REC Silicon

Investor Presentation • May 12, 2020

FIRST QUARTER 2020

PRESENTATION

Disclaimer 2020

FIRST QUARTER

This presentation includes and is based, inter alia, on forward-looking information and statements that are subject to risks and uncertainties that could cause actual results to differ. These statements and this presentation are based on current expectations, estimates and projections about global economic conditions, the economic conditions of the regions and industries that are major markets for REC Silicon ASA's (including subsidiaries and affiliates) lines of business. These expectations, estimates and projections are generally identifiable by statements containing words such as "expects", "believes", "estimates" or similar expressions. Important factors that could cause actual results to differ materially from those expectations include, among others, economic and market conditions in the geographic areas and industries that are or will be major markets for REC Silicon ASA's businesses, energy prices, market acceptance of new products and services, changes in governmental regulations, interest rates, fluctuations in currency exchange rates and such other factors as may be discussed from time to time in the presentation. Although REC Silicon ASA believes that its expectations and the presentation are based upon reasonable assumptions, it can give no assurance that those expectations will be achieved or that the actual results will be as set out in the presentation. REC Silicon ASA makes no representations or warranties, expressed or implied, as to the accuracy, reliability or completeness of the presentation, and neither REC Silicon ASA nor any of its directors, officers or employees will have any liability to you or any other persons resulting from your use.

This presentation was prepared for the first quarter 2020 results on May 12, 2020. Information contained herein will not be updated. The following slides should be read and considered in connection with the information given orally during the presentation.

REC Silicon ASA shares have not been registered under the U.S. Securities Act of 1933, as amended (the "Act"), and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Act.

FIRST QUARTER

• Q1 Results
• Silicon Gases & Semiconductor Market Outlook
• Financial Review
• US/China Trade Update
• PV Market Outlook
• Yulin JV Update
• Battery Update
• Short-Term Business Plan
• Q&A

Revenues:	\$24.7M
EBITDA:	\$ 1.0M

March 31, 2020 cash balance of \$30.2M

• Cash increase of \$0.8M
• Cash inflows from operations \$2.2M

Silicon gas sales

• Sales volume of 730MT (vs. guidance of 850MT)
• Average silane gas prices stable

Semiconductor segment polysilicon sales

• Semiconductor grade polysilicon sales volume of 85MT
• 14.0% Semiconductor grade polysilicon price increase vs. Q4'19

Decision to restart FBR production facility postponed

• Market uncertainty caused by COVID-19
• Uncertainty regarding implementation of Phase I Trade Agreement

Process to evaluate the sale of Butte, Montana plant

• Several interested parties
• Due diligence delayed due to COVID-19

Response to COVID-19

• Prioritize the health and safety of REC Silicon's workforce
• Focus on maintaining capability to continue operating

Polysilicon Sales Volume **
Total	89MT
Inventory Increase	151MT

Total Polysilicon Production
Actual	242MT
Guidance*	280MT
Deviation	-13.5%

** Guidance Presented October 30, 2019

** Excludes Fines and Powders

Semiconductor Production
Actual	168MT
Guidance*	180MT
Deviation	-6.9%

Silicon Gases Sales Vol.
Actual	730MT
Guidance*	850MT
Deviation	-14.1%

Silicon Gases and Semiconductor

Technology is driving the Semiconductor Market Short-term uncertainty due to COVID-19

REC Silicon - Leading Silane Gas Producer 2020

FIRST QUARTER

REC (US) Company A Company B Company C Company D Company E Company F Company G Company H Company I Loaded Silane Cost (\$/kg) Silane Gas Cash Cost Supply Stack

Available Capacity (MT)

Largest producer and distributor of Silane Gas Unmatched experience and safety record Recognized product quality and reliability

Infrastructure to protect market share

Large module fleet Secure distribution channels

Available capacity to support market growth

2018
Company	Sales (\$B)	Share
Samsung	\$82.9	16.1%
Intel	\$70.2	13.6%
SK Hynix	\$37.0	7.2%
Micron	\$31.0	6.0%
Broadcom (1)	\$18.5	3.6%
Qualcomm (1)	\$16.5	3.2%
Toshiba*	\$15.4	3.0%
ΤI	\$15.0	2.9%
Nvidia (1)	\$12.3	2.4%
ST	\$9.6	1.9%
	\$308.2	60.0%
	\$514.0	100.0%

