Dokument1 04.05.2001 18:49 Uhr Seite 2 [Annual Report … · [Annual Report 2000] Sunshine is life....

SolarWorld AG The Power Company

[Annual Report 2000]

Sunshine is life.

Dokument1 04.05.2001 18:49 Uhr Seite 2

18.12.1998:SolarWorld AG

established

08.10.1999:Second capital

increase by

Euro 500.000 to

Euro 3,0 m

(issue price Euro

13,75 )1988:Frank H. Asbeck,

Ingenieurbüro für

Industrieanlagen

set up

1995:Photovoltaics

division started

08.11.1999:First trading day of

SolarWorld stock at

the Düsseldorf

Stock Exchange

01.12.1999:Acquisition of 6.25

per cent share in

Fuhrländer

wind power plant

manufacturer

Published by:

SolarWorld AG, Kurt-Schumacher-Str. 12 – 14, 53113 Bonn

Contact: Investor Relations Department, Tel.: 01803 – 2000 3000

Internet: www.solarworld.de

The detailed version of the Annual Report is also available in the German language.

The Annual Report can be downloaded as a pdf file from the Internet under the address www.solarworld.de

To obtain complete documents as well as the annual financial statements please get in touch with SolarWorld AG,

Investor Relations Department,

Kurt-Schumacher-Str. 12 – 14, 53113 Bonn,

under tel.: +49 (0) 228 55920-12 or fax +49 (0) 228 55920-99,

or via e-mail under [email protected]


The History

16.12.1999:Acquisition of 72

per cent share in

Swedish solar

module manufacturer

GPV effective

01 January 2000

May/June 2000:Increase of capital

stock to

Euro 3,75 m

11.08.2000:Take-over of 82

per cent majority

of the solar wafer

manufacturer

Bayer Solar

GmbH, Frei-

berg/Saxony,

today Deutsche

Solar, currently

Europe`s largest

producer of silicon

wafers with a

world market

share of more

than 20 per cent

Sept./Nov. 2000:Increase of capital

stock to 4.5 m

by way of two

capital increases

of 375,000

each

May/June 2001:Conversion of

80.2 per cent

subsidiary Wind-

Welt into a stock

corporation with a

capital increase of

1.0 m and an

imminent IPO in

the organized

stock market


I. At a Glance

1

2. The Value Chain

Geschäfb.eng.4c 04.05.2001 18:28 Uhr Seite 1

2

Dipl.-Ing. Frank H. Asbeck

Chairman of the Board of SolarWorld AG

Dear Shareholders and Friends

of SolarWorld AG,

The year 2000 was a milestone in German

energy history. The signal for the conversion

of the German energy sector was loud and

clear: The German Parliament passed the Rene-

wable Energies Act which gives a compre-

hensive and sustainable boost to renewable

energies in the Federal Republic of Germany.

The outlook is clear: Renewable energies are

expected to secure a major share of the energy

supply in the future. There are no alternatives

to this approach as borne out by the most

recent United Nations climate report dating

from February 2001. Because the emission

of carbon dioxide, caused by the generation

of power from coal for example, global war-

ming will be promoted with dire consequen-

ces for people and large parts of our globe.

Renewable energies are clean and emission-

free – they produce safe and reliable power

without endangering the climate. What is more,

the sun, as one form of renewable energy,

has a residual life of 6 billion years which

should be enough to keep us going for a while.

That ecology and economy can work excel-

lently hand in hand is powerfully underlined

by the business development of SolarWorld

AG. We already managed to reach our ori-

ginal sales target for the fiscal year 2000 after

only nine months. We matched the 1999 total

sales after less than six months.

In the fiscal year 2000 SolarWorld AG took

a decisive stride towards becoming a world-

wide solar energy company. We were able

to take over Bayer Solar GmbH, a subsidi-

ary of the Leverkusen Bayer Group. Today,

the company is called Deutsche Solar GmbH

and is among the world market leaders in the

production of wafers for the solar energy indu-

stry. This industry would be nothing without

wafers because they are the major product

in the manufacture of solar cells and thus in

the construction of complete solar power sta-

tions. Deutsche Solar holds a 20 per cent share

in the worldwide wafer market. “There is Sol-

six inside” (Solsix being the brand name of

solar wafers made by Deutsche Solar) enjoys

an excellent reputation among solar produ-

cers all over the world. The company is among

the world’s most modern solar production faci-

lities and has established a significant inter-

national position. Together with our other hol-

dings and activities in the solar energy indu-

stry we succeeded in the year 2000 in making

SolarWorld AG an internationally renowned

partner in the renewable energy industry. The

strong media interest in our company is evi-

dence of this new position of SolarWorld AG.

We see the comprehensive, positive cover-

age of our activities in the daily city and trade


II. Chairman’s Statement

press as a recognition as well as an incen-

tive to vigorously pursue this approach also

in the future.

We owe our past successes not least to our

shareholders who again made available capi-

tal for our strategy of further expansion last

year. We are delighted that this investment

has paid off handsomely for our shareholders

within a short period of time. The SolarWorld

AG share is one of the most successful stocks

of the year 2000.

Yet, that alone is not enough by way of a

thank you to our shareholders for the trust they

have placed in us. While in the recent past

more and more companies listed on the New

Market traumatized their shareholders with

absolutely atrocious results and reports of los-

ses SolarWorld AG proposes to pay its sha-

reholders a dividend of € 0.30 per share

subject to AGM approval.

Our objective is to expand SolarWorld AG

into a fully integrated solar energy group with

international activities. In the future, the Solar-

World Group will cover the entire value chain

of the solar industry from raw silicon all the

way to the Solarparc. At the Deutsche Solar

location we will not only expand wafer pro-

duction to 100 Megawatt but will also start

the production of 50 MW solar cells and modu-

les.

As a consequence of these expansionary mea-

sures we expect a substantial increase of our

corporate goodwill.

As a pure solar energy group we see our com-

pany in the global photovoltaics market with

a clear edge over the market-dominating, cum-

bersome competitors. Banking solely on size

is the wrong strategy in the dynamic and rapidly

moving PV market. With competitors like BP

and Shell Siemens the actual core businesses

like oil and nuclear energy directly clash with

photovoltaics. Yet, for SolarWorld solar

energy is its operational business and we are

committed to establishing PV technology world-

wide. Our compact size and the commitment

of our dynamic and highly motivated staff make

it possible for us not only to react quickly and

flexibly to the constantly changing market con-

ditions but indeed to bring about these chan-

ges ourselves.

SolarWorld AG will continue to make a clean

profit in the future from selling zero-emission

innovative solar technology. The market of solar

energy generation is only at the beginning of

its development. SolarWorld AG has taken

a clear position in this initial set-up. We are

not waiting for the next stimulus. We are going

to give it ourselves. For example, by further

reducing costs which is designed to make solar

power fully competitive with the heavily sub-

sidized traditional energies. Photovoltaics has

long since stopped being the toy of pipe dre-

amers. PV is a clean business today – and

will continue to be so in the future.

