EANS-News: Strong Polysilicon Business Mitigates Sales and Earnings Drop in Q1 2009

- Q1 2009 Group sales drop 14 percent to €873 million
- At €158
million, the operating result (EBITDA) was 46 percent lower than the
prior-year figure
- Positive net cash flow of €71 million
- Full
year 2009 sales and earnings expected to drop substantially year on
year
- Continuation of strategic growth projects via investments of
some €800 million in current ficsal year

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München (euro adhoc) - April 30, 2009 - The global recession clearly
impacted Wacker Chemie AG´s Q1 2009 figures. The Munich-based
chemical company generated January-March 2009 sales totaling EUR872.5
million (Q1 2008: EUR1,019.5m), down 14 percent compared to the
prior-year quarter. This was primarily due to a decrease in sales
volumes, though partially because of lower prices, too. In contrast,
the more favorable US$ exchange rate had a positive effect on sales
of +4 percent.

WACKER enacted measures as early as the second half of 2008 to cut
costs and temporarily adjust production capacity to slowing demand.
The first quarter of 2009 showed benefits of these measures on
profitability. Whereas WACKER´s first-quarter earnings before
interest, taxes, depreciation and amortization (EBITDA) fell 46
percent year on year to EUR157.8 million (Q1 2008: EUR291.1m), the
figure nevertheless reflected the advantages of lower material costs
and personnel expenses, as well as more favorable raw-material and
energy prices. The EBITDA margin equaled 18.1 percent (Q1 2008: 28.6
percent). The Group´s Q1 2009 earnings before interest and taxes
(EBIT) reached EUR58.2 million (Q1 2008: EUR198.7m), with a quarterly
result of EUR5.5 million (Q1 2008: EUR130.6m). Earnings per share
were EUR0.17 (Q1 2008: EUR2.63).

The Group´s polysilicon business made the largest contribution to Q1
2009 sales and earnings. The WACKER POLYSILICON division´s sales
crossed the EUR300 million mark in a single quarter for the first
time ever and EBITDA rose 136 percent. Nevertheless, the sales and
earnings trend declined significantly at all other divisions. The
drop was most pronounced for Siltronic´s semiconductor business,
where sales were down 64 percent year on year - with EBITDA declining
to EUR-60.0 million.

For full-year 2009, WACKER is expecting markedly lower sales and
operational earnings compared with the prior-year figures. How strong
this decline will be primarily depends on further demand and price
developments at WACKER´s key customer groups. The Group is focusing
its investments on its strategic growth projects, particularly the
ongoing expansion of polysilicon production capacity. From today´s
viewpoint, WACKER´s investment volume will reach a magnitude of
EUR800 million in fiscal 2009.

"After several years of successful growth, we are facing a period of
widespread economic uncertainty and thus a great entrepreneurial
challenge in light of the global recession," said Group CEO Rudolf
Staudigl in Munich on Thursday. "Our measures to limit the impact of
the economic crisis on our company are proving effective. The key
megatrends that we profit from remain intact. This is why I stay
optimistic about WACKER´s future in the long term, even though 2009
will not be an easy year for us."

Regions Benefiting from the strength of its polysilicon business, the
WACKER Group saw first-quarter sales in Germany climb some 3 percent
year on year to EUR220.8 million (Q1 2008: EUR215.3m). In the rest of
Europe, however, sales fell 23 percent to EUR202.0 million (Q1 2008:
EUR260.8m). Asia remains WACKER´s largest market, though
January-March 2009 sales there dropped by 23 percent to EUR267.0
million (Q1 2008: EUR345.6m). China accounts for over half of
WACKER´s Asian sales. In the Americas, WACKER generated sales of
EUR162.3 million in the period under review, nearly matching the
prior-year level (Q1 2008: EUR169.2m). In this region, WACKER
profited from the consolidation of Air Products Polymers, a former
partner company, and from the favorable euro/dollar exchange rate. In
"Other Regions", Q1 2009 sales totaled EUR20.4 million (Q1 2008:
EUR28.6m).

Net Cash Flow and Investments WACKER generated a positive net cash
flow of EUR70.9 million (Q1 2008: EUR-3.2m) from January-March 2009.
Here, a EUR67.9 million increase of customer prepayments and
reductions in current assets together with our investment focus on
strategic growth projects were the key contributors. Additionally, in
Q1 2008, a EUR173.4 million payment for acquiring the shares in Air
Products Polymers and Wacker Polymer Systems (former partner
companies) had affected cash flow in that quarter.

In Q1 2009, WACKER invested EUR176.8 million (Q1 2008: EUR145.5m).
The focus was on polysilicon expansion projects at Burghausen and
Nünchritz (Germany), as well as on extension of the silicones site in
Zhangjiagang (China). Some EUR100 million was spent on the ongoing
polysilicon capacity expansion alone in the period under review. In
the medium term, WACKER intends to build a new production plant for
hyperpure polycrystalline silicon in the USA to satisfy the increase
in demand expected from the solar and semiconductor industries in the
years to come. In February, WACKER purchased a plot of land (550
acres or 220 hectares) in the State of Tennessee for this purpose at
a cost of close to $20 million.

