Siltronic Tag Archive

  • Siltronic to Stop Production of Small Diameter Wafers

    Siltronic to Stop Production of Small Diameter Wafers

    3 Min Read

    Siltronic AG plans to gradually cease production of polished and epitaxial small diameter wafers at its Burghausen site. The process, which excludes unpolished wafers, is set to be completed in the course of 2025.

    Siltronic currently produces wafers with a diameter of 300 mm, 200 mm and wafers with smaller diameters (SD) of up to 150 mm. The SD wafer technology was developed primarily in the 1990s and earlier. The most significant technological breakthroughs in recent decades have been achieved with larger diameters, which also show the highest growth potential. An average volume growth of 6 percent per year is expected for 300 mm wafers.

    “SD wafer production at Siltronic originated in Burghausen in 1968. It has contributed to our success for many years, thanks to the outstanding work of our employees. However, the wafer industry has evolved significantly due to structural changes and innovations. Demand has increasingly shifted to wafers with larger diameters and improved properties, while SD wafers are approaching the end of their life cycle. This has led to a notable decline in volumes, which recently had a negative impact on earnings. As this will likely continue to intensify in the coming years, we have decided, together with the Supervisory Board, to gradually reduce the production of small diameters and to cease it in the course of 2025,” comments Dr. Michael Heckmeier, CEO of Siltronic AG.

    “Despite this decision the Burghausen site remains of crucial importance for Siltronic. Our global technology as well as research and development center, the production of 300 mm wafers and 200 mm hyperpure silicon ingots as well as a large part of our administrative functions are located here,” Michael Heckmeier continues.

    Just 25 years ago, more than half of the silicon wafer market consisted of wafers with a diameter of up to 150 mm. Today, it is less than five percent, based on data published by the industry organization SEMI. This is the result of customers reducing or ceasing their production of small wafers due to the dynamic technological developments in the semiconductor industry. In addition, competition, particularly from China, is now clearly felt in the small diameters.

    In the past financial year, SD wafers accounted for a single-digit percentage of the Group’s sales. The impact on earnings has already been clearly negative in recent months. Approximately 400 people are employed in the small diameters, about half of whom are on fixed-term and temporary contracts. The aim is to reduce the core workforce in a socially responsible manner through demographic change and partial retirement, and to avoid layoffs for operational reasons.

    “Due to structural changes in the market, we assume that SD wafers will not recover and that their impact on earnings would be considerably negative in the coming years. We have therefore decided to take this difficult but necessary step. At the same time, our goal is to ensure that workforce reductions at Siltronic are socially responsible and no layoffs are made for operational reasons. After the end of the SD wafer production and the subsequent dismantling measures that may be necessary, our EBITDA margin will improve by around one to two percentage points in the medium term,” adds Claudia Schmitt, CFO of Siltronic AG.

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  • Siltronic Closes 2023 with a Solid Performance

    Siltronic Closes 2023 with a Solid Performance

    6 Min Read

    Siltronic AG closed the 2023 financial year with a solid performance despite difficult conditions, confirming the preliminary figures announced at the beginning of February. The company achieved sales of EUR 1,513.8 million (2022: EUR 1,805.3 million) and EBITDA of EUR 433.9 million (2022: adjusted EUR 621.6 million).

    Thanks to stable sales prices, the EBITDA margin remained at a healthy level of 28.7 percent (2022: adjusted 34.4 percent). The declines are due to significantly weaker demand, mainly as a result of increased inventories in the value chain.

    These will also characterize the financial year 2024. As a result, wafer demand is expected to remain weak, particularly in the first half of the year. Under these conditions, sales and EBITDA margin, before ramp cost, are expected to be in the region of the previous year. The ramp of the new 300 mm fab in Singapore will burden the margin by up to three percentage points compared to 2023.

