ReneSola Announces First Quarter 2018 Results

SHANGHAI, June 20, 2018 /PRNewswire/ -- ReneSola Ltd ("ReneSola" or the "Company") (www.renesolapower.com) (NYSE: SOL), a leading solar project developer and operator, today announced its unaudited financial results for the first quarter ended March 31, 2018.

Mr. Xianshou Li, ReneSola's Chief Executive Officer, commented, "We started 2018 with solid performance across our business as a result of continued strong execution of our strategy. First quarter revenue exceeded our expectations and operating margin expanded significantly from the fourth quarter of 2017, resulting in a sequential increase in net income of over 200%."

Li continued, "Our overall global project pipeline remains solid at around 1.1 GW. In the first quarter, we successfully installed 6.3 MW of rooftop projects in China and 6.8 MW of ground-mount projects in North Carolina. As we look to the remainder of 2018, we remain optimistic about the business opportunities across different geographies. In addition, the fundamentals for our project business have significantly improved over the last few quarters, and we will maintain our commitment to growing profitably, managing our operations and strengthening our financial position."

First Quarter 2018 Highlights


                                        Q1 2018        Q4 2017     Q/Q
                                                                Change
                                 ($ in million) ($ in million)
                                  -------------  -------------

    Revenue                               $44.8           $64.8   -30.9%

    Gross Profit                           $8.4            $6.8   +22.6%

    Operating Income                       $5.9            $4.9   +19.4%

    EBITDA                                 $9.0            $4.7   +94.3%

    Income before Income Tax and
     Noncontrolling interests              $5.4            $2.0  +173.8%

    Net Income                             $5.4            $1.7  +220.0%
    ----------                             ----            ----   ------

    --  Revenue was $44.8 million, compared to the raised guidance range of $40
        million to $45 million;
    --  Gross margin was 18.7%, compared to 10.5% in Q4 2017;
    --  Income before income tax and noncontrolling interests was $5.4 million,
        compared to an income of $2.0 million in Q4 2017 and a loss of $3.2
        million in Q1 2017;
    --  Recognized revenue of $31.8 million from Project Development business,
        mainly from sales of utility solar projects in the United Kingdom;
    --  Recognized revenue of $8.7 million from EPC services for 15.8 MW of DG
        projects in China;
    --  Recognized revenue from the sale of electricity of $4.2 million;
    --  Installed 6.3 MW of rooftop projects in China and 6.8 MW of ground-mount
        projects in North Carolina, United States; and
    --  Solar power project pipeline of approximately 1.1 GW, of which 748 MW
        are late-stage.

First Quarter 2018 Financial Results

Revenue was $44.8 million, compared to $64.8 million in Q4 2017 and $0.2 million in Q1 2017.

    --  Revenue from the Project Development business was $31.8 million as we
        recognized revenue from sales of utility projects in the United Kingdom
        that were recorded as deferred project revenue in the amount of $20.8
        million as of December 31, 2017 due to the contingency consideration of
        the substantive return right of the customer under ASC 360 Real Estate
        Sales and recognized as revenue in the amount of $21.9 million in Q1
        2018 with the final price adjustment upon the issuance of the final
        acceptance certificate (FAC) and all revenue recognition criteria is met
        upon adoption of ASC 606.
    --  Revenue from the EPC business was $8.7 million as we recognized revenue
        from the provision of EPC services of 15.8 MW in China.
    --  Revenue from the sale of electricity was $4.2 million. The Company
        generated 28.4 million kwh of electricity from its operating projects in
        China during the quarter.

Gross profit was $8.4 million, compared to a gross profit of $6.8 million in Q4 2017 and a loss of $0.2 million in Q1 2017. Gross margin was 18.7%, compared to 10.5% in Q4 2017, mainly due to the improved margin from overseas project development business and EPC business in China.

Operating expenses were $2.5 million, up from $1.9 million in Q4 2017 and from $1.3 million in Q1 2017. Sales and marketing expenses were $0.1 million, down from $0.6 million in Q4 2017, mainly due to reduced commission expenses associated with sale of green certificates. General and administrative expenses were $2.4 million, up from $1.7 million in Q4 2017, mainly due to the increased salary expenses associated with additional new hires.

