SunPower Reports First Quarter Results
SunPower Reports First Quarter Results
Company Exceeds Revenue, Margin and Adjusted EBITDA Forecasts; Record First Quarter Performance in US Residential Business
SAN JOSE, Calif., May 8, 2018 /PRNewswire/ -- SunPower Corp. (NASDAQ:SPWR) today announced financial results for its first quarter ended April 1, 2018.
($
Millions,
except
percentages
and per-
share
data) 1st Quarter 4th Quarter 1st Quarter
2018 2017(3) 2017(3)
--- ---- ------ ------
GAAP
revenue $391.9 $651.1 $329.1
-------- ------ ------ ------
GAAP gross
margin 2.6% (2.1)% (13.9)%
---------- --- ----- ------
GAAP net
loss $(116.0) $(572.7) $(219.7)
-------- ------- ------- -------
GAAP net
loss per
diluted
share $(0.83) $(4.10) $(1.58)
--------- ------ ------ ------
Non-GAAP
revenue(1) $398.9 $824.0 $429.5
----------- ------ ------ ------
Non-GAAP
gross
margin1,2 6.5% 11.9% 6.5%
---------- --- ---- ---
Non-GAAP
net
income
(loss)1,2 $(28.2) $35.8 $(50.4)
---------- ------ ----- ------
Non-GAAP
net
income
(loss)
per
diluted
share1,2 $(0.20) $0.25 $(0.36)
--------- ------ ----- ------
Adjusted
EBITDA1,2 $32.3 $100.3 $8.6
---------- ----- ------ ----
Operating
cash flow $(233.3) $47.9 $(126.9)
---------- ------- ----- -------
(1)Information about SunPower's
use of non-GAAP financial
information, including a
reconciliation to U.S. GAAP, is
provided under "Use of Non-GAAP
Financial Measures" below.
2 Excludes polysilicon costs
related to above market
polysilicon contracts.
3 The company adopted the new
revenue recognition standard
effective January 1, 2018. The
prior periods presented here
have been restated to reflect
adoption of the new standard.
"Our solid execution, ability to meet project deadlines and commitment to controlling costs enabled us to exceed our forecasts across all of our business segments," said Tom Werner, SunPower CEO and chairman of the board. "In our distributed generation business (DG), we continued to gain share in both our residential and commercial end markets as we saw strong demand throughout the quarter. In commercial, we completed and sold a number of key projects including our 7-megawatt (MW) Joint Base Anacostia-Bolling (JBAB) project as well as our 4-MW carport, rooftop and ground system for Campbell Soup. Additionally, interest in our recently launched Helix commercial storage solution remained strong as we added to our pipeline during the quarter. Demand for our high quality, industry leading residential solutions was also robust as we exceeded plan in all core markets with our U.S. residential business posting record first quarter results. In our power plant business, we executed well as we met our project milestones including the sale of our 126-MW Guajiro development project in Mexico to Atlas Renewables. Finally, we further expanded the global footprint of our SunPower Solutions (SPS) group as first quarter shipments exceeded 100 MW and we remain on plan to deploy up to 1 gigawatt (GW) in SPS this year.
"In our upstream business, we achieved our cost reduction targets and our Fabs remain at 100 percent utilization. We also continued tool installation for our first full-scale Next Generation Technology (NGT) production line at Fab 3 with first silicon expected in June and volume production planned in the fourth quarter.
"Over a year ago, we embarked on a program to transform the company through the implementation of a number of key operational and strategic initiatives. Operationally, our goal was to improve cash flow, delever the balance sheet, divest certain assets, reduce operating expenses and simplify our financial reporting. Strategically, our initiatives have focused on improving our competitive position in a challenging industry environment while structuring the company for sustained profitability. As a result, we made the decision to sell our remaining power plant development assets, expand our global equipment sales business through our SPS group and reallocate resources to our faster growing, higher margin global DG business. Additionally, we committed to investing in those areas that offer further differentiation and growth potential including our industry leading cell and panel technology, our solar-plus-storage offerings, as well as our complete solutions product suite.
"Given the strong progress of our transformation initiatives over the last 12 months, we have now turned our efforts to the next phase of our strategy: optimizing our corporate structure to further reduce costs, improve financial transparency and better position the company for sustained profitability. As a result of these efforts, we believe that a model that more closely aligns us towards an upstream and downstream business unit structure offers us significant opportunities to maximize our core strengths in manufacturing, technology and products while streamlining decision making and simplifying our financial reporting.
"Specifically, in upstream we will focus our efforts on further leveraging our proprietary back contact cell technology, including NGT, as well as the continued ramp of our unique P-Series product which we expect to reach multi-GW scale by the end of this year. Also, with the recent announcement of our planned acquisition of SolarWorld Americas, we expect to expand our U.S. manufacturing footprint, adding additional cell and module capacity to serve growing demand in North America. With a broad portfolio of high efficiency, high quality DG product offerings, we believe we can capture greater market share and superior margins in the residential and commercial segments due to our differentiated technology attributes. In relation to the downstream, we plan on increasing investment in our U.S. DG business while leveraging our SPS group to continue to meet the demand of our global power plant and DG customer base. With the DG industry forecasted to grow by 40 percent over the next five years, our extensive product portfolio, solar-plus-storage offerings and a strong global power plant and rooftop channel strategy through SPS, we believe the transition to our new business unit structure will position us to drive long term, sustained financial success for our shareholders.
"Finally, we are progressing on our corporate initiatives to delever our balance sheet. For example, the sale of our ownership stake in 8point3 Energy Partners remains on plan with the shareholder vote on the proposed transaction scheduled for May 23, 2018. Also, we expect to monetize more than 400 MW of SunPower leases that we currently hold on our balance sheet over the coming quarters. In addition, we are in the process of actively divesting our North America power plant development assets in order to focus exclusively on leveraging our SPS group for power plant equipment sales. We believe these actions, as well as others, will materially increase our liquidity, improve cash flow and simplify our financial statements," concluded Werner.
"Our strong first quarter performance was driven by solid execution in all markets while prudently managing expenses," said Chuck Boynton, SunPower chief financial officer. "Financially, our efforts remain focused on improving cash flow, managing our working capital and executing on our restructuring initiatives. With our asset monetization plans on track and continued cost control, we are well positioned to retire our $300 million convert in June as well as having the resources to fund our growth plans this year."
First quarter fiscal 2018 non-GAAP results exclude net adjustments that, in the aggregate, improved non-GAAP earnings by $87.8 million, including $1.4 million related to sale-leaseback transactions, $45.1 million related to impairment of residential lease assets, $18.7 million related to cost of above market polysilicon, $11.2 million related to restructuring expense, $8.8 million related to stock-based compensation expense, and $2.6 million related to intangibles.
