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Jabil Signs Manufacturing Supply Agreement with Day4 Energy
December 29, 2008 |Estimated reading time: 3 minutes
Day4 Energy Inc., a solar electric technology developer and manufacturer of superior performance solar modules, today announced it has signed a long-term manufacturing supply agreement with Jabil Circuit Inc., a leading global electronic solutions company. Under the terms of the multi-year agreement, Jabil will purchase from Day4 Energy certain equipment required for the manufacture and supply of the modules and produce Day4 Energy's brand of modules for residential and commercial applications.
"The outsource strategy is a key component of our business plan offering a number of advantages including a step-function improvement in our cost structure with substantial photovoltaic module assembly cost savings, significant working capital expense reduction and a natural hedge to foreign exchange effects by geographically aligning our production with our key sales locations," said George Rubin, president of Day4 Energy. "Day4 will provide the solar cells based on our proprietary designs and Jabil's manufacturing expertise and supply chain power will allow us to enhance the efficiencies of photovoltaic module manufacturing. By partnering with Jabil we can focus on our core areas of expertise and value creation for Day4, namely R&D and sales and marketing."
"We believe that our proven technical and manufacturing expertise, coupled with Day4 Energy's superior product offering, is a strong combination. This partnership expands our clean technologies portfolio by developing a foothold in the solar industry, a market we believe has tremendous growth potential and can benefit from our economies of scale, optimized supply chain and standardized global operating systems," explained Brian Althaver, Jabil vice president of strategic development.
George Rubin added, "This relationship streamlines the company's cost structure and takes advantage of our flexible business model. With the fundamental near-term shifts occurring in the solar sector, our strategy is to reduce working capital costs, and ensure that we are in a good position to take advantage of the significant reductions we expect in materials costs over the next couple of quarters. We are seeing continued strength in demand for our product in Europe in the residential and commercial applications and remain confident in our contracted sales for 2009." Rubin continued, "We will focus on managing production to effectively and efficiently meet the best timing and geographical demand for 2009. Given the broader economic environment and seasonal weather patterns we are being proactive in managing our business to avoid inventory build-up. We expect to have the equipment installed at the Jabil facility in Q1 and to be operating at full capacity as we enter the second half of 2009. This timing coincides perfectly with the expected demand cycle as it capitalizes on the normal seasonality from December through the first quarter. The overall strategy not only aligns our cost structure with the near term it ultimately puts the company in a better position to expand and grow in the future by focusing on those parts of the business that drive the highest returns."
About Day4 Energy
Day4 Energy Inc is Canada's largest manufacturer of high performance photovoltaic (PV) modules for residential, commercial and utility scale installations around the world. By fundamentally improving on the design and assembly of solar modules, Day4 Energy produces unique PV panels of high power density, increased lifetime and uncompromised aesthetic appearance. Day4 Energy partners with international technology leaders to develop and deliver IEC- and UL-certified solar products to customers throughout Europe and North America. Day4 Energy is listed on the Toronto Stock Exchange under the symbol "DFE." For more information, visit www.day4energy.com.
About Jabil
Jabil is an electronic product solutions company providing comprehensive electronics design, manufacturing and product management services to global electronics and technology companies. Jabil helps bring electronics products to the market faster and more cost effectively by providing complete product supply chain management around the world. With approximately 85,000 employees and facilities in 22 countries, Jabil provides comprehensive, individualized-focused solutions to customers in a broad range of industries. Jabil common stock is traded on the New York Stock Exchange under the symbol, "JBL." Further information is available at www.jabil.com.