REC Reports Profit in Third Quarter on REC Wafer Bankruptcy
Renewable Energy Corp. (REC), the Norwegian solar-energy company, reported a profit in the third quarter after the bankruptcy of its Norwegian REC Wafer unit allowed it to “derecognize” some liabilities.
The Sandvika-based company reported net income of 408 million kroner ($71 million), versus a loss of 759 million kroner a year earlier, according to a statement released today. The company reported an 860 million kroner profit from discontinued operations, while continuing operation had a loss of 452 million kroner.
REC said last week it expected results to miss analyst estimates, with revenue from continuing operations at 1.5 billion kroner and a loss before interest, tax, depreciation and amortization of about 185 million kroner. It repeated those figure today.
“REC continues to aggressively reduce costs and improve our product quality, together with our partners we will weather the current industry turmoil and capture the opportunities that lie ahead,” said Chief Executive Officer Ole Enger.
The Norwegian company, just like European peers such as Solarworld AG (SWV), is struggling with low prices after Chinese competitors expanded just as demand slowed. Lower subsidies from governments in France, Italy and Germany have reduced sales of renewable energy components. REC shares fell to a record low 1.16 kroner yesterday, down from as high as 196 kroner in November 2007.
REC has sought to boost its finances by reducing capacity, shutting activity in Norway. The company raised 1.3 billion kroner through a share offer in July.
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