Financial Outlook
The company's second quarter GAAP guidance is as follows: revenue of $360 million to $410 million, gross margin of 2.5 percent to 4.5 percent and a net loss of $125 million to $100 million. Second quarter 2018 GAAP guidance includes the impact of revenue and timing deferrals due to sale-leaseback transactions as well as charges related to the company's restructuring initiatives. On a non-GAAP basis, the company expects revenue of $375 million to $425 million, gross margin of 6 percent to 8 percent, Adjusted EBITDA of $10 million to $35 million and megawatts deployed in the range of 350 MW to 380 MW. Second quarter non-GAAP guidance reflects timing differences related to the revenue recognition of certain power plant projects during the quarter.
Also, the company now expects fiscal year 2018 Adjusted EBITDA to be in the range of $75 to $125 million. Fiscal year 2018 Adjusted EBITDA guidance assumes a $55 million negative impact related to tariffs associated with the section 201 trade case as well as a reduction of approximately $50 million of non-controlling interest income resulting from the anticipated sale of the company's lease portfolio in the second half of the year. On a comparative basis under the same assumptions, the company expects 10 to 15 percent year-over-year growth in 2018 Adjusted EBITDA.
The company will host a conference call for investors this afternoon to discuss its first quarter 2018 performance at 1:30 p.m. Pacific Time. The call will be webcast and can be accessed from SunPower's website at http://investors.sunpower.com/events.cfm.
This press release contains both GAAP and non-GAAP financial information. Non-GAAP figures are reconciled to the closest GAAP equivalent categories in the financial attachment of this press release. Please note that the company has posted supplemental information and slides related to its first quarter 2018 performance on the Events and Presentations section of SunPower's Investor Relations page at http://investors.sunpower.com/events.cfm. The capacity of power plants in this release is described in approximate megawatts on a direct current (dc) basis unless otherwise noted.
About SunPower
As one of the world's most innovative and sustainable energy companies, SunPower Corporation (NASDAQ:SPWR) provides a diverse group of customers with complete solar solutions and services. Residential customers, businesses, governments, schools and utilities around the globe rely on SunPower's more than 30 years of proven experience. From the first flip of the switch, SunPower delivers maximum value and superb performance throughout the long life of every solar system. Headquartered in Silicon Valley, SunPower has dedicated, customer-focused employees in Africa, Asia, Australia, Europe, North and South America. For more information about how SunPower is changing the way our world is powered, visit www.sunpower.com.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, but not limited to, statements regarding: (a) expectations regarding demand and project and order pipelines; (b) our plans and expectations regarding manufacturing expansion, production goals, product focus and production ramps, and cost reduction efforts; (c) our strategic goals and plans, and our ability to achieve them; (d) our plans to optimize our corporate structure, reduce and control costs, improve financial transparency, maximize our core strengths, position our company for sustained profitability, streamline decision making, and the impact of these initiatives on our financial performance; (e) our expectations and plans regarding product focus, growth and market share, profitability, margins, and financial performance in each of our business lines; (f) our plans expansion of our U.S. distributed generation and SunPower Solutions business lines, and our ability to meet global demand; (g) our plans to invest in technologies and strategic initiatives and allocate resources; (h) our plans to align into upstream and downstream business units, and the financial impacts of such plans; (i) our expectations regarding our restructuring plan and associated initiatives, including plans to delever our balance sheet and complete planned divestiture transactions, and the impact of these initiatives on our liquidity, financial performance, cash flow, and operating expenses; (j) our ability to successfully complete key strategic transactions, including the sale of our remaining power plant development assets, the sale of our interest in 8point3 Partners, our planned monetization of our lease portfolio and associated accounting charges, and our expectations regarding the timing and proceeds of such transactions, and their impact on our liquidity, cash flow, and financial statements; (k) our plans and expectations with respect to acquisition and expansion activities, including the planned SolarWorld Americas acquisition; (l) our positioning for future success, long-term competitiveness, and our ability to return to sustained profitability; (m) our ability to retire our 2018 convertible bonds, and fund our planned growth initiatives; (n) our expectations for the solar industry and the markets we serve, including market conditions, tariff and associated impacts, demand and focus, and long-term prospects; (o) our second quarter fiscal 2018 guidance, including GAAP revenue, gross margin, and net loss, as well as non-GAAP revenue, gross margin, Adjusted EBITDA, and MW deployed, including related assumptions; and (p) fiscal year 2018 guidance, Adjusted EBITDA, including related assumptions and projected year over year growth. These forward-looking statements are based on our current assumptions, expectations and beliefs and involve substantial risks and uncertainties that may cause results, performance or achievement to materially differ from those expressed or implied by these forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to: (1) competition in the solar and general energy industry and downward pressure on selling prices and wholesale energy pricing; (2) our liquidity, substantial indebtedness, and ability to obtain additional financing for our projects and customers; (3) changes in public policy, including the imposition and applicability of tariffs pursuant to the Section 201 trade action and the process for exemptions; (4) regulatory changes and the availability of economic incentives promoting use of solar energy; (5) the success of our ongoing research and development efforts and our ability to commercialize new products and services, including products and services developed through strategic partnerships; (6) fluctuations in our operating results; (7) appropriately sizing our manufacturing capacity and containing manufacturing and logistics difficulties that could arise; (8) challenges managing our joint ventures and partnerships; (9) challenges executing on our HoldCo and YieldCo strategies, including the risk that we may not be able to successfully monetize our interest in 8point3 Energy Partners; and (12) our ability to successfully implement actions to meet our cost reduction targets, reduce capital expenditures, and implement our restructuring plan and associated initiatives, including plans to sell projects, monetize assets, and streamline our business and focus.? A detailed discussion of these factors and other risks that affect our business is included in filings we make with the Securities and Exchange Commission (SEC) from time to time, including our most recent reports on Form 10-K and Form 10-Q, particularly under the heading "Risk Factors."? Copies of these filings are available online from the SEC or on the SEC Filings section of our Investor Relations website at investors.sunpower.com.?All forward-looking statements in this press release are based on information currently available to us, and we assume no obligation to update these forward-looking statements in light of new information or future events.
©2018 SunPower Corporation. All rights reserved. SUNPOWER, the SUNPOWER logo, EQUINOX and HELIX are trademarks or registered trademarks of SunPower Corporation in the U.S. and other countries as well.
