Q-Cells SE: Broader Product Portfolio Strengthens Earnings Power
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- 2010 to see continued implementation of restructuring program and
strategic transformation drive
- Expansion in selected international markets
- Net income for 2009 affected by portfolio write-offs
Bitterfeld-Wolfen, 24 March 2010: Q-Cells SE (QCE; SIN 555866) is to add
crystalline modules and medium-sized solar energy systems to its product
portfolio and adapt market access in order to advance the company's
transformation from a solar cell manufacturer to a provider of photovoltaic
solutions. The objective of this broadened business model is to cover the more
profitable areas of the value chain and improve the risk position. In parallel
to the strategic transformation, the company will continue to advance its
current restructuring programme in order to lay the foundations of future
competitiveness. In 2010, the company expects a considerable increase in sales
to between ?1.0 billion and ?1.2 billion as well as a significant improvement in
the operating income.
Product portfolio for international markets
Q-Cells had taken initial steps to reposition the business back in 2008 with the
move towards the production of thin-film modules as well as the installation of
large ground-mounted systems. In future, the product portfolio will also include
medium-scale projects and crystalline modules. In order to manufacture such
modules, Q-Cells has agreed a partnership with Flextronics: Flextronics is
constructing a production line in Malaysia on the basis of Q-Cells' technical
specifications and high-level quality requirements for modules with a capacity
of 200 MWp, to be equipped with solar cells produced by Q-Cells. The first
module was produced in mid-March this year.
At the beginning of April, Q-Cells is to start marketing the modules to
wholesalers and large installation service providers. The range initially
includes thin-film modules from Solibro branded "Q Smart" and crystalline
modules for ground-mounted systems under the "Q Base" brand, which were
previously manufactured only for the in-house project business of the
subsidiary, Q-Cells International GmbH (QCI) with cooperation partners. All in
all, Q-Cells' product range will continuously be expanded over the course of the
year. In the future, it will feature an innovative portfolio consisting of solar
cells, crystalline and thin-film modules as well as photovoltaic systems for
large-scale ground and roof-mounted systems. Sales activities were reorganised
for this purpose over recent months. In order to meet the requirements of
international customers more efficiently, offices were also established in the
core regions of France, Italy and North America, while others are planned. As a
result, the product portfolio, sales and customer support are all customised to
the core technologies of Q-Cells.
The systems business is also to be broadened out. In addition to the large
ground-mounted systems in which QCI has successfully specialised in the past two
years, more medium-sized projects related to between 500 kilowatts and 5 MWp are
also to be installed in future, i.e. solar energy systems for commercial and
industrial customers. The knowledge obtained from large-scale projects can be
used to manufacture smaller modules, which also entail a lower level of capital
investment.
"In the next few years, the market for photovoltaics will experience not only
strong growth but also overcapacities and margin pressure. We can be very
successful in such a market, given our strong brand and the high quality of our
products. However, in order to achieve this, Q-Cells must have more flexible and
cost-efficient manufacturing capacity at its disposal while focusing on the
expansion of the product portfolio and market access. The partnership with
Flextronics is a first important milestone. However, we need to continue to
build on that if we are to keep up with the strong international competition",
comments Nedim Cen, CEO and CFO of Q-Cells SE.
Advancing restructuring measures
In addition to Q-Cells' strategic transformation, the restructuring of the
company, which is already underway, will be further advanced in 2010. After the
adjustment of production capacities in 2009 and the related redundancies, the
main objectives in 2010 will include the streamlining of the technology
portfolio, optimising cash management and working capital as well as adapting
internal structures. "Following dynamic growth in recent years, the entire solar
industry finds itself in the midst of extensive transformation. New business
models require different internal structures. This also applies to Q-Cells. The
review of internal organisation and processes is a key task for 2010," according
to Nedim Cen.
At the end of the 2009 financial year, extensive adjustments were also made to
the investment portfolio. The book values of three investments were written down
to zero in 2009. In addition to Solaria Corp., these were Sovello AG (write-down
in Q4: ?88 million) and Sunfilm AG (write-down: ?150 million). Both Sunfilm and
Flexcell are currently negotiating alternative financing structures with their
principal banks. At the same time Calyxo is searching for new financing
partners. Due to existing contractual obligations in relation to Sunfilm,
Q-Cells posted a net outflow of funds of approx. ?42 million in the first
quarter of 2010. In the case of Sovello, the shareholders have concluded an
agreement with the financial investor Ventizz Capital related to the sale of
100% of the shares. This is expected to lead to a change of ownership in the
coming weeks. With the adjustments, Q-Cells is taking a major step towards
eliminating or minimising accounting risks in future.
