ersol confirms record results for 2007

Erfurt, 28 March 2008. With the publication of its audited financial statements for 2007 ersol Solar Energy AG (ersol) today confirms its preliminary revenue figures (2007: € 160.2 million, previous year: € 127.8 million). The operating result (EBIT) grew by 10.1% to € 22.3 million (previous year: € 20.3 million). Notwithstanding substantial expansion activities, in 2007 the Company thus posted the highest turnover and best operating results in its 10-year history. The EBIT margin stood at 13.9%, compared to 15.9% in the previous year. Due to the strong increase in the negative financial result (€ -8.9 million) there was a decline in the profit after taxes compared to the previous year (2007: € 8.7 million, previous year: € 12.3 million). Earnings per share – diluted by the capital increase in summer 2007 and reduced by increased expenditure for interest and currency hedging transactions – were only € 0.85. In 2006 this figure was € 1.25 and thus 47.1 % higher. A significant increase is anticipated for 2008.

Export ratio increases further

ersol generates a good portion of its revenue – 50.9 % – abroad: 28.3 % in Europe (excluding Germany), 10.9 % in China, 5.8 % each in Japan and North America and 0.1 % in other countries. Germany accounts for 49.1 % of the Company’s revenue. The export ratio was 8.1 percentage points higher in 2007 than in 2006 (42.8 %). Since ersol’s German customers in turn exported a larger portion of their module production in 2007, the indirect export share was substantially more than 50%.

Strong growth in workforce proportionate to corporate development

In the Group as a whole, at the end of last year ersol AG employed a workforce of 802. In 2007 the Group created almost 400 new jobs. It is anticipated that the 1,000 mark will be passed in the course of this year.

In the reporting year the personnel cost ratio – the share of personnel costs from wages, salaries and social security in total revenue – was 13.4%. This high ratio (2006: 10.2%) resulted from early contributions hiring for the timely satisfaction of personnel requirements in thin-film production, at the new cell plant in Arnstadt and the Wafers segment, as well as for administrative functions in the Group. Many of the new employees undergo preparatory training before starting work in the new production facilities. For the same reasons, revenue per employee fell compared to the previous year (about € 260 thousand compared to € 375 thousand). For 2008 the Company anticipates a substantial reduction in the personnel expenses ratio, as more than double the production volume is to be generated using the workforce that already existed at the end of 2007.

Business segments marked by capacity expansion

The second year of group affiliation of SRS – ersol acquired the company in February 2006 – was extremely successful, as the corporate figures show. Overall, ersol Silicon benefits from a strong global demand for its products and services; in particular with the demand for sorting and etching services being very high. Having been in business for the past eleven years, the ersol subsidiary is able to build on a very strong network and thus guarantees the ersol Group a constant supply of polysilicon, among other things.

In 2007 the ersol Wafers segment was technologically very successful: in particular, polysilicon input was reduced further against the Watt output. At the same time, the year was characterised by the significant expansion of ersol Wafers, which almost trebled its capacities by the end of 2007 from 45 MWp to 120 MWp. Complete acceptance of the production buildings and infrastructure was possible. Production began in January 2008; the site is to be expanded further by the end of the year to a capacity of 180 MWp.

2007 the ersol Solar Cells segment was characterised by the impending start of the production in Arnstadt. Cell Fab 2 was inaugurated in November in the presence of German Federal Minister of the Environment, Sigmar Gabriel. With a crystalline silicon solar cell production capacity of 100 MWp the factory has been able to significantly increase its monthly production since January 2008. By the end of 2008 this segment is to be expanded to a capacity of 120 MWp. Another focal point was the expansion at the Erfurt site: capacity here was increased in 2007 from 60 MWp to 80 MWp and is to be expanded further to 100 MWp by the end of 2008.

Thin-film activities, organised in the ersol Modules segment, are completely on schedule. An output of 20 MWp is targeted for this year. Negotiations are currently being held with further potential customers after closing of the first sales contracts. The first test series being performed together with research partner Schott Solar in the micromorphous thin-film module area are also progressing very satisfactorily.

“Our expectations for 2007 were fulfilled in many respects. On the one hand ersol has passed further milestones in the expansion of production capacity, on the other we have even exceeded our EBIT and sales targets. And that is not all: ersol has created a large number of jobs and once again set the course for the future,” Dr Claus Beneking, Chief Executive Officer of ersol, is delighted to report.


For more detailed information on the Company’s operating figures for 2007, please refer to ersol’s Annual Report 2007, published online today at:

http://www.ersol.de/en/investorrelations/reportspresentations/

Sonja Teurezbacher
Director Corporate Communications & Investor Relations
Wilhelm-Wolff-Str. 23
99099 Erfurt
Germany

Phone: +49 361 2195-1130
Fax: +49 361 2195-1133
Email: IR@ersol.de

About ersol

ersol Solar Energy AG produces and markets high-quality silicon-based Photovoltaic products. The Group comprises the segments Silicon, Wafers, Solar Cells and Modules. With sales of € 160 million in financial year 2007, the Thuringia-based company is one of the leading players in the solar industry.
Listed since 30 September 2005 on the Prime Standard of the Frankfurt Stock Exchange, the young ersol share had already been added to the TecDAX on 19 December 2005. Currently the ersol Group has more than 850 employees.
The Company’s main goal is to establish itself even more strongly as a manufacturer of high quality silicon solar cells and to account for a disproportionate slice of the anticipated growth in the photovoltaic industry. To achieve this, ersol currently focuses on technologically demanding stages of the value chain for photovoltaic plants, and in particular on the production of wafers and solar cells. There are a number of pillars to the Company’s supply of the raw material it needs, silicon. It is primarily secured by longterm delivery agreements with leading polysilicon manufacturers. In addition to this, the Company’s internal recycling capacities in the silicon area also make an important contribution. Silicon is processed in the Wafers segment. The monocrystalline wafers manufactured there are preliminary products for the manufacturing of highly-efficient silicon solar cells in the Solar Cells segment. Since early 2006 the company has been delivering a part of its solar cells for the production of solar modules to the joint venture Shanghai Electric Solar Energy Co. Ltd. (SESE) in which the ersol Group has a 35% holding. The sales of these and other photovoltaic modules are handled in part by the Modules business segment. In the future, this segment is expected to include the Company’s own module production, planned for 2009. ersol also develops silicon-saving thin-film technology in the Modules segment. For this purpose ersol has a production facility for silicon thin-film modules.

This release was published on openPR.