Major polysilicon producer Wacker Chemie reported an 11% increase in polysilicon sales in the first quarter of 2014, compared to the same quarter a year ago as sales volume and ASPs increased, due to the strong recovery in global PV demand.

Wacker reported polysilicon sales of €262 million (US$365 million), up from €250 million (US$348.1 million) in the fourth quarter of 2013, its third successive quarter of increased revenue.

“Wacker had a good start to the new fiscal year in Q1 2014,” said Rudolf Staudigl, CEO of Wacker Chemie. “Customer demand for our products rose noticeably throughout all divisions in the first quarter. At the same time, price pressures have eased in a number of segments. Especially for solar silicon, we are seeing better prices than a year ago. Our sales and earnings trend in Q1 and our current order level are supporting our optimistic view on the coming months.”

However, polysilicon revenue was mainly boosted by another long-term supply deal being cancelled and Wacker receiving €114 million (US$158.7 million) in cancellation damages of which €32.2 million (US$44.8 million) was recorded in the first quarter of 2014, including the usual retention of unspecified advanced payments on the contract.

As a result, EBITDA increase by approximately 29% year-on-year to €180.0 million (US$250.6 million), compared with the prior year’s figure of €52.5 million (US$73.1 million). EBITDA margin was 68.7%, up 22.3%, compared to the prior year period.

Production update

Wacker continued to run its polysilicon plants at full-capacity in the first quarter and expects to remain at full-capacity in the second quarter. Wacker is effectively capacity constrained until its new polysilicon plant in the US is completed, though the company noted in its first quarter earning call that it was continuing work to increase output at existing facilities.

The company reiterated that the new polysilicon plant in Tennessee would be completed by the middle of 2015, with production ramp in the second half of 2015.

Wacker was able to ship 49,000MT of polysilicon in 2013 and expects to increase both shipments and sales in 2014, benefiting from a slight recovery in polysilicon prices.

The company expects global PV demand to be in the range of 43GW to 52GW in 2014, requiring between 250,000MW of polysilicon to as much as 300,000MT, a 14% CAGR.