WACKER POLYSILICON

Strategy

WACKER POLYSILICON’s strategic aims are to maintain its quality and cost leadership as a hyperpure-polysilicon manufacturer, and to expand its production capacities in line with market growth. This strategy is based on long-term supplier relations with customers.

Slight Year-on-Year Rise in Sales and EBITDA

WACKER POLYSILICON increased its sales slightly compared with the previous year. The total rose by 5.8 percent to €1.45 billion (2010: €1.37 billion), fueled by sales volumes growth. Demand for high-quality polysilicon was very strong in the first nine months, with plants running at full capacity. In 2011’s fourth quarter, though, there was a marked drop in demand. This reversal was prompted by extreme overcapacity along the photovoltaic industry’s supply chain and by initial consolidation within the sector. Due to this situation, the division worked closely with customers to draw up model solutions based on existing agreements.

In 2011, we sold a total of 32,000 metric tons of polysilicon . As in the previous year, Asia, especially China, was the main sales region. Sales volumes grew by a double-digit rate in the Americas, but fell back slightly in Europe.

EBITDA climbed 1.9 percent to €747.3 million (2010: €733.4 million). Earnings were impacted not only by a slack fourth quarter, but also by the start-up costs for ramping up production capacity at Nünchritz’s Poly 9 expansion stage. In contrast, EBITDA benefited from advance and indemnity payments totaling some €66.2 million as a result of the termination of agreements with customers withdrawing from solar business. The EBITDA margin reached 51.6 percent (2010: 53.6 percent).

Marked Increase in Investments

WACKER POLYSILICON’s investments grew significantly in 2011 – rising 82.8 percent to €566.5 million (2010: €309.9 million). Capital expenditures were mainly for the construction and expansion of the new polysilicon facilities at Nünchritz and Charleston (Tennessee, USA). Construction work on the new integrated production site in Charleston is on schedule. To bring production output in line with anticipated customer demand, WACKER has decided to increase capacity at Charleston to 18,000 metric tons per year, up from a previous 15,000. It is anticipated that this move will raise total capital expenditures for the project from $1.5 billion to $1.8 billion. The facilities are scheduled for completion by the end of 2013.

The workforce grew again, due to new and expanded production capacities. At year-end, the division had 2,251 employees (December 31, 2010: 1,763).

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Key Data: WACKER POLYSILICON

€ million

 

2011

 

2010

 

2009

 

2008

 

2007

 

 

 

 

 

 

 

 

 

 

 

Total sales

 

1,447.7

 

1,368.7

 

1,121.2

 

828.1

 

456.9

EBITDA

 

747.3

 

733.4

 

520.8

 

422.0

 

182.2

EBIT

 

545.6

 

586.7

 

414.1

 

349.8

 

135.0

Capital expenditures (asset additions)

 

566.5

 

309.9

 

400.1

 

410.3

 

259.5

R&D costs

 

14.5

 

12.8

 

11.3

 

5.4

 

6.3

Employees (December 31, number)

 

2,251

 

1,763

 

1,600

 

1,289

 

1,003