Alfen Slashes Revenue Forecast as Electric Vehicle Charging Station Market Lags Behind Expectations

Alfen, a prominent player in the electric vehicle charging station, battery, and transformer station industry, has announced a downward revision of its revenue forecast for the current year. The adjustment comes as the market for electric vehicle charging stations underperforms relative to initial projections made earlier this year.

On Tuesday morning, the Amsterdam-listed company released a statement revealing the updated outlook for 2023. Alfen now anticipates sales ranging from €490 million to €520 million, a notable decrease from the prior forecast of €540 million to €600 million.

Investors responded with concern to the news, prompting a swift reaction in the stock market. Within hours of the opening of the Amsterdam stock exchange, ALFEN shares experienced a decline of more than 5%, trading at €61.30-0.74%.

In its press release, Alfen emphasized that it still maintains a robust cash position, boasting €35 million in cash reserves and an additional €66 million available through a credit facility at the bank. The company further emphasized that its other business units continue to grow despite the charging station market challenges.

A company spokesperson attributed the subdued market performance to worse-than-expected developments in the charging station sector. However, the exact cause of the disappointing demand remains unclear. Consequently, Alfen’s clients are now holding inventory for longer than anticipated.

Alfen had proactively stockpiled significant quantities of parts last year during a period of supply chain disruptions. This strategic decision increased the company’s working capital from €23 million to €87 million by the end of the previous year.

Further insights into market dynamics and Alfen’s response are expected to be unveiled on August 23 when the company discloses its financial results for the year’s first half. The spokesperson noted that the lowered revenue forecast was disclosed preemptively due to the sensitivity of the information in relation to stock market regulations.

In May, CEO Marco Roeleveld hinted at excess inventory faced by Alfen’s suppliers during the presentation of the first-quarter results. At that time, Roeleveld’s optimism rested on positive signals from customers and the growing sales of electric vehicles, with the expectation that the market would rebound post-summer.

Alfen specializes in the production of “slow chargers” for electric vehicles, capable of charging at up to 22 kW. These chargers cater to consumers charging their electric cars at home and companies facilitating charging options at their employees’ residences. The company also manufactures charging points for public use.

The Q1 results had already showcased the adverse impact of the sluggish market on Alfen’s performance. Charge point sales revenue dropped by 14% to €47 million, and the company produced 32% fewer charge points (43,800 units) in the first three months of the year compared to the same period in the previous year. The adjusted gross operating profit also witnessed a decline of 25.7% to €12.7 million.

This setback arrives on the heels of a record-breaking year for Alfen, which witnessed remarkable growth across its divisions in 2022. The charging station division experienced an impressive sales increase of 143% compared to the previous year, while the energy storage and transformer station sectors also reported sales growth of 157% and 11%, respectively.

As Alfen navigates the challenges the current market landscape poses, industry observers eagerly await further details about the company’s strategies and responses to the evolving electric vehicle charging station sector.

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