Employees On March 31, 2009, WACKER had 15,851 employees worldwide
(Dec. 31, 2008: 15,922), of whom 12,103 worked at German sites (Dec.
31, 2008: 12,110) and 3,748 at international sites as per the end of
Q1 2009 (Dec. 31, 2008: 3,812). To gain the flexibility needed for
reacting to the current demand decline, the Group applied for
short-time work schedules at Siltronic AG from January 2009 and at
Wacker Chemie AG from February, in each case for six months. In
addition, the Group is taking every opportunity to reduce personnel
costs by not extending limited employment contracts and by
terminating contracts with temporary workers. WACKER is also
transferring employees from its semiconductor subsidiary Siltronic to
other corporate entities.

Business Divisions In Q1 2009, WACKER SILICONES generated total sales
of EUR264.9 million (Q1 2008: EUR360.3m). The sales trend was marked
by a substantial decline in sales volumes, particularly in the
construction and automotive market segments, as well as in the
textile industry. In contrast, sales in the medical technology and
power generation and distribution segments developed comparatively
better. WACKER SILICONES generated an EBITDA of EUR27.7 million from
January-March 2009 (Q1 2008: EUR64.8m), thus achieving an EBITDA
margin of 10.5 percent (Q1 2008: 18.0 percent). The year on year
earnings drop resulted almost entirely from lower volumes. Favorable
exchange rates and lower personnel costs, however, had a positive
effect on earnings.

Construction-segment weakness worldwide and seasonal effects of the
severe winter in Europe had a noticeable impact on WACKER POLYMERS´
sales. Total sales from January-March 2009 amounted to EUR172.3
million (Q1 2008: EUR198.5m), down 13 percent year on year. Adjusted
for the addition of Air Products Polymers´ dispersion business, the
decline was 22 percent. Q1 2009 EBITDA for the division was EUR21.5
million (Q1 2008: EUR38.1m), resulting in an EBITDA margin of 12.5
percent (Q1 2008: 19.2 percent). The earnings drop vis-à-vis Q1 2008
was primarily caused by declining sales volumes and price pressure.
In contrast, lower raw material costs and more favorable exchange
rates had a positive effect on results. Measures to optimize
production efficiency also served to support earnings.

WACKER FINE CHEMICALS had total sales of EUR21.6 million in Q1 2009
(Q1 2008: EUR27.7m), down 22 percent year on year. This drop in sales
is attributable to the discontinuation of certain catalog products
resulting from the fine-chemical business portfolio consolidation.
The division´s earnings performance presents a similar picture. The
division generated an EBITDA of EUR1.9 million for January-March 2009
(Q1 2008: EUR3.2m), thus achieving an EBITDA margin of 8.8 percent
(Q1 2008: 11.6 percent). WACKER FINE CHEMICALS´ bioengineered
products, such as cyclodextrins and cysteine, performed well. The
same was true of pharmaceutical proteins, thanks to rising sales
volumes.

WACKER POLYSILICON profited further from continued strong polysilicon
demand in Q1 2009. Compared to the prior-year period, the division
doubled its total quarterly sales to EUR315.0 million (Q1 2008:
EUR155.9m). The enormous production capacity expansion at the
Burghausen site was primarily responsible for this growth. WACKER
POLYSILICON´s EBITDA greatly outpaced sales growth, climbing to
EUR168.1 million (Q1 2008: EUR71.3m). This represents a 136 percent
increase compared with the prior-year quarter. At 53.4 percent (Q1
2008: 45.7 percent), the EBITDA margin remains at the high level
achieved in the last few quarters. This growth was driven by higher
sales volumes, as well as by positive price and product-mix effects.

At Siltronic, the negative business trend of late fiscal 2008 gained
additional momentum in Q1 2009. Sales revenues of EUR126.0 million
(Q1 2008: EUR346.1m) for the period under review were 64 percent
below the comparable prior-year figure. Quarterly demand for silicon
wafers of all diameters was very weak in all regions. This led to
both significantly lower sales volumes and a drastic deterioration in
market prices. Moreover, the silicon-monocrystal business for the
solar and equipment industry showed clear signs of the current crisis
in terms of both sales volumes and prices achievable on the spot
market. Favorable exchange rates were not able to compensate for the
extremely difficult global semiconductor-market situation. As a
result, Siltronic posted a January-March 2009 EBITDA of EUR-60.0
million (Q1 2008: EUR114.0m). The EBITDA margin dropped accordingly
from 32.9 percent in Q1 2008 to -47.6 percent in Q1 2009. To
counteract the earnings situation, Siltronic implemented an extensive
package of measures that will reduce personnel costs. This led to a
year on year personnel-cost reduction of 30 percent in Q1 2009.