Yours truly,

Dipl.-Ing. Frank H. Asbeck

Chairman of the Board of SolarWorld AG

3


44

III. The SolarWorld Stock/Shareholder Value1. Share Indicators 7

2. Share Price Development in 2000 7

3. Dividend Policy 9

4. Investor Relations – Transparency Breeds Trust 9

I. At a Glance 1. Corporate Indicators

2. The Value Chain

3. The History

IV. Economic and Management Report1. Background Conditions

1.1. Macroeconomic Situation 11

1.2. Energy Markets 11

1.2.1. General Development 12

1.2.2. Renewable Energy Markets 12

2. Corporate Situation

2.1. Business Substance 13

2.2. Business Development 2000 13

2.3. Business Strategy 14

2.4. Deutsche Solar GmbH 14

2.5. History 15

2.6. Capital Development 15

2.7. Financing 16

2.8. Procurement 16

2.9. Turnover 16

2.10. Sales and Order Situation 16

2.11. HR and Management 17

2.12. Profits / Dividends 17

II. Chairman’s Statement 2


V. Forecast19 1. Macroeconomic Situation

19 2. Energy Demand

20 3. Industry Situation

21 4. SolarWorld AG Business Development

VII. Annual financial Statements25 1. Profit and Loss Account

26 2. Balance Sheet

28 3. Management Report 2000

32 4. Auditors´ Opinion

35 VIII. Report of the Supervisory Board

36 IX. Vision

23 VI. Risk Management Report

5


6


III. The SolarWorld Stock/Shareholder Value

7

Securities ID: WKN 510840Stock exchange code: SWVMarket segment: Over-the-counter market in Düsseldorf, Frankfurt, Stuttgart, Berlin,

Hamburg – XETRADividend 2000 € 0,30 per share (recommended)Issue price in Nov. 1999: € 13,75Number of shares 4,5 million shares/1 € per shareMarket capitalization DM 528 million(at a share price of € 60 per share

at the end of 1st quarter 2001)

1.Share Indicators

2. Share Price Development in 2000

With a year-end closing price in 2000 of

€ 85.00 the SolarWorld AG stock achieved

an increase of 525 per cent over the 1999

year-end closing price of € 13.60.

This SolarWorld AG share price development

in the year under review reflects the boom in

the renewable energies industry. The coming

into force of the Renewable Energies Act (Erneu-

erbare-Energien-Gesetz = EEG) in April

2000 and the rise of the oil price to over

$ 30.00 per barrel in August 2000 placed

the focus fairly and squarely on ecology stocks:

Thus, the SolarWorld share reported signifi-

cant price increases precisely at these points

in time. Against the backdrop of the finite nature

of fossil energies the promotion of renewa-

ble energies was a necessary step towards

increasing the efficiency of renewable ener-

gies and to bring about a cost convergence

through the simultaneous price increase of fos-

sil raw materials.

In addition to the optimum market conditions

SolarWorld AG’s strategically important step

of acquiring Bayer Solar, the largest unaffi-

liated wafer producer worldwide, in August

2000 also had positive repercussions on the

development of the SolarWorld share price

in 2000. Through this take-over as well as

that of the Swedish module manufacturer GPV

in December 1999 SolarWorld AG exten-

ded its photovoltaic value chain developing

from a pure dealer into a fully integrated com-

pany.

Some short-term profit taking in 2000 tem-

porarily caused a significant volatility of the

SolarWorld share price. However, a gene-

rally stable upward trend showed that most

of the investors were relying on a sustainable

medium to long-term investment strategy.


8

In addition to the interest shown in individual

ecology „stocks“ investments into ecology-ori-

ented funds also showed significant growth

in 2000. In the November 2000 they excee-

ded the DM 3 bn mark for the first time. All

German speaking ecology funds as well as

investment houses like Schroders, ADIG, DIT,

Merril Lynch, West LB, Deutsche Postbank and

the major Italian banks all had SolarWorld

AG shares in their portfolios at the end of the

year 2000.

According to the assessment of analysts the

SolarWorld share price potential indicates fur-

ther interesting growth perspectives. At the end

of 2000 the stock was tipped to go as high

as € 119 (source: Bank Julius Bär).

Particularly for the investor with long-term ori-

entation the SolarWorld stock seems to be

an interesting proposition because the mar-

ket for renewable energies was very much at

the beginning in 2000: Only about 0.01 per

cent of total power generation in Germany

comes from solar power, which is, however,

already an increase of 150 per cent over the

previous year. Based on this very low market

share and against the background of the gene-

ral conditions outlined above the growth poten-

tial of the photovoltaics industry is enormous

while the risk is limited since it is a market

that will substitute the conventional, finite energy

sources.


For “innovative, informative and professional”

presentation on its Internet site in the year 2000

SolarWorld AG received the Environmental

Online Award in gold, a much coveted qua-

lity hallmark for environmental communication.

This high award created by the German Wor-

king Group for Ecological

Management (Bundes-

deutscher Arbeitskreis für

umweltbewusstes Mana-

gement = B.A.U.M.) which

is under the patronage of

Jürgen Trittin, the German

Minister of the Environment,

and sponsored by the

Bavarian Ministry of Rural

Development and Environ-

mental Protection, was

again reinforced and con-

firmed impressively in early

February 2001 when the

sculpture and the certificate

that go with the award

were presented to SolarWorld AG.

As another important pillar of our IR work we

were able to establish new contacts and streng-

then existing ones in numerous talks with insti-

tutional investors, especially international

investors, at different conferences and road-

shows.

With our ad hoc publicity as a legal publi-

city requirement complementing our regular,

voluntary PR work we ensured a comprehensive

and broadly based flow of information.

III. The SolarWorld Stock/Shareholder Value

9

3. Dividend Policy

For the first time the Executive Board and the

Supervisory Board propose a dividend of

€ 0.30 per share for fiscal year 2000. This

dividend policy reflects the development of

SolarWorld profits in the year under review

and proves that investments in the solar busi-

ness can in fact be profitable.

4. Investor Relations – Transparency Breeds Trust

It is the declared objective of the SolarWorld

management to maintain a dialogue with sha-

reholders and capital market participants that

is based on trust as well as complete and topi-

cal information.

In order to meet the demands of quick and

continuous information flows to investors in this

process, online communication was increa-

singly employed as a communications medium

in our IR communications mix in the year 2000:

Since the spring of 2000 SolarWorld AG has

been presenting itself with a new Internet

approach under the address www.solar-

world.de.

In this context the continuous, up-to-the-minute

updating of company-, market- and investor-

related information takes up a major portion

of our operational IR work. Not least, the trust

placed in our company and the attendant

increase in value were created by this com-

munications strategy based on transparency

and topicality.


10


1. Background Conditions

1.1. Macroeconomic Situation

In the year 2000, the German economy clearly

picked up speed. The findings of the Kiel World

Economic Institute (Institut für Weltwirtschaft =

IfW) show that the gross domestic product

(GDP) for the entire year 2000 was up by

3.0 per cent on 1999 – a clearly more sub-

stantial increase than in the whole of the nine-

ties. During the same period unemployment

decreased significantly.