SUNPOWER CORPORATION
CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
Apr. 1, Dec. 31,
2018 2017
---- ----
Assets
Current assets:
Cash and cash
equivalents $260,672 $435,097
Restricted cash and
cash equivalents,
current portion 34,667 43,709
Accounts receivable,
net 190,795 204,966
Contract assets 58,636 35,074
Inventories 354,611 352,829
Advances to
suppliers, current
portion 93,744 30,689
Project assets -
plants and land,
current portion 72,767 103,063
Prepaid expenses and
other current
assets 139,071 146,209
-------
Total current assets 1,204,963 1,351,636
Restricted cash and
cash equivalents,
net of current
portion 67,230 65,531
Restricted long-
term marketable
securities 5,959 6,238
Property, plant and
equipment, net 1,137,083 1,147,845
Solar power systems
leased and to be
leased, net 377,012 369,218
Advances to
suppliers, net of
current portion 117,096 185,299
Long-term financing
receivables, net 341,619 330,672
Goodwill and other
intangible assets,
net 23,512 25,519
Other long-term
assets 508,249 546,698
Total assets $3,782,723 $4,028,656
========== ==========
Liabilities and Equity
Current liabilities:
Accounts payable $334,201 $406,902
Accrued liabilities 184,846 229,208
Contract
liabilities,
current portion 86,226 104,286
Short-term debt 59,583 58,131
Convertible debt,
current portion 299,875 299,685
Total current
liabilities 964,731 1,098,212
Long-term debt 431,655 430,634
Convertible debt 816,930 816,454
Contract
liabilities, net of
current portion 156,510 171,610
Other long-term
liabilities 817,540 804,122
Total liabilities 3,187,366 3,321,032
--------- ---------
Redeemable
noncontrolling
interests in
subsidiaries 14,105 15,236
Equity:
Preferred stock - -
Common stock 141 140
Additional paid-in
capital 2,449,907 2,442,513
Accumulated deficit (1,785,927) (1,669,897)
Accumulated other
comprehensive loss (897) (3,008)
Treasury stock, at
cost (186,065) (181,539)
--------
Total stockholders'
equity 477,159 588,209
Noncontrolling
interests in
subsidiaries 104,093 104,179
Total equity 581,252 692,388
------- -------
Total liabilities
and equity $3,782,723 $4,028,656
========== ==========
SUNPOWER CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
THREE MONTHS ENDED
------------------
Apr. 1, Dec. 31, Apr. 2,
2018 2017 2017
---- ---- ----
Revenue:
Residential $169,432 $174,322 $134,694
Commercial 123,336 144,003 105,446
Power Plant 99,120 332,809 88,955
------ ------- ------
Total revenue 391,888 651,134 329,095
Cost of revenue:
Residential 141,390 164,817 119,920
Commercial 118,023 171,221 105,600
Power Plant 122,227 328,689 149,159
------- ------- -------
Total cost of revenue 381,640 664,727 374,679
Gross profit (loss) 10,248 (13,593) (45,584)
Operating expenses:
Research and development 18,891 19,823 20,515
Selling, general and administrative 65,130 72,526 67,403
Restructuring charges 11,177 2,769 9,790
Impairment of residential lease
assets 49,092 624,335 -
------ ------- ---
Total operating expenses 144,290 719,453 97,708
------- ------- ------
Operating loss (134,042) (733,046) (143,292)
Other income (expense), net:
Interest income 529 139 938
Interest expense (25,106) (24,851) (20,902)
Other, net 15,794 1,468 (74,088)
Other expense, net (8,783) (23,244) (94,052)
------ ------- -------
Loss before income taxes and equity
in earnings of unconsolidated
investees (142,825) (756,290) (237,344)
Benefit from (provision for) income
taxes (2,628) 2,870 (2,031)
Equity in earnings (loss) of
unconsolidated investees (2,144) (146) 2,488
------ ---- -----
Net loss (147,597) (753,566) (236,887)
Net loss attributable to
noncontrolling interests and
redeemable noncontrolling
interests 31,623 180,915 17,161
Net loss attributable to
stockholders $(115,974) $(572,651) $(219,726)
========= ========= =========
Net loss per share attributable to
stockholders:
- Basic $(0.83) $(4.10) $(1.58)
- Diluted $(0.83) $(4.10) $(1.58)
Weighted-average shares:
- Basic 140,212 139,613 138,902
- Diluted 140,212 139,613 138,902
SUNPOWER CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
THREE MONTHS ENDED
------------------
Apr. 1, Dec. 31, Apr. 2,
2018 2017 2017
---- ---- ----
Cash flows from operating activities:
Net loss $(147,597) $(753,566) $(236,887)
Adjustments to reconcile net loss to net
cash provided by (used in) operating
activities:
Depreciation and amortization 39,833 54,291 41,247
Stock-based compensation 7,053 9,294 7,375
Non-cash interest expense 4,443 5,837 2,958
Impairment of equity method investment - 7,993 72,964
Dividend from 8point3 Energy Partners LP 5,399 7,859 7,192
Equity in earnings of unconsolidated
investees 2,144 146 (2,488)
Gain on sale of equity method investment (15,576) (5,346) -
Deferred income taxes (344) (8,541) 227
Impairment of residential lease assets 49,092 624,335 -
Other, net 972 (3,881) 4,777
Changes in operating assets and liabilities,
net of effect of acquisitions:
Accounts receivable 13,924 (40,469) 50,651
Contract assets (23,561) 7,104 12,401
Inventories (34,195) 28,776 (40,004)
Project assets 20,484 71,536 32,260
Prepaid expenses and other assets 10,885 14,103 33,264
Long-term financing receivables, net (38,114) (32,308) (30,584)
Advances to suppliers 5,149 16,075 13,701
Accounts payable and other accrued
liabilities (100,156) 4,281 (198,909)
Contract liabilities (33,097) 40,373 102,962
Net cash provided by (used in) operating
activities (233,262) 47,892 (126,893)
-------- ------ --------
Cash flows from investing activities:
Purchases of property, plant and equipment (8,859) (12,177) (27,877)
Cash paid for solar power systems, leased
and to be leased (23,787) (22,007) (18,217)
Cash paid for solar power systems (2,604) (88,306) (4,605)
Dividend from 8point3 Energy Partners LP 2,694 - -
Dividend from equity method investees - 882 -
Proceeds from sale of equity method
investment 27,282 5,954 -
Cash paid for investments in unconsolidated
investees (6,349) (2,680) (10,142)
Net cash used in investing activities (11,623) (118,334) (60,841)
------- -------- -------
Cash flows from financing activities:
Proceeds from bank loans and other debt 49,794 56,104 110,763
Repayment of bank loans and other debt (51,052) (54,755) (129,027)
Proceeds from issuance of non-recourse
residential financing, net of issuance
costs 32,687 6,435 20,580
Repayment of non-recourse residential
financing (3,781) (2,133) (1,298)
Contributions from noncontrolling interests
and redeemable noncontrolling interests
attributable to residential projects 36,726 55,591 49,030
Distributions to noncontrolling interests
and redeemable noncontrolling interests
attributable to residential projects (5,422) (5,200) (3,763)
Proceeds from issuance of non-recourse
power plant and commercial financing, net
of issuance costs 9,104 209,222 121,818
Repayment of non-recourse power plant and
commercial financing (890) (27,463) (28,964)
Purchases of stock for tax withholding
obligations on vested restricted stock (4,526) (366) (4,062)
Net cash provided by financing activities 62,640 237,435 135,077
------ ------- -------
Effect of exchange rate changes on cash,
cash equivalents, restricted cash and
restricted cash equivalents 477 (609) 788
--- ---- ---
Net increase (decrease) in cash, cash
equivalents, restricted cash and restricted
cash equivalents (181,768) 166,384 (51,869)
Cash, cash equivalents, restricted cash and
restricted cash equivalents, beginning of
period 544,337 377,953 514,212
------- ------- -------
