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SunPower offers confident '17 forecast when others could not

Q2: U.S. Solar and Wind Power by the Numbers

Essential Energy Insights - September 17, 2020

Essential Energy Insights September 2020

Rate case activity slips, COVID-19 proceedings remain at the forefront in August


SunPower offers confident '17 forecast when others could not

has been able todo what competitor and business partner First Solar Inc. could not: offer investors a view ofwhat it thinks business will look like next year.

SunPowerforecasts deploying more than 2,000 MW of solar capacity in 2017, with EBITDAof around $500 million. That would be an increase from the 1,600 MW to 1,900 MWit expects to deploy this year. In First Solar's view, on the other hand, therestill are too many "moving pieces and uncertainties" to form a "meaningful"outlook, the company's CFO and incoming CEO Mark Widmar said on an earningscall April 27. Widmar acknowledged hearing concern that the company has notprovided guidance for next year.

FirstSolar's outgoing CEO James Hughes said customers are working throughuncertainty about procurement in light of the extension of the investment taxcredit last year.

OnSunPower's earnings call May 5, executives were asked to account for their confidence;the company's forecast has held since last November. Chairman, President andCEO Thomas Werner pointed to the company's geographic and, increasingly,technological diversity, "so it diversifies out any single country orsingle segment to a large degree, or alternatively it gives you more comfort inlonger-term guidance.

"What'snew since November, of course, is the [investment tax credit] extension,"he added, "and, if anything, that moves business from '16 to '17. … Whatit does do more favorably, though, it gives you a longer horizon to work withcustomers and, importantly, financiers."

SunPowerreported a first-quarter net loss attributable to shareholders of $85.4million, or 62 cents per share, compared to a net loss of $9.6 million, or 7cents per share, in the 2015 first quarter. The company reported revenue of$384.9 million in the first quarter compared to $440.9 million a year ago.

EBITDA,the company's preferred metric, was $6.3 million in the first quarter comparedto $58.8 million a year ago.

Analystsexpected a first-quarter EPS loss of 60 cents per share and EBITDA of $10.7million, according to the S&P Capital IQ consensus estimate.

Thecompany's earnings have been impacted by its strategy of holding some projectson its balance sheet that it plans to eventually sell to , a yieldcoit co-sponsors with First Solar. Under its "holdco" strategy,SunPower reported 1,544 MW of assets that are operating and under contract.