REC as the Major Supplier

Source: IC Insights (1) Fabless *Includes Toshiba Memory

Q1 2020 Silicon Gas Sales marginally lower

China silane market down due to COVID-19

FIRST QUARTER 2020

› Silicon gas sales volumes

• Q1'20 730MT vs. 850MT guided
• Lower shipments due to COVID-19
• Due primarily to quarantine mandates imposed by Chine in January 2020
• Customer orders delayed to control inventory levels
• › Market recovery expected, timing uncertain
• Uncertainty due to COVID-19
• Duty on US silane when exported to China

QUARTER Q1 2020 Electronic Grade Polysilicon in line with forecast 2020

› Semiconductor grade polysilicon sales

• 2019 713MT

• 2020 800MT

• › Market recovery expected, timing uncertain
• Uncertainty due to COVID-19
• Duty on US polysilicon when exported to China
• › Focus on high end Float Zone polysilicon
• 2 Producers of Float Zone
• Product mix optimized for highest value creation

FIRST

(USD million)	Q1 2020		Q1 2019		2019
	Revenues	EBITDA	Revenues	EBITDA	Revenues	EBITDA
Semiconductor Materials	24.5	8.0	32.2	9.2	126.7	37.8
Solar Materials	0.2	(2.8)	12.9	(7.4)	33.4	(26.6)
Other	0.0	(4.1)	-	(6.5)	0.0	(24.1)
Eliminations	-	-	0.0	0.0	0.0	0.0
REC Silicon Group	24.7	1.0	45.0	(4.7)	160.2	(12.9)

Key Financial Results – Semiconductor Materials

FIRST QUARTER

2020

Key Financial Results – Solar Materials and Other 2020

Solar Materials

Revenues: \$0.2M EBITDA Contribution: (\$2.8M) Loss

• › Polysilicon sales volumes 1MT
• Sales of remaining inventories only
• › Net Expense of \$2.8M reflects successful efforts to decrease spending rates to maintain liquidity

Other and Eliminations

• › Net cost: (\$4.1M) (compared to \$4.5M in Q4'19)
• Lower net expense due primarily to timing of expenses

FIRST QUARTER

FIRST QUARTER

Cash Flows 2020

Cash inflows from operating activities \$2.2M

• › EBITDA of \$1.0M
• › Working capital decrease \$5.4M
• Increase in inventories (\$5.2M)
• Decrease in trade receivables \$7.0M
• Increase in payables and accruals \$3.6M
• › Interest paid (\$1.5M)
• › Currency loss of (\$2.7M) (Stronger USD vs. NOK)
• › Other (\$0.1M)

Cash inflows from investing activities \$0.3M

• › Capex (\$0.3M)
• › Decrease in restricted cash \$0.6M

Cash outflows from financing activities (\$1.6M)

› Payment of lease liabilities (\$1.6M)

Nominal debt - \$176.0M

• › Decrease of \$5.4M in Q1'20
• \$1.6M Decrease in Lease Liabilities (IFRS 16)
• \$3.7M Due to stronger USD relative to NOK

Nominal net debt - \$145.7M

• › Decrease of \$6.3M in Q1'20
• Increase in cash of \$0.8M
• Decrease in nominal debt of \$5.4M

Contingent Liabilities

• › Reassessment of tax \$20.3M
• › Indemnity loan \$19.0M
• › 2012 Property tax appeal \$8.0M

USD Million

U.S. / China Trade Update

QUARTER

2020

Phase 1 Trade Deal Reopens China Market for US Solar Grade Polysilicon

• › China committed to purchase US-made polysilicon in Phase 1 US/China Trade Deal
• Commitments contained in non-public annexes
• › COVID-19 delaying execution of the Phase 1 Trade Deal
• › Long Term Impact: China market is open to US Solar Grade Polysilicon without tariffs
• › Section 301 and other US leverage available for enforcement
• › US Government recognition of strategic importance of US Polysilicon

PV Market Outlook

FIRST QUARTER

2020

FIRST QUARTER

• › 2020 PV installation ~105GW
• 20GW lower compared to 2019
• › The demand outside of China may decline from ~85GW in 2019 to ~55GW in 2020 due to the effect of COVID-19
• › China may increase installations from ~30GW in 2019 to ~50GW in 2020 to stimulate the demand
• › China has become gradually more dependent on the global market for their PV industry

