LEHI, Utah, Nov. 7, 2017 /PRNewswire/ -- Vivint Solar (NYSE: VSLR), today announced financial results for the third quarter ended September 30, 2017.

Third Quarter 2017 Operating Highlights

Key operating and development highlights for the quarter ended September 30, 2017 include:

  • MW Booked of approximately 53 MWs for the quarter.
  • MW Installed of approximately 47 MWs. Total cumulative MWs installed were approximately 820 MWs.
  • Installations were 7,076 for the quarter. Cumulative installations were 120,363.
  • Estimated Nominal Contracted Payments Remaining increased by approximately $111 million during the quarter to approximately $2.9 billion.
  • Estimated Retained Value increased by approximately $75 million during the quarter to approximately $1.5 billion.
  • Estimated Retained Value per Watt was $1.98.
  • Cost per Watt was $2.94, an increase from $2.88 in the second quarter of 2017 and up from $2.85 in the third quarter of 2016.

Third Quarter 2017 GAAP Financial Results

Summary GAAP financial results for the quarter ended September 30, 2017 include:

  • Operating Leases and Incentives Revenue was $45.9 million, up 37% from $33.4 million in the third quarter of the prior year. Total revenue for the quarter was $75.1 million, up 82% from $41.3 million in the third quarter of the prior year.
  • Cost of Revenue – Operating Leases and Incentives was $34.7 million, down from $39.3 million in the same period of 2016.
  • Total Operating Expenses, including cost of revenue, were $87.1 million, compared to $74.6 million in the third quarter of 2016.
  • Loss from Operations was $12.0 million compared to $33.3 million in the same period of 2016.
  • GAAP Net Income Available (Loss Attributable) per Share to Common Stockholders was $0.06, down from $0.15 in the third quarter of 2016.
  • Non-GAAP Net Loss Attributable Before Non-Controlling Interests and Redeemable Non-Controlling Interests per Share was ($0.33), up from ($0.36) in the same period of 2016. See below for a further discussion of Non-GAAP Loss per Share.
  • Cash and Cash Equivalents as of September 30, 2017 were $101.8 million.

Financing Activity

As of September 30, 2017, the company had $15 million in undrawn capacity in the working capital facility, had $275 million in undrawn capacity in the aggregation facility, and had approximately 76 MWs of installation capacity remaining in its tax equity funds.

Guidance for Fourth Quarter 2017

The following statements are based on current expectations. These statements are forward-looking, and actual results may differ materially. These statements supersede all prior statements regarding 2017 financial results.

For the fourth quarter of 2017, Vivint Solar expects:

  • MW Installed: 46 to 50 MWs
  • Cost per Watt: $2.90 - $3.00

Earnings Conference Call

Vivint Solar will host an investor conference call and live webcast today, Tuesday, November 7, 2017, at 5:00 p.m. ET to discuss these financial results. To access the conference call, dial 1.844.579.6824 or 1.763.488.9145 for international callers. The conference ID is 9870 3603. A listen-only webcast will be accessible on the investor relations page of the Company's website at investors.vivintsolar.com/ and will be archived and available on this site until November 30, 2017. Participants should follow the instructions provided on the website to download and install the necessary audio applications in advance of the call. In addition, the earnings presentation slides will be available on the investor relations page of the site by 5:00 p.m. ET along with this press release and the financial information discussed on today's conference call at investors.vivintsolar.com/.

About Vivint Solar

Vivint Solar is a leading full-service residential solar provider in the United States. With Vivint Solar, customers can power their homes with clean, renewable energy and typically achieve significant financial savings over time. Offering integrated residential solar solutions for the entire customer lifecycle, Vivint Solar designs and installs the solar energy systems for its customers, and offers monitoring and maintenance services. In addition to being able to purchase a solar energy system outright, customers may benefit from Vivint Solar's affordable, flexible financing options, power purchase agreements, or lease agreements, where available. Through an exclusive collaboration, Vivint Solar also offers solar plus storage systems with Mercedes-Benz batteries. For more information, visit www.vivintsolar.com or follow @VivintSolar on Twitter.

