4.2 Financial performance

4.2.1 2001 Performance

GWU Solar, a leading PV distributor in Germany, doubled it sales revenue in 2001 to 25 million euros and continued its trend of profitability.

Solarworld AG increased sales revenues in 2001 to 82.116 million euros (51.325 million euros in 2000) with profit (according to International Accounting Standards) rising to 7.543 million euros (1.264 million euros). Earnings before interest and tax (EBIT) reached 13.389 million euros (9.184 million euros) and EBT was 13.101 million euros (8.924 million euros).

Earnings per share increased to 1.63 euros (0.32 euros). Solar Energy Systems, Australia recorded turnover up 116.9%. Total income for the six months to December 2001 was $744,725 up 116.9% on the corresponding period for 2000. The loss for the period was $673,629, an increase of 108% on $323,822 for the corresponding period of year 2000. Sunways AG, achieved sales turnover of 21.3 million euros and losses before tax and interest of 3.3 million euros in 2001. Net losses amounted to 2.1 million euros in 2001.

Management had adjusted its targets downwards in November 2001, however, after two major customers cancelled their orders in August 2001. The board had to postpone breakeven from 2001 to 2002 as a result. According to earlier announcements, the company is expected to register profits before tax and interest of 0.1 million euros on turnover of 33.8 million euros in 2001. Chairman Franz Heim resigned, with effect from Mar 31, 2002.

4.2.2 Q1 2002 Performance

AstroPower

Total revenues for the quarter ended Mar 31, 2002, were a record $20.7 million, an increase of 44.7% from the first quarter of 2001. Product revenues for the three months ended Mar 31, 2002 were a record $20.4 million, an increase of 49.9% from the three months ended Mar 31, 2001. Over the same period, net income was $2.0 million, as compared to a loss of $1.5 million in the year-earlier period. The 2001 period results were affected by the settlement of litigation.

Without the settlement charges, net income for the 2001 period would have been $1.1 million.

Evergreen Solar

For the three months ended Mar 31, 2002, product revenues were $913,000, an increase of $767,000 from $146,000 for the same period in 2001. Research revenues for the first quarter were $236,000, as compared to $331,000 for the same period of last year. Net loss for the first quarter of 2002 was $3.4 million, or $0.30 per share, as compared with a net loss of $2.4 million, or $0.21 per share, for the same period of last year.

At Mar 31, 2002, cash, cash equivalents, and short-term investments totaled $22.2 million, compared to $26.3 million at Dec 31, 2001.

Sunways AG

In the first quarter 2002, Sunways generated sales of 3.9 million euros, an increase of 114% on the same period last year (1.8 million euros). This broke down into 2.4 million euros of total sales (previous year: 1.0 million euros, +150%) for the solar cell business and 1.5 million euros (0.9 million euros, +74%) sales from solar systems.

According to plan, the Group loss of Sunways was again reduced substantially. Earnings before interest and taxes (EBIT) amounted to -0.4 million euros (previous year: -1.0 million euros). The consolidated net loss improved to -0.3 million euros (previous year: -0.4 million euros). The Management Board confirmed its intention to reach break-even in fiscal year 2002. Sunways seeks to generate sales of approximately 33.8 million euros in 2002, compared to 21.3 million euros in 2001.

Photowatt

In the year to Mar 31, 2002, Photowatt revenues rose by 19% to $50.9 million (from $42.7 million). In the quarter to Mar 31, 2002 sales increased 14% to $15.3 million (from $13.4 million). "Photowatt has made major strides in the past year and is one of the few solar companies in this growing niche to make money," said Klaus Woerner, President and Chief Executive Officer.

"Although very recently we've seen some pricing pressure in this market, Photowatt has much better operating efficiencies because of production advancements made in the past year and this should allow it to make meaningful contributions again this fiscal year." Energy Conversion Devices In the third quarter ended Mar 31, 2002, revenues increased 38% to $24,490,000 compared to $17,722,000 in the third quarter last year. The Company's net loss was $5,015,000 compared to $4,272,000 in the same quarter last year.

"Our revenue growth is mainly from machine-building contracts with positive margins," said Stanford R. Ovshinsky, ECD's President and Chief Executive Officer. "We are now optimizing the solar cell production equipment we designed and built for United Solar, our photovoltaic joint venture with Bekaert. With the production efficiencies that we have built into our manufacturing equipment, we expect to increase our annual production capacity beyond 25 megawatts."

In the nine months ended Mar 31, 2002, revenues increased 72% to $73,693,000 compared to $42,944,000. The Company had a net loss of $12,096,000 compared to $6,733,000 in the same nine months ended March 31, 2001.

Spire Corporation

Spire reported sales of $3.3 million for the first quarter of 2002, compared to $3.2 million for the first quarter of 2001. Net loss for the first quarter was $605,000, or $0.09 per share, versus a loss of $603,000, or $0.09 per share, in the same year-earlier period. Sales of solar module manufacturing equipment in the first quarter fell to $1.2 million from $2.1 million for the same year-earlier period, but sales of photovoltaic (PV) systems by Spire Solar Chicago were $700,000, compared to $20,000 last year.