Soitec reports total consolidated sales of 137.3 million Euros for H1 2010-2011

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• H1 Consolidated sales up by 45.7% year on year
• Return to current operating profit anticipated in H1
• Sequential growth at constant exchange forecast in H2 for semiconductor business
• Positive outlook for solar markets

Bernin, France, October 18, 2010– Soitec (Euronext Paris), the world's leading supplier of silicon-on-insulator (SOI) and advanced solutions for the electronics and energy industries, today reported second quarter consolidated sales of 68.7 million Euros giving consolidated sales of 137.3 million Euros for the first six months of the year equal to growth of 45.7% versus the same period last year.

Strong demand from other markets offset Q2 PC seasonal weakness

Q2 small diameters wafer sales increased sequentially by 26.2% (28.0% at constant exchange) supported by significant demand from automotive, mobile phone and lighting (CFL lamps) markets. 300 mm wafers sales were down sequentially by 10.5% (9.3% at constant exchange) as the PC market suffered a “seasonal” drop against continued strength from gaming and server sales. Total wafer sales for the quarter of 61.0 million Euros ended with a slight sequential reduction of 4.0% (2.6% at constant exchange).

Second quarter revenues from other activities were 0.8 million Euros from licensing, 2.1 million Euros for Tracit and 2.3 million Euros from Picogiga. Concentrix recorded 2.4 million Euros related to partial shipments on the Chevron contract.

In the first half of the financial year, total wafer sales were up sequentially by 17.8% or 5.9% at constant exchange and on a year on year basis by 41.8% and 30.4% at constant exchange. 300 mm, wafers, which represented 79% of total wafer sales, grew sequentially by 16.9% or 5.1% at constant exchange and on a year on year basis by 32.0% or 21.4% at constant exchange. All other wafer sales were up sequentially by 21.2% or 9.0% at constant exchange and on a year on year basis they almost doubled equal to 82.3% at constant exchange demonstrating the benefits of the successful strategy towards new markets like the RF applications for mobile phones and SOI based lighting products (CFL lamps).

Licensing revenues were 1.5 million for the half year. Tracit recorded sequential growth of 58% with sales of 4.1 million Euros. Picogiga recorded sequential growth of 3% and year-on-year growth of 37% with sales of 4.6 million Euros for the first half of the year.

Current operating income anticipated to be positive for H1 – H2 Positive Outlook

Sequential sales growth and the favourable exchange movement of 11.2% (from 1.43 in H2 last year to 1.28 in H1 this year) should lead to a favourable impact on margins. As a result and in combination with the positive impact from continuing operating efficiency, the company anticipates announcing a positive current operating income for the full first half of the year compared to a second half loss of 13.1 million Euros last year and a loss of 15.8 million Euros in the first half one year ago.

Recent semiconductor industry news flow suggests sustained demand over the coming quarters. This is backed up by the most recent indications from major customers underlying further sequential growth over the second half of the year at constant exchange for the Group’s semiconductor business. New contracts are anticipated in solar photovoltaic markets.

Recent development

On Monday 11 October, Soitec announced a global alliance with Johnson Controls (NYSE: JCI). Under this collaboration, partners will identify and respond to commercial opportunities for the project development and construction of utility scale solar energy facilities. Johnson Controls will build, operate, maintain and provide lifecycle support for solar installations using Concentrix CPV technology.

Agenda

The consolidated results of the first half of the 2010-2011 financial year will be published on 17 November 2010 before opening of the Paris Bourse.

About Soitec

Soitec is the world’s leading innovator and provider of the engineered substrate solutions that serve as the foundation for today’s most advanced microelectronic products. The group leverages its proprietary Smart Cut™ technology to engineer new substrate solutions, such as silicon-on-insulator (SOI) semiconductor wafers, which became the first high-volume application for this proprietary technology. Since then, SOI has emerged as the material platform of the future, enabling the production of higher performing, faster chips that consume less power.

Today, Soitec produces more than 80 percent of the world’s SOI wafers. Headquartered in Bernin, France, with two high-volume fabs on-site, Soitec has offices throughout the United States, Japan and Taiwan, and a new production site in Singapore.

Three other divisions – Picogiga International, Tracit Technologies and Concentrix Solar – complete the Soitec Group. Picogiga delivers advanced substrates solutions, including III-V epi wafers and gallium nitride (GaN) wafers, to the compound materials market for manufacturing high-frequency electronics and other optoelectronic devices. Tracit provides thin-film layer transfer technologies used to manufacture advanced substrates for power ICs and microsystems as well as generic circuit transfer technology, Smart Stacking™, for applications such as image sensors and 3D integration. In December 2009, Soitec acquired 80 percent of Concentrix Solar, the leading provider of concentrated photovoltaic (CPV) solar systems for the industrial production of energy. With this acquisition, Soitec has entered the fast-growing solar market. Shares of the Soitec Group are listed on Euronext Paris.

For more information, visit: www.soitec.com.

Soitec, Smart Cut, Smart Stacking and UNIBOND are trademarks of S.O.I.TEC Silicon On Insulator Technologies.

For all information, please contact:

International Media Contact

Camille Darnaud-Dufour

+33 (0)6 79 49 51 43

camille.darnaud-dufour@soitec.fr

Investor Relations

Olivier Brice

+33 (0)4 76 92 93 80

olivier.brice@soitec.fr

French Media Contact

Muriel Martin, H&B

+33 (0)1 58 18 32 44

m.martin@hbcommunication.fr

News Source : Soitec reports total consolidated sales of 137.3 million Euros for H1 2010-2011