Norway Firm REC Silicon Reports $35.6 M Revenue in Q2 FY21

Budget reactions

REC Silicon is exploring opportunities created by President Biden’s renewable energy agenda to utilize its proven FBR technology to provide low-cost, low-carbon polysilicon for the solar value chain, said Tore Torvund, CEO of the Norway-based silicon materials producer.

The company recently reported second quarter 2021 revenues of USD 35.6 million versus USD 28.0 million in the first quarter of 2021 and EBITDA of USD 7.9 million versus USD 4.0 million in the prior quarter. EBITDA during the second quarter included the forgiveness of USD 8.3 million in loans guaranteed by the US government under the C.A.R.E.S. Act.

REC Silicon reported EBITDA contributed by the semiconductor materials segment of USD 11.5 million for the second quarter compared to USD 10.8 million for the first quarter. Second quarter results included other income of USD 4.5 million related to the forgiveness of a loan provided by the US government under the C.A.R.E.S. Act which has been recognized as grant income. Excluding this item, EBITDA decreased by USD 3.8 million.

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This decrease can primarily be attributed to lower EBITDA contribution from the semiconductor materials segment due to higher electricity prices, lower production to avoid high electricity prices, higher costs due to the acceleration of planned maintenance, and lower quality product due to an interruption of manufacturing caused by a lightning strike, said the company.

In a conference call with analysts following the results disclosure, Torvund said the company was still working to restart production at Moses Lake in 2023 – some four years after the facility was shuttered in 2019 – but stressed this was dependent on REC Silicon securing sales in the region, either for solar-grade polysilicon or silicon anodes.

During the investor presentation, REC Silicon stressed the benefits of its FBR method, particularly the results of its FBR-B technology that has been used to produce solar-grade polysilicon within the company’s joint venture in Yulin, China, itself a 20,000 metric tonne facility.

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REC Silicon said the FBR-B method posed numerous benefits over the Siemens process, including reduced energy consumption, and the company estimates it could operate facilities with around one-third of the workforce required to operate a facility using the Siemens method.

As for the rest of the Q2 FY21 results, Silicon gas sales volumes for the second quarter were 819 MT compared to 781 MT during the prior quarter. Total polysilicon sales volumes for the quarter were 485 MT and polysilicon inventories decreased by 157 MT. REC Silicon reported a cash balance of USD 123.6 million on June 30, 2021 compared to USD 131.5 million on March 31, 2021.

“The demand for semiconductor polysilicon and silicon gases continued to strengthen over the last quarters and this trend is projected to continue. Overseas shipping limitations have affected the timing for some order fulfillments. REC Silicon’s negotiations with several Silicon Anode companies continue to progress, but agreements have not yet been reached.

A US solar value chain will support the transition to renewable energy, create high-paying manufacturing jobs in the US, and result in the restart of the REC Silicon Moses Lake facility,” added Torvund.