Cash, cash equivalents, restricted cash and
restricted cash equivalents, end of period $362,569 $544,337 $462,343
======== ======== ========
Non-cash transactions:
Costs of solar power systems, leased and to
be leased, sourced from existing inventory $14,354 $15,296 $13,389
Costs of solar power systems, leased and to
be leased, funded by liabilities $5,835 $5,527 $3,169
Costs of solar power systems under sale-
leaseback financing arrangements, sourced
from project assets $9,791 $44,490 $52,917
Property, plant and equipment acquisitions
funded by liabilities $12,768 $15,706 $44,966
Contractual obligations satisfied with
inventory $17,517 $14,820 $ -
Assumption of debt by buyer upon sale of
equity interest $27,321 $ - $ -
Assumption of debt by buyer upon sale of
projects $ - $196,104 $ -
Impact to Previously Reported Results
Adoption of ASC 606 impacted our previously reported results as follows:
SUNPOWER CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
Three Months Ended December 31, 2017
------------------------------------
As Reported Adoption of ASC 606 As Adjusted
----------- ------------------- -----------
Revenue:
Residential $175,652 $(1,330) $174,322
Commercial 147,559 (3,556) 144,003
Power Plant 334,889 (2,080) 332,809
------- -------
Total revenue 658,100 (6,966) 651,134
Cost of revenue:
Residential 165,683 (866) 164,817
Commercial 174,948 (3,727) 171,221
Power Plant 332,701 (4,012) 328,689
------- -------
Total cost of revenue 673,332 (8,605) 664,727
Gross profit (loss) (15,232) 1,639 (13,593)
Operating loss (734,685) 1,639 (733,046)
Other expense, net (16,179) (7,065) (23,244)
------- ------ -------
Loss before income taxes and equity
in earnings of unconsolidated
investees (750,864) (5,426) (756,290)
Equity in earnings (loss) of
unconsolidated investees (1,598) 1,452 (146)
------ ----
Net loss (749,592) (3,974) (753,566)
Net loss attributable to
stockholders $(568,677) $(3,974) $(572,651)
========= ======= =========
Net loss per share attributable to
stockholders:
- Basic $(4.07) $(0.03) $(4.10)
- Diluted $(4.07) $(0.03) $(4.10)
Three Months Ended October 1, 2017
----------------------------------
As Reported Adoption of ASC 606 As Adjusted
----------- ------------------- -----------
Revenue:
Residential $153,258 $(1,345) $151,913
Commercial 106,005 8,407 114,412
Power Plant 217,928 1,583 219,511
------- -------
Total revenue 477,191 8,645 485,836
Cost of revenue:
Residential 126,614 (867) 125,747
Commercial 99,988 6,718 106,706
Power Plant 234,931 (2,837) 232,094
------- -------
Total cost of revenue 461,533 3,014 464,547
Gross profit 15,658 5,631 21,289
Operating loss (76,953) 5,631 (71,322)
Other expense, net (22,668) 936 (21,732)
------- --- -------
Loss before income taxes and equity
in earnings of unconsolidated
investees (99,621) 6,567 (93,054)
Equity in earnings (loss) of
unconsolidated investees 15,308 1,451 16,759
------ ------
Net loss (78,856) 8,018 (70,838)
Net loss attributable to
stockholders $(54,247) $8,018 $(46,229)
======== ====== ========
Net loss per share attributable to
stockholders:
- Basic $(0.39) $0.06 $(0.33)
- Diluted $(0.39) $0.06 $(0.33)
Three Months Ended July 2, 2017
-------------------------------
As Reported Adoption of ASC 606 As Adjusted
----------- ------------------- -----------
Revenue:
Gross profit $157,125 $(1,319) $155,806
Commercial 100,105 (8,279) 91,826
Power Plant 80,216 133 80,349
------ ------
Total revenue 337,446 (9,465) 327,981
Cost of revenue:
Residential 130,987 (844) 130,143
Commercial 97,530 (8,914) 88,616
Power Plant 93,694 (639) 93,055
------ ------
Total cost of revenue 322,211 (10,397) 311,814
Gross profit 15,235 932 16,167
Operating loss (78,191) 932 (77,259)
Other expense, net (37,727) 925 (36,802)
------- --- -------
Loss before income taxes and equity
in earnings of unconsolidated
investees (115,918) 1,857 (114,061)
Equity in earnings (loss) of
unconsolidated investees 5,449 1,388 6,837
----- -----
Net loss (112,822) 3,245 (109,577)
Net loss attributable to
stockholders $(93,760) $3,245 $(90,515)
======== ====== ========
Net loss per share attributable to
stockholders:
- Basic $(0.67) $0.02 $(0.65)
- Diluted $(0.67) $0.02 $(0.65)
SUNPOWER CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands, except per share data)
(Unaudited)
Three Months Ended December 31, 2017
------------------------------------
As Reported Adoption of ASC 606 As Adjusted
----------- ------------------- -----------
Net loss $(749,592) $(3,974) $(753,566)
Adjustments to reconcile net loss to net cash provided by operating
activities:
Depreciation and amortization 55,157 (866) 54,291
Impairment of equity method
investment - 7,993 7,993
Equity in loss (earnings) of
unconsolidated investees 1,598 (1,452) 146
Changes in operating assets and liabilities, net of effect of
acquisitions:
Accounts receivable (35,234) (5,235) (40,469)
Costs and estimated earnings in
excess of billings 1,026 (1,026) -
Contract assets - 7,104 7,104
Project assets 81,177 (9,641) 71,536
Prepaid expenses and other assets 8,240 5,863 14,103
Long-term financing receivables,
net (32,343) 35 (32,308)
Accounts payable and other
accrued liabilities 36,272 (31,991) 4,281
Billings in excess of costs and
estimated earnings 270 (270) -
Customer advances 6,913 (6,913) -
Contract liabilities - 40,373 40,373
Net cash provided by operating
activities 47,892 - 47,892
------ --- ------
Net increase in cash, cash
equivalents, restricted cash and
restricted cash equivalents 166,384 - 166,384
Cash, cash equivalents,
restricted cash and restricted
cash equivalents, beginning of
period 377,953 - 377,953
-------
Cash, cash equivalents,
restricted cash and restricted
cash equivalents, end of period $544,337 $ - $544,337
======== ===================================== ========
Three Months Ended October 1, 2017
----------------------------------
As Reported Adoption of ASC 606 As Adjusted
----------- ------------------- -----------
Net loss $(78,856) $8,018 $(70,838)
Adjustments to reconcile net loss to net cash used in operating
activities:
Depreciation and amortization 46,188 (868) 45,320
Equity in earnings of
unconsolidated investees (15,308) (1,451) (16,759)
Changes in operating assets and liabilities, net of effect of
acquisitions:
Accounts receivable 10,331 1,465 11,796
Costs and estimated earnings in
excess of billings 394 (394) -
Contract assets - (6,625) (6,625)
Project assets (2,194) 6,748 4,554
Prepaid expenses and other assets 11,525 (463) 11,062
Long-term financing receivables,
net (28,984) 23 (28,961)
Accounts payable and other
accrued liabilities (20,495) (6,523) (27,018)
Billings in excess of costs and
estimated earnings (3,269) 3,269 -
Customer advances 1,556 (1,556) -
Contract liabilities - (1,643) (1,643)
Net cash used in operating
activities (26,612) - (26,612)
------- --- -------
Net decrease in cash, cash
equivalents, restricted cash and
restricted cash equivalents (23,070) - (23,070)
Cash, cash equivalents,
restricted cash and restricted
cash equivalents, beginning of
period 401,023 - 401,023
-------
Cash, cash equivalents,
restricted cash and restricted
cash equivalents, end of period $377,953 $ - $377,953
======== ===================================== ========
Three Months Ended July 2, 2017
-------------------------------
As Reported Adoption of ASC 606 As Adjusted
----------- ------------------- -----------
Net loss $(112,822) $3,245 $(109,577)
Adjustments to reconcile net loss to net cash used in operating
