5N Plus, Inc., a major supplier of high purity cadmium telluride (CdTe) to First Solar, Inc., has reported record quarterly revenue of $18.1 million on the back of strong demand in the photovoltaics market and increases in prices. In markets other than PV, 5N Plus saw sales flat to slightly down. The materials specialist also benefited from the ramp of its new refining facility in Germany, which delivered a full quarter of revenue for the company.
“We are pleased to report the results of the second quarter of our 2009 fiscal year which has been characterized by continuing growth and record level profitability,” commented Jacques L’Écuyer, President and Chief Executive Officer. “This reflects the strong operational performance now at both of our facilities and the increasing demand for our products. In spite of the current financial world crisis, demand for our products remained strong during the quarter as we managed to increase sales and further strengthen our twelve month backlog of orders to a record level of $54,722,363 as at November 30, 2008.”
5N Plus had a backlog worth $22.2 million in the same period of 2007, highlighting an increase in backlog of over 146%.
At a cost of approximately $14 million, the new refining facility in Germany is expected to double the production of CdTe for 5N Plus and enable the company to supply in excess of 200MT of CdTe per year.
The company said that it was considering future plans to increase capacity and R&D efforts, indicating that it expects demand to remain strong, despite the current economic conditions and concern over the growth projections of the PV industry in 2009.
Update: 14th January
During the 5N Plus quarterly conference call, executives noted that First Solar accounts for 78% of sales. Current installed refining capacity of tellurium was 200MT per annum and was sufficient to meet customer demand in 2009.
Executives also noted that it estimated that it required a maximum of 25MT of tellurium to produce 200MW of thin film modules and could be as low as 5MT. Based on the higher quantity, 5N Plus could supply 1.6GW of CdTe thin film modules in 2009. First Solar has already guided capacity of 1GW is planned for 2009.
5N Plus is also building inventory. Currently the company has the equivalent of 1-years production of CdTe in storage, which has increases between 20-30% since the previous quarter.
The company noted that tellurium prices had declined slightly in response to the current global economic downturn and was taking advantage of the lower demand for the rare metal to secure further sources of supply and build further inventory.
The new facility in Germany had a capacity of 100MT per annum and was currently at 50% capacity. Executives noted that further capacity expansions were not expected in the short-term and that to double capacity from the current 200MT capability would only require approximately $5 million investment.
The company also noted that improvements in capacity and production costs could be achieved without expansion due to continual focus on manufacturing improvements in 2009.