Report as of June 30, 2010 - centrotherm · Report as of June 30, 2010 . August 12, 2010. Silicon &...

Report as of June 30, 2010 August 12, 2010

Silicon & Wafer

Solar cell & Module

Thin film module

Semiconductor

Report as of June 30, 2010 2© centrotherm photovoltaics AG

Disclaimer

We have exercised utmost care in the preparation of this presentation. It contains forecasts and/or information relating to forecasts. Forecasts are based on facts, expectations, and/or past figures. As with all forward-looking statements, forecasts are connected with known and unknown uncertainties, which may mean the actual result deviates significantly from the forecast. Forecasts prepared by third parties, or data or evaluations used by third parties and mentioned in this communication, may be inappropriate, incomplete, or falsified. We cannot assess whether information, evaluations, or forecasts made by third parties are appropriate, complete, and not misleading. To the extent that information in this presentation has been taken from third parties, or these provide the basis of our own evaluations, such use is made known in this report. As a result of the above-mentioned circumstances, we can provide no warranty regarding the correctness, completeness, and up-to-date nature of information taken, and declared as being taken, from third parties, as well as for forward-looking statements, irrespective of whether these derive from third parties or ourselves.

Rounding differences may arise.

Contents

1. Highlights 6M 20102. Recent developments3. Market trends4. Financials

Silicon & Wafer

Solar cell & Module

Thin film module

Semiconductor


Top operating performance results in hugely increased EBIT and is consequently reflected in the EPS

Sales and earnings in 6M 2010 above previous’ year level:

Sales: EUR 278.3 million (+5.4% yoy)

EBIT: EUR 33.9 million (+31.3% yoy)

Earnings per share: EUR 1.08 (+29.1% yoy)

FY 2010 sales guidance increased to EUR 580-600 million

Strong business leads to increased revenue estimates

Order book increases to EUR 864.0 million

Order intake 6M 2010: EUR 353.3 million

Major order from Qatar recognized in order intake

5© centrotherm photovoltaics AG Report as of June 30, 2010

Margin excellence in core business Solar cell & Module - Some segment highlights of H1 2010

Solar cell & Module:

Sales: EUR 180.3 million (+14.5%)

EBIT: EUR 42.2 million (+80.5%)

Record level: EBIT margin at 23.4% in H1 2010, 27.2% in Q2 2010

High demand for single equipment

Thin film module:

Sales: EUR 7.2 million

EBIT: EUR -16.2 million

Stabilization in machine pool; first modules in operation

Client prepares to sell first modules

Silicon & Wafer:

Sales: EUR 90.7 million (+ 13.6%)

EBIT: EUR 7.8 million (+48.1%)

Promising contract negotiations with customers

Operating highlights: Successful projects proceedingsAsia Silicon in China

Top

Contents


Silicon & Wafer

Solar cell & Module

Thin film module

Semiconductor


CIGS-Turnkey: Even assuming a tiny market share, the business case is enormously attractive

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

5,000

5,500Capacity in MWp

2014201320122011201020092008

centrotherm estimate

LBBW estimate for CIS/CIGS

centrotherm market share (5 %)

Adressable CIGS thin film market for centrotherm from 2012 onwards (conservative case)

Strategic investments for future thin film technology:- 2010/2011: EUR ~ 65 million expenditures for technology, equipment, strategic cooperations

Expected Return: IRR of > 15 %

Positive NPV in double-digit million EUR amount

EBIT-margin expectations: 12-15 % (mid-term)


Main results H1 2010

Client prepares for module

sale from CIGS production line

Small scale production (“mini production”) of CIGS thin film modules to start from Q4 on

Selling the manufactured modules on selected Asian markets starts from Q4

Stabilization in machine pool

Further endurance tests towards manufacturing capability performed

Key steps (selenization and sputtering) improved

Second source consumable assessment (e.g. glass, chemicals) started

Modules in daily operation

CIGS modules produced

First modules installed on client’s rooftop

Modules generate electricity for air-conditioning on site

Joint approachon further

cooperation

Joint teams of CT and customer collaborate on all sections

Strong collaboration empower staff on both sides

Professional know-how transfer to client

Taiwanese thin film project: Turnaround becomes visible


Solid project management to support the roadmap for thin film

Thin film milestones up to 2013

2011

Comment

Further potential for increasing EBIT by

signing new contracts

2012

Comment

Position as innovative market-leading player in CIGS thin film industry

leads to first positive EBIT performance

20132010

Comment

Negative EBIT due to further expenditures in equipment and process

improvements of Taiwanese project

Establishment of efficient and competitive CIGS thin film technology

Finalizing Taiwanese thin film project and

start mass production

Elaboration of new worldwide

thin film projects

Improving Taiwanese thin film project

(equipment/process)Projects

Signing and start new thin film deals (turnkey and

equipment)

