Solar-Fabrik AG

euro adhoc: Solar-Fabrik AG
quarterly or semiannual financial statement / Solar-Fabrik AG announces sales and net income all time high

@@start.t1@@--------------------------------------------------------------------------------   Disclosure announcement transmitted by euro adhoc. The issuer is responsible   for the content of this announcement. --------------------------------------------------------------------------------@@end@@

6-month report


Solar-Fabrik AG (ISIN: DE0006614712) concluded the first six months of 2007 with EUR 2,130 thousand earnings after tax (net result)(previous year EUR 1,670 thousand). Group sales in the first six months of 2007 were up 71% compared with the same period of the previous year, to EUR 51,335 thousand (previous year EUR 29,973 thousand). Solar-Fabrik is expecting a further sales increase from EUR 72.7 million to more than EUR 130 million for the current business year due to the continued integration of all activities along the value-added chain.

In the Wafers Division, Solar-Fabrik generated around EUR 29,450 thousand in sales in the first six months of 2007, around EUR 20,066 thousand of which were external sales. Sales for this segment thus increased by EUR 18,398 thousand over the first six months of the previous year. This corresponds to a 166 % growth rate. The segment result (= segment sales - segment expenses - depreciation) was EUR 3,751 thousand (same period of previous year: EUR 2,155 thousand). The expansion of activities of the Global Expertise Wafer Division Ltd. (GEWD Ltd.) in the areas of silicon and wafers is to be continued. An additional representative office has been opened in Shanghai (China) in order to benefit from the booming Chinese photovoltaic market. Through its daughter company GEWD Ltd. Solar-Fabrik signed a silicon supply contract with Hoku Materials, Inc. which has strategic importance. The company views securing the supply of polysilicon a central element of reaching Solar-Fabrik´s primary objective: global growth while ensuring capacity utilization across the entire value-added chain.

In the Solar Power Systems Division, Solar-Fabrik has adjusted its sales strategy to increasingly dealing with large clients. In the reporting period, sales in this segment increased by more than 15 %, from EUR 27,047 thousand in the first six months of 2006 to EUR 31,255 thousand in the first six months of this year. The large customer segment is more price-sensitive, which, as expected, has had a negative effect on the gross margin. For the first half year of 2007, group EBIT reached EUR 1,470 thousand (same period of previous year EUR 1,677 thousand). The overall result for the segment was EUR -2,323 thousand (previous year: EUR -478 thousand). Thereof, EUR -787 thousand are associated with Q2 2007, and EUR -1,536 thousand with Q1 2007. Comparing the segment result of these two quarters, the increased utilization of capacity caused the segment losses almost to be halved in Q2 2007. In spite of the price-sensitivity, the large client segment offers advantages which Solar-Fabrik considers key to the company's future development. Because of the gross margins achievable, the production of solar modules is a volume-driven business area. Based on the current business plan, Solar-Fabrik will be in a position in 2008 to sell considerably greater quantities than originally expected by servicing the large client segment. This segment can also generate business in the traditionally weak first quarter of the business year, leading to a balancing out of the quarterly results and advancing the planning reliability. The company expects that gross return will have improved by the end of the year, as sales prices will have been fixed based on order quantities, and purchasing prices are expected to continue to fall in the coming months. The positive order situation and the resulting upwards adjustment of results planning for subsequent years for this segment has led the company to clearly increase the capitalized deferred tax assets, a fact which is reflected in EUR 1,058 thousand tax income (previous year: EUR 30 thousand) for the first half of 2007. The improved results expectations should allow Solar-Fabrik to utilize tax loss carry forwards sooner and more extensively.

The company expects for the upcoming months and the future a significant increase in sales and net result. This expectation is justified by the consequent realization of the following issues:

@@start.t2@@•          100 % utilization of capacity (causing an decrease in fixed costs)
•          Further development of capacities along the value added chain
•          Further development of activities with a higher gross margin within the
value chain
•          Further efficiency improvements in the production
•          Improved supply conditions caused by increasing volumes
•          High reliability  of raw material supply
•          Diversification of the customer basis in Germany and abroad@@end@@

@@start.t3@@end of announcement                                                 euro adhoc 27.07.2007 07:30:52

ots Originaltext: Solar-Fabrik AG
Im Internet recherchierbar:

Further inquiry note:
Martin Schlenk
Tel. +49(0)761 4000 207

Branche: Alternative energy
ISIN:      DE0006614712
WKN:        661471
Börsen:  Börse Frankfurt / regulated dealing/prime standard
              Börse Berlin / free trade
              Börse Stuttgart / free trade
              Börse München / free trade

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