Norway-based silicon material manufacturer REC Silicon‘s net loss widened 112.09% year-over-year (YoY) to $52.6 million in the third quarter (Q3) 2024 from $24.8 million due to the suspension of Moses Lake and Butte Montana facility.

The company’s revenue also dropped 2.87% YoY to $33.8 million in Q3 2024 from $34.8 million.

Earnings before interest, taxes, depreciation, and amortization (EBITDA) also declined 139.88% YoY to $42.7 million in Q3 2024 from $17.8 million. The company has attributed the quarter’s loss to startup costs associated with the Moses Lake facility and weaker operational results from its Butte Montana facility.

Additionally, the company had announced the delay in qualifying Moses Lake polysilicon and shutting down operations at the Moses Lake facility. Silane shipments were also affected by the global solar module slowdown, particularly around utilization and due to trade concerns.

The company’s earnings per share (EPS) loss expanded to $0.13 in Q3 2024 from $0.06 in Q3 FY24.

9M results

In the first nine months (9M) of 2024, the company’s net loss widened 94.58% YoY to $143.8 million from $73.9 million in 9M 2023.

The company’s revenue declined 12.92% YoY to $113.6 million in 9M 2024 from $100.6 million in 9M 2023.

Its EBITDA loss also widened 127.78% YoY to $112.3 million in 9M 2024 from $49.3 million.

The company’s EPS loss also expanded YoY to $0.34 in 9M 2024 from $0.18 in 9M 2023.

In February 2024, the company announced that it would shut down its polysilicon production capacity at its Butte facility.

The semiconductor segment’s revenues were $32.8 million in the third quarter of 2024.

Total polysilicon sales volumes, including by-products, were 169MT in the third quarter of 2024. Semiconductor-grade polysilicon sales were at 108MT for both the third and second quarters of 2024. Other grade polysilicon sales volumes decreased to 61MT during the third quarter.

REC Silicon also restarted manufacturing granular polysilicon for the solar energy markets from its facility in Moses Lake, Washington, during the fourth quarter of 2023. This facility uses best-in-class proprietary Fluidized Bed Reactor (FBR) technology to produce low-cost, high-purity polysilicon for the solar industry. The Moses Lake facility has an annual capacity of 24,000MT of silane gas.

The majority of the capacity will be used to produce some 16,000 MT of monograde solar module polysilicon. The company is targeting a ramp to 100% operation during Q4 2024.

Outlook

REC Silicon CEO Kurt Levens said, “The solar module market is right now in a bit of softness. All of the regions that we supply to are experiencing lower utilization from a production standpoint. You can see there that an operating rate of an average of 45%, which is far lower than what those rates were prior to the occurrence of these particular mechanisms, and that has a direct effect on those other markets we talked about where we ship into, although, they’re not our primary target markets, we do ship into them in order to take advantage of volume opportunities while our business grows here in the U.S. as the onshoring efforts continue.”

“In Chinese polysilicon, we do see some production decreases. They appear to be attempting to control inventory and balance their demand. There are a number of producers that are in maintenance shutdowns. By those, I mean more than ten that are in maintenance shutdowns in order to, again, try to control inventory. We are hearing about some rationalization, but I clearly — we expect that there’s going to be some rationalization in the industry.” he added.

However, in the U.S., there is an increased activity around reshoring. “There were also some additional announcements of wafer and cell capacity. Wafers drive opportunities for not just polysilicon but also cells. Wafers, for us in the materials business, is the linchpin of the solar module market. So it drives polysilicon, but it drives cell opportunities and cell opportunities drive silane demand,” added Levens.

In January 2024, REC Solar Holdings, a 100% step-down subsidiary of Reliance Industries, entered into a share purchase agreement with Norway-based Elkem to sell a 100% equity stake in REC Solar Norway for an aggregate cash consideration of ₹22 million.

In Q$, FY24, REC Silicon reported revenue of $40.5 million in the Q4 of 2023, a 28% year-over-year (YoY) rise from $31.6 million, driven by strong performance in the semiconductor business.