PHOTON International The Photovoltaic Magazine

Despite delay in profitability, SES pushes distribution of pumps

Solar Energy Systems Ltd. (SES), a Western Australia-based manufacturer of solar-powered water pumps, announced first-quarter results in late November for the period through September.

	© Solar Energy Systems Ltd.
Water works: SES has plans to use its Sun Mill pump in systems to generate potable water, which it would sell by the liter.

Sales of $424,000 AUD ($238,000 USD) were lower than forecast, due to the weak time of year and drought conditions, says managing director Anthony Maslin. But the burn rate of cash reduced by nearly half to $70,000 AUD ($39,000 USD) per month, he adds.

The company has added a second sales office on the island of East Timor, which Maslin describes as doing well. »We think we've developed a model we can take elsewhere,« he says, without giving further details.

The company is also placing an emphasis on building its distribution network. While SES has set up distributors in Fiji, Malaysia, and Canada, and is considering establishing a presence in the Pacific region, Sri Lanka, India, Africa and South America, it is concentrating mostly on Australia. In November, the number of distributors increased from 50 to 70. This led to a growth in November sales to 55 systems, more than a third of which went to untapped markets in New South Wales and Victoria. Maslin says November was the company's best month ever, with sales 20 percent above the previous record. »We're expecting to be profitable in the next one or two years,« he predicts.

But according to an investor update in Nov. 2001, Maslin had foreseen profitability by the end of 2002. The delay is reflected in SES's falling share price, which on Dec. 10 was $0.046 AUD ($0.03 USD), less than a third of its value a year earlier. When SES went public in Dec. 2000 (see PI 1/2001, p. 21), the price per share was $0.29 AUD ($0.16 USD).

In other developments, SES has early-stage plans to begin the manufacturing of pump components overseas, with the first factory most likely in China by the end of 2003. If the results are good, Maslin says SES would then start manufacturing complete systems. The company is also looking at the possibility of building and operating mini-utilities to sell potable water on islands through its Solarflow system, which uses a Sun Mill pump to purify water through a membrane. Maslin, who describes the plans as »longer term,« says SES would sell potable water via a water purchase agreement. He declined to estimate the profit margin.