Developing new markets with innovative technology and excellent services

Market analysis and preparation of new

thin film deals Sales

Increased R&D efforts for high efficiency/low cost

CIGS production technology

Further improvement of technology and solutions for specific/niche markets

Improving crucial equipment for smooth production

processR&D

approx. –15m € EBIT (conservative approach: no sales of

CIGS line planned)approx. 5m € EBIT

approx. –25m € EBIT (conservative approach: no sales of

CIGS line planned)Finance


Future technology portfolio of the business unit “Thin film module”

Thin film module

In discussion:

Production of CIGS implemented metrology

(Thin film Metrology)

Turnkey line for solar module production including technology and ramp-up

CIGS Turnkey

50 MW - Line

100 MW - Line

Equipment for deposition and further processing of absorber layer as well as thin film electrodes

Special Equipment

CT Sulfur-Equipment

CT Se Inline Deposition

Combination of sputter and selenization equipment for CIGS absorber +(contact) layer deposition

CIGS Equipment

FHR Sputter-EquipmentCT Selenium-Equipment

Balanced product portfolio creates cross-selling opportunities

CT Annealing Furnaces


Successful product launches of H1: Solar cell & Module

Pre coating system

Silicon nitride pre coating of process boats Increased production throughput by 4 – 6 % PECVD processes for R&D processes Fully automated process

Laser system

Selective emitter generation Laser diffusion Masking layer ablation

Selective Emitter Technology (Premium)

Oxidation (Masking layer) Laser ablation Laser damage etching Improved efficiency

Selective EmitterTechnology (Base)

Laser diffusion with P-Glassas source Simple process sequence Low Capex No melting of surface Improved efficiency


Significant innovations in Silicon & Wafer provide considerable progress on the cost roadmap

24 Pair CVD Reactor

High purity polysilicon production Low Energy consumption

of 60 kWh/kg Future increase of capacity possible Modern calculation and simulation

methods such as Computational Fluid Dynamics (CFD)

High PressureSTC-TCS Converter

Low energy consumption Improved conversion efficiency High operation pressure Increased throughput Environmentally friendly closed

loop polysilicon production

Contents


Silicon & Wafer

Solar cell & Module

Thin film module

Semiconductor


Market analysis shows that current trends are strongly driving our business

Detailed analysis of investment behavior of our customers shows:

Trend 1: Undamped growth of 20-30% yoy and less dependence on few national markets

Trend 2: Continuous cost pressure in PV industry

Trend 3: Ramp-Up time & high-efficiency technology as key success factor for producers

Trend 4: New entrants with large-scale projects (400-500 MW)

Trend 5: Premium cost leaders are committed to centrotherm


0

5

10

15

20

25

30

35 CAGR +28%

2014

32

2013

27

2012

21

Installed PV [GW]

2011

15

2010

12

2009

8

2008

6

2007

3

EuropeNorth AmericaAsiaRest of World

Sources: EuPD research, Sarasin Bank, centrotherm photovoltaics

CAGR +52%

Trend 1: Decreasing dependence on a few national markets: Market internationalisation is expected in the next years


Trend 2: Module market for 2010 soaring – pressure on cost structure at least remaining high in 2011

End market:

Current system prices still allow attractive project returns large volume for Germany expected (> 6 GW) in 2010

Most probably Germany will remain leading PV market in 2011, however other countries (USA, China, Italy …) will add more and more to the increasing global demand

Production:

USD/€-exchange rate puts considerable pressure even on low-cost producers, despite slightly increasing price environment for wafers, cells and modules (~ 5 %)

Producers currently are running at high utilization rates to serve global demand; ensuing ramp-up of capacity will lead to a downward price cycle for modules and rising cost pressure in 2011

Significant expansions of cost-leading producers driving our single-equipment business strongly

Main question: Can producers lower their costs?


0

1

2

3

4

H2 2010

1.52

2.79

2011

1.22

2.38

H1 2010

3.29

1.89

-3%

1.1.10 1.1.121.1.111.10.101.7.10

-13%

-14%

Degression rates for high installation volumes in 2010 > 6.5 GW (100 kW – 1000 kW)

-7% to -14%

Margins

Manufacturer ASPBOS

To achieve 8% project return, the required system price needs to be:

Req

uire

d sy

stem

pric

e (€

/Wp)

Trend 2: Additional pressure through FiT-degression in Germany: Producers will have to lower their costs


Trend 3: Customers focus on Ramp-Up time and high-efficiency technology

Ramp-Up & project lead timeRamp-Up & project lead time

High efficiencyHigh efficiency

2007: PECVD 30 MW with throughput of 1,100 wafers/hour and 15.5% efficiency

2010: PECVD 60 MW with throughput of 2,000 wafers/hour and 17% efficiency (mc-Si)

