Evergreen Solar, which makes solar panels, has shuttered its pilot factory and plans to take a $25 million write off as a result, the company said Monday.
The move should help the Marlboro, Mass.-based company save money, a much-needed move as it tries to weather the recession. It’s one of a growing list of solar companies that have vowed to cut costs as they face a lowering demand for their products. LDK Solar, a Chinese silicon wafer maker, on Monday cut its sales and shipment forecast for 2009.
Evergreen (NSDQ: ESLR) also hasn’t fared well since Lehman Brothers filed for bankruptcy in September. The solar company enlisted Lehman to raise money and had loaned 30.9 million of it shares in the process. Evergreen haven't been able to get those shares back, however, prompting the company to sue Lehman and Lehman’s new owner, Barclays.
The solar company closed the pilot plant in Marlboro last week. It is transferring most of the employees from its pilot plant to its commercial factory in Devens. It expects to spend about $350,000 for severance costs through March.
Evergreen has been building the Devens factory in phases. It recently completed the second phase of the factory, which should reach a production capacity of 40 megawatts per quarter in the second half of 2009, the company said.
The company shipped 8.5 megawatts worth of solar panels from the Devens factory and 3.7 megawatts from the Marlboro pilot plant during the fourth quarter of 2008.
Aside from taking a non-cash charge of $25 million in the fourth quarter as a result of the pilot plant closing, Evergreen said it might spend $3 million to $5 million in the next 12 months for related site restoration and moving costs.
The company's shares fell nearly 4 percent to reach $3.46 per share in after-market trading.