Stop parsing PDFs. Get the API. Request Access

AI Terminal

MODULE: AI_ANALYST
Interactive Q&A, Risk Assessment, Summarization
MODULE: DATA_EXTRACT
Excel Export, XBRL Parsing, Table Digitization
MODULE: PEER_COMP
Sector Benchmarking, Sentiment Analysis
SYSTEM ACCESS LOCKED
Authenticate / Register Log In

REC Silicon

Investor Presentation • Feb 12, 2014

3726_rns_2014-02-12_7616506d-0dc6-425c-8a1d-bc4b12c3876f.pdf

Investor Presentation

Open in Viewer

Opens in native device viewer

REC Silicon ASAQ4 2013

Disclaimer

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 projecti estimates projections about global economic conditions, the economic conditions of the regions and the economic the industries that are major markets for REC Silicon ASA (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 is making no representation or warranty, 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 li directors, officers or liability ability to you or any other persons resulting from your use use.

This presentation was prepared for fourth quarter 2013 results presentation on February 12, 2014. Information contained within 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.

Q
&
A
O
Q
l
k
1
d
2
0
1
4
t
o
o
a
n
u
–		 C
O
T
T
d
E
o
r
n
v
u
,
F
i
i
l
O
i
i
n
a
n
c
a
v
e
e
r
r
v
e
e
w		 J
J
M
M
C
F
O
a
a
y,
U
S
C
h
i
T
d
U
d
t
n
a
r
a
e
p
a
e		 K
S
h
l
A
i
G
l
C
l
t
t
t
c
s
s
s
a
n
e
n
e
r
a
o
n
s
e
u
z
u
,
M
k
O
i
t
a
r
e
e
r
e
v
v
w		 K
L
V
P
C
i
l
e
e
n
s
o
m
m
e
r
c
a
v
,
C
S
G
R
E
i
l
i
l
U
d
t
c
o
n
e
n
e
r
a
p
a
e		 C
O
T
T
d
E
o
r
n
v
u
,
M
L
k
o
s
e
s
a
e		 S
i
l
i
I
I
I,
I
V
c
o
n		 S
i
l
a
n
e
g
a
s
E
l
4
6
0
m
p
o
y
e
e
s		 F
B
R		 G
l
i
l
i
r
a
n
u
a
r
s
c
o
n
B
t
t
e
u		 S
i
l
i
I
I
c
o
n		 S
i
l
a
n
e
g
a
s

Safety and Regulatory Compliance

  • › New safety initiatives implemented implementedin late 2012
  • › 15% reduction in Total Recordable Injuries from 2012
  • › Environmental compliance maintained throughout 2013
  • › Process Safety Management compliance maintained throughout 2013

ButteTRILTI

  • Strong, stable operations
  • › Higher production at lower cost
  • ›Modest market improvement
  • › Increased silicon gas sales volume
R
e
v
e
n
u
e
(
)
M
i
l
l
i
N
O
K
o
n		 i
F
B
R
P
d
t
r
o
u
c
o
n
› S
b
l
i
t
t
t
r
o
n
g
s
a
e
o
p
e
r
a
o
n
s		 4
3
7		 (
)
2
*
7
5		 4
3
0
M
T
7
,
› ,
H
i
h
d
i
l
t
t
g
e
r
p
r
o
c
o
n
a
o
e
r
u
w
t
c
o
s		 E
B
I
T
D
A
(
M
i
l
l
i
N
O
K
)
o
n		 C
C
F
B
R
h
t
a
s
o
s
› M
d
k
i
t
t
t
o
e
s
m
a
r
e
m
p
r
o
e
m
e
n
v		 1
6
4		 (
)
*
1
8
7		 \$
/
1
0
0
k
5
g
› I
d
i
l
i
l
n
c
r
e
a
s
e
s
c
o
n
g
a
s
s
a
e
s
l
o
m
e
v
u		 E
B
I
T
D
A
M
a
r
g		 i
n		 S
i
l
i
G
S
l
c
o
n
a
s
a
e
s
2
2
2
2
0
0
%
%		 (
)
*
2
5
%		 M
T
7
7
8

2013: Increased FBR Production at Reduced Cost

Continued Focus on Cost Improvement

› Lowest energy consumption in 90% the industry

  • ›Strategic workforce reductions
  • › Continued process and 800 production improvements

Note: YTD 2013 actual production numbers and energy usage used in calculations CVD: Chemical vapor deposition

Continued Focus on Quality Improvement

  • › Improvements in process stability have increased reactor run ar Polysilicon (M
  • › Longer run lengths improved both yield and quality of polysilicon

New g her purity pro ducts currently being qualified

40%

China and Japan are Primary Markets, New Focus on Taiwan

2013 Revenue by Region REC Silicon Imports to China

Polysilicon Market Landscape

2013 Polysilicon Market Mass Balance

  • › 200K MT shipped to PV value h i * cain*›
  • ~25% more material shipped in H2' 13 from H1 '13 150 000H213
  • ›Tier 1 still "base load"
  • › Semi shipments remain flat 100,000

Approximately 228,000 MT of virgin material shipped to market in 2013*

Note: *Preliminary estimates only Preliminary only.

