Q-Cells announces comprehensive set of measures
(Thomson Reuters ONE) - Corporate news announcement processed and transmitted by Hugin AS.The issuer is solely responsible for the content of this announcement. ------------------------------------------------------------------------------------ - Sales fall in first half-year by 36.8 per cent to 366.2 millionEuro, EBIT negative at -47.6 million Euro- Production volume 272.2 MWp- Set of measures decided on to adjust capacities and to lower costs,strengthen technology position and secure liquidity reservesThe photovoltaics company Q-Cells SE (QCE; WKN 555866) has presentedits half-year report up to 30 June 2009. Following the considerabledecline in business performance for Q-Cells SE in the first sixmonths of the current year, the Board of Management is introducing acomprehensive set of measures to fundamentally improve the company'sperformance. As already stated, sales in the first half of the yearfell from 579.5 million Euro in the previous year period to 366.2million Euro. A profit in business operations (EBIT) of 119.1 millionEuro in the first six months of last year is countered by anoperating loss of -47.6 million Euro over the same period in 2009.Influenced by a further write-down in connection with the sale of itsshare in Renewable Energy Corporation ASA (REC) in May, the periodloss incurred for the first half of 2009 was 696.9 million Euro. Theproduction volume has remained almost constant at 272.2 MWp incomparison with the first half of 2008. Q-Cells' business was harmedby negative pricing trends in the industry and reduced customervolumes. Q-Cells International, a fully consolidated subsidiary ofQ-Cells SE, performed generally better and continued to grow rapidlybuilding solar parks. The company achieved an EBIT of 8.0 millionEuro during the half-year on sales of 128.0 million Euro and, amongstother projects, is currently erecting Germany's biggest ever solarpark in Strasskirchen in Bavaria with a capacity of around 54 MWp."The business performance shows how quickly and dramatically themarkets have changed for us. In order to take rapid and comprehensivecountermeasures, we have developed Q-Cells Reloaded, a three-tier setof measures with which we will adapt Q-Cells to market conditionswhich have structurally changed. The aim is to grow profitably at asustainable rate again in the medium term," says Anton Milner, CEO ofQ-Cells SE. Milner further says: "Of course we feel the pressure onprices that comes from overcapacities and the financing of majorprojects which remains sluggish because of the financial crisis. Wewill tackle these and other issues most resolutely in the context ofQ-Cells Reloaded." In addition, operating profit has been affected bylong-term contracts with wafer suppliers which have been working tothe company's disadvantage, by manufacturing partly at too high costsby international comparison and also by comparatively high overheads."Q-Cells Reloaded" Set of MeasuresThe set of measures comprises the following:1. Adjust capacity and lower costsAs a result of the oversupply of silicon wafers, the market price forthis preliminary product in the short-term has, since the beginningof the year, been below the price level that Q-Cells agreed with itssuppliers in its contracts for 2009. In the first half year alonethis resulted in a competitive disadvantage of around 50 millionEuro. In 2010 the contracts will be brought into line with the marketprice so that this disadvantage will largely be eliminated.In addition, the cost structure of the older generation productionlines at the Thalheim location lies around 30% above the usuallyaccepted level in international competition. This is mainly theresult of substantial scale effects which could be achieved withlarger production lines and the technical condition of the oldequipment. For this reason the Board of Management has decided toshut down these production lines. Together with the necessaryreduction in overheads in all areas, around 500 jobs will be cutpermanently. Short-time work will continue to be in operation at theThalheim plant depending on the market development. Altogether areduction of production cost of 25% will be achieved with thesemeasures.2. Strengthening of technology positionQ-Cells is focusing its research in the solar cell sector on projectsthat are marketable and where success can be expected in the short tomedium term. Most recently an efficiency