REC Silicon

Regulatory Filings • Jul 2, 2018

REC Silicon ASA - Solar Trade Dispute with China Forces Layoffs

REC Silicon ASA - Solar Trade Dispute with China Forces Layoffs

Moses Lake, Washington - July 1, 2018: REC Silicon ASA (REC Silicon)

REC Silicon will execute a layoff affecting nearly 40% of its current workforce

in Moses Lake, Washington on July 2, 2018. This layoff will impact approximately

100 employees across the company and is a direct result of the on-going solar

trade dispute between China and the United States. Due to this on-going trade

dispute, the company has not been able to access its critical market in China

since 2014. This has caused successive reductions in REC Silicon's operations in

the United States.

REC Silicon has decided to reduce its production at Moses Lake to approximately

25% of total production capacity. This decision is in response to the solar

trade dispute between China and the United States and reduced demand for solar

grade polysilicon. The actions taken today will help maintain the company's

liquidity, its ability to meet financial obligations, and maintain REC Silicon's

capability to resume manufacturing operations when access to China's polysilicon

markets is restored.

REC Silicon's management regrets today's lay-off of our highly-skilled

colleagues. We have done all we can to avoid today's action, but we have no

choice while the China market remains closed. It is a tremendous injustice that

the hard-working Americans, who have made REC Silicon the polysilicon industry's

technology leader and one of the most competitive producers in the world are now

losing their jobs. REC Silicon can out-compete its foreign rivals, and we can do

it from our manufacturing locations here in the United States. We simply need

fair access to the China market.

REC Silicon invested $1.7 Billion to construct a state of the art, cost leading

solar grade polysilicon production facility in Moses Lake, Washington in 2010.

At its peak in 2011, REC Silicon generated $1 Billion in annual revenues from

its operations in the United States and provided approximately 900 high paying

jobs. Approximately 95% of REC Silicon's revenues are generated from sales in

markets outside the United States. As a consequence of the on-going solar trade

dispute with China, REC Silicon has executed successive layoffs to preserve its

operations in the United States. After the layoff today, the company will

continue to employ approximately 400 people at its facilities in Moses Lake,

Washington and Butte, Montana. As a direct result of the solar trade dispute,

REC Silicon's workforce has declined by a total of 500 jobs since 2011. During

the same period, the company's revenues have declined by over 70% to $272

Million in 2017.

REC Silicon's fluid bed reactor (FBR) production facility in Moses Lake,

Washington produces the lowest unsubsidized cost solar polysilicon in the world.

Because REC Silicon employs a highly cost competitive manufacturing technology,

the company's products are competitive without trade protection.  President

Trump and U.S. Trade Representative Robert Lighthizer committed to pursue a

resolution of the AD/CVD measures imposed by the Government of China on U.S.

polysilicon. There has not been a resolution nor any re-opening of the China

market to REC Silicon. It is now absolutely urgent that the U.S. Government

takes steps to re-open the China market for U.S. polysilicon production to avoid

further job losses, avoid the loss of U.S. technology leadership, to preserve

this important part of the solar energy supply chain in the United States, to

allow REC Silicon to re-start production, and most importantly allow us to re-

hire our skilled and dedicated workers.

REC Silicon's markets for semiconductor grade polysilicon and silicon gas

products have not been impacted by the solar trade dispute. REC Silicon's

operations in Butte, Montana will continue to support these markets.

REC Silicon currently has approximately $42 Million in cash deposits and expects

to report approximately $58 Million in revenues for the second quarter of 2018.

Second quarter FBR production is expected to be 2,040 MT or 240 MT below the

guidance on April 26, 2018. The results for the company's semiconductor segment

and silicon gas sales are expected to be near guidance. Current market

conditions will negatively impact the company's profitability and credit risk

exposure. REC Silicon expects to recognize additional impairments to

inventories, accounts receivable, and fixed assets in its second quarter

earnings release on July 19, 2018.

Conference call

REC Silicon will host a conference-call to answer questions from investors,

analysts and other interested parties on 2 July at 8:00 am CET.

To join this event, please use the below Click to Join link 5-10 minutes prior

to start time, where you will be asked to enter your phone number and

registration details. Our Event Conferencing system will call you on the phone

number you provide and place you into the event. Please note that the Click to

Join link will be active 15 minutes prior to the event.

Click to Join >>

Use the Click to Join option above for the easiest way to join your conference

or view the complete list of access numbers and conference start times

For further information, please contact:

Francine Sullivan, Vice President Business Development

REC Silicon ASA

Phone: +1 509 750 1133

Email: francine.sullivan@recsilicon.com

James A. May II, Chief Financial Officer

REC Silicon ASA

Phone: +1 509 989 1023

Email: james.may@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 over 30 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 Fornebu,

Norway.

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

This information is subject to the disclosure requirements pursuant to section

5-12 of the Norwegian Securities Trading Act.