REC Silicon Annual Report 2019

REC Silicon Annual Report 2019 6 Board of Directors’ report 2019 HIGHLIGHTS (COMPARED TO 2018) > Cash balance of $29.4million at December 31, 2019 • Cash decrease of $2.4million in 2019 • Net proceeds from private placement of equity $19.0million • Cash outflows from operations of ($13.0) million • EBITDA loss of ($12.9) million • Working capital decrease of $20.2million • Interest payments of ($17.6) million > Revenues of $160.2million and EBITDA Loss of $12.9million • Compared to 2018 revenues of $221.2million (27.6%Decrease) • Compared to 2018 EBITDA loss $4.9million > Silicon gas sales volumes of 3,380MT • Compared to 2018 sales volumes of 3,600MT (6.1%decrease) • 3.5%Decrease in average silane gas prices > Total polysilicon sales volumes of 5,892MT • Compared to 7,784MT in 2018 (24.3%decrease) • Average prime granular polysilicon price decrease of 36.7% • Polysilicon inventory decrease of 2,783MT > Semiconductor segment polysilicon sales • Sales volumes of 1,111MT (28.4%decrease) • 9%Semiconductor grade polysilicon price increase > Successful completion of private placement of equity • Settled on May 14, 2019 • NOK 170million in gross proceeds (25,438,187 shares at NOK 6.70) > Shutdown of Moses Lake FBR facility on May 15, 2019 • Caused by the ongoing solar trade dispute between the China and the U.S. • Workforce reduction announced on July 15, 2019 • Long-term shutdown until significant positive developments in solar grade polysilicon markets occur • $20million additional impairment of assets > Process to evaluate the sale of the Butte, Montana plant is on-going • Will be sold only if an acceptable bid is received • Proceeds will be used to retire debt, provide a buffer for contingent liabilities, and to restart FBR > Phase I trade agreement between the U.S. and China • Advised by U.S. Administration that China solar grade polysilicon markets will open • Will evaluate the potential restart of FBR production BOARD OF DIRECTORS’ REPORT