Incurs Additional Impairment Charge for Investment in Nitol Solar
SAN FRANCISCO and WUXI, China, May 8 /PRNewswire-Asia/ -- Suntech Power Holdings Co., Ltd. (NYSE: STP), the world’s largest manufacturer of crystalline silicon photovoltaic (PV) modules, today announced the filing of its 2008 annual report on Form 20-F with the Securities and Exchange Commission, including its 2008 audited financial statements. During the course of its 2008 year-end financial audit process, the Company determined that the investment impairment charge previously reported in its press release discussing its preliminary fourth quarter 2008 results should be increased from $48.8 million to $73.8 million. The additional $25.0 million impairment charge relates to Suntech’s investment in Nitol Solar, a polysilicon manufacturer in which the Company owned a 14.0% equity interest as of December 31, 2008.
The additional impairment charge was primarily due to updated information obtained from Nitol Solar’s final December 31, 2008 financial statements including new material information related to fixed asset impairments and losses on financial instruments. As this additional information related to conditions that existed at December 31, 2008, the assumptions used to determine the fair value of Suntech’s investment in Nitol Solar were
re-assessed and it was determined that an additional provision of $25 million was necessary. The after tax impact to Suntech’s 2008 net income as a result of this additional investment impairment was $22.8 million.
In March 2009, Nitol Solar entered into a series of debt restructuring agreements through which it secured approximately $400 million in debt financing to complete the construction of its 3,800 metric ton polysilicon production facility. Nitol Solar currently has 300 metric tons of production capacity and intends to initiate production in an additional 3,500 metric ton facility in early 2010. As a result of the dilution caused by the recent debt restructuring, Suntech owned an 11.5% equity interest in Nitol Solar as of
May 8, 2009.
The audited consolidated balance sheet as of December 31, 2008 and statement of operations data for the fourth quarter and full year 2008 can be found in an SEC filing on Form 6-K filed today. Additional information relating to our 2008 financial statements, including the notes thereto, can be found in our annual report on Form 20-F. Copies of the related 6-K and 20-F can be found in the "Investor Center" section of the Suntech website under "SEC Filings." Should you wish to be sent a hard copy of the complete audited financial statements please contact ir@suntech-power.com.
About Suntech
Suntech Power Holdings Co., Ltd. (NYSE: STP) is the world’s leading solar energy company as measured by production output of crystalline silicon photovoltaic (PV) modules. Suntech designs, develops, manufactures, and markets premium-quality, high-output, cost-effective and environmentally friendly solar products for electric power applications in the residential, commercial, industrial, and public utility sectors. Suntech’s patent-pending Pluto technology for crystalline silicon solar cells improves power output by up to 12% compared to conventional production methods.
Suntech also offers one of the broadest ranges of building-integrated solar products under the MSK Solar Design Line(TM). Suntech designs and delivers commercial and utility scale solar power systems through its wholly owned subsidiaries Suntech Energy Solutions and Suntech Energy Engineering. With regional headquarters in China, Switzerland and San Francisco and sales offices worldwide, Suntech is passionate about improving the environment we live in and dedicated to developing advanced solar solutions that enable sustainable development. For more information, please visit http://www.suntech-power.com .
Safe Harbor Statement
This press release contains forward-looking statements. These statements constitute "forward-looking" statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. Such statements involve certain risks and uncertainties that could cause actual results to differ materially from those in the forward- looking statements. Further information regarding these and other risks is included in Suntech’s filings with the U.S. Securities and Exchange Commission, including its annual report on Form 20-F. Suntech does not undertake any obligation to update any forward-looking statement as a result of new information, future events or otherwise, except as required under applicable law.
For more information, please contact:
At Suntech:
In China:
Rory Macpherson
Investor Relations Director
Suntech Power Holdings Co., Ltd.
Tel: +86-21-6288-5574
Email: rory@suntech-power.com
In the United States:
Sanjay M. Hurry
Vice President
The Piacente Group, Inc. (Investor Relations Counsel, Suntech)
Tel: +1-212-481-2050
Email: suntech@tpg-ir.com