Outlook WACKER is preparing for a global downturn in 2009. From
today´s vantage point, it is not clear whether the global economy
will return to a growth path in 2010. Given the economic
uncertainties, the Group cannot make a reliable and quantifiable
forecast for the rest of 2009 at this time. Based on the current
situation, the Munich-based chemical company assumes sales and the
operating result will decline noticeably from now until year-end.

Despite the generally difficult global environment, WACKER does see
growth potential, especially at WACKER POLYSILICON, which is
profiting from plant and product-line expansions. At WACKER´s other
three large divisions, however, business trends will be more
difficult. According to company estimates, the silicon-wafer business
will perform particularly weakly, due in part to falling prices for
300 mm wafers. Currently, no reliable forecast is possible for WACKER
SILICONES or WACKER POLYMERS.

WACKER enacted a series of measures at an early stage to counter the
pressures of the global financial and economic crisis. For example,
the Group cut budgets, introduced short-time work and other measures
to lower personnel expenses, placed restraints on hiring, modified
investment plans and safeguarded operational financing. WACKER
intends to reduce personnel costs during the current fiscal year by
15 percent, thus by some EUR160 million. The Group anticipates
positive effects in 2009 from raw-material and energy costs, which
will probably be lower than in 2008.

For the long term, WACKER believes that key megatrends will remain
strong, enabling the company to sustainably profit from them. For
example, the Group has a whole series of products to serve the energy
megatrend. As in the past, the largest growth opportunities there
arise from the manufacture of polysilicon for the solar industry. As
for the digitization megatrend, the Group´s semiconductor-grade
silicon wafers will enable it to benefit from further growth. In view
of its strong regional presence in Asia´s growth markets and in
emerging economies elsewhere, WACKER can offer a whole range of
products and solutions that are ideal for increasing living standards
in these regions. WACKER is confident about the long-term potential
of these megatrends and intends to use them to resume its
sustainably-oriented growth path once the global economy has come out
of recession.

Information for editorial offices: The Q1 2009 report can be
downloaded from WACKER´s website (www.wacker.com) under Investor
Relations.

WACKER's Key Figures
|EUR million |Q1 2009 |Q1 2008 |Change | |
| | | |in % | |
|Sales |872.5 |1,019.5 |-14.4 | |
|EBITDA1 |157.8 |291.1 |-45.8 | |
|EBITDA margin2 |18.1% |28.6% |-36.7 | |
|EBIT3 |58.2 |198.7 |-70.7 | |
|EBIT margin2 |6.7% |19.5% |-65.8 | |
| | | | | |
|Financial result |-7.1 |-0.8 |>100 | |
|Income before taxes |51.1 |197.9 |-74.2 | |
|Result for the period |5.5 |130.6 |-95.8 | |
| | | | | |
|Earnings per share in EUR |0.17 |2.63 |-93.6 | |
| | | | | |
|Investments (incl. |176.8 |145.5 |21.5 | |
|financial assets) | | | | |
|Investments in acquisitions|0.0 |-173.4 |-100 | |
|Net cash flow |70.9 |-3.3 |n.a. | |
| | | | | |
|EUR million | Mar. 31, | Mar. |Dec. 31,| |
| |2009 |31, 2008|2008 | |
| | | | | |
|Equity |2,106.1 |1,908.6 |2,082.8 | |
|Financial liabilities |283.9 |250.2 |272.4 | |
|Provisions for pensions |382.5 |374.4 |376.1 | |
|Net financial debt |-100.7 |-152.8 |-32.9 | |
|Total assets |4,705.1 |4,226.8 |4,625.1 | |
| | | | | |
|Employees (number at end of|15,851 |15,660 |15,922 | |
|period) | | | | |
| | | | | |

1 EBITDA is EBIT before depreciation and amortization.
2 Margins are calculated based on sales.
3 EBIT is the result from continuing operations for the period before interest
and other financial results, limited partnership interests and income taxes.

This press release contains forward-looking statements based on assumptions and
estimates of WACKER´s Executive Board. Although we assume the expectations in
these forward-looking statements are realistic, we cannot guarantee they will
prove to be correct. The assumptions may harbor risks and uncertainties that may
cause the actual figures to differ considerably from the forward-looking
statements. Factors that may cause such discrepancies include, among other
things, changes in the economic and business environment, variations in exchange
and interest rates, the introduction of competing products, lack of acceptance
for new products or services, and changes in corporate strategy. WACKER does not
plan to update the forward-looking statements, nor does it assume the obligation
to do so.

end of announcement euro adhoc
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ots Originaltext: Wacker Chemie AG
Im Internet recherchierbar: http://www.presseportal.de

Further inquiry note:

Christof Bachmair

Media Relations & Information

Tel.: +49 (0)89 6279 1830

E-Mail: christof.bachmair@wacker.com

Branche: Chemicals
ISIN: DE000WCH8881
WKN: WCH888
Index: Midcap Market Index, MDAX, CDAX, Classic All Share, HDAX,
Prime All Share
Börsen: Börse Frankfurt / regulated dealing/prime standard