Solarfun Power Holdings Co., Ltd., a vertically integrated manufacturer of silicon ingots, wafers and photovoltaic ("PV") cells and modules in China, announced that it has already reached its 2010 year-end target of 360 MW in ingot manufacturing capacity, 400 MW in wire saw capacity, 500 MW of cell capacity and 900 MW in module capacity. This represents increases of 100 MW in cell capacity and 200 MW in module capacity compared to the end of the second quarter of 2010. As announced in the Company's press release dated July 19, 2010, the cell capacity is scheduled to increase to 550MW by early in the first quarter of 2011 through debottlenecking and the enhancement of manufacturing processes.
In addition, the Company announces that it plans to further increase capacity in the upstream segments of its manufacturing operations in 2011. The Company plans to increase:
——Cell capacity from 550 MW to 820 MW;
——Wire saw capacity from 400 MW to 572 MW; and
——Ingot capacity from 360 MW to 510 MW.
The Company expects to ramp production of the new cell, wire saw and ingot lines in the second quarter of 2011 and complete the expansion by the third quarter of 2011. The total capital expenditures required for this expansion, including the construction of new buildings and related infrastructure, are approximately $130 million. These capital expenditures will be fully financed by the recent equity injection from the Hanwha Group, the Company's cash on hand, as well as net cash flow from operations.
Peter Xie, CEO and President of Solarfun, commented, "We are optimistic about our prospects in 2011 and plan to ramp up our manufacturing capacity to meet expected customer demand. Our goal is to make Solarfun more fully vertically integrated as we seek to lower our manufacturing costs and become the leading low cost producer in the market. As our current projections indicate, the expected capital expenditures will be spent on expanding ingot, wafer and cell capacities, which we believe will help improve our cost structure over time. In addition, as part of the capital expenditures for 2011, we plan to construct additional buildings, facilities and infrastructure, especially for our ingot and wire saw operations, which will lay a flexible foundation for further upstream expansion as market conditions permit. We also plan to continue to reduce processing costs through enhanced manufacturing efficiencies and other R&D breakthroughs, and we believe we are well positioned in a number of fast growing solar markets outside of Germany."