UPDATE 1-Wacker Chemie scraps sales outlook on solar woes
* Now expects 2012 sales below 2011 levels
* Q2 EBITDA 241 mln eur vs 235 mln Rtrs poll
* Shares indicated 2.6 percent lower in pre-market trade
FRANKFURT, July 25 (Reuters) - Wacker Chemie, the world's No.2 maker of polysilicon, scrapped its sales outlook for the ongoing year, blaming the solar sector's ongoing consolidation that has pushed many of its clients into crisis or out of business.
"Growing supply-chain inventories and financing difficulties among market participants could cause some polysilicon customers to not take full delivery or to delay taking delivery, or lead to the termination of contracts," the company said on Wednesday.
Wacker Chemie, whose polysilicon is a key material in the production of solar cells, now expects 2012 sales to be slightly below 2011 levels of 4.91 billion euros ($5.9 billion). It had previously guided for sales of about 5 billion euros.
The solar sector has come under intense pressure, caused by fierce competition from Asian rivals, overcapacity and falling government subsidies for solar power.
This has driven some players out of business, including German players such as Solon and Q-Cells, that filed for insolvency after months of talks with creditors and banks.
In 2011, Wacker Chemie's cash-cow polysilicon unit accounted for about 30 percent of group sales and about two thirds of earnings before interest, tax, depreciation and amortisation (EBITDA), with an EBITDA margin of more than 50 percent.
In the second quarter, the EBITDA margin at the unit amounted to 41.9 percent.
On a group level, second-quarter EBITDA came in at 241 million euros, slightly higher than the 235 million average estimate in a Reuters poll of banks and brokerages.
Wacker Chemie's main rivals in the production of polysilicon include Hemlock Semiconductor, a joint venture between Dow Corning, Shin-Etsu Handotai and Mitsubishi Materials, as well as Korean OCI Co Ltd and China's GCL-Poly Energy Holdings.
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