LONDON (Alliance News) - PV Crystalox Solar PLC on Wednesday said it has opted to extend the period of its strategic review in light of "recent positive developments" in the photovoltaic - or solar power - market.
The company noted that market conditions have been "extremely challenging" for several years, with overcapacity depressing prices. However, the spot price for the company's primary product, wafers, has shown some "modest recovery" in recent months. Additionally the price of the company's key raw material, polysilicon, has fallen to "historical lows" and is still in decline.
This means that wafer prices now exceed the company's cash cost of production, and as the company has a significant polysilicon inventory, converting this inventory into wafers is now more favourable then selling it at market prices.
PV Crystalox has one outstanding long-term sales contract, but the customer has failed to buy wafers in line with obligations. As the company has not been able to negotiate a "mutually acceptable agreement" with this customer, it has now filed arbitration against them, and a tribunal is scheduled to take place in Frankfurt in July.
PV Crystalox said that, in view of both its market decline in photovoltaic cell manufacturing and its lack of an active customer base in Japan, it suspended wafering operations in Japan in 2015. It opted to wind up its Tokyo based subsidiary at the end of 2015.
PV Crystalox said it "remains mindful of the need to protect shareholder value and accordingly believes that extending the period of the strategic review is in the best interest of shareholders, especially in view of the judgement of the arbitral tribunal which is expected before the end of 2016."
The company will report its 2015 results March 17.
Shares in PV Crystalox were up 5.4% at 8.17 pence Wednesday morning.
By Hana Stewart-Smith; hanassmith@alliancenews.com; @HanaSSAllNews
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