activities:
Depreciation and amortization 45,269 (845) 44,424
Equity in earnings of
unconsolidated investees (5,449) (1,387) (6,836)
Changes in operating assets and liabilities, net of effect of
acquisitions:
Accounts receivable (27,224) 4,055 (23,169)
Costs and estimated earnings in
excess of billings 1,859 (1,859) -
Contract assets - (2,220) (2,220)
Project assets (97,022) (8,935) (105,957)
Prepaid expenses and other assets 53,852 (1,751) 52,101
Long-term financing receivables,
net (31,872) 51 (31,821)
Accounts payable and other
accrued liabilities (9,754) 15,050 5,296
Billings in excess of costs and
estimated earnings (4,411) 4,411 -
Customer advances 13,294 (13,294) -
Contract liabilities - 3,479 3,479
Net cash used in operating
activities (161,799) - (161,799)
-------- --- --------
Net decrease in cash, cash
equivalents, restricted cash and
restricted cash equivalents (61,320) - (61,320)
Cash, cash equivalents,
restricted cash and restricted
cash equivalents, beginning of
period 462,343 - 462,343
-------
Cash, cash equivalents,
restricted cash and restricted
cash equivalents, end of period $401,023 $ - $401,023
======== ===================================== ========
Use of Non-GAAP Financial Measures
To supplement its consolidated financial results presented in accordance with GAAP, the company uses non-GAAP measures that are adjusted for certain items from the most directly comparable GAAP measures, as described below. The specific non-GAAP measures listed below are: revenue; gross profit/margin; net income (loss); net income (loss) per diluted share; and adjusted earnings before interest, taxes, depreciation and amortization ("Adjusted EBITDA"). Management believes that each of these non-GAAP measures is useful to investors, enabling them to better assess changes in each of these key elements of the company's results of operations across different reporting periods on a consistent basis, independent of certain items as described below. Thus, each of these non-GAAP financial measures provides investors with another method to assess the company's operating results in a manner that is focused on its ongoing, core operating performance, absent the effects of these items. Management uses these non-GAAP measures internally to assess the business, its financial performance, current and historical results, as well as for strategic decision-making and forecasting future results. Many of the analysts covering the company also use these non-GAAP measures in their analyses. Given management's use of these non-GAAP measures, the company believes these measures are important to investors in understanding the company's operating results as seen through the eyes of management. These non-GAAP measures are not prepared in accordance with GAAP or intended to be a replacement for GAAP financial data; the non-GAAP measures should be reviewed together with the GAAP measures and are not intended to serve as a substitute for results under GAAP, and may be different from non-GAAP measures used by other companies.
Non-GAAP revenue includes adjustments relating to 8point3, utility and power plant projects, and sale-leaseback transactions, each as described below. In addition to those same adjustments, Non-GAAP gross profit/margin includes adjustments relating to impairment of residential lease assets, cost of above-market polysilicon, stock-based compensation, amortization of intangible assets, depreciation of idle equipment, and non-cash interest expense, each as described below. In addition to those same adjustments, non-GAAP net income (loss) and non-GAAP net income (loss) per diluted share are adjusted for adjustments relating to, restructuring expense, IPO-related costs, the tax effect of these non-GAAP adjustments, and other items, each as described below. In addition to the same adjustments as non-GAAP net income (loss), Adjusted EBITDA includes adjustments relating to cash interest expense (net of interest income), provision for (benefit from) income taxes, and depreciation.
Non-GAAP Adjustments Based on International Financial Reporting Standards ("IFRS")
The company's non-GAAP results include adjustments to recognize revenue and profit under IFRS that are consistent with the adjustments made in connection with the company's reporting process as part of its status as a consolidated subsidiary of Total S.A., a foreign public registrant which reports under IFRS. Differences between GAAP and IFRS reflected in the company's non-GAAP results are further described below. In these situations, management believes that IFRS enables investors to better evaluate the company's revenue and profit generation performance, and assists in aligning the perspectives of our management and noncontrolling shareholders with those of Total S.A., our controlling shareholder.
-- 8point3. In 2015, 8point3 Energy Partners LP ("8point3 Energy
Partners"), a joint YieldCo vehicle, was formed by the company and First
Solar, Inc. ("First Solar" and, together with the company, the
"Sponsors") to own, operate and acquire solar energy generation assets.
Class A shares of 8point3 Energy Partners are now listed on the NASDAQ
Global Select Market under the trading symbol "CAFD." Immediately after
the IPO, the company contributed a portfolio of 170 MW of its solar
generation assets (the "SPWR Projects") to 8point3 Operating Company,
LLC ("OpCo"), 8point3 Energy Partners' primary operating subsidiary. In
exchange for the SPWR Projects, the company received cash proceeds as
well as equity interests in several 8point3 Energy Partners affiliated
entities: primarily common and subordinated units representing a 40.7%
(since reduced to 36.5% via a secondary issuance of shares in fiscal
2016) stake in OpCo and a 50.0% economic and management stake in 8point3
Holding Company, LLC ("Holdings"), the parent company of the general
partner of 8point3 Energy Partners and the owner of incentive
distribution rights in OpCo. Holdings, OpCo, 8point3 Energy Partners
and their respective subsidiaries are referred to herein as the "8point3
Group" or "8point3."
The company includes adjustments related to the sales of projects contributed to 8point3 previously based on the difference between the fair market value of the consideration received and the net carrying value of the projects contributed, of which, a portion is deferred in proportion to the company's retained equity stake in 8point3. Prior to the adoption of ASC 606, these sales are recognized under either real estate, lease, or consolidation accounting guidance depending upon the nature of the individual asset contributed, with outcomes ranging from no, partial, or full profit recognition. The company adopted ASC 606 on January 1, 2018, using the full retrospective method, which required the company to restate each prior period presented. The company recorded a material amount of deferred profit associated with projects sold to 8point3 in 2015, the majority of which had previously been deferred under real estate accounting. Accordingly, the company's carrying value in the 8point3 materially increased upon adoption which required the company to evaluate its investment in 8point3 for other-than-temporary impairment ("OTTI"). In accordance with such evaluation, the company recognized a non-cash impairment charge on the 8point3 investment balance in the prior periods that were affected.
