pv crystalox solar plc interim report 2011 crystalox solar plc...02 pv crystalox solar plc interim...

PV Crystalox Solar PLCInterim Report 2011

Thekeytosolarpower

About PV Crystalox Solar PLCPV Crystalox Solar is a highly specialised supplier to the world’s leading solar cell manufacturers, producing multicrystalline silicon wafers for use in solar electricity generation systems.

Our customers, the world’s leading solar cell producers, incorporate these wafers into solar modules to harness the clean, silent and renewable power fromthesun.Weareplayingacentralroleinmakingsolarpowercostcompetitive with conventional hydrocarbon power generation and, as such, continuetoseektodrivedownthecostofproductionwhilstincreasingsolar cell efficiency.

The Group’s own polysilicon plant is in Bitterfeld, Germany. The Group manufactures silicon ingots in Oxfordshire, United Kingdom, and carries out wafer production for European customers at its facilities in Erfurt, Germany.WafersforcustomersinAsiaareproducedinJapan.

Visitournewwebsitewww.pvcrystalox.com

01PV Crystalox Solar PLC Interim Report 2011

Overview:

Highlights

Financial statementsOverviewOverview of results

•Wafershipmentvolumeincreasedby23%to204MW(H12010:165MW)

•Revenuesupby16%to€129.6million(H12010:€111.7million)

•EBITupby161%to€24.3million(H12010:€9.3million)

•Netcashpositionat30June2011of€41.3million(31December2010:€54.8million)

Progress against strategic objectives•IncreasinglydiversegeographicalcustomerbasewithmajorPVcompanies

•10%reductioninaveragewaferproductioncostinH12011

•BitterfeldtoachievenameplateproductioncapabilityinH22011

Outlook •Recentpricingpressuresexpectedtopersist

•Increaseddemandexpectedinanumberofsignificantmarkets,particularlyChina,JapanandtheUS

Overview IFC About PV Crystalox Solar PLC 01 Highlights 02 Chairman and Chief Executive’s

joint statement

Financial statements 05 Statement of directors’ responsibilities 06 Condensed consolidated statement

of comprehensive income 07 Condensed consolidated

balance sheet 08 Condensed consolidated statement

of changes in equity 09 Condensed consolidated

cash flow statement 10 Notes to the condensed

consolidated interim financial statements

IBC Officers

Revenues

€129.6mH1 2010: €111.7m

Net Cash (cash less external loans)

€41.3m31 December 2010: €54.8m

EBIT (earnings before interest and taxation)

€24.3mH1 2010: €9.3m

Operating cash flow

€18.1mH1 2010: €6.4m

02 PV Crystalox Solar PLC Interim Report 2011

Overview:

Chairman and Chief Executive’s joint statement

Overview and strategic update TheGroupachievedacreditableoperationalperformanceinthefirsthalfof2011,despiteadeterioratingmarketenvironmentinthelattermonths,withrevenuesup16%onthepreviousyear.DemandforourwaferscontinuedtobestrongduringthefirstfourmonthsoftheyearandalthoughdemandweakenedduringMayandJune,shipmentvolumesforthefirsthalfof2011totalled204MW,a23%increaseonthe165MWshippedinthesameperiodin2010.Ouraveragesalesprice(ASP)duringthefirsthalfyearwasapproximately6%belowthatreportedforH12010buttheimpactonmarginswasoffsetbytheacceleratedprogressinourwaferingandinternalpolysiliconproductioncostreductionprogrammes.

PVend-marketdemandduringH12011hasbeenmuchweakerthaninitialindustryforecastsparticularlyinthetwokeymarketsofGermanyandItaly.ArecentannouncementfromtheGermanEnvironmentministryconfirmedthatPVinstallationsinGermany,thelargestglobalmarket,wereonly1.1GWduringthefirstfivemonthsoftheyearwhichisapproximatelyhalfthelevelinstalledinthesameperiodin2010.Uncertaintyduetodelaysinfinalisingrevisions

tofeedintariffs(FIT)frozedemandinItalyinthefirsthalfoftheyearalthoughrecoveryofthemarketisexpectedfollowingtheannouncementinMayandsubsequentclarificationsinlateJuly.Asaresultofsluggishgrowthinthesetwokeymarkets,spotpricingofwafersandmodulesreducedfromQ12011levelsby45%and25%respectivelyduringMayandJunebuthasnowstabilised.

