A Service For Professionals Tuesday, August 22, 2017
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A Service For Professionals Tuesday, August 22, 2017 11435 Sources 399,534,180 Articles 3,328,029 Readers
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Sunworks Reports Second Quarter Revenue of $25.0 Million and Earnings per Share of $0.05

Focused effort to enhance operational efficiency drives sequential increase in operating margin, net income and earnings

/EINPresswire.com/ -- ROSEVILLE, CA--(Marketwired - August 10, 2017) - Sunworks, Inc. (NASDAQ: SUNW), a provider of solar power solutions for agriculture, commercial and industrial (ACI) and residential markets, today announced financial results for the second quarter and six months ended June 30, 2017.

Q2 2017 Summary:

  • Revenue of $25.0 million, a decrease of 19.3% compared to the record $31.0 million recorded in the year-ago quarter and a sequential increase of 73.6% versus the $14.4 in the first quarter of 2017.
  • Gross margin of 26.9% compared to 29.4% in the year-ago quarter and 19.4% in the first quarter of 2017.
  • Net income of $1.1 million compared to net income of $0.7 million in the year-ago quarter and a net loss of $2.9 million in the first quarter of 2017.
  • Backlog of $58.2 million compared to $59.8 million at March 31, 2017 and $43.8 million at June 30, 2016.

Chuck Cargile, Sunworks Chief Executive Officer said, "We executed well in the second quarter to achieve our near-term objective of returning Sunworks to profitability. Our revenue and gross margins improved sequentially and we reduced our operating expenses while strengthening our back-office systems and internal controls. As a result, we generated a 43.5% year-over-year increase in net income on a lower base of revenue, demonstrating the earnings power of Sunworks. Today, we have a stable platform for profitable growth firmly in place. Our backlog for scheduled installations remains strong and our pipeline for new sales is robust, giving us confidence for even greater profitability in the second half of this year. We are intensely focused on driving higher revenue and profitability to significantly increase shareholder value."

"The second quarter last year represented a record level of revenue for Sunworks, more than 60% above previous records," added Mr. Cargile. "The $25 million reported in the second quarter this year is the second-highest revenue level in our history, and we are confident we have the backlog and demand to support sustainable and profitable growth going forward."

As of June 30, 2017, the company's cash balance was $4.2 million and total debt outstanding (including convertible debt) was $2.2 million.

 
Backlog:
Three Months Ended
    Q2 2017   Q2 2016   % Change
(in Millions USD)            
Beginning backlog   $59.8   $39.6   51.0%
New sales   23.4   35.2   -33.6%
Revenue   (25.0)   (31)   -19.4%
Ending backlog   $58.2   $43.8   32.9%
(In Megawatts)            
Beginning backlog   23.6   13.0   81.5%
New sales   10.9   14.0   -22.1%
Revenue   (12.1)   (12.5)   -3.5%
Ending backlog   22.4   14.5   54.8%
             

Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA):

Adjusted EBITDA is a supplemental non-GAAP financial measure that the Company believes is an important measure of operating performance.

The following is a non-GAAP measure of cash flow, or adjusted EBITDA, which adds back non-cash items including interest, taxes, stock based compensation and depreciation and amortization.

         

Adjusted EBITDA:
           
Three Months Ended   Q2 2017   Q2 2016   $ Change
(in Thousands USD) Net income   $1,068   $744   $324
Add back:            
  Interest   246   286   (40)
  Taxes   0   0   0
  Stock based compensation   317   1,834   (1,517)
  Depreciation and amortization   103   96   7
Adjusted EBITDA   $1,734   $2,960   $(1,226)
As a percentage of revenue   6.9%   9.5%    
             

Conference Call Details:

Management will host a conference call to discuss these results today, Thursday August 10, 2017 at 10 a.m. ET. To access the call, please dial 1-866-682-6100 (toll free) or 1-862-255-5401 (international). The conference call will also be broadcast live over the Internet, which can be accessed via the Investor Relations section of Sunworks' web site at http://ir.sunworksusa.com. All participants should call or access the website approximately 5 minutes before the conference begins.

The webcast will be available for replay for at least 90 days. A telephonic replay of this conference call will also be available by dialing 1-877-481-4010 (toll free) or 1-919-882-2331 (International) using Replay ID 18827, until 11:59 p.m. ET on August 24, 2017.

About Sunworks, Inc.

Founded in 1983, Sunworks, Inc. is a premier provider of solar power solutions for both consumers and businesses. We're committed to quality construction practices that always exceed industry standards and uphold our ideals of ethics and safety.

Today, Sunworks continues to grow its presence, expanding nationally with regional and local offices. We strive to consistently deliver high quality, performance oriented solutions for the agriculture, commercial, federal, public works, residential, and utility industries. Our dedication to excellence is reflected in our 25-year warranty, a benchmark that we stand by in order to support our customers above and beyond their expectations.

Sunworks fields a diverse, seasoned workforce that includes distinguished veterans who are devoted to providing the very best customer experience. All of our employees, from technicians to executives, uphold our company's guiding principles each day. Sunworks is a member of the Solar Energy Industries Association (SEIA) and is a proud advocate for the advancement of solar power. For more information, visit www.sunworksusa.com.