    “We continue to see strong growth for our wafer sales in the mid-term, driven by megatrends. However, 2023 and to some extent 2024 will be impacted by increased inventories in the value chain. The dynamic development of Artificial Intelligence will lead to significantly higher demand for wafers. Thanks to our new 300 mm fab in Singapore, we are prepared for this and expect sales to increase to more than EUR 2.2 billion and the EBITDA margin to rise to the high 30’s by 2028,” comments Dr. Michael Heckmeier, CEO of Siltronic AG.

    Business development in 2023 – solid in a difficult environment

    Group sales decreased by 16.1 percent to EUR 1,513.8 million in 2023 – the guidance was minus 15 to 17 percent. This was due to the lower wafer area sold. Average selling prices in euro remained stable compared to 2022.

    Cost of sales decreased by 4.1 percent to EUR 1,141.6 million and therefore less than the decrease in sales. This was due to increased depreciation and amortization, higher cost, in particular for raw materials and supplies, and lower fixed cost dilution as a result of the lower wafer area sold. As a result, the gross margin declined from 34.1 percent to 24.6 percent.

    In order to mitigate risks from exchange rate developments, Siltronic performs currency hedging measures, which resulted in a net income from exchange rate effects of EUR 16.5 million in 2023, after expenses of EUR 21.0 million in 2022.

    In the reporting year, Siltronic generated an EBITDA of EUR 433.9 million (2022: EUR 671.6 million, adjusted EUR 621.6 million) and an EBITDA margin of 28.7 percent (2022: 37.2 percent, adjusted 34.4 percent) – the guidance was 28 to 30 percent. As with the gross margin, lower fix cost dilution and cost increases were the main reasons for the lower EBITDA margin. EBIT of EUR 231.3 million was also well below the previous year’s level (EUR 495.6 million, adjusted EUR 445.6 million) due to higher depreciation as a result of significantly higher investment activity.

    The Group’s tax rate was 13 percent in the reporting year (2022: 11 percent), resulting in a net profit of EUR 201.3 million in 2023 (2022: EUR 434.4 million). Of this, EUR 184.4 million (previous year: EUR 390.6 million) are attributable to the shareholders of Siltronic AG. Earnings per share were EUR 6.15 compared to EUR 13.02 in 2022.

    Net cash flow development characterized by high investments

    In the past financial year, Siltronic made net payments of EUR 1,112.1 million for capex including intangible assets. These were primarily related to the construction of the new 300 mm fab in Singapore and the expansion of the crystal pulling hall in Freiberg. High payments could not be fully financed from cash flow from operating activities like in 2022. As a result, free cash flow decreased to EUR -624.2 million and net cash flow to EUR 663.5 million.

    Statement of financial position remains healthy

    As of December 31, 2023, total assets amounted to EUR 4,504.9 million (previous year: EUR 4,050.7 million) with a significant increase in property, plant and equipment. As planned, the high level of capex led to a significant decrease in cash and cash equivalents and financial investments.

    Due to the negative free cash flow and the dividend of EUR 90.0 million paid in 2023, Siltronic had net financial debt of EUR 355.7 million as of December 31, 2023 (2022: net financial assets of EUR 373.6 million). As equity increased only slightly year-on-year, the equity ratio decreased to 46.6 percent, compared to 51.0 percent at the end of 2022.

    Dividend proposal of EUR 1.20 per share for the financial year 2023

    In view of the persistently difficult market situation, the Executive Board proposes to the Annual General Meeting on May 13, 2024, to pay a dividend of EUR 1.20 per share for the financial year 2023, corresponding to a payout ratio of approximately 20 percent of the consolidated net profit attributable to Siltronic shareholders.

    This corresponds to a dividend payment of EUR 36.0 million. At the same time Siltronic confirms its dividend policy for the future, according to which approximately 40 percent of the consolidated net profit attributable to the shareholders of Siltronic AG, as determined in accordance with IFRS, will be distributed. The upper limit remains unchanged at EUR 3.00 per dividend-bearing share.

