Meyer Burger presents half year results 2007

Meyer Burger – Strong growth for first half year of 2007 – Positive outlook

Meyer Burger achieved strong organic growth during the first half year of 2007 and further strengthened its dominant market position in the photovoltaic industry. Incoming orders increased by 391% to CHF 386.9 million (HY1 2006: CHF 78.8 million). Net sales for the first six months of 2007 rose by 72% to CHF 67.3 million (HY1 2006: CHF 39.2 million). In addition, Meyer Burger also put high efforts into advance performance and as a result, changes in inventories of finished products and work in process also increased sharply to CHF 21.9 million. On an EBIT and Group earnings level, the results for the first half year of 2007 do not reflect the full earnings potential of Meyer Burger yet, because of the high advance performances made. EBIT amounted to CHF 4.5 million (EBIT margin of 5.0%) and Group earnings were CHF 3.3 million for the period under review. With the amount of advance performances already made and a much stronger production output since April 2007, Meyer Burger expects to achieve a significant increase in sales and a strong improvement in profitability for the second half of 2007. For the entire fiscal year of 2007, Meyer Burger confirms its expectations to achieve net sales of over CHF 180 million and an EBIT margin of between 12-14%.

For the first half year of 2007, Meyer Burger Technology Ltd (SWX Swiss Exchange: MBTN) flourished and strenghtened its dominant position in the photovoltaic industry, which has been experiencing dynamic growth. Incoming orders increased by an impressive 391% to CHF 386.9 million (HY1 2006: CHF 78.8 million). As of 30 June 2007, Meyer Burger has an order backlog of CHF 470.2 million, which represents an excellent basis for strong sales growth in the second half of 2007 and the years to come.

Net sales in the first six months of 2007 were up by 72% to CHF 67.3 million (HY1 2006: CHF 39.2 million). Sales rose in Asia and Europe in particular. The strong sales growth was achieved even though production output and sales continued to be affected during January and early February 2007, due to the relocation of the production facilities to new ones in Thun. The amount for changes in inventories of finished products and work in process also increased sharply to CHF 21.9 million. Operating income rose by 112% to CHF 90.9 million (HY1 2006: CHF 42.9 million). Given that all changes in inventories of finished products and work in process are recognised at their production costs, these working efforts are not reflecting their true profitability yet in the consolidated income statement of the first half year.

Gross profit rose by 44% to CHF 28.7 million (HY1 2006: CHF 19.9 million). Due to higher cost of products and services, which also includes the expenses for finished products and work in process, the gross margin expressed in percent of operating income was reduced temporarily to 31.6% (HY1 2006: 46.3%). In terms of personnel, extra capacities were provided in order to ensure execution of the order backlog in due time. The increase in personnel expenses of 44% to CHF 15.3 million (HY1 2006: CHF 10.7 million) was disproportionately low compared to the improvements in operating income. Operating expenses amounted to CHF 7.7 million (HY1 2006: CHF 2.7 million). This was mainly due to higher rental costs for the larger production facilities in Thun, general costs involved in relocating operations from Steffisburg to Thun, and increased transport expenses as a consequence of the strong sales growth.

On an EBIT and Group earnings level, the results for the first half of 2007 do not reflect the full earnings potential of Meyer Burger yet, because of the high advance performances made. EBIT amounted to CHF 4.5 million (HY1 2006: CHF 6.0 million) and Group earnings were CHF 3.3 million (HY1 2006: CHF 4.7 million). With the amount of advance performances already made and a much stronger production output since April 2007, Meyer Burger expects to achieve significantly higher operating margins and a considerable increase in Group earnings during the second half of 2007.

Outlook
Meyer Burger currently assumes that the economic environment will remain positive and that the rapid development in the solar industry will continue. With all the capacity adjustments made during the first six months of 2007, Meyer Burger expects for the entire fiscal year of 2007 net sales of over CHF 180 million and an EBIT margin of between 12-14%.

For further information please have a look on http://www.meyerburger.ch/

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