November 5, 2008

Munich, Germany: Wacker Reports Third Quarter Results

Wacker Chemie AG increased both its Q3 sales and operating result by 21 percent against the prior-year quarter and expects new full-year sales and earnings records. July-September consolidated sales reached €1,156.9 million (Q3 2007: €958.5m). Growth was driven chiefly by soaring sales volumes, higher prices and favorable product-mix effects. The weaker US dollar, in contrast, lowered the sales upturn by 5 percent.

The first nine months of 2008 saw consolidated sales exceeding the three-billion-euro level for the first time, up 15 percent year on year to €3.30 billion (9M 2007: €2.86bn). Q3 earnings also showed strong gains.

Despite the tough business climate, WACKER generated an EBITDA (earnings before interest, taxes, depreciation and amortization) of €327.5 million for the quarter (Q3 2007: €269.9m). This translates into an EBITDA margin of 28.3 percent (Q3 2007: 28.2 percent). Cumulative January-September EBITDA reached €936.5 million (9M 2007: €796.2m).

WACKER’s July-September net cash flow was €86.0 million (Q3 2007: €257.0m). This year-on-year decline is largely attributable to significantly higher investments for ongoing Group growth projects. Additionally, the prior-year quarter’s high customer prepayments for future polysilicon shipments affected net cash flow development.

Within the overall result, WACKER POLYSILICON continued to profit from strong polysilicon demand in Q3 2008 – crossing the 200-million-euro quarterly sales mark for the first time ever – with total Q3 sales of €238.9 million (Q3 2007: €126.0m). The division’s 90-percent year-on-year sales increase stems from volume gains enabled by production-capacity expansion, as well as higher prices.

WACKER POLYSILICON’s EBITDA gain even outstripped that of sales. For the July-September period, the division reported an EBITDA of €130.7 million (Q3 2007: €49.4m) – up 165 percent. The EBITDA margin of 54.7 percent (Q3 2007: 39.2 percent) was higher than both the prior-year and prior-quarter figures (Q2 2008: 54.0 percent).

For the full fiscal year, WACKER remains firmly on course to achieve its forecast goals despite the overall economy’s uncertainties and risks. The Group’s Executive Board therefore reaffirms its full-year 2008 forecast and anticipates sales growth of clearly above 10 percent compared to 2007. EBITDA should increase, too. In making this forecast, the company expects seasonal and demand-related factors to lead to weaker Q4 business, except at WACKER POLYSILICON. In this segment, WACKER anticipates a continued strong performance.

The Group sees outstanding long-term growth potential in its product portfolio that it intends to decisively utilize. Next to the continuation and completion of strategic growth projects already in progress, WACKER’s focus is on further production-capacity expansion at WACKER POLYSILICON and measures for ensuring its semiconductor business’s ongoing profitability, as well as continuous optimization of our global position, cost situation and chemical-segment capacity utilization. WACKER views these as key prerequisites for continued long-term profitable growth.

Further details about: Wacker