Array Technologies (NASDAQ: ARRY) (“Array” or “the Company”), a
leading provider of tracker solutions and services for
utility-scale solar energy projects, today announced financial
results for its second quarter ended June 30, 2022.
“In the second quarter, our consolidated revenue
grew by 116% and had organic growth in our legacy Array business of
79%. This substantial growth is a testament to not only Array’s
product and service offerings, but also our ability to provide
flexible solutions for our customers in a shifting demand landscape
while also maintaining a relentless focus on operational
execution,” said Kevin Hostetler, Chief Executive Officer. “In
addition to our top line growth, in the second quarter we also
delivered gross margin of 11.1%, which was our third consecutive
quarter of improvement. This continued progress demonstrates we are
on the path to restoring our historical margins as our mix of new,
higher priced, contracts continue to improve.”
Mr. Hostetler continued, “As we look at the
current state of our industry in the U.S., we are encouraged by the
recent executive order issued by President Biden in support of
domestic clean energy. The executive order means that we believe
the approximately $240.0 million of projects we previously
identified as at risk are now expected to move forward. While we
don’t expect the majority of these projects will get delivered in
2022 due to lead times, it is important that this demand is now
solidified. Additionally, the Inflation Reduction Act, when passed,
provides meaningful clarity on the long-term incentive structure
for the solar industry, including investments that aim to tackle
climate change. This clarity allows participants to confidently
make decisions on future investments therein accelerating the
adoption of solar energy. We strongly encourage the House to pass
this bill and President Biden to sign it into law.”
Mr. Hostetler concluded, “Finally, given our
strong second quarter and the additional clarity on our domestic
demand landscape we are reaffirming our 2022 outlook.”
Second Quarter 2022 Financial
Results
Revenues increased 116% to $424.9 million,
compared to $196.5 million for the prior-year period, primarily
driven by the acquisition of STI Norland which contributed revenue
of $72.7 million. Excluding the impact of the acquisition, revenue
was up $155.7 million, or 79%, driven by both an increase in the
total number of MWs shipped and an increase in ASP.
Gross profit increased 131% to $47.4 million
compared to $20.5 million in the prior year period, driven
primarily by the increase in volume both from the acquisition of
STI as well as our organic growth. Gross margin increased to 11.1%
from 10.4% driven by a larger portion of higher priced contracts
and the addition of STI.
Operating expenses increased to $54.2 million
compared to $21.1 million during the same period in the prior year.
The higher expense is primarily related to a $18.3 million increase
in amortization expense related to the STI acquisition. The
remaining increase primarily represents the additional operating
expenses from the STI business as well as higher headcount related
costs to support the Company’s growth.
Net loss to common stockholders was $15.0
million compared to a net loss of $5.5 million during the same
period in the prior year, and basic and diluted loss per share were
$0.10 compared to basic and diluted loss per share of $0.04 during
the same period in the prior year.
Adjusted EBITDA increased to $25.9 million,
compared to $9.9 million for the prior-year period.
Adjusted net income was $14.2 million compared
to adjusted net income of $3.0 million during the same period in
the prior year and adjusted basic and diluted adjusted net income
per share was $0.09 compared to adjusted net income per share of
$0.02 during the same period in the prior year.
Executed Contracts and Awarded
Orders
Total executed contracts and awarded orders at
June 30, 2022 were $1.9 billion, with $1.5 billion from our Array
Legacy Operations segment and $0.4 billion from STI Norland.
The $1.9 billion represents an increase of 110% from June 30,
2021.
