PV Crystalox (PVCS)

PV CRYSTALOX (PVCS)

Intro:
(Alison sunbathing with a solar panel on top of her which will be created in post-production. In the Shoot this will be green card.)

“This is hard work.
I’m not just topping-up the tan you know.
I’m heating 12 homes at the same time!”

Main
PV Crystalox Solar makes wafers, but not the edible kind.
The company produces silicon ingots and wafers used in solar panels.
Its customers, some of the world’s biggest solar cell producers, use these hi-tech widgets to harness the sun and generate green electricity.
These so-called photovoltaic solar cells can last for more than 25 years.
And the future looks bright.
Boffins at the German Advisory Council on Global Change reckon solar energy will eclipse other sources this century to become the dominant energy source.
But lately the climate hasn’t been kind to PV Crystalox.
In June the company warned on profits after demand for its products weakened in Germany, its biggest market.
Average selling prices have fallen due to high inventory levels and lower demand.
Like poor old Icarus who got too close to the sun, the shares crashed and burned, falling 43% in one day.
Ouch.
If the status quo continues, Crystalox could make a loss in the second half of 2011.
And, if this happens, the currently generous dividend could be cut.
Might the shares rise again?
It depends how successful management is at cutting the cost of wafer production and whether average selling prices could pick up - it’s busy tackling both issues right now.
But, in the meantime, all may not be lost.
Crystalox is debt-free and has a healthy bank balance, with £50 million of net cash on its books or 12p a share.
Some analysts think this cold hard cash, plus the company’s production know-how, could make it a tasty titbit for a predator.
Especially given markets in a handful of Mediterranean countries are due to come online soon.
And while the short-term outlook is cloudy, with the world’s oil and coal
resources burning out, the long term trend for green energy production is undoubtedly sunny.