    Outlook for 2024 characterized by weak demand, especially in the first half of the year

    As a result of the continued weak demand for silicon wafers, the Executive Board expects sales in 2024 to be the region of the previous year. The first six months of 2024 are expected to be the most affected by delivery postponements, so that sales for this reporting period are expected to be at the level of the second half of 2023. The EBITDA margin, before ramp cost, will also be in the region of the previous year. Due to the ramp of the new 300 mm fab in Singapore the margin will be reduced by up to three percentage points compared to 2023. Ramp cost mainly comprise energy, material and labor costs.

    The guidance is based on a EUR/US dollar exchange rate of 1.10. On a positive note, average selling prices are expected to remain stable. The Executive Board expects energy and material cost (before ramp cost) to be lower in 2024 than in the previous year. However, the positive effect will be compensated by rising labor tariffs and a lower result from currency hedging compared to the previous year. Due to the high level of capex in recent years, depreciation and amortization will almost double compared to 2023. As a result, EBIT will be significantly lower than last year.

    Capex will decrease to below EUR 600 million compared to the record level of EUR 1,316 million in the previous year. As a result, the company expects a significant improvement in net cash flow, which will nevertheless remain significantly negative.

    Growth targets until 2028 confirmed

    The Executive Board confirms the mid-term targets for the period up to financial year 2028, as communicated in November 2023, which include a significant increase in sales to more than EUR 2.2 billion and an improvement in the EBITDA margin to the high 30’s. The targets are driven by the increasing relevance of global megatrends with a strong increase in demand for semiconductors and thus for wafers. The improvement in the Group’s profitability will primarily be driven by the expected volume growth and a higher cost efficiency.

    Siltronic will use its expected future cash flows primarily for further organic growth, to strengthen its innovative strength and to reduce debt.

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  • Siltronic Appoints Klaus Buchwald as Chief Operating Officer

    Siltronic Appoints Klaus Buchwald as Chief Operating Officer

    2 Min Read

    Effective August 1, 2024, the Supervisory Board has appointed Klaus Buchwald to the Executive Board of Siltronic AG. The 55-year-old will assume the position of Chief Operating Officer (COO).

    In his role, Mr. Buchwald will be primarily responsible for Operations and Supply Chain, Engineering and IT. Siltronic’s Executive Board will thus be expanded to three members. Furthermore, the existing division of responsibilities between CEO Dr. Michael Heckmeier and CFO Claudia Schmitt will remain unchanged. Klaus Buchwald has initially been appointed for three years.

    “We are convinced that Mr. Buchwald’s expertise, particularily in the areas of production, logistics and supply chain, as well as his in-depth knowledge of the semiconductor industry and its value chain, make him the ideal candidate for the new COO position on the Siltronic Executive Board,” says Dr. Tobias Ohler, Chairman of the Supervisory Board of Siltronic AG. “Together with Mr. Heckmeier and Ms. Schmitt, Mr. Buchwald will contribute to the realisation of the ambitions and to the further profitable growth of Siltronic,” Dr. Ohler continued.

    The company aims to achieve sales of more than EUR 2.2 billion and an EBITDA margin in the high 30 percent range by 2028. These targets are to be achieved by expanding production capacities with the new fab in Singapore, a stronger focus on technology leadership, the Power segment as well as increasing cost efficiency, among other things.

    Klaus Buchwald

    Klaus Buchwald, who studied mechanical and industrial engineering, was born in 1968. He worked for Infineon for more than 21 years, most recently as Senior Vice President Operations of the “Green Industrial Power” division and as Executive Vice President Corporate Supply Chain. Prior to this, he held various management positions at the DAX listed company and spent four years as Head of Supply Chain at the technology group Rohde & Schwarz. He started his career at a renowned management consultancy firm.

