REC to exit all wafer operations in Norway
Sandvika, April 24, 2012: With prospects of continued negative operating results, Renewable Energy Corporation ASA (REC) has decided to close down the remaining 650 MW multicrystalline wafer plant at Herøya currently in operation.
Production at the plant is expected to discontinue in the second quarter, and about 460 employees will be affected by the close down. REC will over the next few months explore alternatives for the facility.
"The solar market has changed dramatically over the last few years. Despite solid demand growth, overcapacity continues to negatively affect the wafer prices. Our organization at Herøya has worked very hard to reduce cost and improve quality. Over the last two years annual cost reductions have exceeded 25 percent, even though the cost position was held back by long term contracts with uncompetitive suppliers. However, with extreme competition, especially from China, and market prices down to one third of the prices one year ago, these cost reductions have unfortunately not been sufficient. Significant continued losses were to be expected from the wafer operations at Herøya going forward. We therefore have no choice but to discontinue our operations in Norway", says Ole Enger, President & CEO.
Three of four employee representatives in the REC Board of Directors voted against the closedown decision.
The fixed assets of the wafer plant were written down to zero in 2011. REC will recognize costs in relation to the close down of the plant in the second quarter 2012.
REC will provide an update on the solar market and REC's operations with the presentation of the first quarter financial results tomorrow, April 25 at 08.00 CET, at Oslo Konserthus, Munkedamsveien 14, 0250 Oslo.
For more information, please contact;
John Andersen, Jr., EVP & Group COO; +47 901 74 080
Mikkel Tørud, VP & IRO; + 47 976 99144
About REC
REC is a leading vertically integrated solar energy company. REC produces polysilicon, wafers, cells and modules for the solar industry, and silicon materials for the electronics industry. REC also engages in project development in selected PV segments. Founded in Norway in 1996, REC employs around 3,200 people globally with revenues of more than NOK 13 billion in 2011. Please visit www.recgroup.com to learn more about REC.
This information is subject of the disclosure requirements acc. to §5-12 vphl (Norwegian Securities Trading Act)
The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and other applicable laws; and
(ii) they are solely responsible for the content, accuracy and originality of the
information contained therein.
Source: Renewable Energy Corporation ASA via Thomson Reuters ONE
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