-- Utility and power plant projects. The company includes adjustments
related to the revenue recognition of certain utility and power plant
projects based the ratio of costs incurred to date to the total
estimated costs at completion of the performance obligations and, when
relevant, the allocation of revenue and margin to the company's project
development efforts at the time of initial project sale. Prior to the
adoption of ASC 606, such projects are accounted for under real estate
accounting guidance, under which no separate allocation to the company's
project development efforts occurs and the amount of revenue and margin
that is recognized may be limited in circumstances where the company has
certain forms of continuing involvement in the project. Under ASC 606,
such projects are accounted for when the customer obtains control of the
promised goods or services which generally results in earlier
recognition of revenue and profit than previous GAAP. Over the life of
each project, cumulative revenue and gross profit will eventually be
equivalent under both ASC 606 and non-GAAP once these projects are
completed.
-- Sale-leaseback transactions. The company includes adjustments primarily
related to the revenue recognition on certain sale-leaseback
transactions based on the net proceeds received from the buyer-lessor.
Under GAAP, these transactions are accounted for under the financing
method in accordance with real estate accounting guidance. Under such
guidance, no revenue or profit is recognized at the inception of the
transaction, and the net proceeds from the buyer-lessor are recorded as
a financing liability. Imputed interest is recorded on the liability
equal to the company's incremental borrowing rate adjusted solely to
prevent negative amortization.
Other Non-GAAP Adjustments
-- Impairment of residential lease assets. In fiscal 2017, the company made
the decision to sell its interest in the residential lease portfolio and
as a result of this triggering event, determined it was necessary to
evaluate the potential for impairment in its ability to recover the
carrying amount of the residential lease portfolio. In accordance with
such evaluation, the company recognized a non-cash impairment charge on
its solar power systems leased and to be leased and an allowance for
losses related financing receivables. In connection with the impairment
loss, the carrying values of its solar power systems leased and to be
leased were reduced which resulted in lower depreciation charges.
Management believes that it is appropriate to exclude the impact of
residential lease assets impairment and its corresponding depreciation
savings from the company's non-GAAP financial measures as they are not
reflective of ongoing operating results and do not contribute to a
meaningful evaluation of a company's past operating performance.
-- Cost of above-market polysilicon. The company has entered in previous
years into multiple long-term, fixed-price supply agreements to purchase
polysilicon for periods of up to 10 years. The prices in these supply
agreements, which incorporate a cash portion and a non-cash portion
attributable to the amortization of prepayments made under the
agreements, significantly exceed market prices. Additionally, in order
to reduce inventory and improve working capital, the company has
periodically elected to sell polysilicon inventory in the marketplace at
prices below the company's purchase price, thereby incurring a loss.
Management believes that it is appropriate to exclude the impact of its
above-market cost of polysilicon, including the effect of above-market
polysilicon on product costs, losses incurred on sales of polysilicon to
third parties, and inventory reserves and project asset impairments from
the company's non-GAAP financial measures as they are not reflective of
ongoing operating results and do not contribute to a meaningful
evaluation of a company's past operating performance.
-- Stock-based compensation. Stock-based compensation relates primarily to
the company's equity incentive awards. Stock-based compensation is a
non-cash expense that is dependent on market forces that are difficult
to predict. Management believes that this adjustment for stock-based
compensation provides investors with a basis to measure the company's
core performance, including compared with the performance of other
companies, without the period-to-period variability created by
stock-based compensation.
-- Amortization of intangible assets. The company incurs amortization of
intangible assets as a result of acquisitions, which includes patents,
purchased technology, project pipeline assets, and in-process research
and development. Management believes that it is appropriate to exclude
these amortization charges from the company's non-GAAP financial
measures as they arise from prior acquisitions, are not reflective of
ongoing operating results, and do not contribute to a meaningful
evaluation of a company's past operating performance.
-- Depreciation of idle equipment. In the fourth quarter of 2017, the
company changed the deployment plan for its next generation of solar
cell technology, which made certain then temporarily idle equipment
obsolete, and therefore, retired that affected equipment. Such asset
impairment is excluded from the company's non-GAAP financial measures as
it is non-cash in nature and not reflective of ongoing operating
results. Excluding this data provides investors with a basis to compare
the company's performance against the performance of other companies
without such charges.
-- Non-cash interest expense. The company incurs non-cash interest expense
related to the amortization of items such as original issuance discounts
on its debt. The company excludes non-cash interest expense because the
expense does not reflect its financial results in the period incurred.
Management believes that this adjustment for non-cash interest expense
provides investors with a basis to evaluate the company's performance,
including compared with the performance of other companies, without
non-cash interest expense.
-- Restructuring expense. The company incurs restructuring expenses related
to reorganization plans aimed towards realigning resources consistent
with the company's global strategy and improving its overall operating
efficiency and cost structure. Restructuring charges are excluded from
non-GAAP financial measures because they are not considered core
operating activities and such costs have historically occurred
infrequently. Although the company has engaged in restructuring
activities in the past, each has been a discrete event based on a unique
set of business objectives. As such, management believes that it is
appropriate to exclude restructuring charges from the company's non-GAAP
financial measures as they are not reflective of ongoing operating
results or contribute to a meaningful evaluation of a company's past
operating performance.
-- IPO-related costs. Costs incurred related to the IPO of 8point3 included
legal, accounting, advisory, valuation, and other expenses, as well as
modifications to or terminations of certain existing financing
structures in preparation for the sale to 8point3. As these costs are
non-recurring in nature, excluding this data provides investors with a
basis to evaluate the company's performance, including compared with the
performance of other companies, without similar impacts.
-- Other. The company combines amounts previously disclosed under separate
captions into "Other" when amounts do not have a significant impact on
the presented fiscal periods. Management believes that these adjustments
provide investors with a basis to evaluate the company's performance,
including compared with the performance of other companies, without
similar impacts.
-- Tax effect. This amount is used to present each of the adjustments
described above on an after-tax basis in connection with the
presentation of non-GAAP net income and non-GAAP net income per diluted
share. The company's non-GAAP tax amount is based on estimated cash tax
expense and reserves. The company forecasts its annual cash tax
liability and allocates the tax to each quarter in a manner generally
consistent with its GAAP methodology. This approach is designed to
enhance investors' ability to understand the impact of the company's tax
expense on its current operations, provide improved modeling accuracy,
and substantially reduce fluctuations caused by GAAP to non-GAAP
adjustments, which may not reflect actual cash tax expense.
-- Adjusted EBITDA adjustments. When calculating Adjusted EBITDA, in
addition to adjustments described above, the company excludes the impact
during the period of the following items:
-- Cash interest expense, net of interest income
-- Provision for (benefit from) income taxes
-- Depreciation
Management presents this non-GAAP financial measure to enable investors to evaluate the company's performance, including compared with the performance of other companies.
For more information about these non-GAAP financial measures, please see the tables captioned "Reconciliations of GAAP Measures to Non-GAAP Measures" set forth at the end of this release, which should be read together with the preceding financial statements prepared in accordance with GAAP.
