Running at full-capacity and benefiting from the weakness of remaining European module manufacturing competitors in Europe, REC Solar ASA is planning to expand capacity 1GW in 2014 and a further 300MW in 2015 to meet demand.

The company expects to  undertake module assembly line de-bottlenecking in the first quarter of 2014 at its fab in Singapore to provide a full-year PV module capacity of 940MW and a nameplate capacity of 1GW, up from 820MW at the end of 2013.

Øyvind Hasaas, CEO of REC Solar ASA said: “In order to further capitalise on the improved market conditions and to meet strong demand, we have embarked on an investment programme to increase our module manufacturing capacity to 1.0 GW by Q3 2014. In addition, we are exploring opportunities to further increase our module capacity to 1.3 GW by 2015."

The company said in a conference call to discuss fourth quarter financial results, that the recent Chinese New Year holiday period had limited its ability produce more than 940MW of modules for 2014.

The de-bottlenecking efforts would mean little additional capital expenditure would be required this year. The balance between ingot/wafer and solar cell capacity would remain roughly in balance with the module expansion plans at the facility, according to the company.

Outsourcing trend

Management noted in the call that it was already planning to expand module capacity in Singapore to 1.3GW in 2015; a decision on the expansion was expected in the second quarter of 2014.

However, the company noted that the 300MW module capacity expansion would require capital expenditure of between US$25 million to US$30 million only. The company noted that funding the expansion would come from expected cash flows and operating profits. The company was planning to remain debt free during this year.

Management said that it would source solar cells from Taiwan to meet the increase in module capacity, therefore keeping capital spending low.

The company reported that internal ingot/wafer capacity in Singapore stood at 640MW, solar cell capacity at 770MW and module capacity at 910MW, suggesting the company is already outsourcing to balance production.

REC Solar expects to increase internal wafer capacity to 840MW by the first half of 2015.

Financial results

REC Solar ASA reported fourth quarter 2013 revenue of US182.4 million, up 17% from the previous quarter. The company benefited from stable module ASPs and continued manufacturing cost reductions to generate a profit (EBITDA) of US$18.2 million, an increase of 102% from the previous quarter.

The company disclosed that its PV module profitability (EBITDA) in the quarter was US$21.1 million, up 103% from the previous quarter. PV module cash costs were reported to have decreased by 10% in 2013.

The company reported a closing cash balance at the end of 2013 of US67.2 million and no debt after the restructuring.


REC Solar ASA noted that it expected market demand for its modules to remain strong in 2014, citing the recent global market forecast by NPD Solarbuzz that installations could reach 49GW in 2014, up from around 36GW in 2013.

The company said that it expected module prices to be stable in the first quarter of 2014 but expected an overall small decline in ASPs for the year. As a result, the company would continue with manufacturing cost reductions that were expected to fall by between 8-12% in the year. The cost reductions would be made by increased conversion efficiencies and increase in scale.

Module production in the first quarter of 2014 would be around 214MW. The company did not guide revenue for the first quarter of 2014.