance sheet and the financial situation of Meyer Burger amid a negative news flow in the sector and the risk that demand for the company’s products doesn’t improve in 2013,” Stefan Gaechter, an analyst at Helvea AG, said by phone from Zurich.
Solar-cell and panel manufacturers, Meyer Burger’s clients, are suffering from low prices and overcapacity after Chinese competitors expanded and demand slowed. Siemens AG (SIE) this week said it would give up its unprofitable solar business. About 180 solar manufacturers will fail or get bought by 2015, Boston- based GTM Research said in a report last week.
“We see no short or mid-term turnaround in the current solar environment,” Lauren Licuanan, an analyst at Commerzbank AG, said today by e-mail. “With product manufacturers continuing to exhibit strong discipline in their capex investment plans, opportunities for pure capacity-driven demand in PV production equipment is very limited.”
Meyer Burger expects demand for its products to rise “substantially” next year, the company said Aug. 16, when it published its first-half results. New markets in Asia, South America, the Middle East and Africa are to ensure growth in the coming years, outperforming Western European markets, it said.
While Meyer Burger, which bought German competitor Roth & Rau AG (R8R) in 2011, is burning cash, “its balance sheet is still OK and will be in the next quarters,” Gaechter said.
“However, if the situation doesn’t improve until 2014, then there is the concern that the company may be forced to seek other ways to raise capital,” he said.
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