SUNPOWER CORPORATION
RECONCILIATIONS OF GAAP MEASURES TO NON-GAAP MEASURES
(In thousands, except percentages and per share data)
(Unaudited)
Adjustments to Revenue:
THREE MONTHS ENDED
------------------
Apr. 1, Dec. 31, Apr. 2,
2018 2017 2017
---- ---- ----
GAAP revenue $391,888 $651,134 $329,095
Adjustments based on IFRS:
8point3 - (114) 5,518
Utility and power plant projects (2,043) 9,138 41,396
Sale-leaseback transactions 9,103 163,837 53,478
Non-GAAP revenue $398,948 $823,995 $429,487
======== ======== ========
Adjustments to Gross Profit (Loss) / Margin:
THREE MONTHS ENDED
------------------
Apr. 1, Dec. 31, Apr. 2,
2018 2017 2017
---- ---- ----
GAAP gross profit (loss) $10,248 $(13,593) $(45,584)
Adjustments based on IFRS:
8point3 - (62) 324
Utility and power plant projects (268) (3,538) 42,691
Sale-leaseback transactions (3,039) 25,839 (3,144)
Other adjustments:
Impairment of residential lease assets (3,853) - -
Cost of above-market polysilicon 18,700 81,804 29,815
Stock-based compensation expense 1,057 2,783 1,184
Amortization of intangible assets 2,492 2,505 2,567
Depreciation of idle equipment 721 2,300 -
Non-cash interest expense - 2 10
Non-GAAP gross profit $26,058 $98,040 $27,863
======= ======= =======
GAAP gross margin (%) 2.6% -2.1% -13.9%
Non-GAAP gross margin (%) 6.5% 11.9% 6.5%
Adjustments to Net income (loss):
THREE MONTHS ENDED
------------------
Apr. 1, Dec. 31, Apr. 2,
2018 2017 2017
---- ---- ----
GAAP net loss attributable to stockholders $(115,974) $(572,651) $(219,726)
Adjustments based on IFRS:
8point3 (177) 8,130 77,698
Utility and power plant projects (268) (3,538) 42,691
Sale-leaseback transactions 1,373 28,491 (1,709)
Other adjustments:
Impairment of residential lease assets 45,139 473,709 -
Cost of above-market polysilicon 18,700 81,804 29,815
Stock-based compensation expense 8,758 9,294 7,375
Amortization of intangible assets 2,492 8,769 3,026
Depreciation of idle equipment 721 2,300 -
Non-cash interest expense 22 25 35
Restructuring expense 11,177 2,769 9,790
IPO-related costs - - 114
Tax effect (170) (3,338) 513
Non-GAAP net income (loss) attributable to stockholders $(28,207) $35,764 $(50,378)
======== ======= ========
Adjustments to Net income (loss) per diluted share:
THREE MONTHS ENDED
------------------
Apr. 1, Dec. 31, Apr. 2,
2018 2017 2017
---- ---- ----
Net income (loss) per diluted share
Numerator:
GAAP net loss available to common stockholders(1) $(115,974) $(572,651) $(219,726)
========= ========= =========
Non-GAAP net income (loss) available to common stockholders(1) $(28,207) $35,764 $(50,378)
======== ======= ========
Denominator:
GAAP weighted-average shares 140,212 139,613 138,902
Effect of dilutive securities:
Stock options - - -
Restricted stock units - 1,570 -
Upfront warrants (held by Total) - 49 -
Warrants (under the CSO2015) - - -
0.75% debentures due 2018 - - -
Non-GAAP weighted-average shares(1) 140,212 141,232 138,902
======= ======= =======
GAAP net loss per diluted share $(0.83) $(4.10) $(1.58)
====== ====== ======
Non-GAAP net income (loss) per diluted share $(0.20) $0.25 $(0.36)
====== ===== ======
(1)In accordance with the if-converted method, net income (loss) available to common stockholders excludes interest expense related to the 0.75%, 0.875%, and 4.0% debentures if the debentures
are considered converted in the calculation of net income (loss) per diluted share. If the conversion option for a debenture is not in the money for the relevant period, the potential
conversion of the debenture under the if-converted method is excluded from the calculation of non-GAAP net income (loss) per diluted share.
Adjusted EBITDA:
THREE MONTHS ENDED
------------------
Apr. 1, Dec. 31, Apr. 2,
2018 2017 2017
---- ---- ----
GAAP net loss attributable to stockholders $(115,974) $(572,651) $(219,726)
Adjustments based on IFRS:
8point3 (177) 8,130 77,698
Utility and power plant projects (268) (3,538) 42,691
Sale-leaseback transactions 1,373 28,491 (1,709)
Other adjustments:
Impairment of residential lease assets 45,139 473,709 -
Cost of above-market polysilicon 18,700 81,804 29,815
Stock-based compensation expense 8,758 9,294 7,375
Amortization of intangible assets 2,492 8,769 3,026
Depreciation of idle equipment 721 2,300 -
Non-cash interest expense 22 25 35
Restructuring expense 11,177 2,769 9,790
IPO-related costs - - 114
Cash interest expense, net of interest income 20,165 22,058 18,529
Provision for (benefit from) income taxes 2,628 (2,870) 2,031
Depreciation 37,576 41,960 38,932
Adjusted EBITDA $32,332 $100,250 $8,601
======= ======== ======
Q2 2018 and FY2018 GUIDANCE
(in thousands
except
percentages) Q2 2018 FY 2018
Revenue (GAAP) $360,000-$410,000 $1,600,000-$2,000,000
Revenue (non-
GAAP) (1) $375,000-$425,000 $1,800,000-$2,200,000
Gross margin
(GAAP) 2.5%-4.5% N/A
Gross margin (non-
GAAP) (2) 6%-8% N/A
Net loss (GAAP) $100,000-$125,000 $370,000-$420,000
Adjusted EBITDA
(3) $10,000-$35,000 $75,000-$125,000
(1) Estimated non-GAAP amounts above
for Q2 2018 include net
adjustments that increase
(decrease) revenue by
approximately $22 million related
to sale-leaseback transactions,
$(5) million related to 8point3
and $(2) million related to
utility and power plant projects.
Estimated non-GAAP amounts above
for fiscal 2018 include net
adjustments that increase revenue
by approximately $200 million
related to sale-leaseback
transactions.
(2) Estimated non-GAAP amounts above
for Q2 2018 include net
adjustments that increase
(decrease) gross margin by
approximately $2 million related
to sale-leaseback transactions,
$(5) million related to 8point3,
$(2) million related to utility
and power plant projects, $19
million related to cost of above-
market polysilicon, $3 million
related to stock-based
compensation expense, and $1
million related to amortization of
intangible assets.
