Vivint Solar Reports First Quarter 2018 Results
Vivint Solar Reports First Quarter 2018 Results
LEHI, Utah, May 8, 2018 /PRNewswire/ -- Vivint Solar (NYSE: VSLR), today announced financial results for the first quarter ended March 31, 2018.
First Quarter 2018 Operating Highlights
Key operating and development highlights include:
-- MW Booked of approximately 52 MWs for the quarter.
-- MW Installed of approximately 40 MWs for the quarter. Total cumulative
MWs installed were approximately 905 MWs.
-- Installations were 5,813 for the quarter. Cumulative installations were
132,643.
-- Estimated Retained Value increased by approximately $77 million during
the quarter to approximately $1.7 billion. Estimated Retained Value per
Watt at quarter end was $2.02.
-- Cost per Watt was $3.15, an increase from $2.95 in the fourth quarter of
2017 and an increase from $2.98 in the first quarter of 2017.
Financing Activity
As of March 31, 2018, the company had $200 million in undrawn capacity in the aggregation facility and approximately 29 MWs of available installation capacity remaining in its tax equity funds. Subsequent to quarter end, the company closed a new tax equity partnership with a $101 million commitment that will fund the installation of approximately 64 MWs with a new tax equity investor.
Summary First Quarter 2018 Financial Results
$ amounts in millions, except per share data
Three Months Ended March 31,
----------------------------
2018 2017 YoY
---- ---- ---
Revenue:
Operating
leases and
incentives $31.1 $30.4 up 2%
Solar energy system and
product sales 37.1 22.7 up 63%
---- ----
Total Revenue 68.3 53.1 up 28%
Cost of revenue:
Operating leases and
incentives 38.7 35.1 up 10%
Solar energy system and
product sales 26.0 18.7 up 40%
---- ----
Total cost of revenue 64.7 53.7 up 20%
Gross profit (loss) 3.5 (0.6) up 667%
Loss from Operations (28.1) (31.1) up 10%
Net (loss)
income $(13.0) $13.3 down 198%
Net (loss)
income per
diluted
share $(0.11) $0.11 down 200%
Non-GAAP net
loss per
share $(0.53) $(0.50) down 6%
Note: Totals may not sum due to rounding.
Guidance for the Second Quarter 2018
The following statements are based on current expectations. These statements are forward-looking, and actual results may differ materially. These statements supersede all prior statements regarding projected 2018 financial results.
For the second quarter of 2018, Vivint Solar expects:
-- MW Installed: 45 to 48 MWs
-- Cost per Watt: $3.05 - $3.13
Earnings Conference Call
Vivint Solar will host an investor conference call and live webcast today, Tuesday, May 8, 2018, at 5:00 p.m. ET to discuss these financial results. To access the conference call, dial 1.866.393.4306 or 1.734.385.2616 for international callers. The conference ID is 233 7889. A listen-only webcast will be accessible on the investor relations page of the company's website at investors.vivintsolar.com/ and will be archived and available on this site until May 31, 2018. Participants should follow the instructions provided on the website to download and install the necessary audio applications in advance of the call. In addition, the earnings presentation slides will be available on the investor relations page of the site by 5:00 p.m. ET along with this press release and the financial information discussed on today's conference call at investors.vivintsolar.com/.
About Vivint Solar
Vivint Solar is a leading full-service residential solar provider in the United States. With Vivint Solar, customers can power their homes with clean, renewable energy and typically achieve significant financial savings over time. Offering integrated residential solar solutions for the entire customer lifecycle, Vivint Solar designs and installs the solar energy systems for its customers, and offers monitoring and maintenance services. In addition to being able to purchase a solar energy system outright, customers may benefit from Vivint Solar's affordable, flexible financing options, power purchase agreements, or lease agreements, where available. For more information, visit www.vivintsolar.com or follow @VivintSolar on Twitter.
Note on Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995, including statements regarding Vivint Solar's guidance for Megawatts Installed and Cost per Watt, installation capacity remaining in tax equity funds, growth prospects, and operating and financial results, such as estimates of nominal contracted payments remaining, estimated retained value, and estimated retained value per watt, including the assumptions related to the calculation of the foregoing metrics.
Forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified. Forward-looking statements should not be read as a guarantee of future performance or results, and they will not necessarily be accurate indications of the times at, or by, which such performance or results will be achieved, if at all. These statements are based on current expectations and assumptions regarding future events and business performance as of the date of this press release, and they are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements, including but not limited to: the availability of additional financing on acceptable terms; changes in the retail price of traditional utility generated electricity; changes in electric utility policies and regulations; the availability of rebates, tax credits and other incentives, including solar renewable energy certificates, or SRECs, and other federal and state incentives; regulations and policies related to net metering; changes in regulations, tariffs and other trade barriers and tax policy affecting us and our industry; our ability to manage growth, product offering mix, and costs effectively, including attracting, training and retaining sales personnel and solar energy system installers; the availability and price of solar panels and other system components, the assumptions employed in calculating our operating metrics may be inaccurate; and such other risks identified in the registration statements and reports that Vivint Solar files with the U.S. Securities and Exchange Commission, or SEC, from time to time. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee that the future results, levels of activity, performance or events and circumstances reflected in those statements will be achieved or will occur, and actual results could differ materially from those anticipated or implied in the forward-looking statements. Except as required by law, Vivint Solar does not undertake and expressly disclaims any obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments or otherwise. You should read the documents Vivint Solar has filed with the SEC for more complete information about the company. These documents are available on both the EDGAR section of the SEC's website at www.sec.gov and the Investor Relations section of the company's website at investors.vivintsolar.com/.
Vivint Solar, Inc.
Condensed Consolidated Unaudited Balance Sheets
(In thousands)
March 31, December 31,
2018 2017
---- ----
ASSETS
Current assets:
Cash and cash equivalents $78,466 $108,452
Accounts receivable, net 18,236 19,665
Inventories 15,790 22,597
Prepaid expenses and other current
assets 22,234 34,049
------ ------
Total current assets 134,726 184,763
Restricted cash and cash equivalents 47,773 46,486
Solar energy systems, net 1,727,479 1,673,532
Property and equipment, net 13,315 15,078
Intangible assets, net 725 862
Prepaid tax asset, net - 505,883
Other non-current assets, net 41,763 37,325
------ ------
TOTAL ASSETS $1,965,781 $2,463,929
========== ==========
LIABILITIES, REDEEMABLE NON-CONTROLLING
INTERESTS AND EQUITY
Current liabilities:
Accounts payable $40,751 $40,736
Accounts payable-related party 529 163
Distributions payable to non-
controlling interests and redeemable
non-controlling interests 7,501 16,437
Accrued compensation 19,890 20,992
Current portion of long-term debt 13,566 13,585
Current portion of deferred revenue 24,255 41,846
Current portion of capital lease
obligation 3,439 4,166
Accrued and other current liabilities 25,989 29,675
------ ------
Total current liabilities 135,920 167,600
Long-term debt, net of current portion 959,187 925,964
Deferred revenue, net of current portion 11,311 29,200
Capital lease obligation, net of current
portion 1,226 1,599
Deferred tax liability, net 356,984 342,382
Other non-current liabilities 12,623 13,674
------ ------
Total liabilities 1,477,251 1,480,419
Commitments and contingencies
Redeemable non-controlling interests 130,107 122,444
Stockholders' equity:
Common stock 1,153 1,151
Additional paid-in capital 562,962 559,788
Accumulated other comprehensive income 13,694 6,905
(Accumulated deficit) retained earnings (277,015) 213,107
-------- -------
Total stockholders' equity 300,794 780,951
Non-controlling interests 57,629 80,115
------ ------
Total equity 358,423 861,066
------- -------
TOTAL LIABILITIES, REDEEMABLE
NON-CONTROLLING INTERESTS
AND EQUITY $1,965,781 $2,463,929
========== ==========
Vivint Solar, Inc.
Condensed Consolidated Unaudited Statements of Operations
(In thousands, except per share data)
Three Months Ended
March 31,
---------
2018 2017
---- ----
Revenue:
Operating
leases and
incentives $31,114 $30,389
Solar energy system and
product sales 37,136 22,725
------ ------
Total revenue 68,250 53,114
Cost of revenue:
Cost of revenue-
operating leases and
incentives 38,687 35,070
Cost of revenue-solar
energy system and
product sales 26,045 18,665
------ ------
Total cost of revenue 64,732 53,735
------ ------
Gross profit (loss) 3,518 (621)
Operating expenses:
Sales and marketing 11,125 8,818
Research and
development 486 896
General and
administrative 19,851 20,579
Amortization of
intangible assets 136 140
--- ---
Total operating
expenses 31,598 30,433
------ ------
Loss from operations (28,080) (31,054)
Interest expense 16,922 14,721
Other (income) expense,
net (2,261) 276
------ ---
Loss before income
taxes (42,741) (46,051)
Income tax expense 18,643 9,401
------ -----
Net loss (61,384) (55,452)
Net loss attributable
to non-controlling
interests and
redeemable non-
controlling interests (48,408) (68,744)
------- -------
Net (loss
attributable)
income
available
to common
stockholders $(12,976) $13,292
======== =======
Net (loss attributable)
income available per
share to common
stockholders:
Basic $(0.11) $0.12
====== =====
Diluted $(0.11) $0.11
====== =====
Weighted-average
shares used in
computing net (loss
attributable) income
available per share to
common stockholders:
Basic 115,155 110,765
======= =======
Diluted 115,155 116,398
======= =======
Vivint Solar, Inc.