Operating income was $5.9 million, compared to an operating income of $4.9 million in Q4 2017 and an operating loss of $1.5 million in Q1 2017.

Total non-operating expenses of $0.4 million included interest expenses of $1.5 million and foreign exchange gain of $1.1 million, mainly driven by theh appreciation of EUR against USD and KRW.

Income before income tax and noncontrolling interests was $5.4 million, compared to an income of $2.0 million in Q4 2017 and a loss of $3.2 million in Q1 2017.

Net income was $5.4 million, compared to an income of $1.7 million in Q4 2017 and a loss of $3.2 million in Q1 2017.

Financial Position

The Company had cash and cash equivalents of $10.9 million as of March 31, 2018, compared to $13.4 million as of December 31, 2017. Long-term borrowings were $32.7 million as of March 31, 2018, compared to $32.5 million as of December 31, 2017. Long-term failed sale-lease back and capital lease liabilities, associated with the financial leasing payables for rooftop projects in China, were $78.2 million as of March 31, 2018, compared to $67.5 million as of December 31, 2017, the increase was mainly due to the corresponding growth of the Company's DG operating assets.

Recent Business Updates

    --  On June 20, 2018,  the Company announced the closing of the sale of its
        utility-scale project located in North Carolina to New York-based
        Greenbacker Renewable Energy Company, LLC ("Greenbacker"), a publicly
        registered, non-traded Limited Liability Company focused on investments
        in renewable energy power plants and energy efficiency projects as well
        as other sustainable investments.  The North Carolina project has a
        capacity of 6.75 MW and represents ReneSola's second project sale to
        Greenbacker.  The first project sale to Greenbacker was completed in
        April 2017.
    --  In June, Sequoia Economic Infrastructure Income Fund ("Sequoia") had
        agreed to extend senior debt facility to 36 million euro for ReneSola's
        55MW of projects in Poland, each with a capacity of 1MW. In December
        2017, Sequoia, which invests in a diversified portfolio of senior and
        subordinated economic infrastructure debt investments, provided a senior
        loan of 15 million euro for all of ReneSola's 55MW projects in the
        region.
    --  The Company announced the appointment of Xiaoliang Liang as Chief
        Financial Officer, effective June 1, 2018.  Mr. Liang brings to ReneSola
        more than 18 years of experience developing, financing and managing
        projects with a focus on renewable energy, including solar, wind, hydro
        and other infrastructure sectors.
    --  In May 2018, the Company closed an equity investment agreement with a
        strategic investor. The investor will invest RMB 200 million in cash to
        acquire 40.13% of Zhejiang ReneSola Investment Limited, the Company's
        subsidiary that holds the Company's distributed generation projects in
        China.

Operating Assets and Completed Projects for Sale

The Company continues to pursue opportunities in small-scale projects in diversified regions and believes its strategy can capitalize on trends in solar energy development. ReneSola currently owns over 193 MW of rooftop projects in operation, which are concentrated in a handful of eastern provinces of China with attractive development environments. As of March 31, 2018, the Company had over 27 MW of rooftop projects under construction.


    Operating Assets               Capacity (MW)
    ----------------               ------------

    China DG                                          193.6

    - Zhejiang& Shanghai                               69.1

    - Jiangsu                                          10.6

    - Henan                                            57.9

    - Anhui                                            31.5

    - Hebei                                            17.1

    - Shandong                                          7.4
    ----------                                          ---

    Romania                                            15.4

    United Kingdom                                      4.3
    --------------                                      ---

    Total                                             213.3
    -----                                             -----

As of March 31, 2018, the Company currently has 10.4 MW of completed projects, which are currently in sale process.


