PVCS.L Regulatory News (PVCS)

PV Crystalox Solar PLC

19 November 2010

INTERIM MANAGEMENT STATEMENT

PV Crystalox Solar PLC (or "the Group") announces its Interim Management Statement, in accordance with the UK Listing Authority's Disclosure and Transparency Rules, for the period from 30 June 2010 to the date of this announcement.

The PV market is continuing to grow strongly with global installations in 2010 expected to double and reach 14-16GW by the year end. As a consequence the Group has seen strengthening demand for its wafers and its production has operated at full capacity during the second half of the year. Our full year shipment volumes are now expected to be around 350MW; ahead of the 320-340MW range indicated at the time of our interim results on 19 August 2010.

Our customer base is continuing to expand and broaden geographically with strong sales growth being achieved particularly in Taiwan which is expected to represent around 20% of our shipment volumes in Q4.

The stable pricing environment has been maintained and our wafer average selling price (ASP) in the second half is broadly similar to the first half.

The ramp up in production at our polysilicon production facility in Bitterfeld is progressing encouragingly with an annualised rate of 1200MT per annum achieved during the last three months. Furthermore the fully loaded production cost during this three month period has been below our average externally contracted polysilicon price.

Overall these positive developments will enhance our performance in the second half of 2010.

The expansion of our ingot production facility at Milton Park from 400 to 500MW will be completed by the end of Q1 in 2011. In view of the forecast market growth and the anticipated requirements of our growing customer base, we are actively planning the next stages of capacity expansion which will enable us to reach 630MW at the end of 2011 and 800MW at end of 2012. In order to secure the additional volume necessary to meet these expansion plans, the Group has recently agreed a new five year contract with one of its external polysilicon suppliers.

As this expansion progresses the resultant higher levels of capital expenditure and related supplier contract prepayments will reduce our net cash position Accordingly we now expect the net cash balance to be in the region of €50 million at the end of 2010. This cash will be available to fund the above-mentioned expansion programme.

The Group is cautiously optimistic about market prospects for 2011 and expects double digit growth in global PV installations in the year. This market background together with our broadening customer base and our continuing progress in cost reduction gives us confidence that we can expand sales volumes in 2011 and beyond.

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