of 18.3% was achieved formonocrystalline cells. "On this basis, we will achieve a 20%efficiency in our R&D lines by the end of 2011", explains GerhardRauter, Member of the Executive Board and responsible for production.Within its technology portfolio Q-Cells will in the futureconcentrate on the thin-film companies Solibro (CIGS) and Calyxo(CdTe), where it controls these companies. The Executive Board ofQ-Cells has requested that Calyxo proves its technological potentialin mass production by the end of 2009. The efficiency of Solibro'sbest thin layer modules has most recently been 11,7%. Solibro startedmass production in 2008 and has since then produced about 9 MWp ofthin-film modules. For its other investments, Q-Cells will continueworking with partners to further expand these companies.3. Securing medium-term liquidity reservesIn order to create sufficient room to manoeuvre for the transitoryphase until the beginning of 2011, Q-Cells' in-house financing is tobe reinforced. All investment projects, especially those for 2010,will be reviewed again and the capital commitment in projects andstocks reduced. In contrast to the original plan, Q-Cells expects areduced outlay of up to 300 million Euro. "We are able to reduce thecash requirement by around 200 million Euro through tight workingcapital management in production and in the project business. We canavoid a further cash outflow of up to 100 million Euro through areduction in our investment programme," says Dr. Nedim Cen, CFO ofQ-Cells SE."After the great successes in the start-up period, for which we alsohave to thank a unique team, we now face some big challenges. Tosteer Q-Cells safely through the crisis and give the company along-term perspective at the Thalheim location, these measures,including a cut in personnel, are unavoidable. We appreciate thatthis is a very painful step to take. At the same time we are evenmanaging to create new positions in the Research & Development, Sales& Marketing and thin-film companies so that in future we will be ableto differentiate ourselves from our competitors even more strongly byhaving a technological edge", Milner concludes.With the change in the photovoltaic markets, new sectors and regionswill also open up. In addition to its core business Q-Cells will infuture engage more in systems integration by building on the projectbusiness of Q-Cells International which is already a well-knownplayer in the market. Milner: "We will be offering our own systemknow-how to selected markets."About Q-Cells SEFounded in 1999, Q-Cells SE is a major global photovoltaic company.In 2008 the company produced solar cells and thin-film modules with atotal power of 574 Megawatt peak (MWp). More than 250 scientists andengineers at Q-Cells are working on further developing the technologyin order to attain the company's objective of rapidly and permanentlyreducing the cost of photovoltaics and making the technologyaffordable and competitive. As well as core business activities,since mid-2008 several Q-Cells SE subsidiaries have been producingphotovoltaic modules on the basis of various thin-film technologies.In addition, the company has entered the business of planning anddeveloping large scale Photovoltaic power plants with its subsidiaryQ-Cells International. The company currently employs around 2,600staff. Q-Cells SE is currently ramping up a production plant inMalaysia, has branches in Hong Kong, China and Japan, is quoted onthe Frankfurt stock exchange (QCE; ISIN DE0005558662) and is listedin the German technology index, TecDAX.Contact informationQ-Cells SEOT ThalheimSonnenallee 17 - 2106766 Bitterfeld-WolfenInvestor Relations:Stefan LissnerTel.: +49 - (0)3494 - 6699 10101investor(at)q-cells.comPublic Relations:Markus WieserTel.: +49 - (0)3494 - 6699 10111presse(at)q-cells.comhttp://hugin.info/136506/R/1334389/316757.pdfhttp://hugin.info/136506/R/1334389/316758.pdf --- End of Message ---Q-Cells SE OT Thalheim, Sonnenallee 17-21 Bitterfeld-Wolfen GermanyWKN: 555866; ISIN: DE0005558662; Index: CDAX, GEX, Prime All Share, TecDAX;Listed: Prime Standard in Frankfurter Wertpapierbörse, Freiverkehr in Bayerische Börse München, Freiverkehr in Börse Berlin, Freiverkehr in Börse Düsseldorf, Freiverkehr in Hanseatische Wertpapierbörse zu Hamburg, Freiverkehr in Börse Stuttgart, Regulierter Markt in Frankfurter Wertpapierbörse;
Datum: 13.08.2009 - 07:00 Uhr
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