Note on Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995, including statements regarding Vivint Solar's guidance for megawatts installed and cost per watt, installation capacity remaining in tax equity funds, growth prospects, and operating and financial results, such as estimates of nominal contracted payments remaining, estimated retained value, estimated retained value per watt, including the assumptions related to the calculation of the foregoing metrics.

Forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified. Forward-looking statements should not be read as a guarantee of future performance or results, and they will not necessarily be accurate indications of the times at, or by, which such performance or results will be achieved, if at all. These statements are based on current expectations and assumptions regarding future events and business performance as of the date of this press release, and they are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements, including but not limited to: the availability of additional financing on acceptable terms; changes in the retail price of traditional utility generated electricity; changes in electric utility policies and regulations; the availability of rebates, tax credits and other incentives, including solar renewable energy certificates, or SRECs, and other federal and state incentives; regulations and policies related to net metering; changes in regulations, tariffs and other trade barriers and tax policy affecting us and our industry; our ability to manage our recent and future growth effectively, including attracting, training and retaining sales personnel and solar energy system installers; the availability and price of solar panels and other system components, the assumptions employed in calculating our operating metrics may be inaccurate; and such other risks identified in the registration statements and reports that Vivint Solar files with the U.S. Securities and Exchange Commission, or SEC, from time to time. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee that the future results, levels of activity, performance or events and circumstances reflected in those statements will be achieved or will occur, and actual results could differ materially from those anticipated or implied in the forward-looking statements. Except as required by law, Vivint Solar does not undertake any obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments or otherwise. You should read the documents Vivint Solar has filed with the SEC for more complete information about the company. These documents are available on both the EDGAR section of the SEC's website at www.sec.gov and the Investor Relations section of the Company's website at investors.vivintsolar.com/.

Vivint Solar, Inc.


Condensed Consolidated Unaudited Balance Sheets


(In thousands)











September 30,



December 31,



2017



2016


ASSETS








Current assets:








Cash and cash equivalents

$

101,755



$

96,586


Accounts receivable, net


29,517




12,658


Inventories


19,802




11,285


Prepaid expenses and other current assets


29,519




46,683


Total current assets


180,593




167,212


Restricted cash and cash equivalents


45,593




26,853


Solar energy systems, net


1,622,561




1,458,355


Property and equipment, net


17,040




23,199


Intangible assets, net


1,002




1,420


Prepaid tax asset, net


482,446




419,474


Other non-current assets, net


36,889




29,843


TOTAL ASSETS

$

2,386,124



$

2,126,356


LIABILITIES, REDEEMABLE NON-CONTROLLING INTERESTS AND EQUITY








Current liabilities:








Accounts payable

$

42,315



$

46,630


Accounts payable—related party


476




191


Distributions payable to non-controlling interests and redeemable non-controlling interests


11,664




16,176


Accrued compensation


23,199




20,003


Current portion of long-term debt


13,454




6,252


Current portion of deferred revenue


32,283




19,911


Current portion of capital lease obligation


4,571




5,163


Accrued and other current liabilities


25,044




19,364


Total current liabilities


153,006




133,690


Long-term debt, net of current portion


882,672




750,728


Deferred revenue, net of current portion


33,680




34,379


Capital lease obligation, net of current portion


2,294




5,476


Deferred tax liability, net


491,834




395,218


Other non-current liabilities


13,999




10,355


Total liabilities


1,577,485




1,329,846


Commitments and contingencies








Redeemable non-controlling interests


127,833




129,676


Stockholders' equity:








Common stock


1,148




1,102


Additional paid-in capital


554,420




542,348


Accumulated other comprehensive income


6,027




7,631


Retained earnings


29,186




5,217


Total stockholders' equity


590,781




556,298


Non-controlling interests


90,025




110,536


Total equity


680,806




666,834


TOTAL LIABILITIES, REDEEMABLE NON-CONTROLLING INTERESTS AND EQUITY

$

2,386,124



$

2,126,356


 

Vivint Solar, Inc.