Condensed Consolidated Unaudited Statements of Cash Flows
(In thousands)
Three Months Ended
March 31,
2018 2017
---- ----
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $(61,384) $(55,452)
Adjustments to reconcile net loss to net cash (used in)
provided by operating activities:
Depreciation and amortization 16,307 14,162
Amortization of intangible assets 136 140
Deferred income taxes 18,969 36,125
Stock-based compensation 2,969 3,922
Loss on solar energy systems and property and equipment 570 2,025
Non-cash interest and other expense 2,007 2,126
Reduction in lease pass-through financing obligation (687) (649)
(Gains) losses on interest rate swaps (2,262) 276
Changes in operating assets and liabilities:
Accounts receivable, net 1,429 (4,481)
Inventories 6,807 (2,115)
Prepaid expenses and other current assets 11,746 27,901
Prepaid tax asset, net - (24,181)
Other non-current assets, net 385 (3,861)
Accounts payable 374 641
Accrued compensation (2,351) (1,763)
Deferred revenue (9,083) 2,109
Accrued and other liabilities (103) 6,473
---- -----
Net cash (used in) provided by operating activities (14,171) 3,398
------- -----
CASH FLOWS FROM INVESTING ACTIVITIES:
Payments for the cost of solar energy systems (72,208) (75,140)
Payments for property and equipment (40) (278)
Proceeds from disposals of solar energy systems and
property and equipment 775 171
--- ---
Net cash used in investing activities (71,473) (75,247)
------- -------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from investment by non-controlling interests
and redeemable non-controlling interests 42,771 58,560
Distributions paid to non-controlling interests and
redeemable non-controlling interests (18,122) (15,027)
Proceeds from long-term debt 40,000 253,750
Payments on long-term debt (7,748) (141,159)
Payments for debt issuance and deferred offering costs - (10,430)
Proceeds from lease pass-through financing obligation 852 852
Principal payments on capital lease obligations (1,015) (1,196)
Proceeds from issuance of common stock 207 147
--- ---
Net cash provided by financing activities 56,945 145,497
------ -------
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS,
INCLUDING RESTRICTED AMOUNTS (28,699) 73,648
CASH AND CASH EQUIVALENTS, INCLUDING RESTRICTED AMOUNTS-
Beginning of period 154,938 123,439
------- -------
CASH AND CASH EQUIVALENTS, INCLUDING RESTRICTED
AMOUNTS-End of period $126,239 $197,087
======== ========
Vivint Solar, Inc.
Key Operating Metrics
Three Months Ended
March 31, December 31, March 31,
2018 2017 2017
---- ---- ----
Installations 5,813 6,467 6,581
Megawatts
installed 40.4 44.6 45.8
Cumulative
installations 132,643 126,830 106,179
Cumulative
megawatts
installed 905.3 864.9 726.9
Estimated nominal
contracted
payments
remaining (in
millions) $3,128.2 $3,021.6 $2,691.9
Estimated
retained value
under energy
contracts (in
millions) $1,295.7 $1,238.0 $1,068.3
Estimated
retained value
of renewal (in
millions) $396.6 $377.1 $317.4
Estimated
retained value
(in millions) $1,692.3 $1,615.1 $1,385.7
Estimated
retained value
per watt $2.02 $2.00 $1.97
Sensitivity Analysis for Retained Value
The following table provides quantitative sensitivity analysis of our estimate of retained value of solar energy systems under contracts as of March 31, 2018, including both the contracted and estimated renewal portion, at a range of discount rates (retained value amounts in millions):
4% 6% 8%
--- --- ---
Estimated retained value
under energy contracts $1,541.0 $1,295.7 $1,102.6
Estimated retained value of
renewal 617.0 396.6 257.8
----- ----- -----
Total estimated retained
value $2,158.0 $1,692.3 $1,360.4
======== ======== ========
Non-GAAP Earnings per Share (EPS) Before Non-controlling Interests
We report GAAP EPS, which is based upon net (loss attributable) income available to common stockholders. We also report non-GAAP EPS. The difference between GAAP EPS and non-GAAP EPS is that non-GAAP EPS is based on net loss, which excludes net loss attributable to non-controlling interests and redeemable non-controlling interests. As we are in a net loss position for all periods reported, potentially issuable shares are excluded from the diluted EPS calculation since the effect would be antidilutive. Therefore, basic and diluted non-GAAP EPS are the same in each period presented.