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  • Siltronic Published Its Forecast for the Financial Year 2024

    Siltronic Published Its Forecast for the Financial Year 2024

    4 Min Read

    Siltronic AG has published its forecast for the financial year 2024 in an ad-hoc announcement. Due to the weakness in demand, as a result of elevated customer inventories and the associated further postponement of delivery volumes, the Executive Board expects sales for the current financial year to be in the region of the previous year.

    The first six months of the financial year 2024 are likely to be affected most by the postponement of delivery volumes, meaning that sales for this reporting period are expected to be at the level of H2 2023. The forecast is based on a Euro/US Dollar exchange rate of 1.10. On a positive note, average selling prices are expected to remain stable.

    The EBITDA margin, before ramp costs, will also be in the region of the previous year. Due to the commissioning of our new state-of-the-art 300 mm fab in Singapore, the margin will be reduced by up to three percentage points compared to the previous year. Ramp costs primarily comprise energy, material and labor costs.

    “Our strategic growth targets until 2028 remain unchanged. In the short-term, however, the continuing weakness in demand will weigh on the development in the financial year 2024. In addition, the expected ramp costs for our new 300 mm fab in Singapore will become noticeable. With the increase in production volume over the next few years, the fab will contribute significantly to the profitable growth of Siltronic. Therefore, we stick to our medium-term ambition and expect sales to grow to more than EUR 2.2 billion and an EBITDA margin in the high 30’s until 2028,” commented Dr. Michael Heckmeier, CEO of Siltronic AG.

    The Executive Board expects a noticeable reduction in energy and material costs (before ramp costs) in 2024 compared to the previous year. However, the positive effect will roughly be compensated by rising labor tariffs and the lower currency hedging result compared to the previous year. The high level of capital expenditure in recent years will almost double depreciation and amortization compared to the previous year. As a result, the EBIT will be significantly lower than in the previous year.

    As already announced, capital expenditure will be more than halved compared to the previous year’s record level of EUR 1,316 million. Therefore, the company expects a significant improvement in net cash flow, although it will still remain significantly negative.

    Growth targets until 2028 remain unchanged

    As communicated in November 2023, significant sales growth to more than EUR 2.2 billion and an improvement of the EBITDA margin to the high 30’s are expected until 2028. This confidence is driven by the increasing relevance of global megatrends such as artificial intelligence, digitalization and electromobility and will lead to a sharp rise in demand for semiconductors and therefore also for wafers. The increase in Group profitability will be primarily driven by expected volume growth and higher cost efficiency, which will be significantly above the expected inflation-related cost increases.

    Future use of funds with focus on growth, innovation and debt reduction –
    Dividend proposal of EUR 1.20 for 2023 due to persistent weakness in demand

    Siltronic will use the cash flows generated as a result of the above mentioned targets primarily for further organic growth, strengthening its innovative power and reducing debt. The latter had increased noticeably due to the high level of capital expenditure in the recent past. Nevertheless, Siltronic shareholders will continue to participate in the company’s success through a dividend. In view of the current difficult market situation, the Executive Board will propose to the Annual General Meeting on May 13, 2024 the payment of a dividend of EUR 1.20 per share for the financial year 2023 and thus a payout ratio of around 20 percent of the Group profit attributable to Siltronic shareholders.

    “As a company in a capital-intensive and cyclical industry, we know how important a solid balance sheet policy and a forward-looking liquidity management are. That is why we will put an even stronger focus on our costs and capex this year. In view of the upcoming refinancing needs, we are convinced that our dividend proposal of EUR 1.20 represents an appropriate balance between capital discipline on the one hand and dividend continuity for our shareholders on the other,” explains Claudia Schmitt, CFO of Siltronic AG.

    Despite this noticeable reduction compared to the previous year, Siltronic confirms its dividend policy for the future, according to which around 40 percent of the Group profit determined in accordance with IFRS principles, attributable to the shareholders of Siltronic AG, will be distributed. The upper limit remains unchanged at EUR 3.00 per dividend-bearing share.