TheGroupcontinuestomakegoodprogressinexpandingitsgeographicalreachandbroadeningitscustomerbase.ShipmentstocustomersinAsiareached80%oftotalvolumesandarebroadlybalancedbetweenJapan,TaiwanandChina,witheachaccountingforinexcessof25%.

Operational updateTheexpansionoftheGroup’singotproductioncapacityto535MWwascompletedonscheduleandwithinbudget.ThenextphaseofexpansionwhichstartedinDecember2010isontrackforcompletionbyearly2012,withacapitalexpenditureof€10million.Withassociatedproductivityimprovementsthecapacitywillreach750MWatcompletionratherthantheoriginallyplanned670MW.Furthercapacityexpansiontoreach1GWwilldependonmarketconditions.

Left:MaartenHendersonRight:DrIainDorrity

Summary:• InH12011wehaveincreasedshipments

and delivered a strong improvement in profitability

• Achievedgoodprogressagainststrategicobjectives, including diversifying our customer base, reducing costs and expanding capacity

• Industryvolumesareexpectedtopickupin H2 2011 but the pricing pressure seen recently is persisting


OverviewFinancial statementsTheGroupcontinuestomakegood

progresswithitsinternalpolysiliconproductionfacilityinBitterfeld.ProductionhasrampedupsteadilysinceoperationstartedinJuly2009andwehaveachievedanannualisedoutputaveraging1,475MTduringthefirstfivemonthsof2011,priortothescheduledmaintenanceshutdowninJune.Followingsomeimprovementstotheplantduringtheshutdown,thefacilityisexpectedtooperateatitsnameplatecapacityof1,800MTduringthesecondhalfof2011.AtthesametimeproductioncostshavebeenfallingandsinceAugust2010thefullyloadedproductioncosthasbeenbelowtheaveragepriceofourcontractedpolysiliconfromexternalsuppliers.Increasingly,ourinternalpolysiliconwillbecomeasignificantdriverofourfutureprofitabilityasfurthercostreductionisexpectedwhenwereachfullcapacity.

Financial review and positionSalesvolumeswere23%higherinthefirsthalfthaninthesameperiodin2010althoughtheimpactwastemperedbyaveragesellingpricesbeing6.2%lower.Theneteffectwasthatsalesrevenueswere16%higherthanlastyearat€129.6million(H12010:€111.7million).Salesvolumesandpricinghadbeeninline

withexpectationsuntilMaywhentherewasafall-offindemandandsignificantpricingpressure.

TheGroupgeneratedEBITat€24.3millionwhichwasanincreaseof161%abovethatforH12010of€9.3million.Thiswasachievedinspiteofaninventorywritedownof€4.4milliontoequateinventoryvaluationswithmarketpriceexpectationforQ32011.Thiswasamelioratedbyanaccelerationofourcostreductionprogrammeinthefirsthalfof2011.TheGroup’smanagementisconfidentthatfurthercostreductionsof5%to10%willbeachievedinthesecondhalfoftheyear.

TheGrouphadanetpositivecashbalanceof€41.3millionwhichwasdownonthe€54.8millionattheendof2010.TheGrouphadinvested€14.9million(netofgrants)incapitalequipmentinH12011.Workingcapitalhadincreasedby€7.6million,mainlyduetohigherinventoriesattheendoftheperiodfollowinglowerthanexpectedsalesvolumesinJune.Inaddition,theGrouphadpaidthe2010finaldividendof€8.1millioninJune.ThiscashpositionremainsacompetitiveadvantageoftheGroupand,despitethedifficulttrading

conditionsanticipatedinthesecondhalf,theGroupexpectstoretainahealthycashpositionthroughtotheyearend.

DividendInviewofthecurrentlychallengingmarketconditions,theBoardhasdecidednottodeclareadividend.TheBoardcontinuestorecognisetheimportanceofdividendstoshareholdersandthedirectorswillreviewthepotentialtore-instatedividendsbasedonthefutureperformanceandprospectsoftheGroup.