The second half of the year was dominated

by a massive increase in the price of oil as

a consequence of the dramatic reduction in

OPEC’s petroleum production. Consumer pri-

ces did continue to show an only moderate

development with an increase of only about

1.9 per cent. Yet, the rate of increase was

clearly higher than in previous years. In addi-

tion to the weakness of the Euro this was mainly

due to the increased energy prices. These also

had a dampening effect on the economy

which, with a growth rate of 2.3 per cent

(according to IfW) in the second half of the

year 2000, was no longer as buoyant as in

the first half when it still grew by 3.8 per cent.

11

IV. Economic and Management Report


12

1.2. Energy Markets

1.2.1. General Development

In the year 2000 the energy markets in Ger-

many were mainly impacted by two events:

the agreement between the Federal Govern-

ment and industry on the phasing out of nuclear

energy on the one hand and increasing oil

and gas prices due to the reduced OPEC pro-

duction volume on the other hand.

Both these events had positive repercussions

on the demand for alternative energy tech-

nologies.

The electricity market was characterized by

opposing development trends. At the whole-

sale level liberalization continued which led

to the establishment of two electricity exchan-

ges in Germany. The residential market and

the market for small businesses, on the other

hand, were marked by the contentious and

overpriced regulations concerning grid uti-

lization. At this level one can only speak of

limited competition at a high price level. The

trading volume in ecology energy from rene-

wable sources continued to remain at a rela-

tively low level because of the high grid uti-

lization fees.

1.2.2. Renewable Energy Markets

The markets for renewable energies continued

to develop very dynamically worldwide in the

year 2000. This related mainly to wind and

solar energy. In the international markets for

solar power products affecting the business

activities of SolarWorld AG, a substantial

increase in the demand was observed. With

some 288 MW the annual worldwide pho-

tovoltaics production in 2000 was 40 per

cent up on the previous year.

Heading the league table of newly installed

photovoltaics systems was again Japan. By

adding more than 100 Megawatt (MW) to

its existing plants the country further streng-

thened its worldwide leadership role in the

production and employment of solar power

plants. This increasing volume in Japan has

been achieved in spite of clearly lower state

subsidies. The Japanese market plays a pionee-

ring role for the normal, unsubsidised photo-

voltaics market of the future that will show a

positive development in spite of declining sub-

sidies.

With a newly installed power output of about

40 MW Germany has replaced the USA

(about 25 MW) as the Number Two in the

world in the use of solar power. In compari-

son with 1999 (15.6 MW) the market in Ger-

many has nearly tripled.

In the three leading PV nations, programs have

been in place for several years designed to

stimulate private demand for PV systems

(70,000 roofs program in Japan, 100,000

roofs program in Germany, one million roofs

program in the USA).

Thus, the German roof conversion program

has set itself the target of installing a total of

300 MW of PV power output by the end of

the year 2004. For comparison: By the end

of the year 2000 about 100 MW had been

installed in Germany. A major driving force

of the market development in Germany has

turned out to be another promotional mea-12


13

sure – the Renewable Energies Act (EEG).

The EEG came into force on 01 April 2000

and guarantees a compensation of at least

DM 0.99 for every kilowatt hour of solar power

fed into the national grid for the next twenty

years. Starting on 01 January 2002 this mini-

mum compensation will be cut by 5 per cent

annually for solar power plants commissioned

after this point in time. This compensation is

geared to the existing costs of generating solar

power and thus moves photovoltaics quite sub-

stantially in the direction of price competiti-

veness with conventional energies like coal

and nuclear power that have been heavily

subsidized for years.

At the EU level the promotion of renewable

energies is also making good progress. The

EU Commission as the major executive organ

of the European Union has just called for an

improved promotion of renewable energies.

In response to increased crude oil prices the

Commission has called upon the individual

member countries to reduce the dependence

of the Community on petroleum imports by

expanding the use of renewable energies. By

now the Commission is also actively suppor-

ting the efforts of individual members and of

the European Parliament to roughly double

the share of renewable energies in primary

energy consumption from 7 to 12 per cent

and in power generation from 13 to 22 per

cent by the year 2010.

2. Corporate Situation

2.1. Business Substance

SolarWorld AG and its subsidiaries GPV and

Deutsche Solar GmbH are engaged in rese-

arch and development for and the produc-

tion and marketing of products for solar power

generation as well as complete solar power

stations. This includes the following:

the production of solar wafers from silicon,

the production of solar modules,

the development of proprietary solar systems,

the development of systems solutions for the,

retail and wholesale trade.

In addition, the SolarWorld AG subsidiary

WindWelt AG is involved in the planning,

construction and operation of wind energy

and solar energy parks and other power sta-

tions based on renewable energies. In this

context SolarWorld AG’s 6.25 per cent sha-

reholding in the manufacturer of wind energy

systems, Fuhrländer AG, is having a very posi-

tive effect.

2.2. Business Development 2000

The fiscal year 2000 was a milestone in Solar-

World AG’s corporate history. The Renew-able

Energies Act (EEG) passed by the German

parliament on 25 February 2000 caused a

veritable run on SolarWorld AG’s products.

After only five months of the fiscal year Solar-

World AG was able to match total sales of

the previous year. The step-by-step increase

of the capital stock to € 4.5 by the company

attracted substantial financial funds. SolarWorld

AG used part of these funds to acquire Bayer

Solar GmbH. Another portion of these funds

will be used for expansionary measures.

With the integration of Bayer Solar, now cal-

led Deutsche Solar GmbH, into the SolarWorld



14

SolarWorld AG will also concentrate on the

selection of high quality and favorably priced

systems components and assembly techniques.

Not only the module costs but also all peri-

pheral costs that still account for up to 50 per

cent of total PV costs are to be reduced in

the process. In this regard SolarWorld AG

can fall back on its very special know-how.

2.4. Deutsche Solar GmbH

On 01 August 2000, SolarWorld AG acqui-

red 82 per cent of the shares of Bayer Solar

GmbH, Europe’s largest manufacturer of sili-

con wafers. Silicon wafers are the most impor-

tant components in the solar energy industry

and at the same time the first product in the

solar energy value chain. The wafers made

from raw silicon are turned into solar cells which

in turn are further processed into solar modu-

les.

In acquiring Bayer Solar GmbH SolarWorld

AG was able to succeed against well-known

and powerful competitors from Germany and

abroad. The take-over has made SolarWorld

AG an important international Solar Player.

The former subsidiary of Bayer AG, now ren-

amed Deutsche Solar GmbH, held a world

market share of more than 20 per cent in the

wafer market in the year 2000. 30 per cent

of the production volume goes to Japan, the

world’s largest market for solar technology.

Until 2002 the production capacity of Deut-

sche Solar GmbH is to be expanded from

32 MW (year-end 2000) to 100 MW. The

investment volume required for this expansion

amounts to about DM 100 m.

AG group of companies and the take-over

of the Swedish module manufacturer Gälli-

vare PhotoVoltaic (GPV), effected in Decem-

ber of 1999, SolarWorld AG has now taken

a decisive step towards becoming a fully inte-

grated solar energy group with worldwide

operations.

