August 10, 2017 / 6:49 AM / 10 months ago

UPDATE 1-SMA Solar posts profit drop as inverter prices fall

* Sticks to full-year sales, profit outlook

* Shares indicated 2.9 pct lower (Adds shares, CEO comment, context)

FRANKFURT, Aug 10 (Reuters) - SMA Solar, Germany’s largest solar group, reported a sharp decline in second-quarter operating profit on Thursday, blaming a drop in inverter prices across segments and regions after Chinese competition heats up.

Second-quarter earnings before interest and tax (EBIT) fell to 222,000 euros ($260,561), down from 13.5 million euros last year, the group said in its half-year report.

Shares in the group, the world’s biggest maker of solar inverters, were indicated to open 2.9 percent lower in pre-market trade at 0635 GMT.

The company stuck to its outlook for sales and profits, which it raised last week on the back a strong order backlog, which stood at 673 million euros at the end of June.

“For the second half of the year, we expect the business to significantly pick up again based on strong incoming orders in all markets,” CEO Pierre-Pascal Urbon said.

Europe’s embattled solar power industry was dealt a blow after cut-price competition from China drove Germany’s SolarWorld into insolvency in May.

$1 = 0.8520 euros Reporting by Christoph Steitz; Editing by Maria Sheahan

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