Risk factors TheprincipalrisksanduncertaintiesaffectingthebusinessactivitiesoftheGroupwereidentifiedundertheheading‘PrincipalRisksandUncertainties’intheDirectors’Reportonpages14to15ofthe2010AnnualReport,acopyofwhichisavailableontheGroup’swebsitewww.pvcrystalox.com.IntheviewoftheBoardthekeyrisksanduncertaintiesfortheremainingsixmonthsofthefinancialyearcontinuetobethosesetoutinthe2010AnnualReportalthoughtheimpactoftheovercapacityinthePVindustryismoreseverethanhadbeenanticipated.


Overview:

Chairman and Chief Executive’s joint statement continued

Market driversTheEuropeanPhotovoltaicIndustriesAssociation(EPIA)believesthemid-termmarketdriversforthePVindustrycontinuetobepositiveandexpectsglobalPVinstallationstogrowto44GWin2015.Forthepastdecade,EuropehasplayedadominantroleinthegrowthofthePVmarketandalthoughthereisnowuncertaintyoverthepathofEuropeanincentives,industrypricingandregulatoryconstraints,theEUmaintainsitscommitmenttomeetingits2020climatechangegoalsandboostingtheshareofrenewablesinthetotalenergymixto20%.

AsiaPacificphotovoltaicmarketsaresettogrowrapidlyandareprojectedtoaccountforapproximatelyone-quarterofglobaldemandby2015,upfrom11%in2010,accordingtothelatestreportfromSolarbuzz.Thetopfivemarketsinthisregion,China,Japan,India,Australia,andSouthKorea,areexpectedtoaccountfor3.3GWofdemandin2011.

TheChinesegovernment’snewFITschemewhichwasannouncedon24July2011hasthepotentialtoincreasesolarinstallationsinthecountryby1.5GWinthenext18months.FurthermorethereisincreasingexpectationsthatChinawilldoubleits2015solargoalfrom5GWto10GWandalsoraiseits2020goalfrom20GWto50GW.

AnationalFITschemeintroducedlastyearisalsodrivingsolargrowthinJapan,withtheimpactoftheFukushimanucleardisasteraddingfurthermomentum.JapanwasthefourthlargestPVmarketintheworldin2010,doublingforasecondyearinarowandinstalling960MW,thankstothere-launchofthenationwideresidentialincentiveprogrammeandthenetFIT.FollowingtheFukushimanucleardisaster,Japansetanambitiousnewrenewableenergytargetandthecountrywillnowaimtoget10%ofitsprimaryenergysupplyfromrenewablesby2020withseveralprominentbusinessfiguresandpoliticiansbackingalargerroleforsolar.

OutlookEnd-marketdemandisexpectedtoaccelerateduringthesecondhalfoftheyearfuelledbyarecoveryinthetwobiggestmarkets,GermanyandItaly,andstronggrowthintheUSandAsia.IndustryanalystsareforecastingthatglobalPVinstallationswillmorethandoubleinthesecondhalfoftheyeartoreachafullyeartotalof19GWto21GW,representinggrowthof10%to20%.InthelongertermtheEPIApolicydrivenforecastpredictsinstallationsof44GWin2015.

Neverthelessthecurrentsupplysituationandpricingpressurewillmeanthattradingconditionsareexpectedtoremainchallenginginthecomingperiod.Asnotedinourtradingupdateon28June2011,theincreasingproductioncapacityinthePVindustryandhighinventories

haveresultedinseverepriceerosionacrossallpartsofthevaluechain,sofarwiththeexceptionofpolysilicon.Giventhesedynamics,theGroupiscurrentlyoperatingatbelowbreakevenlevelandtheGroupislikelytoincuranoperatinglossinthesecondhalf.Fullyearshipmentvolumesareexpectedtobeintherange400MWto450MW.

