How has STI Norland evolved since mid-2019?
There have been many changes and we have grown significantly. In 2019, we achieved the goal we had set for ourselves, which was to reach EUR100 million in revenue. In 2020, we exceeded our goal of growing by 25%, experiencing 200% growth compared to 2019 even during the pandemic. In early 2020, the pandemic had already started to affect us since we purchase many goods from China. Later, we were affected in India because there was a sudden lockdown there as well. We have a supplier in India that suddenly could not ship goods overseas. Subsequently, the lockdown in Spain followed. The reality is that our projects have not stopped despite the challenges. Commercial activity, fortunately, was ongoing, and in the first months of the pandemic we saw a great deal of activity.
In February 2020, Aurica Capital acquired a 41.5% stake in STI Norland. What does mean for the company?
We incorporated shareholders and venture capital investors, which demonstrates the attractiveness of this sector for investors. From my point of view, this is extremely interesting because we are seeking a partner for the growth that we will continue to experience. On top of that, Aurica is connected to Banco Sabadell. We saw some synergies because renewable energy projects are capital intensive, and most of them are financed. That took place in February, and the relationship has been excellent.
What are the latest innovations from STI Norland in terms of new products or others in the pipeline?
The main update is that for a year and a half now we have been working on a project to develop a program regarding the dynamic calculation of the tracker. This is something that is highly sought after in the market. It is a system that calculates the structures in a dynamic way and takes into account external factors such as wind. In addition, we have developed a control system and installed it, and we will start manufacturing it in Spain to sell it everywhere. We could sell this product to every country.
The sector is attractive, but is also fairly competitive. What differentiates the company from its competitors?
The main difference is our experience. We are the pioneering company in developing trackers in the world. We have developed an array of trackers, and these designs are for different products and are all our own. We certainly have extensive experience and capacity to develop products and are leaders in product development. We have been working with some of our clients for 18 years. There is no company in the sector that has been working with the same clients for such a long time. Furthermore, I want to stress the robustness of our products and our impeccable service, since we do everything for the clients. We work to provide the best service possible.
The company turns 25 years in 2021. In 2020, despite the pandemic, you entered into the Australian market. What was the process like, and are you planning to enter other markets?
We planned to start in early 2020 but postponed those plans because of the situation. It has been difficult to enter Australia due to the different lockdown measures. There are certain travel restrictions, so we started in 4Q2020 with a goal to develop between 100 and 150MW in 2021 and obtain more than EUR8 million in revenue. As for other markets, we have a roadmap, which is our growth plan. In addition to Australia, we want to enter other markets where we plan to replicate the model that we implemented in Brazil, where we are market leaders. We have a team of about 150 workers in Brazil, where we also manufacture.
What criteria do you implement when deciding which countries to enter?
We have evaluated the growth potential for the sector in many countries and identified that those with the greatest prospects for growth are in the photovoltaic market. One of them is China, which is number one, followed by the US and India, respectively. In these markets, however, not everything that gets installed is through trackers. We do trackers and fixed structures. Sometimes, these are installed on roofs, for example. We, therefore, evaluated where more photovoltaic development will take place and where more trackers will be installed. We evaluated both factors and came up with that shortlist.
In terms of innovation, you invest more than 2% of your annual revenue in R&D. How important is innovation for STI Norland?
Innovation is one of the pillars of STI Norland, and as a result of this, we have developed many products. There are technologies that did not succeed, though others did. We are heavily focused on R&D for trackers, and innovation differentiates us from our competitors. The photovoltaic industry evolves rapidly, as there are many new innovations constantly coming to the market. In that regard, we must be ready to constantly adapt to new environments.
In terms of regulations, what main challenges is the sector facing?
It is important to have a scenario for this sector. In 2018, 3GW of photovoltaic were developed in Spain, while in 2019 zero were developed. Investors in photovoltaic energy require stable regulations. It is important to provide certainty in the market so that investors know what they will face and can plan ahead. There has been a huge bubble in renewable energy, and that should be cooled off.
What is your main goal for 2021?
The main goal is to continue with our growth strategy. Early 2021 has been heavily influenced by the effects of 2020. Right now, there are many factors that are not under our control. Steel prices are dramatically increasing, and there is a lack of supply. In fact, we cannot carry out some projects in certain countries because there is a lack of steel. Also, some of the vessels leaving China are four times more expensive than before. The situation is extremely tough. It is difficult to obtain projects, and the current environment is challenging to work in under normal conditions.