SILTRONIC

In 2008, Siltronic’s sales amounted to €1.36 billion (2007: €1.45 billion) – down 6.3% year on year. The reason for the drop in sales was weak semiconductor-sector demand, which particularly impacted Siltronic’s Q4 business. The prices of all wafer diameters dropped. By selling monocrystals and other materials to the solar industry, Siltronic partially offset its lower semiconductor-sector sales.

Semiconductor-Industry Demand Fell in 2008

2008 EBITDA amounted to €357.3 million (2007: €478.1 million), down 25.3%. Consequently, the EBITDA margin dropped to 26.3 percent (2007: 32.9%). Key negative factors for the earnings trend included declining average wafer prices and high average euro/dollar exchange rates. In contrast, sales of silicon monocrystals substantially bolstered Siltronic’s profitability. At the same time, Siltronic introduced various productivity-boosting and cost-cutting measures. Since Siltronic procured less polysilicon from WACKER POLYSILICON due to weaker demand in Q4, the quantities that WACKER POLYSILICON did not sell were instead sold to the solar industry on the polysilicon market. Siltronic received a credit note of €6.7 million from the income generated by these sales.

During 2008, Siltronic invested €199.6 million (2007: €200.0 million). A considerable sum was spent on optimizing the Freiberg and Burghausen production plants. Investments also focused on the new 300 mm fab in Singapore that Siltronic built in partnership with Samsung Electronics. This joint venture started production in June 2008. By year-end 2009, the facility is expected to produce around 200,000 wafers per month. Some US$1 billion has been invested in the new production facility, which will ultimately have a monthly capacity of 300,000 wafers.

Siltronic had 5,469 employees on December 31, 2008 (December 31, 2007: 5,634).