Timminco Limited
TSX : TIM

Timminco Limited

March 17, 2009 16:31 ET

Timminco Announces Cost Containment Plan for Silicon Operations

TORONTO, ONTARIO--(Marketwire - March 17, 2009) - Timminco Limited ("Timminco" or the "Company") (TSX:TIM) announced today that it will temporarily curtail production of silicon metal due to difficult market conditions and reduced demand for silicon metal in the chemical and aluminum industries.

This operating mode will be implemented at the beginning of the second quarter 2009, with the goal to preserve cash flow and decrease current working capital levels. The decrease of silicon metal production will result in a temporary workforce reduction. During this period, the Company will supply silicon metal to customers from existing finished goods inventory.

Timminco will continue to produce solar grade silicon, although at levels that bring production in line with customer orders. Customers for solar grade silicon have recently reduced their orders significantly due to the current market downturn. The Company will defer further capacity expansion of its solar grade silicon facility pending recovery of demand for solar grade silicon.

Dr. Heinz Schimmelbusch, Chairman of the Board and Chief Executive Officer of Timminco, commented that, "The impact of global economic and credit conditions have prompted us to take decisive action to reduce costs and preserve capital until the silicon metal and solar grade silicon markets improve."

About Timminco

Timminco is a leader in the production of low cost solar grade silicon for the solar photovoltaic energy industry. Using its proprietary, patent pending technology, Timminco purifies silicon metal into solar grade silicon (also known as upgraded metallurgical silicon) for use in the manufacture of solar cells. Timminco also produces silicon metal, magnesium extrusions and other specialty metals for use in a broad range of industrial applications serving the aluminum, chemical, pharmaceutical, electronics and automotive industries.

CAUTIONARY NOTE ON FORWARD-LOOKING INFORMATION

This news release contains "forward-looking information", as such term is defined in applicable Canadian securities legislation, concerning Timminco's future financial or operating performance and other statements that express management's expectations or estimates of future developments, circumstances or results. Generally, forward-looking information can be identified by the use of forward-looking terminology such as "expects", "believes", "anticipates", "budget", "scheduled", "estimates", "forecasts", "intends", "plans" and variations of such words and phrases, or by statements that certain actions, events or results "may", "will", "could", "would" or "might" "be taken", "occur" or "be achieved". In this news release, such information includes statements regarding: the Company's operating cash flows and working capital reductions from the proposed activities, the scope and timing of the production curtailment, the impact on the Company's workforce, and the timing for further capacity expansion. Forward-looking information is based on a number of assumptions and estimates that, while considered reasonable by management based on the business and markets in which Timminco operates, are inherently subject to significant operational, economic and competitive uncertainties and contingencies.
Timminco cautions that forward-looking information involves known and unknown risks, uncertainties and other factors that may cause Timminco's actual results, performance or achievements to be materially different from those expressed or implied by such information, including, but not limited to: global economic conditions; customer commitments under long-term contracts for solar grade silicon; limitations under existing credit facilities; cost of solar grade silicon production; protection of intellectual property rights; increasing and maintaining the purity of solar grade silicon; selling prices for solar grade silicon; price volatility for silicon metal; pricing and availability of raw materials for silicon metal and solar grade silicon production; expansion of solar grade silicon production and sales; production capacity expansion at the Becancour facilities; limited history with solar grade silicon production; dependence upon power supply for silicon metal production; closure of magnesium facilities and execution of proposed joint venture for the magnesium business; price volatility for magnesium metal; magnesium supply chain interruptions; dependence upon key customers of magnesium extruded and fabricated products; financing requirements for capital expenditures; foreign currency exchange; dependence upon key executives and employees; customer concentration; completion and integration of potential acquisitions, partnerships or joint ventures; risks with foreign operations and suppliers; environmental, health and safety laws and liabilities; equipment failures; transportation disruptions; conflicts of interest; intellectual property infringement claims; new regulatory requirements; labour disputes; and changes in laws. These factors are discussed in greater detail in Timminco's Annual Information Form for the year ended December 31, 2007, and Timminco's most recent Management's Discussion and Analysis, each of which is available via the SEDAR website at www.sedar.com. Although Timminco has attempted to identify important factors that could cause actual results, performance or achievements to differ materially from those contained in forward-looking information, there can be other factors that cause results, performance or achievements not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate or that management's expectations or estimates of future developments, circumstances or results will materialize. Accordingly, readers should not place undue reliance on forward-looking information. The forward-looking information in this news release is made as of the date of this news release and Timminco disclaims any intention or obligation to update or revise such information, except as required by applicable law.

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Contact Information

  • Timminco Limited
    Robert Dietrich
    Executive Vice President - Finance and CFO
    (416) 364-5171
    (416) 364-3451 (FAX)
    Email: rdietrich@timminco.com
    or
    The Equicom Group Inc.
    Lawrence Chamberlain
    (416) 815-0700 ext. 257
    (416) 815-0080 (FAX)
    Email: lchamberlain@equicomgroup.com