Sandvika, September 28, 2011: The Board of Directors of Renewable Energy Corporation ASA (REC) has resolved to initiate a process, including formal deliberations with the employee representatives to assess permanent closedown of parts of the production capacity in Norway.
On the basis of continued weak market conditions and prospects of significant negative cash flow, REC considers permanent closedown of the production capacity at the oldest multicrystalline wafer plants at Herøya, the multicrystalline wafer plant in Glomfjord and the solar cell plant in Narvik. This represents approximately 775 MW of annual wafer capacity or 45 percent of REC's wafer capacity in Norway, as well as 180 MW of solar cell capacity. Approximately 700 employees are expected to be affected by the potential shutdowns.
Operation continues at the newest multicrystalline wafer plants at Herøya (650 MW annual capacity) and the monocrystalline plant in Glomfjord (300 MW annual capacity). REC works intensively to improve operation and reduce costs at these facilities, and positive cash flow continues to be the main criteria for continued operation.
The integrated wafer, cell and module facility in Singapore (700 MW annual module capacity) and the polysilicon facilities in the US (19.000 MT annual polysilicon capacity) continues to operate at full capacity.
"This is an unfortunate, but necessary step in the current market environment. We are mindful of the impact the potential closedowns will have on the affected employees and the local communities in Norway. This is therefore not a decision we take lightly. We are currently working hard to regain the competitiveness of our remaining Norwegian operations. In this challenging market conditions, I am pleased to see that the good development in our Singapore wafer, cell and module production and in our US polysilicon production. This gives us a foundation for the future", said Ole Enger, President & CEO.
REC will assess and present its estimates for costs and write-downs in relation to the restructuring of the production plants in Norway in connection with the publication of the third quarter results on October 26th 2011.
For more information, please contact;
Mikkel Tørud, VP & IRO; +47 976 99 144
Peder Poulsson, Investor Relations Analyst; +47 950 26 311
For press and media, please contact:
John Andersen, Jr., Group COO & EVP Wafer, Cells and Modules; +47 901 74 080
REC is a leading vertically integrated player in the solar energy industry. Ranked among the world's largest producers of polysilicon and wafers for solar applications and a rapidly growing manufacturer of solar cells and modules, REC also engages in project development activities in selected PV segments. Founded in Norway in 1996, REC is an international solar company, employing more than 3,900 people worldwide with revenues close to NOK 14 billion in 2010. 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)