ErSol Solar Energy AG

euro adhoc: ErSol Solar Energy AG
Strategic management decisions
ErSol AG resolves further investment to expand its production capacity; earnings forecasts raised for 2006

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ErSol AG resolves further investment to expand its production capacity; earnings forecasts raised for 2006

At its meeting today, ErSol AG's Board of Management resolved to make further investments in the expansion of its production capacity for solar cells, in view of continued high market demand. During the current initial expansion phase, the investment of approximately EUR 16 million at the Arnstadt plant will see total wafer capacity of around 45 MWp being developed by mid-2006. This corresponds to an increase of 25 MWp. At an additional cost of approximately EUR 50 million, expansion of the company's production capacity for wafers has also already been resolved. In tandem with these measures, the Board of Management today resolved to develop additional capacity for the manufacture of solar cells at both of its plants in Erfurt and Arnstadt. The investments totalling EUR 19 million that the company had already planned will now be followed by further investment amounting to EUR 36 million. The Board of Management expects that these funds will allow it to increase its existing production capacity forecasts in the solar cells area for the end of 2007 from 110 MWp to 180 MWp. Together with its investments in thin-film module production already announced on 30 March 2006 of more than EUR 80 million, the company therefore intends to make total investments in excess of EUR 190 million in 2006 and 2007. By 2008, the company's goal is to boost its total production capacity to 220 MWp, rather than its original goal of 110 MWp.

On this basis, the Board of Management believes that the ErSol Group can achieve sales of between EUR 120 and EUR 125 million in 2006, though the benefits from this accelerated capacity development and from the investments that have been brought forward are not likely to filter through until the second half of the year. The Board of Management also anticipates that both earnings before taxes and the operating result for 2006 will be between EUR 25 and EUR 30 million. Should ErSol's figures continue this very encouraging development, the Board of Management expects that in the medium-term, it may be able to propose the distribution of a dividend to the company's General Meeting.

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ots Originaltext: ErSol Solar Energy AG
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Further inquiry note:
Sonja Teurezbacher
Investor Relations Manager
+49 (0)361 219 5130

Branche: Alternative energy
ISIN:      DE0006627532
WKN:        662753
Index:    CDAX, TecDAX
Börsen:  Frankfurter Wertpapierbörse / official dealing/prime standard

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