BUDAPEST, Hungary, March 31 /PRNewswire-FirstCall/ -- Zoltek Companies,
Inc. and the Hungarian Government today announced their joint commitment to a
major expansion plan to turn Zoltek's facility 30 miles west of Budapest into
the world's largest carbon fiber production facility. Through the expansion,
Zoltek is committed to adding 600 new employees in Hungary over the next few
As part of the agreement, the Hungarian Government has pledged a grant of
29 billion HUF (approximately $14.5 million) to Zoltek's Hungarian subsidiary
for use in modernizing its facility, establishing a research and development
center there, and supporting a rapid buildup of manufacturing capacity for
both acrylic fiber precursor raw material and carbon fiber. By the end of
2009, Zoltek expects rated annual carbon fiber production in Hungary to reach
at least 8,000 tons (18 million pounds), compared to 800 tons (2 million
pounds) at the beginning of 2005.
"We are extremely grateful to the Hungarian Government for their generous
and steadfast support," said Zsolt Rumy, Zoltek's Chairman, President and
Chief Executive Officer. "This grant is a critical element supporting
modernization and expansion of the facility. We believe that our Hungarian
plant, in turn, will play a leading role in the production of carbon fibers
used in commercial and industrial applications in European and world markets.
Zoltek's strategic goal is to position the facility to stand at the epicenter
of the next great revolution in building materials in every important sense -
from technological as well as marketing and manufacturing perspectives."
Since becoming a public company in 1992, Zoltek has focused on a mission
of "commercializing" carbon fibers -- by reducing the cost and price of this
high-performance, space-age material and producing it in the quantities needed
to encourage widespread adoption in emerging applications. Zoltek believes
that it has been a catalyst in turning carbon fiber into the key enabling
material for achieving breakthrough levels of performance in a variety of
recently developed applications, including wind energy, ultra deepwater
drilling, the creation of super- strong but super-lightweight concrete
structures, and a new generation of extraordinarily fuel efficient cars.
In 1995, Zoltek acquired Magyar Viscosa Rt., whose principal business was
producing acrylic fiber for textile markets, in a privatization transaction
with the Hungarian Government. Since the acquisition, Zoltek has made
substantial investments to convert the operation into production of acrylic
fiber used as the precursor in Zoltek's low-cost method of manufacturing
carbon fibers. As a result, Zoltek capitalized on the opportunity to secure
an abundant future supply of low-cost raw material and a wealth of highly
skilled workers and engineering talent. Zoltek also has installed and is
operating four carbon fiber production lines in Hungary.
In 2004, Zoltek identified wind energy as the first clear "breakthrough"
non-aerospace application for carbon fibers. Zoltek has entered into long-term
strategic supply relationships with both Vestas Wind Systems AS, of Denmark,
the world's largest producer of wind turbine generators, and Gamesa Eolica, of
Pamplona, Spain, the world's second largest producer. Zoltek is supplying
both of those customers with carbon fibers produced in Hungary. In 2005 and
early 2006, key technical employees transferred from Hungary to Zoltek's
Abilene, Texas facility played a key role in re-establishing carbon fiber
production at that plant.
This press release contains forward-looking statements, which are based
upon the current expectations of the Company. Because these forward-looking
statements are inherently subject to risks and uncertainties, there are a
number of factors that could cause the Company's plans, actions and actual
results to differ materially. Among these factors are the Company's ability
to: re-activate its formerly idle manufacturing facilities on a timely and
cost-effective basis, to meet current order levels for carbon fibers;
successfully add new capacity for the production of carbon fiber and precursor
raw material; execute plans to exit its specialty products business and reduce
costs; achieve profitable operations; raise new capital and increase its
borrowing at acceptable costs; manage changes in customers' forecasted
requirements for the Company's products; continue investing in application and
market development; manufacture low-cost carbon fibers and profitably market
them; and penetrate existing, identified and emerging markets. The timing and
occurrence (or non-occurrence) of transactions and events that determine the
future effect of these factors on the Company, as well as other factors, may
be beyond the control of the Company. The Company undertakes no obligation to
update any forward-looking statement to reflect events or circumstances after
the date of this press release.
SOURCE Zoltek Companies, Inc.
Zsolt Rumy, CEO or Kevin Schott, CFO, both of Zoltek Companies, Inc., +1-314-291-5110
-0- Mar/31/2006 12:45 GMT
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