2.3. Business Strategy

The strategy of SolarWorld AG – as the only

company in the world at the moment – is to

integrate all stages of the value chain of the

solar energy industry within its own ranks and

to further internationalize its business activi-

ties. The objective of the company is to out-

perform the solar world market leaders. In the

majority of all cases the competitors are major

corporations for whom the PV business is merely

of secondary or even tertiary importance and

is primarily perceived as a PR exercise. Here,

SolarWorld AG as a dedicated solar tech-

nology group sees excellent opportunities to

advance to the top in the international mar-

ket by concentrating on its core business of

solar energy. In this context, SolarWorld AG

has decided to go public with all non-ope-

rational solar activities in the form of its sub-

sidiary WindWelt AG.

The goal of the operational PV business is to

attain and retain price leadership while main-

taining a high quality level. SolarWorld AG

expects massive price cuts to result from its

entry into PV mass production. The automa-

ted mass production will lead to a significant

reduction of unit costs. SolarWorld AG will

soon reach this threshold by establishing addi-

tional large-scale production facilities. In addi-

tion to the actual “hardware” of photovoltaics,


15

The world market share of Deutsche Solar

GmbH will be further increased as a result of

this planned expansion.

Within the framework of this expansion stra-

tegy, a raw materials reprocessing plant based

on recycling, a 50 MW solar cell and a

25 MW solar module production facility (with

an option for another 25 MW) are to be esta-

blished by the end of 2002. With the imple-

mentation of this plan, the world’s most modern

high-tech solar technology center will emerge

at Freiberg in which ecologically clean pro-

ducts will be produced and many new jobs

will be created. The planned conversion into

a stock corporation (AG) will take account of

these developments.

2.5. History

In 1988 Dipl.-Ing. Frank H. Asbeck founded

the engineering office Frank H. Asbeck Inge-

nieurbüro für Industrieanlagen, Bonn as a sole

proprietorship. Until 1998, the company was

involved in the realization of projects of rene-

wable energy generation. In 1998, these activi-

ties were transferred to the newly founded Solar-

World AG. Until the foundation of SolarWorld

AG, the Frank H. Asbeck Ingenieurbüro für

Industrieanlagen planned and built industrial

solar power stations of more than one MW

in Germany.

Since 1995, the trade in PV modules, inver-

ters, components as well as kits and systems

solutions has been added with the emphasis

in distribution on the roofing and electrical who-

lesale trade as well as solar energy installa-

tion companies, the makers of prefab homes

and building marts.

The 80.2 per cent SolarWorld AG subsidiary

Asbeck Immobilien- und Kraftwerksgesellschaft

mbH took over the activities in the fields of wind

energy and plant engineering after the crea-

tion of SolarWorld AG. In November 2000,

this company was renamed WindWelt GmbH.

The conversion of WindWelt into a stock cor-

poration – WindWelt AG – was filed for entry

in the Commercial Register on 15 March 2001.

In December 1999, SolarWorld AG acqui-

red a 6.25 per cent shareholding in the wind

energy manufacturer Fuhrländer GmbH, also

a stock corporation (AG) today, that serves

to support the wind energy activities of the

company. In the same month, SolarWorld AG

acquired a 72 per cent share in the module

manufacturer Gällivare PhotoVoltaic (GPV), Gäl-

livare/Sweden.

Entry into module production followed eight

months later with the take-over of 82 per cent

of the shares of the solar wafer manufacturer

Bayer Solar GmbH, Freiberg, today called

Deutsche Solar GmbH.

2.6. Capital Development

At SolarWorld AG’s foundation on 18

December 1998, the capital stock amounted

to DM 100,000. In May 1999 the capital

was converted to Euro and increased to

€ 2.5 m at the same time. In the course of

another capital increase, SolarWorld AG pla-

ced an additional 500,000 shares on the

capital market at an issue price of € 13.75.

The introduction of the capital at the Rheinisch-

Westfälische Börse (stock exchange) in Düs-

seldorf was effected on 08 November 1999.

A capital increase in the spring of 2000 inclu-



16

ding subscription rights as well as two addi-

tional capital increases in the course of the

year excluding subscription rights for existing

shareholders brought the capital stock up to

€ 4.5 m by 31 December 2000. It is divi-

ded into 4.5 million no-par stock certificates

with an imputed share of € 1 in the capital

stock.

2.7. Financing

The investments made by SolarWorld AG are

financed from the cash flow. For the finan-

cing of shareholdings and of measures to

expand capacity, SolarWorld AG was able

to fall back primarily on liquid funds it recei-

ved from the placement of corporate shares

in the capital market. These liquid funds will

also make it possible to finance further steps

of expansion in fiscal year 2001.

2.8. Procurement

SolarWorld AG buys the merchandise and

products it needs to conduct its business activi-

ties from a number of different manufacturers

and suppliers. The purchase of solar cells, for

example, is based on delivery contracts with

Astropower Inc., Delaware/USA, for exam-

ple. Furthermore, there are extensive busin-

ess relations to the PV world market leader

BP Solar and other manufacturing companies

in the PV industry. Solar modules are predo-

minantly produced by our subsidiary GPV.

Components for the manufacture of complete

solar energy systems are outsourced from relia-

ble partners all of whom are the technologi-

cal market leaders.

2.9. Turnover

In fiscal year 2000, SolarWorld AG gene-

rated a turnover of DM 32.1 million. This was

an increase of more than 200 per cent over

the previous year. Deutsche Solar GmbH repor-

ted sales of DM 74.5 million.

For the current fiscal year, SolarWorld AG is

expecting a substantial increase in the sales

of all companies.

2.10. Sales and Order Situation

The market for photovoltaics was characterized

by a very strong demand in fiscal year 2000.

SolarWorld AG was able to substantially boost

sales of its products by around one third to three

Megawatt. SolarWorld AG is not involved in

the direct business to final customers but gene-

rates its sales through distribution channels like

solar energy trading and installation companies

and the electrical wholesale trade. In the year

2000, some 8,000 electrical fitters attended

one-day seminars on photovoltaics with special

reference to SolarWorld products at various elec-

trical wholesale companies.

Because of the persistently strong demand, the

order situation is more than satisfactory. Solar-

World AG’s order books are full.


17

2.11. HR and Management

In the course of the year under review, Solar-

World AG substantially increased its head-

count. In addition to the members of the Board,

there were 31 staff working for SolarWorld

AG and 251 employees for the SolarWorld

Group at the end of the 2000 fiscal year.

The number of staff in the group was still as

low as 29 at the end of the 1999 fiscal year.

The Board of SolarWorld AG consists of Dipl.-

Ing. Frank H. Asbeck (Chairman) and Dipl.-

Ing. Peter Westermayr (Engineering and R&D).

Also on the Management of SolarWorld AG

are Frau Dipl. oec. troph. Sybille Teyke, res-

ponsible for Investor Relations/Marketing, Dr.

Hartwig Westphalen, responsible for

Sales/Distribution, and Dipl.-Ing. Boris Kle-

bensberger, in charge of Strategic Corporate

Development.