Sources: SEMI Polysilicon Shipment survey, NPD Solarbuzz Polysilicon and Wafer Supply Chain Quarterly & IHS Global Silicon Forecast Market Tracker.

  • M d t t d i ti ›odest, s teady improvemen t in spot prices
  • › Spot ASPs still have upward pull pull\$20.00 in Q1
  • › 8% growth in shipment CY 12- 13*\$15 00

Spot Index (2013 to Jan 2014)

Note: *Based on 2013 preliminary all shipment data of 228,000 MT compared to 210,000 MT in 2012. Data reflects the average of weekly spot indices (PV grade) from Bloomberg New Energy Finance, EnergyTrend & PV Insights.

  • ›2013 at 36 GW*
  • › Wide range of forecasts for 2014 - Demand to rise in all scenariosDemand
  • ›Q1 already on pace with Q4 2013
  • › Current demand visibility through Q3 2014

*Preliminary estimates only.

Note: 2013 installation data is still coming in; the figure is the average of all compiled third party estimates. 2014 installation forecasts are the lower and upper limits of this year's demand as predicted by market consultants and outside analysts.

2014 Polysilicon Supply/Demand/Price Curve

  • ›Some higher-cost plants will continue to operate
  • ›Increased low-cost supply likely this year
  • ›Most likely market price between \$21-30/kg

Notes: Estimated cash costs by production line & location of all currently active and new plants to be commissioned in 2014. Assumptions of 3.5 GW Thin Film & 30K MT of semi demand. New capacity w/ 50% ramp factor vs. installed nameplate.

Current Market Development – Semiconductor Polysilicon

  • ›Industry is correlated to global macroeconomics
  • › 2013 fl t li ht th di t d i 2014 2013 was at; sli ght growth predi cein

  • ›Currently excess polysilicon inventory at semi wafer manufacturers

  • › FBR Prime ASP consistent with spot price indices

    • Improved product quality & consistency
  • Preferred form factor
  • Commercial strategy
  • Increased market demand

High Purity Granular is the Future

  • ›Became available to market in 2011
  • › E bl i d ibl h i ht Enables increased crucible charge weight

  • ›Reduces ingot cost

  • › Demand outpacing supply in coming years 40,000

  • › REC Silicon is the leader in Silane and Fluid Bed Reactor technology

Granular / Siemens Blend

Current Market Development – Silicon Gases

›Market growth anticipated

  • › Shipments increased H2'13
  • Excessive inventory cleared inventory
  • -"One-off" spot activity

Silicon Gases – More than just a molecule

  • › Signature Silane ®
  • Highest purity
  • -Supply security
  • -Infrastructure & service
  • -Experience
  • Safety stewardship
  • ›Premium relative to competition

China / US Trade Update

US/China Solar Trade Issues

  • › US imposed AD and CVD orders against Chinese solar panel companies exporting to the US in 2011/2012
  • › China then issued Preliminary AD (July 2013) and CVD Orders (Sep 2013) against US polysilicon producers
  • › Final Determination issued on January 20 2014 20, 2014
  • -57% AD tariff and 0% CVD tariff imposed on REC
  • › REC is continuing to sell its solar grade polysilicon into China by working with customers to utilize available options under existing laws, including current "Process in Trade," under China Customs laws
  • › Political and di pg y lomatic ne gotiations between the US and China are underwa y to resolve but outcome and timing are uncertain

