REC Silicon (RECSI) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenues were $37.7M, down from $42.1M in Q1 2024, mainly due to lower silicon gas and semiconductor polysilicon volumes.

• EBITDA loss widened to $38.2M in Q2 2024, driven by Moses Lake startup costs and lower value product output.

• Cash balance at June 30, 2024, was $37.6M, down $63.5M from the previous quarter, mainly due to Moses Lake restart investments.

• Poly production at Butte site ceased at quarter end as part of exit plan.

• PV industry oversupply and trade actions are challenging silane volumes and factory utilization.

Financial highlights

• Q2 2024 revenues: $37.7M; Q2 2024 EBITDA: -$38.2M; Q2 2024 EBIT: -$47.9M.

• Semiconductor materials segment EBITDA was $7.0M, while solar materials segment EBITDA was -$36.6M.

• Silicon gas sales price increased 16.5% quarter-over-quarter.

• Net debt as of June 30, 2024, was $313.5M; equity ratio was -3.3%.

• Cash and cash equivalents at quarter-end were $37.6M.

Outlook and guidance

• Moses Lake restart is on track, with all construction to be completed by end of August and first shipment targeted for mid-September; full capacity expected by year-end.

• PV markets expected to remain challenged for several quarters due to oversupply and trade actions.

• CapEx spending to ramp down in H2 2024; no further CapEx at Butte as focus shifts to cash conservation.

• Discussions with silicon anode material producers ongoing, with resolution expected this year.

• EBITDA guidance range of $100 million–$300 million remains valid if market conditions are unchanged.