The WindWelt AG subsidiary is managed

by Dipl.-Ing. Frank H. Asbeck as the Chair-

man of the Board and Dipl.-Meteorologe Tho-

mas Klodt as Vice President Engineering.

Other General Managers of Deutsche Solar

GmbH are Dipl.-Kfm. Ekhard von Dewitz and

Prof. Dr. Peter Woditsch.

Dipl.-Ing. Peter Westermayr is General Mana-

ger of GPV.

In the course of the current fiscal year, the Solar-

World Group is going to increase its head-

count by roughly 100 additional employees.

2.12. Profits / Dividends

In fiscal year 2000, SolarWorld AG repor-

ted a very good overall result. The net income

for the year amounted to DM 6.75 million.

The Board will propose to the Annual Gene-

ral Meeting to pay a dividend of € 0.30 per

no-par share certificate from the balance sheet

profit.

In the current and all future years, SolarWorld

AG will strive for a continuous improvement

of its result throughout the group.



18


19

V. Forecast

1. Macroeconomic Situation

SolarWorld AG follows the forecasts of lea-

ding economic institutes in assessing the future

macroeconomic situation. Thus, economists are

expecting a positive development for the cur-

rent and the coming year even though they

predict a slight decline in comparison with

the year 2000. For the current year, the Insti-

tut für Weltwirtschaft (IfW) in Kiel is foreca-

sting an increase in the gross domestic pro-

duct of 2.7 per cent for Western Europe and

of 2.4 per cent for Germany.

The declining economy in the USA will con-

tinue to have a moderating effect on the world-

wide development of interest rates. The lower

level of interest rates can be expected to again

improve the attractiveness of investments in

the stock market.

Thus, it is fair to expect a stable development

in the German stock market in 2001. Sha-

res of companies in the renewable energy

industry are certain to attract a great deal of

investor interest again since the market con-

tinues to grow and ecologically oriented invest-

ments are highly appreciated by an increa-

sing number of investors.

2. Energy Demand

The worldwide demand for energy is rising

continuously. This refers above all to indivi-

duals and states that have so far participa-

ted in worldwide energy consumption on an


20

almost negligible scale. In the countries of Latin

and Central America, Africa and Asia the

demand for energy will increase significantly

in the future.

At the same time, the international community

of states wants to reduce substantially the emis-

sion of greenhouse gases like CO2 that are

responsible for global warming. This means

that the use of fossil energy sources like coal

and oil, but also natural gas, no longer hold

much promise for the future. These old ener-

gies – as well as the socially and ecologi-

cally very doubtful nuclear energy – can only

be substituted by a massive expansion of rene-

wable energies.

3. Industry Situation

The worldwide PV market is characterized by

high doubledigit growth rates. A large num-

ber of economic players outside the industry

see photovoltaics as a very promising busin-

ess field of the future. On a worldwide

basis,more and more “Old Economy” com-

panies are getting into the clean technology

to generate energy from sunlight. This deve-

lopment will continue. In this context, it can

also be expected that mergers and acquisi-

tions in this field will increase.

The market in Germany will continue to grow

substantially – backed by the political back-

ground conditions. With the help of the

‘100.000 Roofs Program’ and the Renewa-

ble Energies Act, a total PV power output

volume of 300 MW is to be achieved until

2004. This means that some 200 MW have

to be added by 2004. Under these condi-

tions it is conceivable that the German mar-

ket alone will grow to DM 1 billion in the

year 2004. In the year 2000, the market

volume amounted to DM 300 – 400 million.

Based on an installed PV power output world-

wide of currently 1,000 MW, the International

Economic Forum on Renewable Energies (Inter-

nationales Wirtschaftsforum Regenerative

Energien = IWR), Münster, expects an

increase by a factor of 4 by 2005 and by

a factor of 15 by the year 2010.

In a forecast dating from September 2000,

the Swiss bank Sarasin & Cie. predicts an

average growth of the PV market of 19 per

cent annually until the year 2010. This means

that the Swiss analysts have again corrected

their original 1999 forecast upwards by well

over one third in order to allow for the increa-

singly dynamic environment. At the end of

2000, the annual photovoltaics production

already exceeded the planned 200 MW by

140 per cent reaching 288 MW.

Predicted PV market development until 2010

(Source: Study by Bank Sarasin, Basle/Sept.

2000)

Mega

watt

per a

nnum

1500

1400

1300

1200

1100

1000

900

800

700

600

500

400

300

200

100

0

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010


In a study on the future development of the

energy markets, the Royal Dutch Shell Group

of Companies considers it possible that rene-

wable energies will reach a share of 50 per

cent of world energy consumption by the year

2050. According to the same study, solar

energy will be the most important renewable

energy from 2030 onwards. From 2050

onwards, solar energy will be the most impor-

tant of all energies.

4. SolarWorld AG business development

SolarWorld AG consistently pursues the stra-

tegy of developing into a fully integrated, inter-

nationally operating solar energy group. This

will help SolarWorld AG catch up with the

current world market leaders in solar energy.

In the current fiscal year, further acquisitions

can therefore be expected. One major ele-

ment of the SolarWorld strategy is to remain

independent of larger groups.

In Germany, SolarWorld AG wants to further

expand its market share in the German solar

business. Its current share is between 7 and

8 per cent. It is to be increased to 11 per

cent by the year 2004.

While the subsidiaries Deutsche Solar GmbH

and GPV already have international operati-

ons SolarWorld AG is planning to move into

other European countries in 2001. It is the-

refore proposed to establish a business pre-

sence in lucrative foreign markets like the

Netherlands, Denmark, Norway, England, Ire-

land, Luxembourg, Belgium, France, Italy,

Spain, Portugal as well as Asia and the USA

in cooperation with local partners.

21

In Germany, SolarWorld AG will continue its

successful partnership with craftsmen. For exam-

ple, it is planned to expand the business with

roofing specialists, architects and other pro-

tagonists in the building industry. In the same

way that we successfully offered training to

some 8,000 electrical fitters in the electrical

industry in the year 2000, SolarWorld AG

will now also conduct such training seminars

in the building industry.

On the whole, SolarWorld AG expects a sub-

stantial increase in group sales in the current

year as well as a further strengthening of the

international market position of the group.

V. Forecast


22


VI. Risk Management Report

By way of its strategy of increasingly uniting

the solar energy value chain under the umbrella

of the company and the consistent imple-

mentation of this strategy in 1999 and 2000

(acquisition of the majority in the wafer manu-

facturer Bayer Solar GmbH, Freiberg/Saxony;

take-over of the majority shareholding in the

Swedish module producer GPV), SolarWorld

AG has made itself independent of wafer and

module purchases in the world market thus

accounting for the necessity of diversifying its

procurement activities.

As a result, SolarWorld AG developed from

a pure dealer to a fully integrated company

and can therefore counteract the risk of deli-

very contracts running out requiring a change

of supplier which in turn would have nega-

tive repercussions on the business activities of

the company.

Within the framework of the implementation

of an environment management system,

SolarWorld AG is currently in the process of

defining internal objectives concerning the envi-

ronmental compatibility of individual stages

of the value chain. In addition, SolarWorld

AG is preparing for ISO 14000 certification

the completion of which is scheduled for early

2002.

