REC silicon 2014 highlights

2014 HIGHLIGHTS (COMPARED TO 2013)

> EBITDA of USD 232.9 million
• Revenues increased by 18% to USD 493.0 million
• EBITDA includes special items of USD 101 million
related to the transfer of technology to the Yulin JV
– EBITDA excluding special items increased by 335%
to USD 131.9 million

> Higher average polysilicon prices – continued market recovery
• 20% increase in average polysilicon prices
• Strong price growth through the third quarter of 2014
• Price decline at year end due to weaker PV markets

> Strong silicon gas sales volumes
• Volume increased by 54% to 3,428 MT
• 8% price decline for silane gas
• High spot sales due to offline competitive capacity

> Continued cost leadership
• FBR Cash cost of USD 12.1/kg
• Reflects continued improvements to reliability
and cost control

> Expansion initiatives
• Yulin Joint Venture in China
– Received USD 198 million for technology transfer
– Equity contribution of USD 75 million
• Rx 25/26 Expansion
– Capital investment of USD 115 million approved
– Detailed engineering underway


Strategy and Objectives

REC Silicon’s strategy is to maintain its position as a low cost leader and
technological innovator in the Silicon materials industry.
REC Silicon intends to improve its competitive position by:
• Improving the stability of manufacturing processes
• Focusing on continued quality improvements in FBR
(surface powder removal and reduction of contaminants)
• Minimizing the impact of trade dispute between US and China
(prioritize spending and develop market opportunities outside China)
• Increasing cost advantage by improving efficiency and
streamlining processes
• Expanding semiconductor polysilicon product offerings to
penetrate markets


OUTLOOK

Third party indices continue to project increased global PV demand. The
resulting increased demand for polysilicon is expected to drive
continued improvements to market balance 2015. In addition, limited
capacity additions and asset rationalization should support price
increases in the second half of 2015.

In 2015, industry analysts are estimating global PV demand in the range
of 53 to 57 GW, compared to an estimated 38 to 42 GW in 2014. The
large range is expected to cause persistent uncertainty regarding the
supply and demand balance for solar grade polysilicon and demand is
expected to build through 2015.

Silicon gas market forecasts project continued strong growth in demand
in 2015, driven by Crystalline PV Cells, Flat Panel Displays, and
semiconductor industries. 

REC Silicon intends to defend market share
gains realized during 2014 and expects sales volumes to increase by 7
percent