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  • Siltronic Achieved 2023 Annual Targets

    Siltronic Achieved 2023 Annual Targets

    4 Min Read

    Siltronic AG has achieved its annual targets for 2023 according to preliminary, unaudited figures. The company achieved preliminary sales of EUR 1,514 million, a decrease of approximately 16 percent compared to the record sales of EUR 1,805 million in 2022. The target for the year was a decline in sales of 15 to 17 percent.

    The main reason for the year-on-year decline was significantly weaker demand from the semiconductor industry due to increased inventories in the value chain. Since Siltronic nevertheless succeeded to keep sales prices stable, a preliminary EBITDA of EUR 434 million was achieved in 2023, resulting in a continued solid EBITDA margin of 29 percent. This was also within the expected target range of 28 to 30 percent.

    The EBITDA for the record year 2022 amounted to EUR 672 million, though it should be noted that this included a one-off compensation payment of EUR 50 million as a result of the failed tender offer by GlobalWafers. The adjusted comparative figure for the EBITDA margin in 2022 was therefore 34.4 percent.

    “We achieved our 2023 targets in a challenging environment. In particular, the EBITDA margin of 29 percent is very solid given the sharp decline in sales. The year 2023 was also marked by the construction of our new 300 mm fab in Singapore, which is on schedule to start operations at the beginning of 2024. The new state-of-the-art fab will contribute to Siltronic’s significant profitable growth in the medium and long term,” commented Dr. Michael Heckmeier, CEO of Siltronic AG.

    Compared to the previous year, cost of sales decreased at a slower rate than sales due to a reduction in fixed costs, higher depreciation and inflationary cost increases, particularly for raw materials, supplies and labor.

    Preliminary earnings before interest and taxes (EBIT) were also significantly lower than in the previous year at EUR 231 million (2022: EUR 496 million, adjusted: EUR 446 million). Accordingly, the preliminary EBIT margin was 15 percent compared to an adjusted 24.7 percent in 2022.

    Solid financial situation despite record investments

    In the reporting year, Siltronic made record investments in property, plant and equipment and intangible assets of preliminary EUR 1,316 million (2022: EUR 1,074 million). This was mainly due to the new 300 mm wafer fab in Singapore and the expansion of the crystal pulling hall in Freiberg.

    Considering the high future investments mentioned above, the preliminary net cash flow of EUR -664 million in 2023 is in line with expectations (2022: EUR -395 million). The high cash payments for capex and the dividend payment of EUR 90 million resulted in net financial debt of EUR 356 million by December 31, 2023 (2022: net financial assets of EUR 374 million).

    Business development in Q4 2023

    As announced, preliminary sales of EUR 357 million in Q4 2023 were slightly above the level of Q3 2023 (EUR 349 million). As expected, at a preliminary EUR 91 million, the EBITDA for Q4 2023 did not reach the level of the previous quarter (EUR 99 million), mainly due to a lower foreign exchange result, which is included in the balance of other operating income and expenses.

    The preliminary quarterly EBIT amounted to EUR 37 million (Q3 2023: EUR 46 million). The EBIT margin reached 10 percent (Q3 2023: 13.3 percent). Despite increased investments, the preliminary net cash flow for Q4 2023 improved significantly to EUR -32 million (Q3 2023: EUR -215 million). This was mainly due to investment grants received in Q4 2023 and positive working capital effects.

    Upcoming events

    The audited financial results and the Annual Report 2023 will be published on March 12, 2024. On this day, the Management Board of Siltronic AG will hold a conference call with analysts and investors (in English only) at 10:00 am (CET). This call will be streamed over the Internet. The audio webcast will be available live and on demand on Siltronic’s website.

