Mari Pinardo | Soltec has launched the first initial public offering in Spain in two years, and with unquestionable success: it was trading at 4.8 euros at the end of October and in mid-December the share price had risen to 7.62 euros. In 2019, the firm supplied 9% of the solar trackers installed worldwide, and it occupies the 3rd position in the global accumulated amount. We talked to CEO, Raul Morales.
Q: In 2019, with revenues of 356 million euros, Soltec doubled those of 2018. But at the end of the first semester of 2020 you declared an income of 115 million euros, implying a loss of 14 million euros. Why this slowdown in the pace of revenue growth? Is there any idea of paying a dividend in the near future?
A: As we announced in the last company results’ presentation, our performance in 2020 has been conditioned by the irruption of the COVID-19. This has impacted some of our main figures temporarily. The pandemic has caused delays in some projects and an increase in structural costs, as a result of the additional resources required to assume the growth expected during the year. Despite this, the company has not experienced any cancellations of projects, only delays. Our operational KPIs (Key Performance Indicator) are solid and we have excellent prospects with respect to our project pipeline. With regard to the possible distribution of a dividend, and as reflected in our IPO prospectus, we do not plan to do this in the next three years. The profits obtained during this period will be invested in the business itself.
Q: The schedule for renewable energy auctions in Spain until 2025 is starting to be outlined. It seems they will be at 3,500 Mw/year, namely, at the lower end of the range (3,000-5,000 Mw). Is the commitment to renewables still very diffident in Spain? If the goal for 2030 is to go from 1.7 Mw in renewables to 36.8 Mw… Shouldn’t the auction be extended from now?
A: The auctions of renewable energies the Government is preparing are very important to give stability to investors on what the price of energy will be. This fact is very relevant for the sector, especially after the fall in prices caused by the pandemic. This system will allow us to have that visibility on assets and the price of energy. It is also important that renewable energy auctions should be technologically neutral and ideally have a pay-as-bid design, in which a price is assigned for the energy generated. I believe we are currently witnessing a very positive time for renewable energies in our country and also at a global level. There is a global consensus in society and the business world in general about their relevance for getting out of this economic crisis.
Q: You say Soltec is the third largest company in the world. What do you invest in R&D? Do you invest in the development of any patents, utility models…?
A: In 2020 we have invested 1.9 million euros in R&D. Our efforts in innovation are channelled through our subsidiary Soltec Innovations. This division was created in 2019 to research and develop new designs and improvements (patents, utility models, industrial designs).
Since the beginning, Soltec has been a company based on innovation. For this reason, we are constantly working on different initiatives and so far this year we have approved 35 patents and 65 are in the process of approval. This is something that without a doubt helps us to be at the forefront of the sector and differentiate ourselves from our competitors. Recently, we launched our SF8 tracker. It is the new generation of single-axis trackers designed to be a robust tracker and specially designed for larger modules. It has a unique configuration of at least 2×60 with 4 to 6 strings with multidrive transmission system within the tracker structure and reinforced torsion tube with improved geometry. So it provides the highest wind resilience while maintaining an elegant design, reducing the number of parts and facilitating the installation of the tracker. It has up to 8.6% more performance and is 22% more rigid, making it ideal for high wind situations