Full Year 2022 Guidance
For the year ending December 31, 2022, the
Company reaffirms it expectations of:
- Revenue to be in the range of $1.30
billion to $1.50 billion
- Adjusted EBITDA(2) to be in the
range of $120.0 million to $140.0 million
- Adjusted net income per share(2) to
be in the range of $0.25 to $0.35
(2) A reconciliation of projected adjusted
EBITDA and adjusted net income per share, which are forward-looking
measures that are not prepared in accordance with GAAP, to the most
directly comparable GAAP financial measures, is not provided
because we are unable to provide such reconciliation without
unreasonable effort. The inability to provide a quantitative
reconciliation is due to the uncertainty and inherent difficulty
predicting the occurrence, the financial impact and the periods in
which the components of the applicable GAAP measures and non-GAAP
adjustments may be recognized. The GAAP measures may include the
impact of such items as non-cash share-based compensation,
revaluation of the fair-value of our contingent consideration, and
the tax effect of such items, in addition to other items we have
historically excluded from adjusted EBITDA and adjusted net income
per share. We expect to continue to exclude these items in future
disclosures of these non-GAAP measures and may also exclude other
similar items that may arise in the future (collectively, “non-GAAP
adjustments”). The decisions and events that typically lead to the
recognition of non-GAAP adjustments are inherently unpredictable as
to if or when they may occur. As such, for our 2022 outlook, we
have not included estimates for these items and are unable to
address the probable significance of the unavailable information,
which could be material to future results.
Conference Call Information
Array management will host a conference call
today at 5:00 p.m. Eastern Time to discuss the Company’s financial
results. The conference call can be accessed live over the phone by
dialing (877) 451-6152 (domestic) or (201) 389-0879
(international). A telephonic replay will be available
approximately three hours after the call by dialing (844)-512-2921,
or for international callers, (412) 317-6671. The passcode for the
live call and the replay is 13731316. The replay will be available
until 11:59 p.m. Eastern Time on August 23, 2022.
Interested investors and other parties can
listen to a webcast of the live conference call by logging onto the
Investor Relations section of the Company's website at
http://ir.arraytechinc.com. The online replay will be available for
30 days on the same website immediately following the call.
To learn more about Array Technologies, please
visit the company's website at http://ir.arraytechinc.com.
About Array Technologies,
Inc.Array Technologies (NASDAQ: ARRY) is a leading global
renewable energy company and provider of utility-scale solar
tracking technology. Engineered to withstand the harshest
conditions on the planet, Array’s high-quality solar trackers and
sophisticated software maximize energy production, accelerating the
adoption of cost-effective and sustainable energy. Founded and
headquartered in the United States, Array relies on its diversified
global supply chain and customer-centric approach to deliver,
commission and support solar energy developments around the world,
lighting the way to a brighter, smarter future for clean energy.
For more news and information on Array, please visit
arraytechinc.com and stinorland.com.
Investor Relations Contact:
Array Technologies, Inc.Investor Relations
505-437-0010investors@arraytechinc.com
Forward-Looking
Statements This press release contains
forward-looking statements that are based on our management’s
beliefs and assumptions and on information currently available to
our management. Forward-looking statements include information
concerning our projected future results of operations, business
strategies, our continued integration of STI Norland and industry
and regulatory environment. Forward-looking statements include
statements that are not historical facts and can be identified by
terms such as “anticipate,” “believe,” “could,” “estimate,”
“expect,” “intend,” “may,” “plan,” “potential,” “predict,”
“project,” "seek," “should,” “will,” “would” or similar expressions
and the negatives of those terms.
Array’s actual results and the timing of events
could materially differ from those anticipated in such
forward-looking statements as a result of certain risks,
uncertainties and other factors, including without limitation: we
may be unable to successfully integrate the business of STI Norland
into our business or achieve the anticipated benefits of the
acquisition of STI Norland; if demand for solar energy projects
does not continue to grow or grows at a slower rate than we
anticipate, our business will suffer; a loss of one or more of our
significant customers, their inability to perform under their
contracts, or their default in payment, could harm our business and
negatively impact revenue, results of operations and cash flows;
the impact of the ongoing conflict in Ukraine on our business; the
ongoing COVID-19 pandemic; significant changes in the costs of raw
materials could adversely affect our financial performance; defects
or performance problems in our products could result in loss of
customers, reputational damage and decreased revenue, and we may
face warranty, indemnity and product liability claims arising from
defective products; existing electric utility industry policies and
regulations, and any subsequent changes, may present technical,
regulatory and economic barriers to the purchase and use of solar
energy systems, which may significantly reduce demand for our
products or harm our ability to compete; changes in the U.S. trade
environment, including the imposition of import tariffs, could
adversely affect the amount or timing of our revenues, results of
operations or cash flows; and the other risks and uncertainties
described in more detail in the Company’s most recent Annual Report
on Form 10-K and other documents on file with the SEC, each of
which can be found on our website www.arraytechinc.com.