2007: Project lead time for 30 MW turnkey production line (e.g. Helios) at 20 months

2010: Project lead time for 100 MW turnkey production line (e.g. LG Electronics) at 12 months


Trend 4: Initial turnkey projects today start with > 400 MW


Trend 5: Premium-costleaders are committed to centrotherm

Quelle: VLSI Research 2010

Contents

1. Highlights2. Recent developments3. Market trends4. Financials

Silicon & Wafer

Solar cell & Module

Thin film module

Semiconductor


Order book: 864.0

Financial overview

6M 2010 Q2 2010

Sales 278.3 163.0

EBIT 33.9 24.0

EBIT margin 12.2% 14.7%

Group SegmentsSilicon & Wafer

Solar cell & Module

Thin film module

6M 2010 Q2 2010Sales 90.7 47.4

EBIT 7.8 0.8


6M 2010 Q2 2010Sales 7.2 3.5

EBIT -16.2 -7.3

EBIT margin -223.1% -211.5%

6M 2010 Q2 2010Sales 180.3 112.2

EBIT 42.2 30.6


Order intake 353.3 275.3

30.06.2010

* Cash & cash equivalentsAll figures in million EUR

Cash:* 194.8

ROCE: 26.5%

Equity ratio: 49.2%


Ongoing positive trend in margins quarter-on-quarter

0

5

10

15

EBIT margin in % of sales

EBIT in million EUR

30

20

10

0Q2 2010

24.0

14.7%

Q1 2010

9.8

Q4 2009

1.71.3%

8.5%


Asia238.2 (85.6%)

Germany16.6 (6.0%)

Rest of Europe19.6 (7.0%)

Rest of World3.9 (1.4%)

Total: 278.3

Asia main growth driver

Breakdown 6M 2010 by regions

Turnkey production

lines34.9 (12.5%)

Single equipment

228.9 (82.2%)

Service & Replacement

parts9.5 (3.4%)

Other1.2 (0.5%)

Total: 278.3

Consulting & Engineering

3.8 (1.4%)

Breakdown 6M 2010 by products

Sales development

+5.4%

in million EUR in million EUR

278.3264.1

0

200

400

600

6M 20106M 2009

in m

illio

n EU

R


Significant reduction in material expenses

Material expenses Personnel expenses

0

50

100

150

200

250

300

0

10

20

30

40

50

60

70

80%

6M 2010

162.0

58.2%

6M 2009

175.4

0

10

20

30

40

50

60

0

2

4

6

8

10

12

14%

6M 2010

37.3

13.4%

6M 2009

30.7

11.6%66.4%

in m

illio

n EU

R

Mat

eria

l exp

ense

s ra

tio*

in m

illio

n EU

R

Pers

onne

l exp

ense

s ra

tio*

*referring to sales


High business volume driving other operating expenses

Other operating expenses Breakdown by cost category

0

5

10

15

20%

80

60

40

20

100

06M 2010

52.6

18.9%

6M 2009

32.5

12.3%

in m

illio

n EU

R

Oth

er o

pera

ting

expe

nses

ratio

*

*referring to sales

01.01.- 01.01.-in million EUR 30.06.2010 30.06.2009Management services 3.8 5.3

Travel expenses 4.8 4.2

Freight and packaging 5.5 3.5

Other services 7.9 2.8

Insurance and contributions 0.8 1.1

Legal and general consultancy 2.9 1.4

Sales commissions 7.1 2.2

Research and development 0.9 0.7

Premises expenses 1.9 1.4

Advertising costs 1.4 1.2Write-downs to trade receivables and receivables relating to production orders 5.0 1.0

