Renewable Energy Corp. ASA, the largest maker of polysilicon used in solar panels, said third- quarter profit soared on a 30 percent jump in sales and a gain from derivatives.
Net income climbed to 1.25 billion kroner ($189 million), or 2.52 kroner a share, from 25 million kroner, or 0.05 krone, a year earlier, the Hovik, Norway-based company said today in a statement. That beat the 407 million-krone median estimate of nine analysts surveyed by Bloomberg.
The company, known as REC, is expanding production at all its business units, including wafers, cells and modules for the solar industry, to exploit demand for energy that doesn't emit carbon dioxide, a gas blamed for global warming. Its biggest shareholders are Norwegian consumer and industrial goods maker Orkla ASA and Germany's Q-Cells AG.
“The long-term market demand and outlook for solar remains strong,'' REC said in the statement. “However, the current financial turmoil is likely to impact short and medium term availability of financing and could therefore also impact demand for solar.''
REC is monitoring the situation and will take “relevant actions'' to respond to market changes, which could include restructuring of capital spending programs and “optimizing liquid funds and credit facilities,'' the company said.
Chief Executive Officer Erik Thorsen said earlier this month REC is “fully financed'' on its expansion projects.
Financial Items
The company reported net financial items of 1.22 million kroner, including a positive effect of 1.21 million kroner on so- called embedded derivatives. In the year-earlier quarter, net financial items were a negative 438 million kroner, including a loss on embedded derivatives of 394 million kroner.
Sales rose to 1.92 billion kroner, missing the average 2.02 billion-kroner analyst estimate, according to the survey.
REC Solar, which makes solar cells in Norway and Sweden, lowered its 2008 revenue forecast to 2.6 billion kroner from a previous projection of between 2.7 billion kroner and 2.85 billion kroner.
REC Solar, whose production from new capacity is behind schedule, reduced its output targets for this year, as did REC Wafer, which makes solar-cell wafers in Norway. REC Silicon reiterated a production target of 6,600 metric tons of polysilicon for 2008, according to the statement.
“Overall growth for the REC Group has been hampered by lower volumes of high-quality polysilicon this year,'' the company said.