Condensed Consolidated Unaudited Statements of Operations


(In thousands, except per share data)



















Three Months Ended



Nine Months Ended



September 30,



September 30,



2017



2016



2017



2016


Revenue:
















Operating leases and incentives

$

45,909



$

33,394



$

119,711



$

80,033


Solar energy system and product sales


29,230




7,868




81,537




13,363


Total revenue


75,139




41,262




201,248




93,396


Operating expenses:
















Cost of revenue—operating leases and incentives


34,731




39,268




103,564




115,566


Cost of revenue—solar energy system and product sales


22,168




6,468




63,664




10,606


Sales and marketing


9,808




8,617




28,037




32,078


Research and development


896




842




2,687




2,218


General and administrative


19,379




19,022




60,259




60,006


Amortization of intangible assets


139




342




418




762


Impairment of goodwill











36,601


Total operating expenses


87,121




74,559




258,629




257,837


Loss from operations


(11,982)




(33,297)




(57,381)




(164,441)


Interest expense


16,148




9,361




47,707




22,539


Other expense (income), net


195




(434)




1,186




(95)


Loss before income taxes


(28,325)




(42,224)




(106,274)




(186,885)


Income tax expense (benefit)


9,375




(2,959)




23,932




10,245


Net loss


(37,700)




(39,265)




(130,206)




(197,130)


Net loss attributable to non-controlling interests and redeemable non-controlling interests


(44,605)




(55,961)




(155,383)




(194,978)


Net income available (loss attributable) to common stockholders

$

6,905



$

16,696



$

25,177



$

(2,152)


Net income available (loss attributable) per share to common stockholders:
















Basic

$

0.06



$

0.15



$

0.22



$

(0.02)


Diluted

$

0.06



$

0.15



$

0.21



$

(0.02)


Weighted-average shares used in computing net income available (loss attributable) per share to common stockholders:
















Basic


114,505




108,692




112,554




107,516


Diluted


119,465




113,344




117,825




107,516


 

Vivint Solar, Inc.


Condensed Consolidated Unaudited Statements of Cash Flows


(In thousands)



















Three Months Ended



Nine Months Ended



September 30,



September 30,



2017



2016



2017



2016


CASH FLOWS FROM OPERATING ACTIVITIES:
















Net loss

$

(37,700)



$

(39,265)



$

(130,206)



$

(197,130)


Adjustments to reconcile net loss to net cash used in operating activities:
















Depreciation and amortization


15,632




12,500




44,671




32,376


Amortization of intangible assets


139




342




418




762


Impairment of goodwill











36,601


Deferred income taxes


33,238




41,075




98,493




124,912


Stock-based compensation


2,249




3,678




9,501




6,145


Loss on solar energy systems and property and equipment


1,258




4,317




5,024




4,576


Non-cash interest and other expense


2,044




1,966




7,355




4,963


Reduction in lease pass-through financing obligation


(1,550)




(1,613)




(3,545)




(3,279)


Losses (gains) on interest rate swaps


200




(258)




1,193




(258)


Excess tax detriment from stock-based compensation





(299)







(1,280)


Changes in operating assets and liabilities:
















Accounts receivable, net


(7,844)




(140)




(16,859)




(8,444)


Inventories


(3,661)




(2,655)




(8,517)




(5,891)


Prepaid expenses and other current assets


(5,084)




(2,209)




16,289




98


Prepaid tax asset, net


(19,866)




(35,273)




(62,972)




(122,313)


Other non-current assets, net


104




(961)




(5,921)




(4,255)


Accounts payable


936




1,742




874




664


Accounts payable—related party


173




(68)




120




(1,480)


Accrued compensation


3,522




3,696




1,500




8,334


Deferred revenue


5,004




2,222




11,673




3,396


Accrued and other liabilities


(44)




(3,955)




6,235




(2,377)


Net cash used in operating activities


(11,250)




(15,158)




(24,674)




(123,880)


CASH FLOWS FROM INVESTING ACTIVITIES:
















Payments for the cost of solar energy systems


(66,192)




(106,651)




(211,225)




(318,273)


Payments for property and equipment


(39)




(809)




(672)




(2,697)


