REC Silicon Annual Report 2019

REC Silicon Annual Report 2019 17 End use PVdemand for 2020 is expected to grow by approximately 9 percent to 132.1GWcompared to 120.7GW in 2019 (PV InfoLink – PVMarket Monthly Note – March 2020). Demand growth in 2020 is expected to be driven by increased PVdemand in China which is forecast to increase from26 percent of global PVdemand in 2019 to 36 percent of global PVdemand in 2020. Growth in PVdemand is expected to be consistent with seasonal trends. Over the longer term, analysts’ estimates of demand for PV installations indicate a balance between polysilicon supply and demand within the next 2 years. In addition, higher cost marginal producers have announced the shutdown of operations which is expected to have a material impact on the total supply of polysilicon to the solar industry. This is expected to place upward pressure on prices to encourage additional investments in polysilicon manufacturing capacity to support expected growth in the long-term demand for PV installations. The COVID-19 (novel coronavirus) outbreak could adversely impact demand for the Company’s products and disrupt supply chains which the Company relies upon to sell its products and to obtain materials and services (See note 33 to the consolidated financial statements). TARGETS The Company curtailed the operation of the FBR facility in Moses Lake as of May 15, 2019 and will not restart the FBR facility until significant positive developments in solar grade polysiliconmarkets occur. Therefore, no targets have been provided for the Solar Materials segment. The Company will continue to operate its manufacturing facility in Butte, Montana. REC Silicon targets total polysilicon production of 960MT during 2020. Semiconductor grade polysilicon production is targeted at 620MT. Silicon gas sales volumes are targeted at 3,570MT during 2020. These estimates do not reflect any estimated impacts of the Phase I trade agreement between the US and China or other developments in trade relations and their related impacts on the overall economy and on PVmarkets. The effects of additional developments in trade relations could impact demand for the Company’s products. FORWARD LOOKING STATEMENTS This report contains statements regarding the future in connection with the Group’s growth initiatives, profit figures, outlook, strategies and objectives. In particular, the section “Outlook” contains forward- looking statements regarding the Group’s expectations. All statements regarding the future are subject to inherent risks and uncertainties, and many factors can lead to actual results and developments deviating substantially fromwhat has been expressed or implied in such statements. These factors include the risk factors relating to REC Silicon’s activities described in section “Risk Factors” above. Espen Klitzing Member of the Board Jens Ulltveit-Moe Chairman of the Board RagnhildWiborg Member of the Board Tore Torvund President and CEO Inger Berg Ørstavik Member of the Board Fornebu, March 23, 2020 Board of Directors Board of Directors’ report