    • March 12, 2024        Publication of the Annual Report 2023
    • May 2, 2024             Quarterly Statement Q1 2024
    • May 13, 2024           Annual General Meeting
    • July 25, 2024           Half Year Report 2024
    • October 24, 2024     Quarterly Statement Q3 2024

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  • Siltronic Returns to MDAX

    Siltronic Returns to MDAX

    1 Min Read

    Due to the positive development of the market capitalization, the Siltronic share is rejoining the MDAX index today. After several months in the SDAX, the Siltronic AG share is once again represented in the second most important index of the German stock exchange. Additionally, Siltronic shares will remain part of the TecDAX.

    Throughout the year, Siltronic’s share price was negatively impacted by the market weakness in the semiconductor industry, which led to its descent to the SDAX in June 2023. Since then, the share price has steadily recovered, and the company’s market capitalization has increased significantly.

    Dr. Michael Heckmeier, CEO of Siltronic, commented on this development: “The re-inclusion of Siltronic in the MDAX reflects investors’ confidence in our future prospects and our continued growth. This underscores the robust share price performance of recent months.”

    Siltronic’s inclusion in the MDAX is part of Deutsche Börse AG’s regular quarterly review. The decision is based on the market capitalization of the freely tradable shares, i.e. the free float market capitalization.

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  • Siltronic Defines Profitable Growth Plan until 2028

    Siltronic Defines Profitable Growth Plan until 2028

    5 Min Read

    The Executive Board of Siltronic AG expects a significant improvement in sales and EBITDA by 2028. Thus, the Group sales are expected to exceed EUR 2.2 billion by 2028 and the EBITDA margin to reach the high 30’s per-centage area. Based on the Group sales forecast for 2023, this corresponds to an increase in sales of more than 40 percent. The EBITDA margin will also improve significantly compared to the 28 to 30 percent forecast for 2023. The targets are based on stable overall price and exchange rate developments (EUR/USD: 1.10).

    For the upcoming year 2024, Siltronic expects that at least the first half of the year will still be bur-dened by high inventories at chip manufacturers and their customers. On the earnings side, the start-up costs of the new production site in Singapore will have a negative impact on the company’s margin in 2024.

    The confidence until 2028 is supported by the increasing relevance of global megatrends such as artificial intelligence, digitalization and electromobility. This will lead to a strong increase in demand for semiconductors and therefore also for wafers. For example, the wafer area required to manu-facture an AI-compatible server is up to eight times larger than that required for a conventional server. The wafer area required for electric vehicles is also 60 to 100 percent higher than for con-ventional combustion vehicles. 

    The increase in Group profitability will mainly be driven by the expected volume growth and higher cost efficiency, which will be significantly higher than the expected inflation-related cost increases.

    Above-average growth in Siltronic’s focus activities

    The company expects wafer demand to grow by an average of four to five percent per year until at least 2028 and a positive trend in all segments: Memory, Logic and Power. Growth is expected to be particularly strong for 300 mm wafers, especially in the leading edge area, as well as for wafers for Power applications. Siltronic should be able to benefit from these trends in particular thanks to its good market positions.

    The company has made systematic preparations for the expected growth phase with high investments, especially for the construction of a new production fab for 300 mm wafers in Singapore (FabNext) and the improvement of the product mix in Freiberg, Saxony. At the beginning of November 2023, the first wafers were produced in Singapore – slightly earlier than planned. Production will be gradually ramped from the beginning of 2024. In view of the high level of automation and efficient cost structure, Siltronic is aiming for EBITDA margins of more than 50 percent for FabNext in the mid-term. 

    Siltronic is already characterized by a high level of resilience, which is reflected in its consistently solid margins even in difficult economic times. In addition to its high cost sensitivity, this is primarily due to its close customer relationships. The company has entered into long-term agreements with many of its customers, securing around two thirds of its sales. 

    “In view of the expected next growth phase driven by megatrends, we have defined medium-term targets for Siltronic up to 2028 against which we will be measured. Group sales are expected to increase to more than EUR 2.2 billion and the EBITDA margin to the high 30’s. Among other things, we will benefit from our new, highly efficient fab in Singapore, our technological leading position and our strength in the Power segment,” commented Dr. Michael Heckmeier, CEO of Siltronic AG, on the development.