TheGroupistakingactiontoaddressthedifficultmarketenvironmentbyworkingtoobtainmoresustainablewaferASPsandtorealisereductionsinsupplierprices.Furthermore,theGroupisacceleratingitscostreductionprogrammestodecreasethecostofitsinternalpolysilicon,enhanceingotcrystalqualityandintroducealowercostwaferproductiontechnology.WiththeseprogrammesreachingcompletionandthepotentialforsubstantialmarketgrowththeGrouplooksforwardtoareturntomorefavourabletradingconditions.

Maarten HendersonChairman

Dr Iain DorrityChief Executive Officer17August2011


OverviewFinancial statements

Financial statements:

Statement of directors’ responsibilities

ThedirectorsconfirmthatthiscondensedsetoffinancialstatementshasbeenpreparedinaccordancewithIAS34‘InterimFinancialReporting’asadoptedbytheEuropeanUnionandthatthisInterimReportincludesafairreviewoftheinformationrequiredbytheDisclosureandTransparencyRulesoftheFinancialServicesAuthority,paragraphsDTR4.2.7andDTR4.2.8.

ThedirectorsofPVCrystaloxSolarPLCarelistedattheendofthisInterimReportandtheirbiographiesareincludedinthePVCrystaloxSolarAnnualReportfortheyearended31December2010.

ByorderoftheBoard

Dr Peter FinneganChief Financial Officer17August2011



Condensed consolidated statement of comprehensive incomefor the six months ended 30 June 2011

Six months Six months Year ended ended ended 30 June 30 June 31 December 2011 2010 2010 Notes €’000 €’000 €’000

Revenues 4 129,593 111,653 252,559Otherincome 2,582 1,715 3,459

Cost of material and services: Costofmaterial 5 (79,280) (73,088) (162,272)Costofservices (10,383) (9,126) (20,479)

Personnel expenses: Wagesandsalaries (7,344) (6,658) (13,660)Socialsecuritycosts (1,210) (1,004) (2,090)Pensioncosts (262) (258) (476)Employeeshareschemes 6 (311) (600) (1,047)

Depreciationonproperty,plantandequipmentandintangibleassets (7,580) (6,323) (13,096)Otherexpenses (5,181) (3,916) (8,373)

Currencygainsand(losses) 3,719 (3,083) (1,176)

Earnings before interest and taxes (EBIT) 24,343 9,312 33,349Interestincome 452 463 1,061Interestexpense (190) (320) (684)

Earnings before taxes (EBT) 24,605 9,455 33,726Incometaxes 7 (6,200) (2,803) (10,462)

Profit attributable to equity holders of the parent 18,405 6,652 23,264

Other comprehensive income Exchangedifferencesontranslatingforeignoperations (10,396) 21,347 12,551

Total comprehensive income Attributabletoequityholdersoftheparent 8,009 27,999 35,815

Earnings per share on continuing activities: BasicinEurocents 8 4.5 1.6 5.7DilutedinEurocents 8 4.5 1.6 5.7

AlloftheactivitiesoftheGroupareclassedascontinuing.

Theaccompanyingnotesformanintegralpartofthesefinancialstatements.



Condensed consolidated balance sheetas at 30 June 2011

As at As at As at 30 June 30 June 31 December 2011 2010 2010 Note €’000 €’000 €’000

Cashandcashequivalents 83,856 132,645 101,300Accountsreceivable 46,679 58,460 55,807Inventories 66,993 43,738 50,813Prepaidexpensesandotherassets 17,757 17,965 24,929Currenttaxassets — 1,732 —

Total current assets 215,285 254,540 232,849

Intangibleassets 593 716 668Property,plantandequipment 9 138,481 120,387 129,509Otherlong-termassets 42,322 16,428 36,757Deferredtaxasset 15,087 11,311 12,080

Total non-current assets 196,483 148,842 179,014

Total assets 411,768 403,382 411,863

Loanspayableshort-term 42,534 55,518 46,462Accountspayable 25,512 11,132 23,129Deferredrevenue 20,006 10,036 10,084Accruedexpenses 5,613 3,737 4,837Provisions 301 356 315Deferredgrantsandsubsidies 2,798 2,598 2,867Incometaxpayable 9,070 5,507 6,764Othercurrentliabilities 1,037 1,474 900

