Solar-Fabrik Aktiengesellschaft für Produktion und Vertrieb von solartechnischen Produkten

EANS-Adhoc: Solar-Fabrik Aktiengesellschaft für Produktion und Vertrieb von solartechnischen Produkten
Solar-Fabrik AG (ISIN: DE0006614712) discloses preliminary 2008 results: sales all time high, but material negative EBIT due to losses at GEWD, cons

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The Management Board of Solar-Fabrik AG (ISIN: DE0006614712) has disclosed the preliminary (unaudited) consolidated group results of Solar-Fabrik AG as of December 31, 2008. Solar-Fabrik was able to increase total revenues in 2008 by some 61.8% to 217.279 million euros (previous year 134.454 million euros). Earnings before interest and tax (EBIT) amounted to -35.344 million euros (previous year -7.378 million euros). Despite the EBIT Solar-Fabrik continues to appreciate a high equity ratio of 56% (previous year 73%). The preliminary (unaudited) group results have been negatively impacted by a couple of special effects. Both Management and Supervisory Board have, after considering these effects together with the currently ongoing market changes towards a buyers market, decided to initiate a comprehensive set of actions to make sure Solar- Fabrik will deliver a short term turnaround.

Solar-Fabrik AG achieved sales of approximately 178.243 million euros (previous year 94.479 million euros) in the division Solar Power Systems. Adjusted for net currency conversion losses the segment posted an EBIT of -0.121 million euros (previous year -3.164 million euros). Hence, the core business marks a clear turnaround.

The business segment Wafer Preparation generated an EBIT of 0.578 million euros (previous year 0.672 million euros) and will be supported to continue the growth.

The subsidiary Global Expertise Wafer Division Ltd. (GEWD) of the Wafer division reported an allowance for doubtful accounts of 6.696 million euros. In addition, the dramatically changed market conditions for silicon led to a devaluation of inventory of 8.864 million euros as well as to the need to account for a provision for onerous contracts of 3.492 million euros. Given the dramatic price erosion for silicon and silicon products the Management Board of Solar-Fabrik AG has no clear visibility on profitable short and mid-term business opportunities of the Wafer division, leading to a goodwill write-off of 14.009 million euros. It is even being considered between the Management Board and the Supervisory Board to file bankruptcy for GEWD.

The business opportunities of Solar Energy Power Pte. Ltd. (SEP), the solar cell manufacturing arm of Solar-Fabrik, are also expected to be negatively influenced by the market changes in the mid-term, leading to a goodwill write- off of 3.000 million euros at the Solar Cells division.

All these results are contingent upon approval of the Supervisory Board as well as the group auditors. Final results will be publicized as of April 30, 2009.

Both the Management and the Supervisory Board of Solar-Fabrik AG have concluded on a revised business strategy, driven by the ongoing market changes. Solar- Fabrik continues to focus on its core competence as a top quality manufacturer of Solar Power Systems, streamlines its corporate structure and performs one- off adjustments regarding potential balance sheet risks, as such enabling improved results in the near future. The new management has an increased focus on comprehensive cost management in the areas of production, supply-chain as well as overhead expenses.

Solar-Fabrik AG enters 2009 with a solid order backlog of more than 80 MWp. Virtually the entire annual capacity of Solar Power Systems was sold under binding contracts at the beginning of the year, leading the Management Board of Solar-Fabrik AG to expect a very positive 2009 group sales forecast of at least 220 million euros for 2008, of which 40% will be realized abroad. Despite the global financial and economical crisis the Management Board feels comfortable to forecast a solid EBIT-margin of about 3% in 2009.

end of announcement                               euro adhoc

Further inquiry note:

Martin Schlenk
Tel.: +49 (0)761/ 4000-207

Branche: Alternative energy
ISIN: DE0006614712
WKN: 661471
Börsen: Börse Frankfurt / regulated dealing/prime standard
Börse Berlin / free trade
Börse Stuttgart / free trade
Börse Düsseldorf / free trade
Börse München / free trade

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