Wacker intends to take an impairment on fixed assets due to weak polysilicon business
Post date: 09/12/2019 - 12:29
For fiscal 2019, German Wacker Chemie AG expects to record an impairment charge of €750 million ($829 million) on the carrying amount of its production facilities for the manufacture of hyperpure polycrystalline silicon. The write-down stems from the continued absence of a recovery in solar-grade polysilicon prices due to the high overcapacity created by Chinese manufacturers. The exact amount of this depreciation will be determined when the annual financial statements are prepared.
»The expected solar-market recovery has not yet materialized and prices are still very low for polysilicon used in photovoltaic applications,« said Wacker’s CFO, Tobias Ohler. »At the same time, we only have limited visibility at present of how the market will develop.« China’s construction of new solar installations fell short of initial expectations. According to the company, the Chinese government is subsidizing the polysilicon production capacity »not only with loans and incentives, but also by providing polysilicon producers with coal-generated electricity at extremely favorable prices. We have adjusted our projections for the coming year accordingly.«