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UPDATE 1-Wacker Chemie's Q1 results hit by solar woes
April 30, 2013 / 6:00 AM / 4 years ago

UPDATE 1-Wacker Chemie's Q1 results hit by solar woes

* Says Q1 EBITDA 164.5 mln eur vs Rtrs poll avg 167 mln

* Keeps outlook for stable sales, falling EBITDA in 2013 (Adds details on polysilicon prices, CEO comments)

FRANKFURT, April 30 (Reuters) - Wacker Chemie, the world’s No.2 maker of polysilicon, saw its first-quarter core profit fall by nearly a quarter, hurt by an ongoing crisis in the solar industry, which it supplies.

The price of polysilicon, a key material needed to produce solar cells, plummeted nearly 50 percent last year due to massive oversupply that was triggered by years of government incentives to encourage consumers to shift to solar energy.

Government incentives in Germany and other European key markets are now being scaled back.

“Solar-silicon prices remain a major challenge,” the company’s Chief Executive Rudolf Staudigl said in a statement on Tuesday but affirmed the company’s 2013 outlook for stable sales and falling core earnings.

In the first quarter, earnings before interest, tax, depreciation and amortisation (EBITDA) reached 164.5 million euros ($215.5 million) in the first three months of the year.

That was down from 213.3 million in the year-earlier period and also slightly below the 167 million euro average forecast in a Reuters poll.

DZ Bank analyst Peter Spengler called the results “very weak” and kept a “sell” rating on Wacker’s shares.

Oversupply has not only been a problem for polysilicon makers but has also led to bankruptcies among solar cell and panel makers. That, in turn, has hurt Wacker Chemie as those manufacturers are the main customers of its polysilicon unit, which accounted for nearly a third of the group’s first-quarter core earnings.

Plunging polysilicon prices last year forced Hemlock Semiconductor, the world’s largest polysilicon maker, and Norway’s Renewable Energy Corp to review production plans, reduce working hours or cut jobs.

Other peers, including South Korea’s OCI Co Ltd and China’s GCL-Poly Energy Holdings, were also hit. ($1 = 0.7634 euros) (Reporting by Christoph Steitz; Editing by Harro ten Wolde and Maria Sheahan)

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