Proceeds from disposals of solar energy systems and property and equipment


852




319




1,952




693


Change in restricted cash and cash equivalents


(2,309)




(3,917)




(18,740)




(8,434)


Proceeds from state tax credits


2,216







2,216





Purchase of intangible assets











(291)


Net cash used in investing activities


(65,472)




(111,058)




(226,469)




(329,002)


CASH FLOWS FROM FINANCING ACTIVITIES:
















Proceeds from investment by non-controlling interests and redeemable non-controlling interests


46,777




53,885




162,291




237,148


Distributions paid to non-controlling interests and redeemable non-controlling interests


(11,294)




(10,417)




(33,774)




(22,230)


Proceeds from long-term debt


33,000




355,551




306,750




500,257


Payments on long-term debt


(5,631)




(220,250)




(164,935)




(224,400)


Payments for debt issuance and deferred offering costs


(267)




(10,544)




(13,677)




(16,774)


Proceeds from lease pass-through financing obligation


980




557




2,467




1,417


Principal payments on capital lease obligations


(1,070)




(1,298)




(3,413)




(4,357)


Proceeds from issuance of common stock


370




2,155




603




2,645


Net cash provided by financing activities


62,865




169,639




256,312




473,706


NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS


(13,857)




43,423




5,169




20,824


CASH AND CASH EQUIVALENTS—Beginning of period


115,612




69,614




96,586




92,213


CASH AND CASH EQUIVALENTS—End of period

$

101,755



$

113,037



$

101,755



$

113,037


 

Vivint Solar, Inc.


Key Operating Metrics



























Three Months Ended



September 30,



June 30,



September 30,



2017



2017



2016














 Installations


7,076




7,108




8,266


 Megawatts installed


46.5




46.9




58.8


 Cumulative installations


120,363




113,287




93,138


 Cumulative megawatts installed


820.3




773.8




634.0


 Estimated nominal contracted payments remaining (in millions)

$

2,913.2



$

2,802.4



$

2,432.2


      Estimated retained value under energy contracts (in millions)

$

1,175.5



$

1,121.6



$

948.3


      Estimated retained value of renewal (in millions)

$

359.7



$

339.0



$

280.0


 Estimated retained value (in millions)

$

1,535.2



$

1,460.6



$

1,228.3


 Estimated retained value per watt

$

1.98



$

1.98



$

1.96


Sensitivity Analysis for Retained Value

The following table provides quantitative sensitivity analysis of our estimate of retained value of solar energy systems under contracts as of September 30, 2017, including both the contracted and estimated renewal portion, at a range of discount rates (retained value amounts in millions):


4%



6%



8%


 Estimated retained value under energy contracts

$

1,405.6



$

1,175.5



$

995.1


 Estimated retained value of renewal


562.8




359.7




232.4


 Total estimated retained value

$

1,968.4



$

1,535.2



$

1,227.5


Non-GAAP Earnings per Share (EPS) Before Noncontrolling Interests

We report GAAP EPS, which is based upon net income available (loss attributable) to common stockholders. We also report non-GAAP EPS. The difference between GAAP EPS and non-GAAP EPS is that non-GAAP EPS is based on net loss, which excludes net loss attributable to non-controlling interests and redeemable non-controlling interests. Additionally, we have excluded the effect of the goodwill impairment for the nine months ended September 30, 2016 as it is a non-cash, non-recurring event that is not representative of our ongoing business. As we are in a net loss position for all periods reported, potentially issuable shares are excluded from the diluted EPS calculation since the effect would be antidilutive. Therefore, basic and diluted non-GAAP EPS are the same in each period presented.

Under GAAP accounting, we report net loss attributable to non-controlling interests and redeemable non-controlling interests to reflect our joint venture fund investors' allocable share in the results of these joint venture investment funds. Net loss attributable to non-controlling interests and redeemable non-controlling interests is calculated based primarily on the hypothetical liquidation at book value, or HLBV, method, which assumes that the joint venture funds are liquidated at the reporting date, even though liquidation may or may not ever occur. Additionally, the returns that will be allocated to the investors over the expected terms of the investment funds may differ significantly from the amounts calculated under the HLBV method. Accordingly, we also report non-GAAP EPS based on our losses before net loss attributable to non-controlling interests and redeemable non-controlling interests per share, which we view as a better measure of our operating performance.  Non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as a substitute for our financial results prepared in accordance with GAAP.