Source: IHS Markit, March 2020

2020 Global Polysilicon Market may decline ~15% from 2019 2020

• › Polysilicon 2020 demand will probably be ~ 75kMT lower than in 2019
• › Major overcapacity in the PV value chain
• Mainly affects China which dominates the PV manufacturing industry
• › Polysilicon Production adjustments 2020
• Non-Chinese company production (~50kMT) permanently curtailed February 2020
• Non-Chinese company indicated 30% reduced production (~20kMT) May 2020
• Chinese companies announced extended maintenance May 2020

(kMT)	2019
PV	465	390
Semi	38	40
Total	503	430

g/w 3.8 3.7

Source: CSIA and REC Market Research, – APRIL 2020

FIRST QUARTER

Polysilicon Market may not be in balance until 2022 2020

• › China may stimulate domestic PV installations to relieve pressure on its PV manufacturing industry
• › 2022 demand ~150GW
• 525kMT Polysilicon
• Restart of idle and cost competitive capacity
• › Chinese companies continue to announce new expansions
• New investments will require \$15/kg polysilicon price without subsidized funding

Source: REC Market Research, – APRIL 2020

FIRST QUARTER

Restart of Moses Lake

Dependent on Phase 1 Agreement and Market Outlook

• › 2022 Installation ~150 GW
• Polysilicon ~525 kMT
• › 2022 Polysilicon capacity support ~150 GW
• Production 2020 ~390 kMT
• Idle capacity ~85 kMT
• New capacity ~60 kMT
• › High cost/low quality Chinese producers to halt production
• › A consolidated market with a limited number of polysilicon companies

Company	PV Production 2020	Restarted PV Production 2022	Added PV Capacity 2022	Total PV Capacity 2022
East Hope	30	10	30	70
Tongwei	75	5	30	110
Daqo	65	5		70
Xinte	65	5		70
GCL	55	25		80
Other Chinese	30	0	0	30
Total China	320	50	60	430
REC Silicon US	0	18		18
Other Outside China	70	17		87
TOTAL	390	85	60	535

Source: CSIA and REC Market Research, – APRIL 2020

REC Silicon's FBR Plant in Moses Lake Cost Competitive

Very low CO² emission due to superior technology and hydroelectric power

• › 2020 105GW installation demand requires 390kMT
• › China polysilicon import assumed to be 70kMT due to cost, quality & low CO² requirements from non-Chinese customers

• › High cost, low quality, & high CO² polysilicon plants will continue to shutdown

• › 2022 150GW installation demand requires 525kMT

• › China polysilicon import assumed to be ~105kMT due to cost, quality & low CO² requirements from non-Chinese customers

FIRST QUARTER

2020

Yulin JV Update

QUARTER Yulin, China – REC Silicon Presence in Primary Market 2020

• › Construction completed in 2018
• › Large scale silicon manufacturing facility with
• 19,000MT FBR-B granular Polysilicon
• 300MT Siemens semiconductor grade Polysilicon
• 500MT Silane Gas loading

Plant characteristics Positioned to capitalize on growing PV industry

• › Located in principal market China
• › FBR-B is semiconductor grade capable which is optimal for monocrystalline PV applications
• › Current REC ownership of 15%, option to increase exposure to 49% from January 2021

Near Term Outlook

• › Q1 Production
• 22MT of Loaded Silane
• 1,618MT of FBR
• 22MT of Siemens
• › High quality FBR production
• › Q1 FBR production reduced from plan due to insufficient raw materials and COVID-19 related impacts.

FIRST

Battery Update

Strong Silane Interest from Anode Makers

Adding 25% silicon to graphite increases capacity 4x

• Resolves logistical challenges for large quantities of silane gas
• › Strong Interest from several companies to start pilot testing
• Will take time before industrial scale

FIRST QUARTER

2020

2020 Business Plan for REC Silicon 2020

• › Continue to operate stable and profitable Butte facility
• › Restart of the Moses Lake FBR plant postponed
• Verify compliance by China with Phase 1 Trade Agreement commitments
• Monitor PV market development
• Moses Lake restart will require additional capital
• › Divestment of the Butte facility if an acceptable offer is received
• Interested parties' due diligence delayed due to COVID-19
• › Continued support from REC Silicon to Yulin JV
• › Continue dialog with silicon anode battery companies for pilot testing and industrial scale production of silicon anode materials

Q2 2020 Reporting July 23, 2020

31 © REC Silicon ASA. All rights reserved. Confidential May 12, 2020

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