REC Silicon hits $24 million Q2 profit as polysilicon demand increases

Advanced polysilicon producer REC Silicon published encouraging second quarter financial results today that revealed the company ended Q2 with a profit of $24.6 million from its continuing operations.

Higher average polysilicon prices boosted the company’s bottom line in the second quarter and reflected a recovering demand for solar grade polysilicon and growing acceptance of granular polysilicon by the market, REC Silicon said today.

Total Q2 revenues for REC Silicon reached $126.8 million, up from $113.3 million in the first quarter. The corresponding EBITDA worked out to be $33.1 million for Q2, almost double the $19 million recorded in Q1 2014. Higher sales volumes accounted for this improved EBITDA outlook, although profit margins were somewhat offset by higher manufacturing costs.

After posting a loss of $49.7 million in the first quarter of the year, the reported profit of $24.6 million represents an encouraging turnaround for REC Silicon, with sales driven by a combination of improved PV, flat panel display, and semiconductor demand, as well as competitive capacity being currently offline.

"Strong second quarter EBITDA demonstrates the strengthening demand for granular polysilicon and silicon gases in the market," said REC Silicon CEO Tore Torvund. "During the quarter, we successfully completed the five-year inspection program in Silane III. Although these outages resulted in higher cost during the first half of 2014, we have completed the planned outages and will operate at full capacity for the remainder of the year."

The company also announced that there is no maintenance work planned for its plants for the third quarter of the year, and so expects polysilicon production to reach approximately 5,000 MT, and hopes to end 2014 some 800 MT up on initial projections of 18,600 MT.