Studies quoted by the Sarasin Bank predict

a positive development of the photovoltaics

market with average growth rates of 19 per

cent (source: Sarasin Study, September

2000), and yet, the retail prices attainable 23

in the market, the purchase prices, the cur-

rency parities, the trading margins and a pos-

sible phasing out of the Federal Government’s

‘100,000 Roofs Program’ in 2005 as well

as the elimination of Federal State or other

subsidies may have negative repercussions on

the business development of the company.

The political risk at the national and the Euro-

pean levels lies in possible changes in legis-

lation that may impact the company’s busin-

ess activities negatively. However, the German

system of subsidies was quite clearly confir-

med by the European Court of Justice (ECJ) in

Luxembourg in March 2001 as a result of which

the risk involved has been limited. In a piece

of litigation on the old German law on fee-

ding power into the national grid (Stromein-

speisegesetz = StrEG) the European Court of

Justice (ECJ) held that minimum compensati-

ons for renewable energies paid pursuant to

the StrEG or the new Renewable Energies Act

could not be construed as subsidies and were

therefore in conformity with EU rules and regu-

lations. The judgment by the European Court

of Justice dated 13 March 2001 thus con-

firms that promoting environmentally-friendly

electricity in this way is within the law.

In order to protect itself against risks emana-

ting from regulations and laws in the fields of

taxation, competition, anti-trust, patents or the

environment, SolarWorld AG always bases

its decisions on legal advice obtained from

its own experts or from proven outside con-

sultants.

Perspectives/Background


24

24


25

VII. Annual financial Statements

SolarWorld Aktiengesellschaft, Bonn

Profit and Loss Account

for the Period 01 January through 31 December 2000

1. Sales revenues 32.098.014,56 10.553.743,94

2. Increase in inventory of work in progress 21.340,00 0,00

3. Other operating income 4.672.755,00 225.511,06

4. Materials

a) Expenditure for raw materials, supplies and goods purchased 28.208.513,42 8.688.883,79

b) Expenditure for services purchased 76.640,95 0,00

28.285.154,37

Personnel expenditure

a) Wages and salaries 1.045.383,61 512.329,43

b) Social security contributions, pensions and other benefits 143.456,22 62.548,48

1.188.839,83

6. Depreciation on intangible fixed assets

as well as property, plant and equipment 172.219,59 70.585,29

7. Other operating expenses 3.930.574,49 2.230.426,12

8. Income from participations 8.200.000,00

of which in group companies

DM 8,200,000.-- (DM 0.00)

9. Other interest and similar income 1.791.710,83 237.330,58

of which from group companies

DM 303,416.66 (DM 62,718.75)

10. Write-downs on participations and securities

held as investments 19.558,30 18.154,64

11. Interest and similar expenses 833.549,65 69.082,14

9.138.602,88

12. Result of ordinary activities 12.353.924,16 -635.424,31

13. Extraordinary income 0,00 939.132,40

14. Taxes on corporate income and business profits 5.593.567,35 0,00

15. Other taxes 6.505,70 1.537,00

5.600.073,05

16. Profit/loss for the year 6.753.851,11 302.171,09

17. Profit/loss brought forward from previous year 249.682,42 -39.347,67

18. Income from capital reduction 0,00 2.208,50

19. Allocation to revenue reserves

a) statutory reserves 0,00 13.141,00

b) reserves for own shares 1.247.087,83 0,00

c) other revenue reserves 3.116.000,00 2.208,50

4.363.087,83

20. Profit for the year 2.640.445,70 249.682,42

DMDM 2000

DM1999


Profit and Loss Account

for the Period 01 January through 31 December 2000


26

ASSETS

A. Fixed assets

I. Intangible fixed assets

1. Franchises, industrial property rights and similar rights and values

as well as licenses in such rights and values 25.726,00 6.942,00

2. Corporate goodwill 258.334,00 278.334,00

248.060,00

II. Tangible fixed assets

1. Technical equipment 9.756,00 12.634,00

2. Other assets and office equipment 680.945,00 198.228,00

690.701,00

III. Financial assets

1. Shares in associated companies 97.114.546,77 21.246,00

2. Investments in securities 1.798.376,30 1.798.376,30

3. Cash deposits on securities 0,00 1.438.825,13

98.912.923,07

99.887.684,07

B. Current assets

I. Inventories

1. Work in progress 21.340,00 0,00

2. Finished goods and goods for resale 6.241.916,24 1.504.464,87

3. Payments on account 784.233,36 0,00

7.047.489,60

II. Receivables and other assets

1. Trade receivables 1.255.856,28 2.675.692,70

2. From associated companies 18.655.002,26 2.212.718,75

3. Other assets 558.719,90 306.179,58

20.496.578,44

III. Securities

1. Own securities 1.247.087,83 0,00

2. Other securities 870.344,35 975.718,86

2.117.432,18

IV. Cash at bank and in hand 100.875.834,26 9.171.508,88

C. Prepayments and accrued income 179.130,56 16.678,90

230.577.149,11 20.617.556,97

26

SolarWorld Aktiengesellschaft

Bonn

Balance Sheet as at 31 December 2000

DM DM DM31.12.2000 31.12.1999


27


LIABILITIES

A. Stockholders’ equity

I. Subscribed capital 8.801.235,00 5.867.490,00

II. Capital reserves 160.704.982,37 12.468.416,25

III. Revenue reserves

1. Statutory reserves 13.141,00 13.141,00

2. Reserves for own shares 1.247.087,83 0,00

3. Other revenue reserves 3.118.208,50 2.208,50

4.378.437,33

IV. Balance sheet profit 2.640.445,70 249.682,42

176.525.100,40

B. Provisions

1. Tax provisions 1.452.793,00 0,00

2. Other provisions 248.858,72 61.400,00

1.701.651,72

C. Creditors

1. Banks 50.903.101,99 1.250.959,21

- of which DM 8,403,101.99 (DM 1,250,959.21) due within one year

2. Deposits received on orders 22.300,00 0,00

3. Trade accounts payable 1.272.248,79 677.867,98

- of which DM 1,272,248.79 (DM 677,867.98) due within one year

4. Other liabilities 152.746,21 26.391,61

- of which DM 152,746.21 (DM 26,391.61) due within one year 52.350.396,99

- of which DM 8,889.70 (DM 5,769.74) tax

- of which DM 37,963.53 (DM 13,065.68) social security contributions

230.577.149,11 20.617.556,97

LIABILITIES

A. Stockholders’ equity

I. Subscribed capital 8.801.235,00 5.867.490,00

II. Capital reserves 160.704.982,37 12.468.416,25

III. Revenue reserves

1. Statutory reserves 13.141,00 13.141,00

2. Reserves for own shares 1.247.087,83 0,00

3. Other revenue reserves 3.118.208,50 2.208,50

4.378.437,33

IV. Balance sheet profit 2.640.445,70 249.682,42

176.525.100,40

B. Provisions

1. Tax provisions 1.452.793,00 0,00

2. Other provisions 248.858,72 61.400,00

1.701.651,72

C. Creditors

1. Banks 50.903.101,99 1.250.959,21

- of which DM 8,403,101.99 (DM 1,250,959.21) due within one year

2. Deposits received on orders 22.300,00 0,00

3. Trade accounts payable 1.272.248,79 677.867,98

- of which DM 1,272,248.79 (DM 677,867.98) due within one year

4. Other liabilities 152.746,21 26.391,61

- of which DM 152,746.21 (DM 26,391.61) due within one year 52.350.396,99

- of which DM 8,889.70 (DM 5,769.74) tax

- of which DM 37,963.53 (DM 13,065.68) social security contributions

230.577.149,11 20.617.556,97

DM DM DM DM31.12.2000 31.12.1999


28

Management Report 2000

of


The company was established on 18 December 1998. Entry into the company register at the Bonn local court (registration num-

ber HRB 8319) took place on 26 March 1999.