    Completed Projects for Sale    Capacity (MW)
    ---------------------------    ------------

    Turkey                                             10.4
    ------                                             ----

    Total                                              10.4
    -----                                              ----

Project Pipeline

As of March 31, 2018, the Company had a pipeline of over 1.1 GW of projects in various stages, of which 748 MW are projects that are late-stage. 156 MW of these late-stage projects are under construction. Late-stage projects include (i) projects with the legal right to develop based on definitive agreements, including the projects held by project SPVs or joint ventured project SPVs whose controlling power can be purchased by us once the late stage is reached, and (ii) projects for which PPA or FiT has been arranged.

The following table sets forth the Company's late-stage project pipeline by location:


    Project Location Late-stage (MW)        Under
                                     Construction
                                             (MW)
    ---                                       ---

    USA                        189.4          24.1

    Canada                      17.3           7.0

    Turkey                  110.0[1]           --

    Poland                      55.0          55.0

    Hungary                     42.6          42.6

    France                      73.7            --

    Spain                      162.0            --

    India                       22.0            --

    China DG                    75.9          27.6
    --------                    ----          ----

    Total                      747.9         156.3
    -----                      -----         -----


    [1] ReneSola has an arrangement
     with a local partner, under
     which our partner holds and
     maintains full titles to all
     projects but we have the right
     to receive 50% proceeds
     generated by the projects.

China


    China: Late-stage Pipeline                     Capacity   Business Model

                                                       (MW)
    ---                                                 ---

    -Zhejiang & Shanghai                               34.2    IPP

    -Jiangsu                                           18.3    IPP

    -Fujian & Guandong                                  8.5    IPP

    -Anhui                                              1.9    IPP

    -Henan                                              5.1    IPP

    -Shandong                                           7.9    IPP
    ---------                                           ---    ---

    China DG                                           75.9
    --------                                           ----

United States

In the U.S, the Company has a late-stage pipeline of 189.4 MW, 24.1 MW of which are under construction and are expected to be connected to the grid in the second quarter of 2018.


    US: Late-      Location Capacity                          Project Type   Status     Expected            Business Model
    stage Pipeline                                                                         COD
                              (MW)
    ---                        ---

    RP-NC             NC              24.1 Utility                         Construction               2018  Project Development

    Utah              UT              10.7 Self-consumption / DG           Development                2018  Project Development

    RP-MN             MN              37.5 Community Solar                 Development                2018  Project Development

    MN-VOS            MN               7.8 Community Solar                 Development                2019  Project Development

    New York          NY               7.7 Community Solar                 Development           2018/2019 Project Development

    RP-CA             CA              13.6 Utility                         Development                2019  Project Development

    Oregon            OR              23.0 TBD                             Development                2019  Project Development

    Alpine            TX              65.0 TBD                             Development                2019  Project Development
    ------            ---             ---- ---                             -----------                ----  -------------------

    Total                            189.4
    -----                            -----

Canada

In Canada, the Company has a late-stage pipeline of 17.3 MW projects, 7.0 MW of which are under construction and are expected to be connected to the grid in the third quarter of 2018. These 7MW projects are eligible for Canada's FiT3 Scheme.


    Canada:
     Late-    Location Capacity      Project Type   Status     Expected      Business Model
    stage
     Pipeline                                                    COD
                         (MW)
    ---                   ---

    FiT3       Ontario           7.0       DG     Construction          2018 Project Development

    FiT4       Ontario          10.3       DG     Development           2019 Project Development

    Total                       17.3
    -----                       ----

Poland

In Poland, the Company has a late-stage pipeline of 55 MW projects, which are under construction and are expected to be connected to the grid in the second half of 2018.


    Poland: Late-stage Location Capacity      Project Type   Status     Expected COD      Business Model
    Pipeline
                                  (MW)
    ---                            ---

    Auction 2016 Dec    Poland           13.0       DG     Construction              2018 Project Development

    Auction 2017 Jun    Poland           42.0       DG     Construction              2018 Project Development

    Total                                55.0
    -----                                ----

Hungary

In Hungary, the Company grew its late-stage pipeline to 71 "Micro PPs" projects, total capacity of 42.6 MW, which are under construction and are expected to be connected to the grid in the second half of 2018.


