Otovo breaks installations records by reaching ~13,000/yr run rate

European marketplace for residential solar and battery installations, Otovo, has published its financial results for Q2 2023, showing a record quarter in terms of installations and revenue and predicting a continuing fall in the cost for solar hardware in the near future.
Otovo breaks installations records by reaching ~13,000/yr run rate
Courtesy of NREL.

This was once again a record quarter for Otovo for installations as the run rate grew to thirteen thousand installed units per year.

“With another set of record installation numbers and more revenue per customer, good things came together this quarter for all time high revenues” said Otovo founder and CEO, Andreas Thorsheim. “With barriers removed in installations and value chains, and a seeming start to a rebound in sales, our view is rather hopeful for the autumn”.

UK general manager Jina Kwon added that in the UK, Otovo has just had one of its best periods for sales with hardware, labour, and cost per watt all down versus this time three years ago - to the benefit of consumers, as these savings are passed directly onto them.

“Consumers will continue to benefit from these cost reductions, which will not just save money on the installation itself, but then create a bigger saving in the long run” said Ms Kwon.

Q2 was also a strong quarter in terms of margin, with a substantial improvement to IFRS reported margins, back up to 21 percent. Gross margin generated, that also accounts for the value creation in the subscription segment, came in at 24 percent.

Otovo also experienced its highest ever addition to the subscription portfolio, with total portfolio value having more than three-folded in a year.

This quarter, Otovo has also centralised its operations and marketing resources in Madrid in order to harness the pan-European position built over the last few years, utilising a flexible, cost-effective, and highly skilled central team. Being active in 13 different European markets with varying customer acquisition costs enables the company to grow where it is most cost-effective and value accretive. Madrid serves as a thriving talent hub, being a European metropolis with excellent access to highly educated international talent. Centralising the staff in one pool grants Otovo the flexibility to allocate resources effectively in response to changes in the workload across different countries.

“The added focus on shared resources in Madrid, which complements our capital light marketplace model gives us a lot of flexibility” said Mr Thorsheim. “This strategy gives us a cost advantage over competitors with more resource-intensive models, strengthening our competitive position”.

With Otovo’s exposure across Europe, currency was a major topic this quarter as the NOK weakened relative to all other currencies in the markets. This had a strong positive effect on reported revenues, ticket sizes, gross profits, as well as portfolio value.

In addition, Otovo managed to significantly reduce installation time for consumers in the second quarter. While the situation in the overall solar market was tense due to the skyrocketing demand for solar energy in 2022, Otovo succeeded in reducing installation times to an average of 2.6 months across all 13 markets (in 2022 this was over 7 months at peak times).

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Tags: Europe , Solar , Saving
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