Net income for 2009
Earnings before interest and taxes (EBIT) at Q-Cells SE for 2009 amounted to
?-486 million. Book losses and write-downs on portfolio companies as well as
discontinued operations accounted for close to an additional ?1 billion, leading
to a full year loss of ?1,356 million.
Production of crystalline solar cells fell to 537 MWp overall in 2009 (previous
year: 570 MWp). Including the thin-film modules of subsidiary Solibro, annual
production of 551 MWp was attained. In 2009, sales of ?802 million were
generated (previous year: ?1,251 million).
At the end of the year, cash and cash equivalents totalled ?412 million, well
above the forecast of ?250 million to ?300 million. This higher cash holdings
amount is partly attributable to postponements in investments to 2010. With
these cash and cash equivalents, the company is sufficiently financed for the
current year.
Outlook for 2010
In addition to the change at the helm of the company, which took place when
Anton Milner stood down on 11 March to be replaced by Nedim Cen, the former CFO,
there was also a change in the Supervisory Board. Richard Kauffman resigned his
post in February 2010 and was succeeded by Helmut Gierse, who has many years of
experience in industrial production and automation.
Particularly in the first six months of 2010, considerable growth of the
European market is expected. Q-Cells is set to benefit from this. Available
investment in 2010 amounts to ?150 million to ?200 million. This will be
allocated to the further expansion of cell production in Malaysia (planned
capacity of 600 MWp by the end of 2010), thin-film module production at Solibro
and targeted research and development for cells, modules and the development of
systems expertise. Crystalline modules are expected to generate sales of 100 to
150 MWp in 2010. Sales in the newly installed photovoltaic systems related to
QCIs project business are set to reach volumes between 150 MWp and 200 MWp.
In 2010, the company expects a considerable increase in sales to between ?1.0
billion and ?1.2 billion as well as a significant improvement in the operating
income.
-----------------+----------------+-----------------
| ´09 overall | ´08 overall
-----------------+----------------+-----------------
Production | 551 MWp | 574 MWp
-----------------+----------------+-----------------
Sales revenues | ?802 million | ?1,251 million
-----------------+----------------+-----------------
EBIT | ?-486 million | ?205 million
-----------------+----------------+-----------------
Net income | ?1,356 million | ?191 million
-----------------+----------------+-----------------
A presentation on the 2009 figures is available for download in the Investor
Relations section of the Q-Cells SE website (www.q-cells.com
About Q-Cells SE
The Q-Cells Group is one of the world's leading photovoltaics companies. Its
extensive product portfolio ranges from solar cells and modules to turnkey
photovoltaic systems. Q-Cells's products are developed and manufactured at its
headquarters in Bitterfeld-Wolfen (Germany) and marketed via its global sales
network. It also has a second production plant in Malaysia. The more than 200
scientists and engineers at Q-Cells are working to swiftly advance solar
technology and achieve Q-Cells' twin aims: driving down the costs of
photovoltaics quickly and permanently, and making solar power competitive. The
close links between R&D and production enable Q-Cells to rapidly translate
cutting-edge innovation into mass production - and underpin its ambition to be
at the forefront of photovoltaic technology.
Q-Cells is quoted on the Frankfurt Stock Exchange (QCE; ISIN DE0005558662) and
also listed on the TecDAX, the German technology index.
Kontaktinformation:
Q-Cells SE
OT Thalheim
Sonnenallee 17 - 21
06766 Bitterfeld-Wolfen
www.q-cells.com
Corporate Communications:
Ina von Spies
Tel.: +49 - (0)3494 - 6699 10121
presse(at)q-cells.com
Investor Relations:
Stefan Lissner
Tel.: +49 - (0)3494 - 6699 10101
investor(at)q-cells.com
[HUG#1396971]
--- End of Message ---
Q-Cells SE
OT Thalheim, Sonnenallee 17-21 Bitterfeld-Wolfen Germany
WKN: 555866;ISIN: DE0005558662;Index:TecDAX,GEX,CDAX,Prime All Share;
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Datum: 24.03.2010 - 02:00 Uhr
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