Safe Harbor Statement

Matters discussed in this press release contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. When used in this press release, the words "anticipate," "believe," "estimate," "may," "intend," "expect" and similar expressions identify such forward-looking statements. Actual results, performance or achievements could differ materially from those contemplated, expressed or implied by the forward-looking statements contained herein. These forward-looking statements are based largely on the expectations of the Company and are subject to a number of risks and uncertainties. These risks include, but are not limited to, risks and uncertainties associated with: the impact of economic, competitive and other factors affecting the Company and its operations, markets, products, and prospects for sales, failure to commercialize our technology, failure of technology to perform as expected, failure to earn profit or revenue, higher costs than expected, persistent operating losses, ownership dilution, inability to repay debt, failure of acquired businesses to perform as expected, the impact on the national and local economies resulting from terrorist actions, and U.S. actions subsequently; and other factors detailed in reports filed by the Company.

   
SUNWORKS, INC.  
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS  
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2017 AND JUNE 30, 2016  
(in thousands, except share and per share data)  
(unaudited)  
                         
    Three Months Ended     Six Months Ended  
    June 30, 2017     June 30, 2016     June 30, 2017     June 30, 2016  
                         
Revenues   $ 25,011     $ 30,995     $ 39,362     $ 50,424  
                                 
Cost of Goods Sold     18,278       21,869       29,850       35,714  
                                 
Gross Profit     6,733       9,126       9,512       14,710  
                                 
Operating Expenses                                
  Selling and marketing expenses     1,793       3,284       3,540       5,845  
  General and administrative expenses     3,204       2,869       6,534       5,750  
  Stock based compensation     317       1,834       534       1,862  
  Depreciation and amortization     103       96       206       116  
                                 
    Total Operating Expenses     5,417       8,083       10,814       13,573  
                                 
(Loss) Income before Other Expenses     1,316       1,043       (1,302 )     1,137  
                                 
Other Expenses                                
  Other expenses     (2 )     (13 )     (45 )     (218 )
  Interest expense     (246 )     (286 )     (491 )     (533 )
                                 
    Total Other Expenses     (248 )     (299 )     (536 )     (771 )
                                 
(Loss) Income before Income Taxes     1,068       744       (1,838 )     366  
                                 
Income Tax Expense     -       -       -       -  
                                 
Net (Loss) Income   $ 1,068     $ 744     $ (1,838 )   $ 366  
                                 
EARNINGS PER SHARE:                                
  Basic   $ 0.05     $ 0.04     $ (0.08 )   $ 0.02  
  Diluted   $ 0.04     $ 0.03     $ (0.08 )   $ 0.02  
                                 
WEIGHTED-AVERAGE COMMON SHARES OUTSTANDING                                
  Basic     22,447,752       20,354,517       21,859,169       19,583,194  
  Diluted     25,831,671       24,321,750       21,859,169       23,051,023  
                                   
   
SUNWORKS, INC.  
CONDENSED CONSOLIDATED BALANCE SHEETS  
AS OF JUNE 30, 2017 AND DECEMBER 31, 2016  
(in thousands, except share and per share data)  
             
    June 30, 2017     December 31, 2016  
    (Unaudited)        
Assets            
Current Assets            
  Cash and cash equivalents   $ 4,165     $ 11,069  
  Restricted cash     250       37  
  Accounts receivable, net     16,674       9,665  
  Inventory     3,698       3,394  
  Costs in excess of billings     5,839       4,307  
  Other current assets     623       117  
                 
  Total Current Assets     31,249       28,589  
                 
  Property and Equipment, net     1,494       1,674  
                 
Other Assets                
  Other deposits     65       53  
  Goodwill     11,364       11,364  
                 
  Total Other Assets     11,429       11,417  
                 
  Total Assets   $ 44,172     $ 41,680  
                 
Liabilities and Shareholders' Equity            
Current Liabilities:                
  Accounts payable and accrued liabilities   $ 12,153     $ 12,979  
  Billings in excess of costs     8,879       4,997  
  Customer deposits     534       64  
  Loan payable, current portion     225       218  
  Acquisition convertible promissory note, current portion     606       454  
                 
                 
  Total Current Liabilities     22,397       18,712  
                 
Long Term Liabilities                
  Loan payable     381       496  
  Acquisition convertible promissory notes, net of beneficial conversion feature of $370 and $807, respectively     640       505  
  Warranty liability     186       116  
  Convertible promissory notes     384       654  
    Total Long Term Liabilities     1,591       1,771  
    Total Liabilities     23,988       20,483  
                 
    Shareholders' Equity                
    Preferred stock Series B, $.001 par value; 5,000,000 authorized shares; 1,506,024 shares issued and outstanding     2       2  
    Common stock, $.001 par value; 200,000,000 authorized shares; 22,455,664 and 20,853,921 shares issued and outstanding, respectively     22       21  
    Additional paid in capital     71,141       70,317  
    Accumulated Deficit     (50,981 )     (49,143 )
                     
    Total Shareholders' Equity     20,184       21,197  
                     
    Total Liabilities and Shareholders' Equity   $ 44,172     $ 41,680  
                     

Investor Relations Contact:
Rob Fink/John Roginski
Hayden IR
646-415-8972 / 570-569-2479
rob@haydenir.com / john@haydenir.com

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