    Hungary: Late-stage         Location Capacity      Project Type                Status Expected                     Business Model
    Pipeline                                                                                COD
                                           (MW)
    ---                                     ---

    Portfolio of "Micro Hungary                   42.6              DG Construction                2018 Project Development
    PPs", 0.5 MW each

    Total                                         42.6
    -----                                         ----

France

In France, the Company formed a strategic partnership with Green City Energy to jointly develop four solar parks with a total installed capacity of 69.0 MW. Additionally, the Company was awarded 16 solar projects in France with a combined capacity of 4.65 MW in the first quarter of 2018.


    France: Late-stage Location Capacity      Project Type   Status    Expected                     Business Model
    Pipeline                                                             COD
                                  (MW)
    ---                            ---

    SOLARPARK           France           69.0     Utility  Development          2019 Project Development

    SPV2                France            4.7       DG     Development          2019 Project Development

    Total                                73.7
    -----                                ----

Other Geographies

In Turkey, the Company has an arrangement with a local partner, under which our partner holds and maintains full titles to 110 MW projects but we have the right to receive 50% proceeds generated by those 110 MW projects.

In India, the Company has a pipeline of 22.0 MW projects, which are self-consumption distributed generations with top-rating commercial and industrial off-takers.


              Other Geographies:  Location Capacity       Project Type             Status Expected            Business Model
              Late-stage Pipeline                                                            COD
                                             (MW)
    ---                                       ---

    Turkey JV                      Turkey           110.0     Utility  Development                      2019  Project Development

    India C&I                       India            22.0       DG     Development                 2018/2019 Project Development

    Total                                           132.0
    -----                                           -----

Outlook

For the second quarter of 2018, the Company's project business is expected to generate revenue in the range of $20 to $30 million and overall gross margin in the range of 20% to 25%. During the second quarter of 2018, the Company expects to connect 15 MW to 20 MW of DG projects in China, and to monetize 6.8 MW projects in international markets.

For 2018, the Company expects to generate revenue in the range of $130 to $140 million with overall gross margin in the range of 20 to 25%. The Company intends to connect 100 MW to 150 MW of DG projects in China, and to monetize 80 MW to 100 MW projects in international markets.

Adoption of New Accounting Policy

Effective from January 1, 2018, SOL adopted the new revenue recognition policy, ASC 606 -- Revenue from Contracts with Customers, using the modified retrospective method in accordance with US GAAP ("ASC 606"). As a result of adopting ASC 606, the Company recognized the cumulative effect of initially applying the revenue standard as an increase of approximately USD 0.87 million to the opening balances of retained earnings. The adjustments primarily arose from the timing of revenue recognition for 1) subscription service fee in the sale of project asset rights and 2) supplies of modules and invertors under cooperation arrangements with the counterparty. Under ASC 360, Real Estate Sales and ASC 605, Revenue Recognition, subscription service fee in the sale of project asset rights and revenue related to modules and invertors supplied under cooperation arrangements are considered contingent and, therefore, the portion of the revenue is not recognized until the contingency has been removed (i.e. upon having the right to receive the subscription fee and achievement of COD, or upon the ultimate sale of the project assets under the cooperation arrangement). Upon adoption of ASC 606, subscription fee is recognized over time as a seperate performance obligation, and the revenue of supplies of modules and invertors is recognized upon the delivery with the control transferred and the Company has right to payment. In addition, the Company had a sale of project asset with a right of return if certain conditions are not met. Under the ASC 360 Real Estate Sales, revenue was not recognised because of the contingency consideration. Upon adoption of ASC 606, revenue was not recognised because of the substantive return right and the Company was not able to assert return was not probable as of December 31, 2017. As such, deferred project revenue as of Dec 31, 2017 in the amount of $21 million would have been classified as a refund liability and the corresponding deferred project costs would have been classified as the Company's right to recover products from customers on settling the refund liability. Such refund liability was recognized as revenue totaling $22 million with an increase due to final price adjustment in the first quarter of 2018

Conference Call Information

ReneSola's management will host an earnings conference call on June 20, 2018 at 8:30 a.m. U.S. Eastern Time (8:30 p.m. China Time).

