Ubbink Solar Modules B.V. (Ubbink Solar), a 100% subsidiary of Centrosolar Group AG (Centrosolar), will close down its solar module plant located in Doesburg, Netherlands. This closure is due to the loss of Ecostream Switzerland GmbH (Ecostream) as the principal customer for the solar modules manufactured there. Ecostream has been affected by a suspension of payment order concerning its parent, Econcern B.V.
Ubbink Solar will remain in existence as a legal entity and will continue to meet all its financial obligations.
The workforce of around 70 at the Dutch plant will be offered redundancy packages that include severance payments. All other liabilities will also be paid off. Centrosolar’s new, module plant in Wismar, Germany, with a module production capacity of currently 110 MWp is unaffected by the closure of the Dutch plant. The modules for Centrosolar’s remaining customers will continue to be manufactured at Wismar.
Ecostream had until now been supplying Ubbink Solar with solar cells, and purchasing the solar modules that were then made from the cells. The volume of business with Ecostream last year amounted to around EUR 25 million, accounting for the lion’s share of the production volume of the plant in question. Centrosolar acquired 30% of the shares in USM from Econcern only as recently as February 2009, thus increasing its interest to 100%. However, payment of the purchase price for the shares acquired in February 2009 will only have fallen due if Ecostream had purchased agreed quantities of modules in the course of 2009, with the result that no purchase price remains payable. Currently, the trade payables furthermore exceed trade receivables from Ecostream. In addition, Centrosolar has access to security deposits from Ecostream, and as matters stand cash losses as a result of the potential bankruptcy of Ecostream can be excluded.
Since the profit margins on the modules manufactured for Ecostream were below average, the lasting negative impact on earnings from the loss of Ecostream as a customer is likely to be very low. It will be possible to cover a portion of the damages by the security deposits. Centrosolar has already built deductions for losses of this nature into its target figures. The guidance communicated at the start of the year consequently remains valid, with revenue around on a par with the 2008 and a positive operating result for 2009.