January 18, 2008 / 11:32 AM / 10 years ago

REC sees margin dipping in 2008, rising from 2009

OSLO, Jan 18 (Reuters) - Norwegian solar industry group Renewable Energy Corp (REC) (REC.OL) expects core profit margin to be a bit lower in 2008 than in 2007, due to expansion costs, but to rise from 2009, its chief executive said on Friday.

The margin and cost outlook came in presentations to investors at REC’s capital markets day in Oslo.

“It cannot be a surprise that we expect a bit lower EBITDA margins in 2008. We expect that the margin will increase in 2009 and on wards,” Chief Executive Erik Thorsen said.

Costs of expansion are expected to double as a portion of revenues to 5 percent this year from 2.5 percent last year, Thorsen said.

“There is a concentration of ramp-ups (of projects) in 2008, which we will benefit from in 2010 and onwards. That’s why we are indicating that our expansion costs will go from 2.5 percent in 2007 and ending at about 5 percent,” he said.

Reporting by Aasa Christine Stoltz

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