(3) Estimated Adjusted EBITDA amounts
above for Q2 2018 include net
adjustments that decrease
(increase) net loss by
approximately $58 million related
to impairment of lease assets, $2
million related to sale-leaseback
transactions, $(24) million
related to 8point3, $(2) million
related to utility and power plant
projects, $19 million related to
cost of above-market polysilicon,
$8 million related to stock-based
compensation expense, $3 million
related to amortization of
intangible assets, $7 million
related to restructuring, $26
million related to interest
expense, $2 million related to
income taxes, and $36 million
related to depreciation. Estimated
non-GAAP amounts above for fiscal
2018 include net adjustments that
decrease (increase) net loss by
approximately $107 million related
to impairment of lease assets, $20
million related to sale-leaseback
transactions, $(24) million
related to 8point3, $(9) million
related to utility and power plant
projects, $96 million related to
cost of above-market polysilicon,
$34 million related to stock-
based compensation expense, $12
million related to amortization of
intangible assets, $31 million
related to restructuring, $83
million related to interest
expense, $16 million related to
income taxes, and $129 million
related to depreciation.
The following supplemental data represent the adjustments, individual charges and credits that are included or excluded from SunPower's non-GAAP revenue, gross profit/margin, net income (loss) and net income (loss) per diluted share measures for each period presented in the Consolidated Statements of Operations contained herein.
SUPPLEMENTAL DATA
(In thousands, except percentages)
THREE MONTHS ENDED
April 1, 2018
-------------
Revenue Gross profit / margin Operating expenses Other income (expense), net Benefit from (provision Equity in earnings of unconsolidated Gain (Loss) attributable to
for) income taxes investees non-controlling interests Net income (loss)
attributable to
stockholders
------------
Residential Commercial Power Plant Residential Commercial Power Plant Research and Selling, general Restructuring charges
development and administrative
----------- ------------------
GAAP $169,432 $123,336 $99,120 $28,042 16.6% $5,313 4.3% $(23,107) -23.3% $(115,974)
Adjustments based on IFRS:
8point3 - - - - - - - - - - - (177) - (177)
Utility and power plant projects - (643) (1,400) - (450) 182 - - - - - - - (268)
Sale-leaseback transactions - 9,103 - - (2,920) (119) - - - 4,412 - - - 1,373
Other adjustments:
Impairment of residential lease assets - - - (3,853) - - - 49,092 - - - - (100) 45,139
Cost of above-market polysilicon - - - 5,802 5,057 7,841 - - - - - - - 18,700
Stock-based compensation expense - - - 195 383 479 2,946 4,755 - - - - - 8,758
Amortization of intangible assets - - - 1,047 735 710 - - - - - - - 2,492
Depreciation of idle equipment - - - 224 216 281 - - - - - - - 721
Non-cash interest expense - - - - - - 3 19 - - - - - 22
Restructuring expense - - - - - - - - 11,177 - - - - 11,177
Tax effect - - - - - - - - - - (170) - - (170)
Non-GAAP $169,432 $131,796 $97,720 $31,457 18.6% $8,334 6.3% $(13,733) -14.1% $(28,207)
======== ======== ======= ======= ====== ======== ========
December 31, 2017
-----------------
Revenue Gross profit / margin Operating expenses Other income (expense), net Benefit from (provision Equity in earnings of unconsolidated Gain (Loss) attributable to
for) income taxes investees non-controlling interests Net income (loss)
attributable to
stockholders
------------
Residential Commercial Power Plant Residential Commercial Power Plant Research and Selling, general Restructuring charges
development and administrative
----------- ------------------
GAAP (As Reported) $175,652 $147,559 $334,889 $9,969 5.7% $(27,389) -18.6% $2,188 0.7% $(568,677)
Adoption of ASC 606 (1,330) (3,556) (2,080) (464) 171 1,932 - - - (7,065) - 1,452 - (3,974)
GAAP (As Adjusted) $174,322 $144,003 $332,809 $9,505 5.5% $(27,218) -18.9% $4,120 1.2% $(572,651)
Adjustments based on IFRS:
8point3 - - (114) (3) - (59) - - - 8,086 - 106 - 8,130
Utility and power plant projects - 10,344 (1,206) - 313 (3,851) - - - - - - - (3,538)
Sale-leaseback transactions - 163,837 - - 25,956 (117) - - - 2,652 - - - 28,491
Other adjustments:
Impairment of residential lease assets - - - - - - - 624,335 - - - - (150,626) 473,709
Cost of above-market polysilicon - - - 17,674 30,056 34,074 - - - - - - - 81,804
Stock-based compensation expense - - - 482 810 1,491 1,131 5,380 - - - - - 9,294
Amortization of intangible assets - - - 852 873 780 - 6,264 - - - - - 8,769
Depreciation of idle equipment - - - 533 834 933 - - - - - - - 2,300
Non-cash interest expense - - - - 1 1 4 19 - - - - - 25
Restructuring expense - - - - - - - - 2,769 - - - - 2,769
Tax effect - - - - - - - - - - (3,338) - - (3,338)
Non-GAAP $174,322 $318,184 $331,489 $29,043 16.7% $31,625 9.9% $37,372 11.3% $35,764
======== ======== ======== ======= ======= ======= =======
April 2, 2017
-------------
Revenue Gross margin Operating expenses Other income (expense), net Benefit from (provision Equity in earnings of unconsolidated Gain (Loss) attributable to
for) income taxes investees non-controlling interests Net income (loss)
attributable to
stockholders
------------
Residential Commercial Power Plant Residential Commercial Power Plant Research and Selling, general Restructuring charges
development and administrative
----------- ------------------
GAAP (As Reported) $136,031 $108,263 $154,782 $15,274 11.2% $(2,366) -2.2% $(43,840) -28.3% $(134,479)
Adoption of ASC 606 (1,337) (2,817) (65,827) (500) 2,212 (16,364) - - - (72,031) - 1,436 - (85,247)
GAAP (As Adjusted) $134,694 $105,446 $88,955 $14,774 11.0% $(154) -0.1% $(60,204) -67.7% $(219,726)
Adjustments based on IFRS:
8point3 - 5,484 34 (3) (519) 846 - - - 77,964 - (590) - 77,698
Utility and power plant projects - - 41,396 - - 42,691 - - - - - - - 42,691
Sale-leaseback transactions - 23,041 30,437 - (2,665) (479) - - - 1,435 - - - (1,709)
Other adjustments:
Cost of above-market polysilicon - - - 4,351 7,132 18,332 - - - - - - - 29,815
Stock-based compensation expense - - - 210 249 725 1,528 4,663 - - - - - 7,375
Amortization of intangible assets - - - 1,214 836 517 - 459 - - - - - 3,026
Non-cash interest expense - - - 4 3 3 4 21 - - - - - 35
Restructuring expense - - - - - - - - 9,790 - - - - 9,790
IPO-related costs - - - - - - - 114 - - - - - 114
Tax effect - - - - - - - - - - 513 - - 513
Non-GAAP $134,694 $133,971 $160,822 $20,550 15.3% $4,882 3.6% $2,431 1.5% $(50,378)
======== ======== ======== ======= ====== ====== ========
View original content with multimedia:http://www.prnewswire.com/news-releases/sunpower-reports-first-quarter-results-300644834.html
SOURCE SunPower Corp.