Total current liabilities 106,871 90,358 95,358

Deferredrevenue — 11,919 10,562Accruedexpenses 108 62 98Pensionbenefitobligation — 124 62Deferredgrantsandsubsidies 23,169 23,692 24,156Deferredtaxliability 640 89 825Otherlong-termliabilities 43 43 42

Total non-current liabilities 23,960 35,929 35,745

Total liabilities 130,831 126,287 131,103

Sharecapital 12,332 12,332 12,332Sharepremium 75,607 75,607 75,607Investmentinownshares (8,640) (9,482) (8,640)Share-basedpaymentreserve 550 2,890 262Reverseacquisitionreserve (3,601) (3,601) (3,601)Retainedearnings 237,392 212,860 227,107Currencytranslationadjustment (32,703) (13,511) (22,307)

Total shareholders’ equity 280,937 277,095 280,760

Total liabilities and shareholders’ equity 411,768 403,382 411,863



Condensed consolidated statement of changes in equityfor the six months ended 30 June 2011

Investment Share- in own based Reverse Currency Share Share shares payment acquisition Retained translation Total capital premium (EBT) reserve reserve profit adjustment equity €’000 €’000 €’000 €’000 €’000 €’000 €’000 €’000

As at 1 January 2011 12,332 75,607 (8,640) 262 (3,601) 227,107 (22,307) 280,760Dividendspaid — — — — — (8,120) — (8,120)Share-basedpaymentcharge — — — 288 — — — 288

Transactions with owners 12,332 75,607 (8,640) 550 (3,601) 218,987 (22,307) 272,928

Profit for the period — — — — — 18,405 — 18,405Currencytranslationadjustment — — — — — — (10,396) (10,396)

Total comprehensive income — — — — — 18,405 (10,396) 8,009

As at 30 June 2011 12,332 75,607 (8,640) 550 (3,601) 237,392 (32,703) 280,937

As at 1 January 2010 12,332 75,607 (5,642) 2,021 (3,601) 214,301 (34,858) 260,160

Dividendspaid — — — — — (8,093) — (8,093)Investmentinownshares — — (3,840) — — — — (3,840)Share-basedpaymentcharge — — — 869 — — — 869

Transactions with owners 12,332 75,607 (9,482) 2,890 (3,601) 206,208 (34,858) 249,096

Profit for the period — — — — — 6,652 — 6,652Currencytranslationadjustment — — — — — — 21,347 21,347

Total comprehensive income — — — — — 6,652 21,347 27,999

As at 30 June 2010 12,332 75,607 (9,482) 2,890 (3,601) 212,860 (13,511) 277,095



Condensed consolidated cash flow statementfor the six months ended 30 June 2011

Six months Six months Year ended ended ended 30 June 30 June 31 December 2011 2010 2010 €’000 €’000 €’000

Earnings before taxes 24,605 9,455 33,726Adjustments for: Interest (262) (143) (377)Depreciationandamortisation 7,580 6,323 13,096Changeinpensionaccruals (62) (67) (129)Changeinotheraccruals 773 (245) 849Profit/(loss)fromthedisposalofproperty,plantandequipment 3 (3) 60Unrealisedlosses/(gain)inforeigncurrencyexchange 1,170 381 (2,938)Deferredincome (1,448) (1,367) (2,755)

32,359 14,334 41,532

Changes in working capital Increaseininventories (17,804) (9,635) (12,633)Decreaseinaccountsreceivables 6,833 5,477 6,349Increase/(decrease)inaccountspayablesandadvancepayments 2,473 (5,212) 4,863Decrease/(increase)inotherassets 455 4,501 (21,846)Increase/(decrease)inotherliabilities 425 (876) (260)

24,741 8,589 18,005

Incometaxespaid (7,085) (3,012) (7,762)Interestreceived 452 463 1,061

Net cash from operating activities 18,108 6,040 11,304

Cash flow from investing activities Proceedsfromsaleofproperty,plantandequipment 58 4 24Proceedsfrominvestmentgrantsandsubsidies 1,543 2,127 3,304Paymentstoacquireproperty,plantandequipment (16,537) (4,406) (19,871)