Dial-in details for the earnings conference call are as follows:


                        Phone Number           Toll-Free Number
                        ------------           ----------------

    United States                +1 8456750437            +1 8665194004
    -------------                -------------            -------------

    Hong Kong                    +852 30186771           +852 800906601
    ---------                    -------------           --------------

    Mainland China              +86 8008190121

                                +86 4006208038
    ---                         --------------

    Other International           +65 67135090
    -------------------           ------------

Please dial in 10 minutes before the call is scheduled to begin and provide the passcode to join the call. The passcode is 1739389.

A replay of the conference call may be accessed by phone at the following numbers until June 28, 2018. To access the replay, please again reference the conference passcode 1739389.


                        Phone Number           Toll-Free Number
                        ------------           ----------------

    United States                +1 6462543697            +1 8554525696
    -------------                -------------            -------------

    Hong Kong                    +852 30512780           +852 800963117
    ---------                    -------------           --------------

    Mainland China              +86 8008700206

                                +86 4006022065
    ---                         --------------

    Other International          +61 281990299
    -------------------          -------------

Additionally, a live and archived webcast of the conference call will be available on the Investor Relations section of ReneSola's website at http://www.renesolapower.com.

About ReneSola

Founded in 2005, and listed on the New York Stock Exchange in 2008, ReneSola (NYSE: SOL) is an international leading brand of solar project developer and operator. Leveraging its global presence and solid experience in the industry, ReneSola is well positioned to develop green energy projects with attractive return around the world. For more information, please visit www.renesolapower.com.

Safe Harbor Statement

This press release contains statements that constitute ''forward-looking" statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the U.S. Private Securities Litigation Reform Act of 1995. Whenever you read a statement that is not simply a statement of historical fact (such as when the Company describes what it "believes," "plans," "expects" or "anticipates" will occur, what "will" or "could" happen, and other similar statements), you must remember that the Company's expectations may not be correct, even though it believes that they are reasonable. Furthermore, the forward-looking statements are mainly related to the Company's continuing operations and you may not be able to compare such information with the Company's past performance or results. The Company does not guarantee that the forward-looking statements will happen as described or that they will happen at all. Further information regarding risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements is included in the Company's filings with the U.S. Securities and Exchange Commission, including the Company's annual report on Form 20-F. The Company undertakes no obligation, beyond that required by law, to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made, even though the Company's situation may change in the future.

For investor and media inquiries, please contact:

In China:

ReneSola Ltd
Mr. Johnny Pan
+86 (21) 6280-9180 x131
ir@renesolapower.com

The Blueshirt Group Asia
Mr. Gary Dvorchak, CFA
+86 (138) 1079-1480
gary@blueshirtgroup.com

In the United States:

The Blueshirt Group
Mr. Ralph Fong
+1 (415) 489-2195
ralph@blueshirtgroup.com


                                         RENESOLA LTD

                             Unaudited Consolidated Balance Sheets

                                   (US dollars in thousands)

                                                     Mar 31,          Dec 31,

                                                                 2018              2017

     ASSETS

     Current assets:

     Cash and cash
      equivalents                                              10,861            13,429

     Restricted cash                                            2,078                 -

     Accounts receivable,
      net of allowances
      for doubtful
      accounts                                                 34,539            23,312

     Advances to
      suppliers-current,
      net                                                         339               380

     Value added tax
      recoverable                                              13,675            15,229

     Prepaid expenses and
      other current assets                                     10,068            10,543

     Project assets
      current                                                  81,460            76,556

     Deferred project
      costs current                                                 -           17,957

     Contract costs                                             2,380            12,669

     Total current assets                                     155,400           170,075


     Property, plant and
      equipment, net                                          192,429           154,659

     Deferred tax assets-
      non-current, net                                            294                59

     Project assets non-
      current                                                  11,233             7,481

     Other non-current
      assets                                                      935             3,425