Except as required by law, we assume no
obligation to update these forward-looking statements, or to update
the reasons actual results could differ materially from those
anticipated in these forward-looking statements, even if new
information becomes available in the future.
Non-GAAP
Financial InformationThis
presentation includes certain financial measures that are not
presented in accordance with U.S. generally accepted accounting
principles (“GAAP”), including Adjusted EBITDA, Adjusted Net Income
and Adjusted Net Income per share. We define Adjusted EBITDA as net
income (loss) plus (i) interest expense, (ii) other (income)
expense, (iii) income tax expense (benefit), (iv) depreciation
expense, (v) amortization of intangibles, (vi) equity-based
compensation, (vii) remeasurement of the fair value of contingent
consideration, (viii) certain acquisition related costs, (ix)
certain legal expense, and (x) other costs. We define Adjusted Net
Income as net income (loss) less preferred dividends and accretion
plus (i) amortization of intangibles, (ii) amortization of debt
discount and issuance costs (iii) preferred dividend accretion,
(iv) equity-based compensation, (v) remeasurement of the fair value
of contingent consideration, (vi) certain legal expense, (viii)
certain acquisition related costs, (ix) other costs, and (x) income
tax (expense) benefit of adjustments. A detailed reconciliation
between GAAP results and results excluding special items
(“non-GAAP”) is included within this presentation. We calculate net
income (loss) per share as net income (loss) to common shareholders
divided by the basic and diluted weighted average number of shares
outstanding for the applicable period and we define Adjusted Net
Income (as detailed above) per share as Adjusted Net Income divided
by the basic and diluted weighted average number of shares
outstanding for the applicable period.
We believe that these non-GAAP financial
measures are provided to enhance the reader’s understanding of our
past financial performance and our prospects for the future. Our
management team uses these non-GAAP financial measures in assessing
the Company’s performance, as well as in planning and forecasting
future periods. The non-GAAP financial information is presented for
supplemental informational purposes only and should not be
considered a substitute for financial information presented in
accordance with GAAP, and may be different from similarly titled
non-GAAP measures used by other companies.
Among other limitations, Adjusted EBITDA and
Adjusted Net Income do not reflect our cash expenditures, or future
requirements, for capital expenditures or contractual commitments;
do not reflect the impact of certain cash charges resulting from
matters we consider not to be indicative of our ongoing operations;
do not reflect income tax expense or benefit; and other companies
in our industry may calculate Adjusted EBITDA and Adjusted Net
Income differently than we do, which limits their usefulness as
comparative measures. Because of these limitations, Adjusted EBITDA
and Adjusted Net Income should not be considered in isolation or as
substitutes for performance measures calculated in accordance with
GAAP. We compensate for these limitations by relying primarily on
our GAAP results and using Adjusted EBITDA and Adjusted Net Income
on a supplemental basis. You should review the reconciliation of
net income (loss) to Adjusted EBITDA and Adjusted Net Income below
and not rely on any single financial measure to evaluate our
business.