According to this definition, the non-GAAP loss before the allocation of loss attributable to non-controlling interests and redeemable non-controlling interests per share was ($0.33) and ($1.16) for the three and nine months ended September 30, 2017.

Vivint Solar, Inc.


Reconciliation from GAAP EPS to Non-GAAP EPS


(In thousands, except per share data)



































Three Months Ended



September 30, 2017



September 30, 2016



Net Loss



EPS



Net Loss



EPS


Net income available to common stockholders

$

6,905



$

0.06



$

16,696



$

0.15


Net loss attributable to non-controlling interests and redeemable non-controlling interests


(44,605)




(0.39)




(55,961)




(0.51)


Non-GAAP net loss

$

(37,700)



$

(0.33)



$

(39,265)



$

(0.36)


Weighted-average shares used in computing net loss per share






114,505








108,692









Nine Months Ended



September 30, 2017



September 30, 2016



Net Loss



EPS



Net Loss



EPS


Net income available (loss attributable) to common stockholders

$

25,177



$

0.22



$

(2,152)



$

(0.02)


Net loss attributable to non-controlling interests and redeemable non-controlling interests


(155,383)



$

(1.38)




(194,978)



$

(1.81)


Impairment of goodwill




$




36,601



$

0.34


Non-GAAP net loss

$

(130,206)



$

(1.16)



$

(160,529)



$

(1.49)


Weighted-average shares used in computing net loss per share:






112,554








107,516


Glossary of Definitions

"Installations" represents the number of solar energy systems installed on customers' premises.

"MWs or megawatts" represents the DC nameplate megawatt production capacity.

"MW Booked" represents the aggregate megawatt nameplate capacity of solar energy systems that were permitted during the period net of cancellations in the period.

"MW Installed" represents the aggregate megawatt nameplate capacity of solar energy systems for which panels, inverters, and mounting and racking hardware have been installed on customer premises in the period.

"Nominal Contracted Payments Remaining" equals the sum of the remaining cash payments that Vivint Solar's customers are expected to pay over the term of their agreements for systems installed as of the measurement date. For a power purchase agreement, Vivint Solar multiplies the contract price per kilowatt-hour by the estimated annual energy output of the associated solar energy system to determine the estimated nominal contracted payments. For a customer lease, Vivint Solar includes the monthly fees and upfront fee, if any, as set forth in the lease.

"Retained Value" represents the net cash flows, discounted at 6%, that Vivint Solar expects to receive from customers pursuant to long-term customer contracts net of estimated cash distributions to fund investors and estimated operating expenses for systems installed as of the measurement date. For purposes of the calculation, Vivint Solar aggregates the estimated retained value from the solar energy systems during the typical 20-year term of Vivint Solar's contracts, which Vivint Solar refers to as estimated retained value under energy contracts, and the estimated retained value associated with an assumed 10-year renewal term following the expiration of the initial contract term, which Vivint Solar refers to as estimated retained value of renewal. To calculate estimated retained value of renewal, Vivint Solar assumes all contracts are renewed at 90% of the contractual price in effect at the expiration of the initial term.

"Retained Value per Watt" is calculated by dividing the estimated retained value as of the measurement date by the aggregate nameplate capacity of solar energy systems under long-term customer contracts that have been installed as of such date, and is subject to the same assumptions and uncertainties as estimated retained value.

"Undeployed Tax Equity Financing Capacity" represents a forecast of the amount of megawatts that can be deployed based on committed available tax equity financing for energy contracts.

Investor Contact:

Rob Kain
Vice President of Investor Relations
855-842-1844
ir@vivintsolar.com

Press Contact:

Ashlyn Hewlett
Method Communications
801-461-9772
ashlyn@methodcommunications.com

 

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SOURCE Vivint Solar

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