"I would like to recognise the considerable efforts of the REC ScanModule team over the last quarters to improve its cost position. Unfortunately the financial performance of the plant has remained unsatisfactory, and despite the efforts of the Glava team the prospects for long-term competitiveness of the plant are weak", says John Andersen, Jr., Executive Vice President & Group COO.
While the Glava plant will continue the production of modules at somewhat reduced capacity until the end of 2010, its closure is expected to affect approximately 300 employees, although REC has said it will take measures to support these employees in seeking new job opportunities.
The operations of REC's 180 MW solar cell plant in Narvik (Norway), will not be affected. The solar cells produced in Narvik will be used in the manufacturing of REC Peak Energy Modules, partly in REC's Singapore facility and partly through contract manufacturing arrangements. Consequently, REC expects to maintain its current capabilities for supply of modules and at the same time improve its overall cost position.
All product warranties provided by REC ScanModule AB will remain intact.
All property, plant, and equipment in REC ScanModule were written down to zero in REC's financial statement for 2009. REC expects to recognize a provision for restructuring cost, currently estimated to approximately SEK 104 million in the third quarter 2010, including termination of employment agreements and other contracts. Furthermore, based on current estimates for operations, the EBITDA for REC's Glava plant is expected to be close to zero in the fourth quarter 2010.
REC is among the world's largest producers of polysilicon and wafers for solar applications, and a rapidly growing manufacturer of solar cells and modules. Founded in Norway, REC is an international solar company, employing close to 4,000 people worldwide.
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