Array Technologies, Inc. and
Subsidiaries Condensed Consolidated Balance Sheets
(unaudited)(in thousands, except per share and share
amounts)
|
June 30, 2022 |
|
December 31, 2021 |
ASSETS |
|
|
|
Current assets |
|
|
|
Cash and cash equivalents |
$ |
51,046 |
|
|
$ |
367,670 |
|
Accounts receivable, net |
|
457,900 |
|
|
|
236,009 |
|
Inventories, net |
|
329,951 |
|
|
|
205,653 |
|
Income tax receivables |
|
16,217 |
|
|
|
9,052 |
|
Prepaid expenses and other |
|
52,831 |
|
|
|
33,649 |
|
Total current assets |
|
907,945 |
|
|
|
852,033 |
|
Property, plant and equipment,
net |
|
17,802 |
|
|
|
10,692 |
|
Goodwill |
|
378,706 |
|
|
|
69,727 |
|
Other intangible assets,
net |
|
421,862 |
|
|
|
174,753 |
|
Deferred tax assets |
|
18,521 |
|
|
|
9,345 |
|
Other assets |
|
30,573 |
|
|
|
26,429 |
|
Total assets |
$ |
1,775,409 |
|
|
$ |
1,142,979 |
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS'
EQUITY (DEFICIT) |
|
|
|
Current liabilities |
|
|
|
Accounts payable |
$ |
231,798 |
|
|
$ |
91,392 |
|
Accounts payable - related party |
|
478 |
|
|
|
610 |
|
Accrued expenses and other |
|
51,072 |
|
|
|
38,494 |
|
Accrued warranty reserve |
|
2,911 |
|
|
|
3,192 |
|
Income tax payable |
|
3,034 |
|
|
|
60 |
|
Deferred revenue |
|
167,556 |
|
|
|
99,575 |
|
Current portion of contingent consideration |
|
— |
|
|
|
1,773 |
|
Current portion of debt |
|
51,494 |
|
|
|
4,300 |
|
Other current liabilities |
|
6,949 |
|
|
|
5,909 |
|
Total current liabilities |
|
515,292 |
|
|
|
245,305 |
|
Long-term liabilities |
|
|
|
Deferred tax liability |
|
84,819 |
|
|
|
— |
|
Contingent consideration, net of current portion |
|
7,686 |
|
|
|
12,804 |
|
Other long-term liabilities |
|
9,723 |
|
|
|
5,557 |
|
Long-term warranty |
|
4,056 |
|
|
|
— |
|
Long-term debt, net of current portion |
|
793,557 |
|
|
|
711,056 |
|
Total long-term liabilities |
|
899,841 |
|
|
|
729,417 |
|
Total liabilities |
|
1,415,133 |
|
|
|
974,722 |
|
Commitments and
Contingencies |
|
|
|
Series A Redeemable Perpetual Preferred Stock of $0.001 par value -
500,000 authorized; 412,606 and 350,000 shares issued as of June
30, 2022 and December 31, 2021, respectively; liquidation
preference of $413.0 million and $350.0 million as of June 30,
2022 and December 31, 2021, respectively |
|
293,974 |
|
|
|
237,462 |
|
Stockholders’ equity
(deficit) |
|
|
|
Preferred stock of $0.001 par value - 4,500,000 shares authorized;
none issued as of June 30, 2022 and December 31, 2021 |
|
— |
|
|
|
— |
|
Common stock of $0.001 par value - 1,000,000,000 shares authorized;
150,279,160 and 135,026,940 shares issued as of June 30, 2022 and
December 31, 2021, respectively |
|
150 |
|
|
|
135 |
|
Additional paid-in capital |
|
401,614 |
|
|
|
202,562 |
|
Accumulated deficit |
|
(296,733 |
) |
|
|
(271,902 |
) |
Accumulated other comprehensive income |
|
(38,729 |
) |
|
|
— |
|
Total stockholders’ equity
(deficit) |
|
66,302 |
|
|
|
(69,205 |
) |
Total liabilities, redeemable
perpetual preferred stock and stockholders’ equity |
$ |
1,775,409 |
|
|
$ |
1,142,979 |
|
Array Technologies, Inc. and
Subsidiaries Condensed Consolidated Statements of