Net cash flow used in investing activities (14,936) (2,275) (16,543)

Cash flow from financing activities (Repayment)/receiptofbankandotherborrowings (1,910) 18,559 11,141Dividendspaid (8,120) (8,093) (12,139)Interestpaid (190) (320) (684)Investmentinownshares — (3,840) (4,266)Share-basedpaymentreserve — 869 —

Net cash flows from financing activities (10,220) 7,175 (5,948)

Netchangeincashandcashequivalentsavailable (7,048) 10,940 (11,184)Effectsofforeignexchangeratechangesoncashandcashequivalents (10,396) 21,301 12,083

Cash and equivalents at beginning of period 101,300 100,404 100,404

Cash and equivalents at end of period 83,856 132,645 101,300

Theaccompanyingnotesformanintegralpartofthesefinancialstatements.


1. Basis of preparationThesecondensedconsolidatedinterimfinancialstatementsareforthesixmonthsended30June2011.TheyhavebeenpreparedinaccordancewithInternationalAccountingStandard(IAS)34‘InterimFinancialReporting’.TheydonotincludealltheinformationrequiredforfullannualfinancialstatementsandshouldbereadinconjunctionwiththeconsolidatedfinancialstatementsoftheGroupfortheyearended31December2010.

Thestatementshavebeenpreparedapplyingtheaccountingpoliciesandpresentationthatwereappliedinthepreparationofthe2010financialstatements.

2. Basis of consolidationTheGroupfinancialstatementsconsolidatethoseoftheGroupanditssubsidiaryundertakingsdrawnupto30June2011.SubsidiariesareentitiesoverwhichtheGrouphasthepowertocontrolthefinancialandoperatingpoliciessoastoobtainbenefitsfromitsactivities.TheGroupobtainsandexercisescontrolthroughvotingrights.Consolidationisconductedbyeliminatingtheinvestmentinthesubsidiarywiththeparent’sshareofthenetequityofthesubsidiary.

3. Functional and presentational currencyThefinancialinformationhasbeenpresentedinEuros,whichistheGroup’spresentationalcurrency.

4. Segment reportingThesegmentsaredefinedonthebasisoftheinternalorganisationalandmanagementstructureandontheinternalreportingtotheBoard.IFRS8requiresentity-widedisclosurestobemadeaboutthecountriesinwhichtheGroupearnsitsrevenuesandholdsitsassetswhichareshownbelow:

Segment information for the six months ended June 2011 The The rest of United rest of Japan China Taiwan Asia Germany Kingdom Europe USA Group €’000 €’000 €’000 €’000 €’000 €’000 €’000 €’000 €’000

Revenues –byentity’scountryofdomicile 36,959 — — — 31,787 60,847 — — 129,593

–bycountryfromwhichderived 36,940 33,467 33,416 398 18,154 64 81 7,073 129,593

Non-current assets* –byentity’scountryofdomicile 568 — — — 118,049 62,779 — — 181,396

*Excludesfinancialinstruments,deferredtaxassetspost-employmentbenefitassetsandrightsarisingunderinsurancecontracts.

Twocustomersaccountedformorethan10%ofGrouprevenueeachandsalestothesecustomersareasfollows(figuresin€’000):

• 31,544(China);and

• 28,072(Japan).


Notes to the condensed consolidated interim financial statementsfor the six months ended 30 June 2011



4. Segment reporting continuedSegment information for the six months ended June 2010 The The rest of United rest of Japan China Taiwan Asia Germany Kingdom Europe USA Group €’000 €’000 €’000 €’000 €’000 €’000 €’000 €’000 €’000

Revenues –byentity’scountryofdomicile 43,402 — — — 34,263 33,988 — — 111,653

–bycountryfromwhichderived 43,123 32,362 2,827 18,743 12,622 28 172 1,774 111,653

Non-current assets* –byentity’scountryofdomicile 726 — — — 113,945 22,860 — — 137,531

*Excludesfinancialinstruments,deferredtaxassetspost-employmentbenefitassetsandrightsarisingunderinsurancecontracts.