    Future use of capital focused on securing further growth opportunities, strengthening tech-nology leadership and reducing debt

    Siltronic will make investments of around EUR 1.3 billion for the above-mentioned projects in 2023. However, as of September 30, 2023, the company maintains a robust financial position with an eq-uity ratio of 49 percent and holds in excess of EUR 500 million in cash and cash equivalents, along with financial assets.

    This reflects a sound and secure financial and balance sheet structure. After reaching the peak of investment activity in 2023, expenditures are expected to noticeably decrease again by more than 50 percent in 2024 alone compared to the previous year. Siltronic will consist-ently invest the cash flows generated in the course of the planned targets in securing organic growth opportunities, expanding automation and digitalization, strengthening its leading technology position and further improving the quality of its balance sheet, including reducing debt.

    This also includes a continued strong focus on research and development (R&D) in order to continue to utilize technology-driven competitive advantages in the future. In the medium term, between four and five percent of Group sales are to be invested in R&D activities.

    “Despite the peak of our investments in 2023, we are in a very solid position with an equity ratio of almost 50 percent and a high liquidity reserve. From 2024, our capex will fall noticeably, but organic growth with the expansion of FabNext remains our top priority. In addition, we will use the expected cash flows from our growth plan until 2028 to strengthen our leading technology position and im-prove the quality of our balance sheet. This will create sustainable value for all our stakeholders,” adds Claudia Schmitt, CFO of Siltronic AG.  

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  • Siltronic Updated Its Climate Strategy

    Siltronic Updated Its Climate Strategy

    3 Min Read

    Siltronic has updated its existing climate strategy and set ambitious targets to fulfill its role in the Paris Climate Agreement.

    The company remains committed to reducing its direct (scope 1) and indirect greenhouse gas emissions from energy purchases (scope 2) to zero by 2045 at the latest. Despite continued growth and the associated significant increase in energy consumption, these greenhouse gas emissions are expected to be reduced by 42% by 2030 as compared to the 2021 base year.

    With these targets, Siltronic is making its contribution to limiting global warming to a maximum of 1.5 degrees Celsius in accordance with the Paris Climate Agreement passed in 2015. For Siltronic, the 1.5-degree benchmark is the key reference point for the target years 2030 and 2045. The carbon intensity, measured by the CO2 emissions in relation to sales, is to be reduced by an average of at least 5 percent per year between 2021 and 2030.

    “Increasing energy efficiency and thus reducing emissions has always been a core element of our corporate strategy. Our goal is to contribute as effectively as possible to the fight against climate change, and at the same time to support the global decarbonization through our products,” said Claudia Schmitt, CFO of Siltronic AG and responsible for the company’s sustainability activities.

    Joining the RE100 underscores our commitment to renewable energy

    To achieve the revised climate targets, Siltronic is committed to gradually increasing the use of renewable energy to 60 percent by 2030 and 100 percent by 2045. To reinforce its commitment to renewable energy, Siltronic joined the RE100 initiative in November 2023. RE100 is a global corporate initiative dedicated to the exclusive use of renewable energy. Through its membership, Siltronic aims to help eliminate one of the biggest obstacles to global decarbonization: the insufficient amount of green electricity available in many energy markets.

    For Siltronic, this is particularly noticeable at its largest site in Singapore, where growth will be strongest in the coming years due to the gradual ramp of the new fab, which recently started test operations. Siltronic’s updated climate targets are conditional on the availability of renewable energy in Singapore to improve by 2030 and beyond. To this end, the company is in continuous dialog with decision-makers in Singapore.

    Siltronic’s commitment to climate protection and the reduction of scope 3 emissions, meaning greenhouse gas emissions generated outside of Siltronic, also extends to the supply chain. The company will intensify its cooperation with suppliers in this regard in the future.