Under GAAP accounting, we report net loss attributable to non-controlling interests and redeemable non-controlling interests to reflect our joint venture fund investors' allocable share in the results of these joint venture investment funds. Net loss attributable to non-controlling interests and redeemable non-controlling interests is calculated based primarily on the hypothetical liquidation at book value, or HLBV, method, which assumes that the joint venture funds are liquidated at the reporting date, even though liquidation may or may not ever occur. Additionally, the returns that will be allocated to the investors over the expected terms of the investment funds may differ significantly from the amounts calculated under the HLBV method. Accordingly, we also report non-GAAP EPS based on our losses before net loss attributable to non-controlling interests and redeemable non-controlling interests per share, which we view as a better measure of our operating performance. Non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as a substitute for our financial results prepared in accordance with GAAP.
According to this definition, the non-GAAP loss before the allocation of loss attributable to non-controlling interests and redeemable non-controlling interests per share was ($0.53) for the three months ended March 31, 2018.
Vivint Solar, Inc.
Reconciliation from GAAP EPS to Non-GAAP EPS
(In thousands, except per share data)
Three Months Ended
March 31, 2018 March 31, 2017
-------------- --------------
Net Loss EPS Net Loss EPS
-------- --- -------- ---
Net (loss attributable)
income available to
common stockholders $(12,976) $(0.11) $13,292 $0.12
Net loss attributable to non-
controlling interests and
redeemable non-controlling
interests (48,408) (0.42) (68,744) (0.62)
------- ----- ------- -----
Non-GAAP net loss $(61,384) $(0.53) $(55,452) $(0.50)
======== ====== ======== ======
Weighted-average shares used in
computing net loss per share 115,155 110,765
======= =======
Glossary of Definitions
"Installations" represents the number of solar energy systems installed on customers' premises.
"MWs or megawatts" represents the DC nameplate megawatt production capacity.
"MW Booked" represents the aggregate megawatt nameplate capacity of solar energy systems that were permitted during the period net of cancellations in the period.
"MW Installed" represents the aggregate megawatt nameplate capacity of solar energy systems for which panels, inverters, and mounting and racking hardware have been installed on customer premises in the period.
"Nominal Contracted Payments Remaining" equals the sum of the remaining cash payments that Vivint Solar's customers are expected to pay over the term of their agreements for systems installed as of the measurement date. For a power purchase agreement, Vivint Solar multiplies the contract price per kilowatt-hour by the estimated annual energy output of the associated solar energy system to determine the estimated nominal contracted payments. For a customer lease, Vivint Solar includes the monthly fees and upfront fee, if any, as set forth in the lease.
"Retained Value" represents the net cash flows, discounted at 6%, that Vivint Solar expects to receive from customers pursuant to long-term customer contracts net of estimated cash distributions to fund investors and estimated operating expenses for systems installed as of the measurement date. For purposes of the calculation, Vivint Solar aggregates the estimated retained value from the solar energy systems during the typical 20-year term of Vivint Solar's contracts, which Vivint Solar refers to as estimated retained value under energy contracts, and the estimated retained value associated with an assumed 10-year renewal term following the expiration of the initial contract term, which Vivint Solar refers to as estimated retained value of renewal. To calculate estimated retained value of renewal, Vivint Solar assumes all contracts are renewed at 90% of the contractual price in effect at the expiration of the initial term.
"Retained Value per Watt" is calculated by dividing the estimated retained value as of the measurement date by the aggregate nameplate capacity of solar energy systems under long-term customer contracts that have been installed as of such date, and is subject to the same assumptions and uncertainties as estimated retained value.
"Undeployed Tax Equity Financing Capacity" represents a forecast of the amount of megawatts that can be deployed based on committed available tax equity financing for energy contracts.
Investor Contact:
Rob Kain
855-842-1844
ir@vivintsolar.com
Press Contact:
Helen Langan
385-202-6577
pr@vivintsolar.com
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SOURCE Vivint Solar