Fourcustomersaccountedformorethan10%ofGrouprevenueeachandsalestothesecustomersareasfollows(figuresin€’000):

• 32,054(China);

• 24,554(Japan);

• 18,741(RestofAsia);and

• 18,338(Japan).

5. Cost of materialCostofmaterialincludesaninventorywritedownof€4.4million(H12010:nil).

ThewritedownrepresentsareductioninvalueofinventoriestotheanticipatedsalespriceinQ32011(lessfutureprocessingcostswhereapplicable)ofbothfinishedgoodsandworkinprogress.

6. Employee benefit trustTheEmployeeBenefitTrust(EBT)currentlyholds10,834,000shares(2.6%)oftheissuedsharecapitalintheCompany.Itholdsthesesharesintrustforthebenefitofemployees.

7. Income taxTheaveragetaxationrateshownintheConsolidatedStatementofComprehensiveIncomeis25.2%(H12010:29.6%).

InaccordancewithIAS12theprofitelementofmaterialheldinstockattheperiodendmustbeeliminatedatthetaxrateapplicabletothecompanyholdingthestock.Thiseliminationhadadisproportionateeffectontheaveragetaxrateintheperiodended30June2011.

Theanticipatedlong-termaveragetaxrateisapproximately28%.



Notes to the condensed consolidated interim financial statements continuedfor the six months ended 30 June 2011

8. Earnings per shareThecalculationofearningspershareisbasedonaprofitaftertaxfortheperiodof€18.4million(H12010:€6.7million)andthenumberofsharesassetoutbelow: Six months Six months ended ended 30 June 30 June 2011 2010

Numberofshares 416,725,335 416,725,335AveragenumberofsharesheldbytheEBTintheperiod (10,849,345) (11,685,790)

Weightedaveragenumberofsharesforbasicearningspersharecalculation 405,875,990 405,039,545Sharesgrantedbutnotvested 27,500 2,008,000

Weightedaveragenumberofsharesforfullydilutedearningspersharecalculation 405,903,490 407,047,545

9. Property, plant and equipmentAdditionstoproperty,plantandequipmentinthesixmonthsended30June2011were€16.6million(H12010:€4.4million).

10. Dividends paid in the periodAsagreedattheAnnualGeneralMeetingheldon26May2011,theGrouppaidadividendof2.0Eurocentsperordinaryshareasshownbelow:

Ordinaryshares 416,725,335SharesheldbytheEBTwaivingdividend (10,712,907)

Sharesattractingdividend 406,012,428

Totaldividendpaidat2.0Eurocentspershare €8,120,249

11. Changes in contingent assets and liabilitiesTherewerenochangesincontingentassetsandliabilities.

12. Related party disclosuresTheGroupdefinesrelatedpartiesastheseniorexecutivesoftheGroupandalsocompaniesthatthesepersonscouldhaveamaterialinfluenceonasrelatedparties.Duringthereportingperiod,noneoftheshareholdershadcontroloveroramaterialinfluenceintheparentgroup.Allfuturetransactionswithsuchrelatedpartieswillbeconductedundernormalmarketconditions.

13. Material post balance sheet eventsTherewerenomaterialpostbalancesheetevents.

14. Approval of interim financial statementsTheunauditedinterimfinancialstatementswereapprovedbytheBoardofDirectorson17August2011.

Thefinancialinformationfortheyearended31December2010setoutinthisInterimReportdoesnotconstitutestatutoryaccountsasdefinedinSection434CompaniesAct2006.TheGroup’sstatutoryfinancialstatementsfortheyearended31December2010havebeenfiledwiththeRegistrarofCompanies.Theauditor’sreportonthosefinancialstatementswasunqualifiedanddidnotcontainstatementsunderSection498(2)orSection498(3)oftheCompaniesAct2006.

Officers

DirectorsMaartenHenderson(Chairman)DrHubertAulichDrIainDorrityDrPeterFinneganMichaelParkerJohnSleeman

Company SecretaryMatthewWethey

PV Crystalox Solar PLC BrookHouse174MiltonParkAbingdonOxfordshireOX144SE

Tel:+44(0)1235437160Fax:+44(0)1235437199

www.pvcrystalox.com

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