    SBTi standards remain reference point, validation not pursued for now

    In 2021, Siltronic defined targets in accordance with the Science Based Target Initiative (SBTi), which changed its criteria for the purchase of renewable energy in Q2 2023. Considering these revised requirements, the company feels compelled not to pursue the planned validation of the SBTi targets. At the same time, the SBTi criteria remain an important reference point for Siltronic.

    The company continues to have its sustainability performance evaluated by independent third parties. To learn more about these and other sustainability practices, please visit https://www.siltronic.com/en/our-company/sustainability.html.

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  • Siltronic Announced Production of the First Wafers in Singapore

    Siltronic Announced Production of the First Wafers in Singapore

    2 Min Read

    Siltronic announced the production of the first wafers in its latest state-of-the-art 300 mm fab in Singapore. The production marks an important milestone in the strategic capacity expansion of Siltronic’s global production network. 

    “It fills me with immense pride to see the production of the first wafers from the line. This is a decisive milestone in the history of Siltronic. I am delighted to see that the test wafer production has started slightly ahead of schedule. I would therefore like to congratulate and thank all the employees and suppliers involved for their contributions. We look forward to supplying our customers with leading-edge wafers from this new state-of-the-art fab,” said Dr. Michael Heckmeier, CEO of Siltronic AG.

    Despite many challenges, including the global pandemic and supply chain constraints, the construction of the new fab, which started in 2021, is on schedule and on budget. By the end of 2024, around 2 billion Euro will have been invested into this greenfield project. This will be followed by further investments on a smaller scale to further ramp the production. 

    The large-scale project covers an area of approximately 20 soccer fields. At peak construction times, more than 5,000 workers were on site for both construction activities and facilities installation. The fab is supported by approximately 5,500 piles which extend up to 60 meters into the ground. In total, 150,000 m³ of concrete and more than 35,000 tons of steel have been used.

    In the mid-term, the new fab is expected to be highly cost efficient due to the high degree of automation and deployment of digitalization, coupled with its strategic proximity to the existing 200- and 300 mm fabs in Singapore, which will lead to economies of scale and synergies. 

    The new fab will serve both medium and long-term demand growth in the semiconductor market, which is driven by megatrends such as digitalization, artificial intelligence, and electromobility. As originally planned, the production ramp phase will commence from the beginning of next year. 

    “The trust and support of our customers has been a key factor for this investment. In the ramp phase, sales from the new fab have been secured to a high degree by long-term agreements. Customers have also contributed significantly to the initial financing of the fab through prepayments,” added Claudia Schmitt, CFO of Siltronic AG.

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  • Siltronic Welcomed Representatives from Singapore Economic Development Board (EDB)

    Siltronic Welcomed Representatives from Singapore Economic Development Board (EDB)

    1 Min Read

    This week, Siltronic welcomed high-ranking representatives from the Singapore Economic Development Board (EDB) to its Munich headquarters. The delegation, led by Chairman Mr. Png Cheong Boon, included five members of the EDB. This visit underscores the ongoing strong international collaboration with the EDB.

    Over the years, Siltronic’s partnership with the EDB has been characterized by strong support and cooperation in many areas, such as workforce development, labor market support, infrastructure development, as well as investment support.

    During the meeting, both parties reiterated their shared commitment to collaboration in these vital areas and engaged in discussions regarding strategies for decarbonization.

    Siltronic’s latest state-of-the-art 300 mm fab is the largest investment ever made by a German company in Singapore. It showcases the commitment to strengthen and expand the positive relationships with our Singaporean partners.

    Dr. Michael Heckmeier, CEO of Siltronic AG, expressed his pleasure to meet the EDB team in person. “The collaboration between Siltronic and the EDB over the years has created significant results. We are proud of these positive collaborative outcomes and look forward to the future.”

    Original – Siltronic

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