     Total assets                                             360,291           335,699
                                                              =======           =======


     LIABILITIES AND
      SHAREHOLDERS' EQUITY


     Current liabilities:

     Short-term
      borrowings                                               23,674             6,606

     Accounts payable                                          29,169            25,788

     Advances from
      customers-current                                           754               237

     Amounts due to
      related parties                                          60,217            60,370

     Other current
      liabilities                                              37,616            30,515

     Income tax payable                                           209               330

     Salary payable                                               849               560

     Deferred project
      revenue current                                               -           20,792

     Total current
      liabilities                                             152,488           145,198


     Long-term borrowings                                      32,722            32,514

     Failed sale-lease
      back and capital
      lease liabilities                                        78,246            67,505

     Total liabilities                                        263,456           245,217
                                                              -------           -------


     Shareholders' equity

       Common shares                                          519,226           519,226

       Additional paid-in
        capital                                                 9,099             9,012

     Accumulated deficit                                    (429,207)        (435,518)

       Accumulated other
        comprehensive income                                  (2,313)          (2,238)

     Total equity
      attributed to
      ReneSola Ltd                                             96,805            90,482

       Noncontrolling
        interest                                                   30                 -

     Total  shareholders'
      equity                                                   96,835            90,482


     Total liabilities and
      shareholders' equity                                    360,291           335,699
                                                              =======           =======


                                                                                                     RENESOLA LTD

                                                                                     Unaudited Consolidated Statements of Income

                                                                                 (US dollars in thousands, except ADS and share data)


                                                                                                                                      Three Months Ended
                                                                                                                                      ------------------

                                                                                                                                              Mar 31, 2018 Dec 31, 2017  Mar 31, 2017


     Revenue                                                                                                                                        44,758        64,809            238

     Cost of revenue                                                                                                                              (36,379)     (57,975)         (449)

     Gross profit(loss)                                                                                                                              8,379         6,834          (211)
                                                                                                                                                     -----         -----           ----


     Operating (expenses) income:

     Sales and marketing                                                                                                                             (128)        (617)          (90)

     General and administrative                                                                                                                    (2,421)      (1,664)       (1,177)

     Other operating income                                                                                                                             30           355              7

     Total operating expenses                                                                                                                      (2,519)      (1,926)       (1,260)
                                                                                                                                                    ------        ------         ------


     Income(loss) from operations                                                                                                                    5,860         4,908        (1,471)

     Non-operating (expenses) income:

     Interest income                                                                                                                                     6           (7)            20

     Interest expense                                                                                                                              (1,519)      (1,113)         (869)

     Foreign exchange gains (losses)                                                                                                                 1,102       (1,740)         (885)

     Other loss                                                                                                                                                    (58)             -

     Income (loss) before income tax, noncontrolling interests                                                                                       5,449         1,990        (3,205)


     Income tax expense                                                                                                                                (9)        (290)          (21)

     Net income (loss) from continuing operations                                                                                                    5,440         1,700        (3,226)


     Discontinued Operations:

     Loss from discontinued operations                                                                                                                   -            -      (20,014)


     Net Income(loss)                                                                                                                                5,440         1,700       (23,240)


     Less: Net income (loss) attributed to noncontrolling interests                                                                                    (1)            -             -
                                                                                                                                                                    ---           ---

     Net income (loss) attributed to holders of ordinary shares                                                                                      5,441         1,700       (23,240)
                                                                                                                                                     =====         =====        =======



     Income (loss) per share from continuing operations

       Basic                                                                                                                                          0.01          0.00         (0.02)

       Diluted                                                                                                                                        0.01          0.00         (0.02)

     Income (loss) per share from discontinued operations

       Basic                                                                                                                                             -            -        (0.10)

       Diluted                                                                                                                                           -            -        (0.10)




     Weighted average number of shares used in computing income (loss) per share

       Basic                                                                                                                                   380,678,902   380,555,641    200,538,902

       Diluted                                                                                                                                 380,818,902   380,579,653    200,538,902

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