March 16, 2009

Rochester Hills, MI, USA: Energy Conversion Devices Updates Outlook

Thin film manufacturer, Energy Conversion Devices said today it is slowing the pace of its "demand-driven" production and expansion plan to better reflect the present impact of credit availability on project flow in the global pipeline for photovoltaics.

ECD also announced that, because of the lack of visibility caused by the current economic conditions, its prior third quarter and full fiscal year 2009 guidance is no longer applicable. The company believes that solar product revenue for the fiscal third quarter will approximate the results from the same period a year ago.

Mark Morelli, ECD's president and chief executive officer said, "We have a strong balance sheet and financial stability, and to keep our company strong we continue to focus on operational excellence and cost reductions. We are making strategic investments in our company including staffing the global sales and marketing team, strengthening customer service and broadening our government relations capabilities. We are continuing to improve our ability to serve our customers worldwide and we have flexibility to quickly respond to changes in the market. We are prudently slowing down production and expansion plans and are taking immediate action to decrease our spending and to adjust our demand-driven expansion to better align with current market conditions."

The company will pause its aggressive production and expansion, implementing a two-week production hiatus effective March 22nd. Also, while the company finalizes the basic construction at Battle Creek, orders for equipment and the hiring of new employees will be postponed until demand improves.

The company is further lowering overall costs and improving manufacturing efficiencies by consolidating some production from its Auburn Hills 1 facility into its newer Auburn Hills 2 facility. About 130 employees will be relocated to Auburn Hills 2 as part of its expansion of operations at that facility. The consolidation will result in a permanent reduction of approximately 70 positions from the remaining operations at Auburn Hills 1. These individuals will receive severance and outplacement services and will also have the opportunity to apply for future jobs at ECD facilities.

"Even in these tough times, there are opportunities on the horizon. The worldwide outlook for the alternative energy industry is tremendous, and the recent announcement of the U.S. stimulus package is excellent news. I believe the outlook for our business has never been stronger," concluded Mr. Morelli.

Further details about: ECD Ovonics