REC Silicon – Third Quarter 2020 Results

PVTIME – REC Silicon ASA (REC Silicon) reported third quarter 2020 revenues of USD 30.3 million versus USD 31.0 million in second quarter of 2020 and EBITDA of USD 17.9 million versus USD 2.9 million in the prior quarter. Third quarter EBITDA included a noncash adjustment of USD 16.0 million due to settlement of the property tax dispute announced on October 14, 2020.

REC Silicon reported a cash balance of USD 35.9 million on September 30, 2020 which is USD 4.3 million higher than June 30, 2020.

Silicon gas sales volumes for the third quarter were 746 MT compared to 831 MT during the prior quarter. Average silane gas prices increased by 3.4% compared to the second quarter of 2020.

Polysilicon sales volumes for the quarter were 401 MT and polysilicon inventories decreased by 163 MT.

Contingent liabilities faced by the Company have been reduced by USD 44.9 million during the third quarter due to the discontinuance of the tax examination by Norwegian Central Tax Office (USD 27.3 million tax and interest) and the settlement of the property dispute regarding property valuations from 2012 through 2015 with Grant County, Washington (USD 17.6 million net decrease in liabilities).

Subsequent to the end of the quarter, REC Silicon entered into business cooperation agreements to partner with Violet Power to develop a non-Chinese Solar PV value chain and to partner with Group 14 Technologies to develop a silicon anode battery materials production facility in Moses Lake.

On October 14, 2020, the REC Silicon raised approximately NOK 1 billion in gross proceeds through the Private Placement of 92,592,592 new shares, at a price per share of NOK 10.80. The net proceeds from the Private Placement will be used to fund expansion investments and activities at the Company’s facilities in Butte and Moses Lake as well as for general corporate purposes. Upon completion of the Private Placement, REC Silicon will have increased its liquidity and may enable the Company to prepare for the eventual restart of the Moses Lake plant.

“Once again, the Company has reported consistent financial results for the third quarter. Butte operations continue to display resilience despite challenges caused by Covid-19. I am pleased that the path to restart production at the Moses Lake plant has become clearer with the announcement of agreements signed with Violet Power and Group 14 Technologies. The successful private placement of equity completed on October 14, 2020 has provided the Company with financial security and flexibility and I am confident that we will be able to capitalize on these opportunities,” said Tore Torvund, CEO of REC Silicon.

For more information, please see the attached third quarter 2020 report and presentation.