Rec Silicon Asa · OSL:RECSI
Rec Silicon Asa — Q4 2022 Earnings Presentation
24 slides from Rec Silicon Asa's earnings presentation, Feb 23, 2023
Slide 1: Fourth Quarter 2022 Presentation
FOURTH QUARTER 2022 PRESENTATION 1 © REC Silicon ASA. All rights reserved. Confidential
Slide 2: Disclaimer
DISCLAIMER This presentation includes and is based, inter alia, on forward-looking information and statements that are subject to risks and uncertainties that could cause actual results to differ. These statements and this presentation are based on current expectations, estimates and projections abo
Slide 3: Agenda
AGENDA › Fourth Quarter Highlights › Financial Review › Semiconductor Materials › Solar Materials › Yulin Update › Supporting Initiatives 3 © REC Silicon ASA. All rights reserved. Confidential February 23, 2023
Slide 4: Fourth Quarter Highlights
FOURTH QUARTER HIGHLIGHTS Revenues: $ 31.6M EBITDA: ($ 23.6M) December 31, 2022 Cash Balance of $ 105.3M - Cash Decrease During Q4 2022 of ($ 26.0M) - ($ 22.2) Cash Outflows From Operating Activities - ($ 22.7M) Cash Outflows From Investing Activities - ($ 1.7M) Cash Outflows From Financing Activiti
Slide 5: Fourth Quarter Financial Review 2022
FOURTH QUARTER FINANCIAL REVIEW 2022
Slide 6: Financial Highlights
FINANCIAL HIGHLIGHTS (USD IN MILLION) Q4-22 Q4-21 2022 2021 Q3-22 Revenues $31.6M Semiconductor Materials $ 31.5 $ 43.2 $ 147.4 $ 142.8 $ 36.6 - Polysilicon Sales Volume Decrease by 22.5% vs. Q3-22 Solar Materials 0.1 0.0 0.2 0.1 0.1 - Silicon Gas Sales Volume Decrease by 12.2% vs. Q3-22 Other 0.1 0
Slide 7: Semiconductor Materials Segment Financial Performance
SEMICONDUCTOR MATERIALS SEGMENT FINANCIAL PERFORMANCE Revenues EBITDA (USD Millions) $44.9M Revenues $31.5M $43.2M - 13.9% Decrease in Revenues vs. Q3-22 $36.6M $34.5M - Polysilicon Sales Volume – 22.5% Decrease vs. Q3-22 $31.5M - Semiconductor Grade Polysilicon - Decrease by 24.5% - Polysilicon Sal
Slide 8: Cash Flows
CASH FLOWS December 31, 2022 Cash Balance $105.3M Cash Flows ($26.0M) Decrease in Cash During Q4’22 (USD Million) $170 Cash Flows From Operating Activities ($22.2M) - ($23.6M) EBITDA $150 - $10.9M Working Capital $10.9 $0.0 $5.1 - ($3.0M) Increase in Inventories $130 ($0.4) - $2.7M Decrease in Recei
Slide 9: Debt
DEBT Debt Maturity Profile (USD Million) $113.9 $105.3 USD Senior Secured Bond Nominal Debt $183.9M Lease Liabilities - ($1.7M) Decrease During Q4-22 Note - Property Tax Settlement - ($0.7M) Changes in Lease Liabilities - ($1.0M) Payment of Grant County Tax Note Nominal Net Debt $78.6M $110.0 - $39.
Slide 10: Fourth Quarter Semiconductor Materials 2022
FOURTH QUARTER SEMICONDUCTOR MATERIALS 2022
Slide 11: Silicon Gases
SILICON GASES Silicon Gas Demand Likely to Remain Soft in 1H 2023 Sales Volumes (MT) - Flat Panel Display Capacity Rationalization Outside of China and Overall Capacity Reduction for First Time in Segment History - Semiconductor Producers, Particularly Memory, are Reducing Utilization by Material Am
Slide 12: Semiconductor Grade Polysilicon
SEMICONDUCTOR GRADE POLYSILICON Semiconductor Grade Polysilicon Sales Volumes (MT) Market Demand Strong but Decline in Sales - Limited Q4 Production Due to Electricity Cost - Production Limited to Lowest Forecasted Electricity Months and the First Half of the Year - Opportunities for Production Incr
Slide 13: Butte Electricity
BUTTE ELECTRICITY Historical Monthly Electricity Price ($ per mWh) Electricity Market Overview 300.00 ‒ Montana’s Power Market has been Deregulated Since 279 1997 250.00 240 ‒ Power Market Pricing has Become Unstable Due to 200.00 Variety of Reasons ‒ Increased Short Term Demand in Specific Regions
Slide 14: DCS Expansion Update
DCS EXPANSION UPDATE Project on Pace for Late Q1 Start Up - First Customers Already Identified for Product Qualifications in H2 2023 - First Sales to Occur in H2 2023 - Project Anchored by > 50% Contract Coverage of Anticipated Capacity New Facility to Drive Future Market and Profitability Gains - 3
Slide 15: Fourth Quarter 2022
FOURTH QUARTER 2022
Slide 16: Polysilicon Market
POLYSILICON MARKET GW Installed 600 Solar Installations Had Strong Growth in 2022 - Expecting Analysts to Report Over 225GW of 500 Global Installations 400 2023 Forecasted to be Another Strong Year - Near 300GW of Installations Forecasted 300 Pricing Fluctuations This Year 200 - More Polysilicon Cap
Slide 17: FBR Offtake Binding Term Sheet
FBR OFFTAKE BINDING TERM SHEET Term Sheet - Ten (10) Year Take or Pay - Monthly Market Price by Indices - Minimum and Maximum Prices - 100% Offtake of Prime Granular Products - Prepayment for Contract Security Working on Final Supply Agreement - Mutual Support to Enhance Product Offering - Support w
Slide 18: Moses Lake Restart Update
MOSES LAKE RESTART UPDATE Projects Initiated to Achieve FBR Ultra High Purity at Full Capacity - Silane Enhancements for Improved Granular Polysilicon Quality - Fluid Bed Reactor Modifications - Handling and Packaging Improvements - Surface Powder and Hydrogen Removal - 5 - 10 kg Packaging - New Gra
Slide 19: Fourth Quarter Yulin JV Update 2022
FOURTH QUARTER YULIN JV UPDATE 2022
Slide 20: Yulin JV, China
YULIN JV, CHINA Plant Characteristics Sales Status Construction Completed in 2018 ‒ 2022 Production Sold Out Large Scale Silicon Manufacturing with Design Capacity of: ‒ Production Costs Lower Than Expected ‒ 18,000 MT FBR-B Granular Polysilicon ‒ 80,000 MT Expansion Announced in 2022 ‒ 300 MT Sieme
Slide 21: Supporting Initiatives 2022
FOURTH QUARTER SUPPORTING INITIATIVES 2022
Slide 22: Governmental Initiatives
GOVERNMENTAL INITIATIVES IRA – With SEMA - IRS Working on Production Tax Credit Process - Department of Commerce Working on 10% “Made in America” Requirements CHIPS ACT ‒ In Late February, the Department Plans to Release a Notice of Funding Opportunity for Commercial Leading-Edge, Current, and Matur
Slide 23: Financing Plan
FINANCING PLAN Capital Requirement Finalized - Moses Lake Modifications for Re-Start and Production of High Purity Granular Polysilicon for Mono PV Applications - Butte Operational and High Value Growth Investments - Bond Repayment of $ 110M in April 2023 Financing Plan - Financing Solution to Addre
Slide 24: Thank You
Thank You Q1 2023 Reporting May 11, 2023 www.recsilicon.com