Financial Review

REC Silicon Group Financial Results – Total and Continuing Operations

O
(
N
K
i
l
l
io
)
m
n		 Q
4
2
0
1
3		 Q
3
2
0
1
3		 2
0
1
3
Re
ve
nu
es		 E
B
I
T
D
A		 E
B
I
T		 Re
ve
nu
es		 E
B
I
T
D
A		 E
B
I
T		 Re
ve
nu
es		 E
B
I
T
D
A		 E
B
I
T
C
S
R
E
i
l
i
c
o
n		 7
5
2		 1
8
7		 (
)
3
8		 7
3
8		 8
0		 (
)
1
3
5		 2,
5
4
3		 4
9
2		 (
)
3
1
1
C
S
R
E
l
o
a
r		 3
2
8		 2
7		 1
1		 9
1
7		 5
9		 2
6		 3,
0
6
1		 1
1
1		 1
1
O
h
&
l
i
i
i
t
t
e
r
e
m
n
a
o
n
s		 (
)
9		 (
)
1
1		 (
)
1
1		 (
)
3
3		 (
)
3
5		 (
)
3
5		 (
)
9
0		 (
)
9
4		 (
)
9
4
T
l
t
t
o
a
s
e
g
m
e
n
s		 1,
0
7
1		 2
0
3		 (
)
3
8		 1,
6
2
1		 1
0
5		 (
)
1
4
3		 5,
5
1
4		 5
1
0		 (
)
3
9
5
A
d
j.
i
d
i
l
R
E
C
W
f
g
a
n
o
n
s
p
o
s
a
a
e
r		 - 8
5		 8
5		 - 1 1 - 8
4		 8
4
L
L
d
d
i
i
l
l
f
f
R
E
C
S
S
l
l
o
s
s
o
n
s
p
o
s
a
o
o
a
r		 - (
(
)
)
1
1,
1
1
1
1
8
8		 (
)
4
8		 - (
)
1
8
2		 (
(
)
)
1
1,
2
2
5
5
1
1		 - (
(
)
)
1
1,
2
2
9
9
9
9		 (
(
)
)
1
1,
2
2
9
9
9
9
T
l
O
i
t
t
o
a
p
e
r
a
o
n
s		 1,
0
7
1		 (
)
8
2
9		 (
)
1		 1,
6
2
1		 (
)
7
5		 (
)
1,
3
9
3		 5,
5
1
4		 (
)
7
0
6		 (
)
1,
6
1
0
D
i
i
d
i
t
t
s
c
o
n
n
e
o
p
e
r
a
o
n
s
u		 (
)
3
2
8		 9
9
3		 (
)
6
0		 (
)
9
1
7		 1
1
1		 1,
2
1
4		 (
)
3,
0
6
0		 1,
0
0
4		 1,
1
0
4
C
i
i
O
i
t
t
o
n
n
n
g
p
e
r
a
o
n
s
u		 7
4
3		 1
6
4		 (
)
6
2		 7
0
5		 3
6		 (
)
1
7
9		 2,
4
5
3		 2
9
8		 (
)
5
0
5
  • › REC Silicon Segment › Other &
  • Represents the continuing operations

eliminations includes:

  • NOK 13 million Q4 Parent Company Expense
  • NOK 94 million 2013 Parent Company Expense
  • Remainder is Elimination of Internal Profit

REC Silicon Segment Key Financial Results (Q4 vs. Q3)

Revenues NOK 752 million

  • ›
  • 6% Price increase
  • › Increased silicon gas sales volume
  • 12% Increase in silicon gas revenues
  • Increased spot market sales

EBITDA NOK 187 illi Millions NOK 187 million

  • 134% increase
  • › Improved cost profile
  • Resource alignment
  • 7% Increase in polysilicon production 118 106

RevenuesEBITDA

* Q1 EBITDA Includes special items of NOK 115 million associated with the cancellation of a sales contract

Financial Status

  • ›Net Debt reduced NOK 0.7 Billion
  • ›Debt reduced NOK 1.5 Billion
  • › Cash flows from operations
  • Will contribute
  • Not sufficient to meet requirements
  • › Additional sources of cash
  • Short-term Revolving Credit Facility
    • Re-issue/exchange into 2016 NOK bonds
  • ›Do not expect to issue equity

Q1 and 2014 Outlook

F
B
R
P
d
i
t
r
o
c
o
n
u
Q
1		 3
0
0
M
T
7
,
2
0
1
4		 M
T
1
6
0
0
0
,
F
B
R
C
h
C
t
a
s
o
s		 S
i
l
i
G
c
o
n		 S
l
a
s
a
e
s
Q
1		 \$
/
k
1
2
8
0
g
2
0
1
4		 \$
/
1
1
0
k
7
g
Q
1		 M
T
7
0
0
2
0
1
4		 2
0
0
M
T
5
,
S
i
d
P
d
t
e
m
c
o
n
c
o
r
r
o
u
Q
1		 3
8
0
M
T
S
i
d
P
d
t
e
m
c
o
n
c
o
r
r
o
u		 T
P		 l
P
l
t
o
a
o
i
d
t
r
o
u
c		 i
l
i
y
s
c
o
n
o
n		 C
E
a
p
x
Q
1		 3
8
0
M
T		 Q
1		 M
T
4
4
3
3
4
4
0
0
,
2
0
1
4		 M
T
1
7
5
0
,		 2
0
1
4		 1
9
4
0
0
M
T
,		 2
0
1
4		 \$
2
M
5
CapEx
2014 \$25 M

More from REC Silicon

AGM Information 2025
Dec 10
AGM Information 2025
Dec 10
AGM Information 2025
Dec 10
Regulatory Filings 2025
Nov 14
Capital/Financing Update 2025
Nov 14
Investor Presentation 2025
Nov 6
Quarterly Report 2025
Nov 6
Earnings Release 2025
Nov 6
Earnings Release 2025
Nov 6
Report Publication Announcement 2025
Oct 24
View all filings →

Talk to a Data Expert

Have a question? We'll get back to you promptly.