Dear Shareholders of the SINGULUS TECHNOLOGIES AG, dear Ladies and Gentlemen! SINGULUS TECHNOLOGIES had based its forecast for the business year 2014 on the respective developments of the key financial figures within the three segments Optical Disc, Semiconductor and Solar. For the Optical Disc division, in the course of the annual budgeting for 2014, the Executive Board had already projected lower sales and earnings (EBIT) contributions than in the business year 2013. After talks with key Optical Disc customers SINGULUS now has to concede that the large Hollywood studios have made significantly more restrained arrangements compared to the prior years. Accordingly, the current year will considerably fall short of expectations since no larger investments for Blu-ray production equipment is planned in 2014. Consequently, the volume sales of our production machines in 2014 will decline significantly compared with the previous year. This sharp decline in our otherwise quite profitable segment is very unsatisfactory for us, in particular since this will have a substantially adverse impact on the course of business for SINGULUS in the 2nd half of 2014. In addition, order intake in the Solar segment is still delayed. Nearly all studies for the solar market forecast a beginning upswing for the market in 2014. However, all market participants come to discover that the project and realization stages of new investment projects take a considerably longer period of time than originally expected. If the forecast growth will materialize, we expect the capital spending for cell production equipment to continue to develop favorably and SINGULUS TECHNOLOGIES to benefit correspondingly.
Outlook Against this background the Executive Board expects the losses incurred in the 1st half of 2014 to expand. Consequently, due to the current business situation restructuring programs for the company are initiated, which will result in significant cost reductions. At all sites the production and personnel capacities are being reviewed and optimized. Especially the Optical Disc activities will be reorganized and considerably streamlined. The administrative expenses will be further reduced as well as the global marketing & sales and service activities reviewed. The outside organization is adjusted to the markets’ requirements to work more effectively and
cost-efficiently. As a consequence, SINGULUS TECHNOLOGIES will face the new challenges with a leaner and significantly more efficient setup. As you already know, SINGULUS TECHNOLOGIES is in the course of a strong transformational process. In the past couple of years SINGULUS TECHNOLOGIES has continuously further developed its technologic know-how on the basis of the core competencies nano- and vacuum-coating as well as thermal and wet-chemical process technology and in addition to the solar market is currently opening new markets with innovative products. Numerous, innovative machines were newly developed and partly already introduced to the market. Additional new machines will still be presented in the current business year. SINGULUS TECHNOLOGIES does not have any liabilities owed to commercial banks. The financing of current projects, the growth in the existing areas as well as the expansion in new work areas are financed by the funds from the issued corporate bond and still rest on a solid and stable basis. The Executive Board will continue to review the acquisition of companies or parts of companies. Of course, these opportunities to broaden the product and service range for a bigger customer base will be analyzed with due diligence and reviewed with commercial prudence. The Executive Board and the entire staff will work on the goals and strategy of the company with a high level of dedication and commitment.
Yours sincerely, The Executive Board SINGULUS TECHNOLOGIES AG