Bank charges 1.0 1.2

Guarantee 0.4 0.3

Passenger vehicle costs 0.6 0.5

Foreign-exchange losses 0.4 0.1

Employee benefit costs 1.1 0.8

Telephone and communication 0.7 0.4

Write-downs to inventories 0.2 0.0

Miscellaneous 6.2 4.2

Total 52.6 32.5


Strong increase in EBITDA and EBIT

EBITDA EBIT

0

2

4

6

8

10

12

14

16

18%

60

40

20

06M 2010

45.9

16.5%

6M 2009

35.8

0

2

4

6

8

10

12

14%Mio. €

60

40

20

06M 2010

33.9

12.2%

6M 2009

25.8

9.8%13.5%

in m

illio

n EU

R

EBIT

mar

gin*

EBIT

DA

mar

gin*

*referring to sales

in m

illio

n EU

R


Rise in net income and earnings per share

Consolidated net income Earnings per share

0

5

10

15

20

25

30

0

1

2

3

4

5

6

7

8

9%

6M 2010

22.9

8.2%

6M 2009

17.7

6.7%1.08

6M 2009

0.840.8

0.6

0.4

0.2

1.2

1.0

0.06M 2010

*referring to sales

in m

illio

n EU

R

Con

solid

ated

net

inco

me

mar

gin*

in E

UR

+29.1%


Excellent margin development in Solar cell & Module segment

17.1%

17.1%

in m

illio

n EU

R

17.1% 13.3%

26.6%

-196.5%

8.6%

23.4%

-223.1%

EBITDASales EBIT-14.2 -16.2

7.812.1

90.7

42.248.0

180.3

7.2

Silicon & WaferSolar cell & ModuleThin film module

Segment development 6M 2010

Solar cell & Module: including semiconductor

Margins refer to sales


Silicon & Wafer: Sales and EBIT increased

6M 2009 6M 2010

90.779.9

10.8+13.6%

8.6%6.6%

0%

10%

20%

30%

40%

6M 2009 6M 2010

7.8

5.3

2.5

Sales EBIT

in m

illio

n EU

R

in m

illio

n EU

R

Margin (referring to sales)


Solar cell & Module: Record margin level achieved

6M 2010

180.3157.5

22.8+14.5%

14.9%

23.4%

0%

10%

20%

30%

40%

50%

6M 2009 6M 2010

42.2

23.4

18.8

Sales EBIT

Solar cell & Module: including semiconductor

6M 2009


in m

illio

n EU

R

in m

illio

n EU

R


7.2

26.8

-19.6-73.0%

-10.7%

-223.1%-230%

-180%

-130%

-80%

-30%

-16.2

-2.9

-13.3

Thin film module: Figures reflect investments in CIGS

Sales EBIT

6M 2009


6M 2010 6M 2009 6M 2010

in m

illio

n EU

R

in m

illio

n EU

R


746.9Total Assets

746.9Total Equity and Liabilities

740.3Total Assets

740.3Total Equity and Liabilities

Equity ratio: 49.2%

Liquidity: EUR 194.8 million

thereof: Goodwill 129.3

Current assets433.9 (58.6%)

Non-current assets: 306.3 (41.4%)

Equity: 344.4 (46.5%)

Non-current liabilities: 72.2 (9.8%)

Current liabilities: 323.6 (43.7%)

thereof: Advance payments received118.3

thereof: Goodwill 129.3

thereof: Securities 30.8

Cash and cash equivalents 164.0

Current assets431.4 (57.8%)

Non-current assets: 315.5 (42.2%)

Equity: 367.5 (49.2%)

Non-current liabilities: 79.2 (10.6%)

Current liabilities: 300.2 (40.2%)

thereof: Advance payments received110.9

Balance sheet as of June 30, 2010

Balance sheet: High liquidity position

Balance sheet as of December 31, 2009

thereof: Securities 34.4

Cash and cash equivalents 133.8

in million EUR in million EUR


30.2

-37.5-40

-30

-20

-10

0

10

20

30

40

Cash flow: Sound increase in operating & total cash flow

9.2

0.00

5

10

15

20

6M 2009 6M 2010

33.125.8

4.84.3

-33.5

5.7

-50

-40

-30

-20

-10

0

10

20

30

40

50

Total cash flow

Cash flow from operating activities Cash flow from investing activities

Cash flow from financing activities

NWC = Changes in Net Working Capital

EBT = Earnings Before Taxes

6M 20106M 2009

in m

illio

n EU

Rin

mill

ion

EUR

in m

illio

n EU

Rin

mill

ion

EUR

Other reconciliation effects

Net investments

Sale of securities

6M 2009 6M 2010

-3.4

43.6

-26.3-27.5

-6.6

3.7

-40

-30

-20

-10

0

10

-34.1-22.6

6M 20106M 2009


Continuously focussing on R&D

1.7

4.3

1.60

1

2

3

4

5

6

7

8

9

10

11

1.2

1.4

1.4

Solar cell & Module

10.3

0.6

3.4

2.0

Silicon & Wafer

2.9

0.50.6

0.1

Thin film module

5.6

Capitalized development costs (intangible)Investments in property, plant and equipmentChanges in inventoryExpenses

in m

illio

n EU

R

Total: 18.8

(6M 2010)


Strong order book

Thin film moduleSolar cell & ModuleSilicon & Wafer

in m

illio

n EU

R 800

600

400

200

1,000

030.06.10

864.0

16.1

209.3

638.6

31.03.10

757.0

16.0

203.3

537.7

31.12.09

797.4

9.6

203.9

583.9

30.9.09

922.4

92.0

169.4

661.0

30.06.09

1,010.2

106.6

191.8

711.8

Thin film moduleSolar cell & ModuleSilicon & Wafer


Contact

centrotherm - continuing innovations

Contact: Saskia Schultz-EbertInvestor Relationscentrotherm photovoltaics AGJohannes-Schmid-Strasse 889143 BlaubeurenTel +49 (0)7344 9188-890Fax +49 (0)7344 9189-395

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