Our Group’s solid progress was not rewarded by capital markets due to the international financial crisis and the poor outlook for the chemical and semiconductor industries.
From a peak of €197.70 on January 1, 2008, WACKER’s share price dropped to €114.81 in March 2008. The decline chiefly stemmed from two factors. First, market expectations for semiconductors were revised downward. Second, analysts curbed their upbeat forecasts for solar-sector companies. Soon, their opinions about continued solar growth turned negative as Germany and Spain (two key markets) lowered their feed-in payments for solar power. WACKER – a major manufacturer in both markets – was unable to fend off the pressure.
After publication of record 2007 figures on March 18, 2008, WACKER stock recovered slightly, peaking in May at almost €170. June’s Capital Markets Day in London also fueled the share price, before a firm downtrend ensued in August.
With mid-September’s bankruptcy of the Lehman Brothers investment bank, the financial crisis took a dramatic turn for the worse. In Q4 2008, it hit the real economy, as many market analysts had predicted. Several of WACKER’s markets were affected, including semiconductors, construction and the automotive sector. As for the solar market, it was impacted by profit warnings from numerous Chinese companies and dim forecasts from German solar-module makers.
In our Q4 conference call, we reconfirmed our forecast for 2008. WACKER’s share price, however, only made a brief recovery. It closed the year at €74.71 after two highly volatile months in November and December.
In all, WACKER stock lost 62% of its value during 2008. Its high for the year was €197.70 and low €62.23.