REC Silicon

Earnings Release • Feb 12, 2016

REC Silicon ASA - Fourth quarter 2015 results

REC Silicon ASA - Fourth quarter 2015 results

Fornebu, Norway - February 12, 2016: REC Silicon ASA (REC Silicon) reports

fourth quarter revenues of USD 74.9 million, compared to USD 87.5 million in the

previous quarter. The corresponding EBITDA during the fourth quarter was a loss

of USD 29.6 million compared to a loss of USD 14.1 million for the previous

quarter. The decrease in revenue and EBITDA can be attributed to lower sales

volumes, the recognition of USD 7 million in bad debt expense and approximately

USD 6.1 million of write down of finished inventories to estimated net

realizable values during the fourth quarter.

Fourth quarter total polysilicon production volumes were 3,022 MT, or 2% over

guidance of 2,980 MT. FBR production was 2,321 MT, exceeding guidance of 2,220

MT, and semiconductor production was 288 MT, compared to guidance of 300 MT.

FBR cash cost was $16.50/kg for the quarter, compared to guidance of $17.10/kg.

Silicon gas sales volumes were 709 MT, slightly above guidance of 700 MT.

However, silicon gas sales prices were 2% lower than the previous quarter.

REC Silicon will also recognize an impairment of USD 151.5 million, due to

anticipated lower future prices caused by the uncertainty from the solar trade

war been the US and China and the impact of Moses Lake production curtailments

and the oversupply in the polysilicon industry.

Due to ongoing negative effects from the trade war between the US and China, the

company has been prevented from accessing the Chinese market during the fourth

quarter, which has resulted in lower sales than previously anticipated.  As a

result, fourth quarter polysilicon sales volumes were 2,740 MT, compared to

guidance of 4,855 MT, and finished goods inventory decreased by 131 MT, compared

to guidance of 1,700 MT of inventory depletion.  Additionally, average sales

prices for solar grade polysilicon declined by 4% compared to the previous

quarter.

In order to reduce existing inventory levels and maintain a healthy cash

position, given the current market conditions in the ongoing solar trade war,

the company will shut down the Silane IV unit and remaining FBR production in

Moses Lake.  Production is currently expected to be shut-down from February

until June of this year, dependent on the ongoing negotiations towards a

resolution in the solar trade war and the general market development outside

China.  The company intends to perform equipment inspections and preventative

maintenance on Silane IV while the unit is shut-down and will utilize current

employees to perform this inspection and maintenance work. Additionally, also on

account of existing inventory levels, Silane III, which has been out of

production since July 2015 and was previously expected to resume production in

January 2016, is also expected to remain out of production until there is a

resolution to the solar trade war.  The company will continue to limit capital

expenditures to critical maintenance.

Butte operations will be unaffected, as its product lines are not affected by

the solar trade war.

There continue to be ongoing negotiations between the US and China towards a

resolution of the trade war.  But, as this is a political process, timing and

outcome of such a resolution remain uncertain.

In light of these developments, Q1 2016 FBR production is expected to be 820 MT,

semiconductor production is expected to be 450 MT, and total polysilicon

production is expected to be 1,540 MT.  Q1 2016 silicon gas sales are expected

to be 600 MT.  The company also expects Q1 2016 polysilicon sales volumes to be

approximately in line with Q4 2015 levels.

REC Silicon's cash balance on December 31, 2015 was USD 95.4 million.  Given the

initiatives currently being undertaken by management to conserve cash, the

company will be capable of paying its existing debt obligations in 2016 from

existing cash and cash flow from operations under current projections, without

seeking additional funding.

For more information, please see the attached fourth quarter 2015 report.

Morning Program:

The company will give a presentation at 8:00 am CET today at Høyres Hus

Konferansesenter, Stortingsgaten 20, Oslo, Norway. The presentation will be in

English.

A live webcast from the presentation can be accessed at www.recsilicon.com or

the following link hegnar tv webcast

It will also be possible to listen to the presentation through a conference

call. Please make sure to dial in 5-10 minutes prior to scheduled start time on

one of the following numbers:

Norway Toll Free: 800 56053

Norway: +47 2350 0486

UK: +44 (0)20 3427 1904

USA:  +1 646 254 3361

Other international: +44 20 3427 1904

Please provide confirmation code 7726594 and state your name, company and

country of residence.

Afternoon Program:

REC Silicon will host an analyst conference call later the same day at 3:00 p.m.

CET. Please make sure to dial in at least 5-10 minutes ahead of time to complete

your registration.

Norway Toll Free: 800 56054

Norway: +47 2350 0486

UK: +44 (0)20 3427 1900

USA:  +1 212 444 0481

Other international: +44 20 3427 1900

Please provide confirmation code 2067854 and state your name, company and

country of residence.

For further information, please contact:

Chris Bowes, Investor Relations

REC Silicon ASA

Phone: +1 509 793 8127

Email: chris.bowes@recsilicon.com

Nils O. Kjerstad

IR Contact Europe

Phone: +47 9135 6659

Email: nils.kjerstad@crux.no

About REC Silicon

REC Silicon is a leading producer of advanced silicon materials, delivering

high-purity polysilicon and silicon gas to the solar and electronics industries

worldwide. We combine 25 years of experience and proprietary technology with the

needs of our customers, and annual production capacity of more than 20,000 MT of

polysilicon from our two US-based manufacturing plants. Listed on the Oslo Stock

Exchange (ticker: REC), the company is headquartered in Moses Lake, Washington

and employs approximately 675 people.

For more information, go to: www.recsilicon.com

This information is subject of the disclosure requirements acc. to §5-12 Vphl

(Norwegian Securities Trading Act)

[HUG#1985702]