Changes in capital stock

Using the authorization of 13 September 1999 the Board of Management, with the approval of the Supervisory Board, decided

on 03 April 2000 to increase the capital stock by € 750,000 to € 3,750,000.00. This capital increase has been completed

and was entered in the company register on 16 May 2000.

The ordinary Annual General Meeting on 29 May 2000, authorized the Board of Management to increase the capital stock of

the company, with the approval of the Supervisory Board, once or several times, but by a maximum total of € 1,500,000 on or

before 31 December 2004 by issuing new bearer shares or against cash and/or non-cash capital contributions.

Partly using the authorization of 29 May 2000 the Board of Management, with the approval of the Supervisory Board given in

its resolution of 08 November 2000, decided on 27 October 2000 to increase the capital stock by another € 375,000.00 to

€ 4,500,000.00. This capital increase has been completed and was entered in the company register on 20 November 2000.


29


Business development

The fiscal year 2000 took a very successful development for SolarWorld AG. So, the positive business development continued in

the second year after the foundation of the company. Sales and profit expectations of the Board of Management were again excee-

ded.

For example, the company increased its sales revenues in fiscal 2000 by 304.14 per cent over the previous year. Total sales in

fiscal year 2000 amount to DM 32.09 million after DM 10.55 million in the year before. The sales target of DM 17 million set

in March 2000 for the 2001 fiscal year was thus exceeded by more than 188 per cent. The result of ordinary business activities

of DM 12.354 million was significantly higher than the result of the prior year ( - DM 635,00.00). And the net income for the

year of DM 6.754 million outperformed the previous year’s figure (DM 302,000.00) several times over.

As expected, the development of expenditures was largely influenced by special costs incurred in the context of additional capi-

tal increases. However, the actual expenses could by maintained at the relatively modest level of DM 1.2 million.

In spite of the dollar exchange rate staying at a high annual average, it was possible to generate a substantial gross income of

DM 3.83 million. Against the background of the necessary staffing-up, the development of personnel expenses was in line with

expectations. On the whole, the reported cost increases are justified when viewed in the context of the special costs incurred by

the capital increases and the massive increase in sales.

Shareholdings

WindWelt GmbH, Bonn (previously Asbeck Immobilien- und Kraftwerksgesellschaft mbH). Asbeck Immobilien- und Kraftwerksge-

sellschaft mbH, in which SolarWorld AG holds an 80.2 per cent, changed ist name on 17 November 2000. The name of this

affiliated company is now WindWelt GmbH. At the moment, the registration of the conversion of WindWelt GmbH into a stock

corporation (German AG) is being filed for. After the IPO the shares of WindWelt AG will be traded in the regulated over-the-coun-

ter market of the Düsseldorf Stock Exchange.

In the fiscal year 2000, WindWelt GmbH realized wind park projects with a total rated output of 5.4 MW. In the first quarter of

the 2001 fiscal year, wind power plants with a total output of 8 MW have already been commissioned. It is planned to imple-

ment a total of ten wind parks with a total output of more than 40 MW in the course of the fiscal year 2001.

Gällivare PhotoVoltaic AB, Gällivare, Sweden

With an agreement dated 14 December 1999, SolarWorld AG acquired a 70 per cent shareholding in the Swedish solar module

manufacturer Gällivare PhotoVoltaic AB (GPV) with effect from 01 January 2000. This acquisition serves SolarWorld AG’s objec-

tive of completing the value chain in solar module production and of achieving the greatest possible independence from suppliers.

In the current fiscal year, it has already been possible to significantly expand the production capacity through conversion and moder-

nization. The target is a solar module production volume in the order of magnitude of 15 MW by the end of the year 2001. The

modules manufactured by GPV in the current fiscal year have been sold successfully through SolarWorld AG.


30

Deutsche Solar GmbH, Freiberg

With an agreement dated 11 August 2000, SolarWorld AG acquired 82 per cent of Bayer Solar GmbH which has been opera-

ting under the name of Deutsche Solar GmbH since 20 October 2000. It is intended to convert Deutsche Solar GmbH into a stock

corporation (German AG) in the course of fiscal 2001.

The purpose of the operation of this subsidiary is production and distribution as well as the performance of any and all other related

activities in the field of photovoltaics. Deutsche Solar GmbH is currently primarily involved in the production of solar wafers. By com-

missioning new manufacturing facilities, wafer production capacity will be enhanced from currently 32 MW to 100 MW as of April

2001. In the future, Deutsche Solar GmbH will also enter the field of solar cell and solar module production. Plans are being drawn

up to establish a manufacturing facility at Freiberg for the production of 25 MW of solar cells and modules with an option to double

this capacity by the year 2003.

Risk management

Circumstances that might negatively impact the situation of the company have not become known after the balance sheet date. The

general corporate risks are continuously defined by the Board of Management, evaluated and, to the extent that this makes econo-

mic sense, minimized or transferred to third parties. Thus, short-term currency fluctuations are hedged against by way of appropriate

currency futures transactions. The loss of receivables outstanding is covered by taking out credit insurance. And the typical warranty

risks in solar power station construction are compensated for by appropriate modular designs. The company also tries to influence

positively the risk of changes in political background conditions in the long term by actively participating in the work of professional

associations both at the national and at the EU levels. This risk has been clearly reduced since the passing of the most recent law on

renewable energies in Germany. Risks we cannot influence are monitored on a regular basis in order to be able to take counter-mea-

sures in good time if the need arises.

Risks resulting from the shareholding in WindWelt GmbH mainly come in the form of delays in obtaining planning permission for indi-

vidual sites as well as the wind conditions encountered. For each potential location the company is having expert opinions drawn up

on the prevailing wind conditions by independent institutes in order to obtain a high degree of planning security.

The company is aware of the fact that its success is essentially determined by its ability to gain and retain qualified and motivated

staff. By giving employees a share in the success of the company and by offering skill improvement measures on a continuous basis

the company has already achieved a high degree of staff retention. Through forward-looking personnel planning it has been possi-

ble to avoid personnel bottlenecks.


31


31

Outlook

Against the backdrop of the continued application of the minimum compensations for alternative energies fed into the national grid

as provided for by the law on the promotion of renewable energies the Board of Management expects a persistently increasing

demand for the products offered by the company.

