Dynex Celebrates Completion of New Fabrication Facilities

12.07.11

Lincoln, England, July 12, 2011 – Dynex Power Inc., a leading specialist high power semiconductor company, today announced that the outlook for both it's near-term and long-term performance was greatly enhanced by events that were recently celebrated in Lincoln.

As recently announced, a high ranking deputation from Dynex’s majority shareholder, Zhuzhou CSR Times Electric Company and its parent company, CSR Corporation, visited Lincoln in June. Mr. Zheng Changhong, President of CSR, was presented the first 6” wafer output from Dynex’s newly completed fabrication facilities, a £12 million, 21-month project that was completed on-time and on-budget. 

As was also previously announced, the combination of production disruption and a weakening order book negatively affected financial performance in the second half of 2010 and the first half of 2011. This revenue weakness preceded the benefits Dynex expects from its opportunities in China, for the production of its new capability. The Company is now enjoying a material increase in its order book. In addition, management expects that following completion of the expansion project operating efficiencies and margins will improve in the near term. It is also expected that there will be improved revenues from the new fabrication lines. 

With the completion of the two 6-inch fabrication lines, the Company is well positioned to take advantage of its significant opportunities in China. Over the past 21 months, Dynex upgraded and expanded its fabrication facility for silicon chips to be used in insulated gate bipolar transistor (IGBT) modules replaced its existing production line, which processed 4-inch diameter silicon. The expansion has increased production capacity approximately tenfold. The largest portion of the project output is expected to be sold to Dynex’s majority shareholder, Zhuzhou CSR Times Electric Co., Ltd. 

While in Lincoln, Mr. Zheng also turned over the first shovel of earth in the planned construction of the new R&D Centre. The new centre is a joint collaboration between Dynex and its majority shareholder, Zhuzhou CSR Times Electric Co. It will employ an additional 30 people, mainly high technology, engineers. The groundbreaking was symbolically important as the R&D Centre is focused on securing a long-term position amongst the top three semiconductor manufacturers based upon innovation and technical excellence. 

“I am pleased we completed the project to expand and upgrade our production facilities and did so on plan and on time. Now, we intend to take as much advantage as we can of the opportunities available to Dynex in the massive Chinese rail expansion, said Dr. Paul Taylor, President & Chief Executive Officer. “We remain very excited about our prospects over the medium term, and probably longer. Even though the market demand for high power semiconductors has been soft, we are gratified by the significant improvement in our order book. We are experiencing clear signs of recovery.” 

Bob Lockwood, Dynex’s Finance Director and Chief Financial Officer, added, “We couldn’t be more pleased with the completion of our expansion project. We are starting to experience the improved results that we expected and indicated at our AGM in Toronto. The soft high power market has had a negative impact on Dynex’s recent revenue. Now that the capital expansion project has been completed, we expect to show material improvements over the next six months, with the overall impact in line with our expectations.” 


For more information:
 

Dr. Paul Taylor
President and Chief Executive Officer
or
Bob Lockwood
Finance Director and Chief Financial Officer
Dynex Power Inc.
Tel: +44 1522 500 500
Email: investorrelations@dynexsemi.com