US solar PV manufacturer SunPower reported its first quarterly earnings this week, revealing revenue well down on the previous quarter, but managed to scrape by without it being a complete disaster by reporting a “smaller than expected” first quarter net loss.
In the second half of 2016, SunPower warned investors that things were going to get rocky on the road ahead, with president and CEO Tom Werner explaining that “While prospects for long-term solar industry growth remain strong, we are seeing a significant near-term market dislocation in the solar market that we expect will impact our financial performance through 2017.” The company’s fourth quarter earnings were solid, but included a net loss of $471 million, well in excess of what the company had predicted.
Moving into 2017, and things were not much better. Revenue for the quarter was only $399.1 million, down 156% on the fourth quarter. The company’s gross margin fell from -3.1% to -7.8%, while the company’s operating cash flow dipped into the negative as well. However, it wasn’t all bad news, with the company reporting a net loss of only $134.5 million: “only” being the operative word, as it was less than the net loss attributable to the fourth quarter of $275.1 million, and down on analyst estimates.
“We executed well despite a challenging industry environment and achieved our financial goals for the first quarter,” said Tom Werner, SunPower president and CEO.
Announced back in December, SunPower initiated a restructuring program which would cut its global workforce by 25%, close a 700 MW manufacturing facility, and reduce 2017 capital expenditure. According to Werner, “Strategically, we are executing on our restructuring program, which we firmly believe will enable us to successfully navigate the current market transition while maximizing near-term cash flow.”
More good news was revealed in the revelation that its majority owner, France’s Total, will guarantee up to $100 million of the company’s $300 million credit revolver facility.
“Total is pleased that SunPower’s first quarter results were in line with its guidance,” said Julien Pouget, Senior Vice President Renewables, Total. “In this context, by agreeing to provide SunPower access to additional liquidity over the next two years through a guarantee of up to $100 million of its revolving credit facility, Total is expressing its continued support for SunPower in the current challenging solar environment.”
Looking forward, SunPower is forecasting revenue for the second quarter between $275 million and $325 million, with a gross margin of between -3% and -1%, and a net loss of between $135 million and $110 million.
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