It is especially in the product segment of photovoltaic modules that the company expects a consistently increasing demand not least

because of redoubled sales efforts in neighboring EU countries. In the future, SolarWorld AG proposes to meet the expected demand

increasingly with photovoltaic modules from its own production. The solar energy value chain from wafers made from raw silicon via

solar cell production all the way to the manufacture of solar modules will be completed by the end of 2003. Deutsche Solar GmbH

in Freiberg/Saxony will establish a manufacturing facility for the production of 25 MW of solar cells and the further processing into

solar modules with the option of increasing this capacity to 50 MW by the end of 2002. Finally, SolarWorld AG is planning to esta-

blish a module recycling plant at Freiberg for the recovery of silicon from silicon-rich raw materials. All in all, it is planned to put into

service a production area of 25,000 square meters and to create 250 jobs at Freiberg. The total investment volume until 2003 will

amount to DM 250 million.

With these measures, SolarWorld AG wants to prepare itself for the rapid increase in demand expected for the coming years and

position itself appropriately in the market.

The Board of Management sees its market development forecasts confirmed by the recent judgment handed down by the European

Court of Justice which held on 13 March 2001 that minimum compensations for renewable energies fed into the national grid are

permitted according to EU law. This decision strengthens the planning security of customers based on the German law for the pro-

motion of renewable energies. However, the Board of Management is convinced that this court decision will also have a stimulating

effect on other countries in the EU.

In view of the consistently favorable political and economic background conditions, the sales development so far and the orders

already received the Board of Management expects a continued positive business development for the fiscal year 2001.

The Board of Management is not aware of any events that might have a negative impact on the future business development.

Bonn, 20 March 2001

SolarWorld Aktiengesellschaft

The Board of Management

(signed) Asbeck (signed) Westermayr


3232– 2 –

Limes Treuhand- und Beratungs GmbH

Wirtschaftsprüfungsgesellschaft

AUDITORS’ OPINION

We have audited the annual financial statements including the bookkeeping records and the management report of SolarWorld Akti-

engesellschaft for the fiscal year from 01 January to 31 December 2000. The maintenance of the books and records and the prepara-

tion of the annual financial statements and the management report in accordance with German commercial law and the supplementary

provisions of the company’s articles of association are the responsibility of the legal representatives of the company. Our responsibility is

to express an opinion on the annual financial statements together with the bookkeeping system and the management report.

We conducted our audit in accordance with § 317 HGB (German Commercial Code) and the generally accepted standards for the

audit of financial statements promulgated by the Institute of German Auditors (Institut der Wirtschaftsprüfer in Deutschland = IDW). Those

standards require us to plan and perform the audit in such a way that inaccuracies and misstatements materially affecting the presenta-

tion of the net assets, financial position and results of operations in the annual financial statements drawn up in accordance with German

principles of proper accounting and in the management report are detected with reasonable assurance. Knowledge of the business activi-

ties and the economic and legal environment of the company and evaluations and possible misstatements are taken into account in deter-

mining audit procedures. The effectiveness of the internal control system and the evidence supporting the disclosures in the books and

records, the annual financial statements and the management report are examined primarily on a sampling basis within the framework

of the audit. The audit includes the assessment of the accounting principles employed and the significant estimates made by the com-

pany’s legal representatives as well as an evaluation of the overall presentation of the annual financial statements and the management

report. We believe that our audit provides a reasonable basis for our opinion.

Our audit has not led to any reservations


33




In our opinion, the annual financial statements give a true and fair view of the net assets, financial position and results of operations

of the company in accordance with German principles of proper accounting. On the whole, the management report provides an accu-

rate understanding of the company’s position and adequately portrays the risks of its future development.

Without qualifying this opinion in any, way we wish to place on record that we did not participate in the physical stocktaking of inven-

tories since we were not commissioned to perform the audit until March 2001.

Bonn, 26 March 2001



Dipl.-Kfm. Dr. Klaus Jansen

Wirtschaftsprüfer


34


3535

VIII. Report of the Supervisory Board

The SolarWorld Aktiengesellschaft Supervisory

Board whose composition remained unchan-

ged in comparison with the previous year held

six formal Supervisory Board meetings in the

year 2000 one of which was a working meet-

ing in conjunction with the acquisition of Bayer

Solar GmbH. Both on this occasion and in

other meetings and individual talks the mem-

bers of the Supervisory Board were kept regu-

larly informed in detail about the current busi-

ness development as well as the asset, reve-

nue and financial situation of the company.

These as well as more fundamental issues were

regularly discussed with the Board of Mana-

gement. Measures requiring approval were

examined in the appropriate form and then

submitted to the Supervisory Board for a final

decision.

As in the previous year the company’s accounts,

annual financial statements and management

report were audited by Limes Treuhand- und

Beratungs GmbH Wirtschaftsprüfungsgesell-

schaft, Bonn. The unqualified auditor’s opinion

was issued on 26 March 2001. After dis-

cussing it with the auditors the Supervisory

Dr. Claus Recktenwald

Chairman of the Supervisory Board

Board took note of, and agreed with, the audit

reports and the audit result.

The Supervisory Board also examined the

annual financial statements and the mana-

gement report and raised no objections. The

annual financial statements have thus been

adopted.

By the same token, the Supervisory Board took

note of, and agreed with, the Board of Ma-

nagement’s proposal on the appropriation of

net income.

The Supervisory Board thanks the Board of

Management most cordially for the succes-

sful work again performed with great dedi-

cation in fiscal year 2000.

Bonn, 03 April 2001

Dr. Claus Recktenwald

Chairman of the Supervisory Board


36

Neutral analysts like the Swiss bank Sarasin

& Cie. compare the current situation in the

PV industry with the mobile telephone market

in the early nineties: just before it turned into

a mass market. Modern life is hardly ima-

ginable without cellular phones any more. Even

school children have discovered mobile com-

munications for themselves. In ten years, neit-

her mobiles nor solar cells will be anything

special any more. They will be found on cars,

busses and ships, they will be seen on the

facades of buildings, they will be mass-pro-

duced for the world market. For the school

children who use their mobiles, the bluish-black

cells on the front of their telephones will be

something perfectly normal. And what is more,

the devices will also weigh less because solar

cells are lighter than batteries.

Once our children actively determine the fate

of our world, there will no longer be any dis-

cussion about the contribution that renewa-

ble energies can make at all – they will see

and experience it on a daily basis. Without

sun, wind and water there is no future – neit-

her in the so-called developing countries nor

in the industrialized countries. The energy sup-

ply of tomorrow will be based on renewable

energies. To secure, it we will not have to

plunder our last oil and coal reserves or test

new methods of nuclear fission or fusion. Sun,

wind and water are readily available. All we

have to do is use them.

IX. Vision


Des

ign:

Kre

ativ

Kon

zept

Kla

us S

chm

uck,

Bon

n

SolarWorld AG[Kurt-Schumacher-Straße 12-14, D-53113 Bonn][Tel.: +49-228-55920-0, Fax: -99][[email protected]][Internet: www.solarworld.de][Aktionärsbetreuung Tel.: 01803-2000 3000]

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