Operations (unaudited) (in thousands, except per share
amounts)
|
Three Months EndedJune 30, |
|
Six Months EndedJune 30, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Revenue |
$ |
424,929 |
|
|
$ |
196,516 |
|
|
$ |
725,515 |
|
|
$ |
444,756 |
|
Cost of revenue |
|
377,553 |
|
|
|
176,009 |
|
|
|
651,552 |
|
|
|
378,083 |
|
Gross profit |
|
47,376 |
|
|
|
20,507 |
|
|
|
73,963 |
|
|
|
66,673 |
|
|
|
|
|
|
|
|
|
Operating expenses |
|
|
|
|
|
|
|
General and
administrative |
|
31,509 |
|
|
|
15,113 |
|
|
|
71,336 |
|
|
|
39,786 |
|
Contingent consideration |
|
(1,678 |
) |
|
|
(13 |
) |
|
|
(5,409 |
) |
|
|
135 |
|
Depreciation and
amortization |
|
24,389 |
|
|
|
5,981 |
|
|
|
47,041 |
|
|
|
11,965 |
|
Total operating expenses |
|
54,220 |
|
|
|
21,081 |
|
|
|
112,968 |
|
|
|
51,886 |
|
|
|
|
|
|
|
|
|
Income (loss) from
operations |
|
(6,844 |
) |
|
|
(574 |
) |
|
|
(39,005 |
) |
|
|
14,787 |
|
|
|
|
|
|
|
|
|
Other expense |
|
|
|
|
|
|
|
Other income (expense),
net |
|
(371 |
) |
|
|
(122 |
) |
|
|
372 |
|
|
|
(200 |
) |
Foreign currency gain
(loss) |
|
(1,736 |
) |
|
|
— |
|
|
|
2,127 |
|
|
|
— |
|
Interest expense |
|
(8,021 |
) |
|
|
(6,651 |
) |
|
|
(14,963 |
) |
|
|
(15,660 |
) |
Total other expense |
|
(10,128 |
) |
|
|
(6,773 |
) |
|
|
(12,464 |
) |
|
|
(15,860 |
) |
Loss before income tax
benefit |
|
(16,972 |
) |
|
|
(7,347 |
) |
|
|
(51,469 |
) |
|
|
(1,073 |
) |
Income tax benefit |
|
(14,195 |
) |
|
|
(1,830 |
) |
|
|
(26,638 |
) |
|
|
(132 |
) |
Net loss |
|
(2,777 |
) |
|
|
(5,517 |
) |
|
|
(24,831 |
) |
|
|
(941 |
) |
Preferred dividends and accretion |
|
12,182 |
|
|
|
— |
|
|
|
23,788 |
|
|
|
— |
|
Net loss to common
shareholders |
$ |
(14,959 |
) |
|
$ |
(5,517 |
) |
|
$ |
(48,619 |
) |
|
$ |
(941 |
) |
|
|
|
|
|
|
|
|
Loss per common share |
|
|
|
|
|
|
|
Basic |
$ |
(0.10 |
) |
|
$ |
(0.04 |
) |
|
$ |
(0.33 |
) |
|
$ |
(0.01 |
) |
Diluted |
$ |
(0.10 |
) |
|
$ |
(0.04 |
) |
|
$ |
(0.33 |
) |
|
$ |
(0.01 |
) |
Weighted average number of
common shares |
|
|
|
|
|
|
|
Basic |
|
150,203 |
|
|
|
126,994 |
|
|
|
149,246 |
|
|
|
126,994 |
|
Diluted |
|
150,203 |
|
|
|
126,994 |
|
|
|
149,246 |
|
|
|
126,994 |
|
Array Technologies, Inc. and
Subsidiaries Condensed Consolidated Statements of
Cash Flows (unaudited) (continued) (in thousands)
|
Three Months EndedJune 30, |
|
Six Months EndedJune 30, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Cash
flows from operating activities |
|
|
|
|
|
|
|
Net loss |
|
(2,777 |
) |
|
|
(5,517 |
) |
|
$ |
(24,831 |
) |
|
$ |
(941 |
) |
Adjustments to reconcile net
loss to net cash used in operating activities: |
|
|
|
|
|
|
|
Provision for (recovery of) bad debts |
|
365 |
|
|
|
(16 |
) |
|
|
510 |
|
|
|
(551 |
) |
Deferred tax expense |
|
(26,633 |
) |
|
|
(429 |
) |
|
|
(19,984 |
) |
|
|
(538 |
) |
Depreciation and amortization |
|
24,556 |
|
|
|
6,483 |
|
|
|
47,579 |
|
|
|
12,964 |
|
Amortization of debt discount and issuance costs |
|
1,576 |
|
|
|
1,532 |
|
|
|
3,286 |
|
|
|
5,118 |
|
Equity-based compensation |
|
2,964 |
|
|
|
1,556 |
|
|
|
7,472 |
|
|
|
9,467 |
|
Contingent consideration |
|
(1,678 |
) |
|
|
(13 |
) |
|
|
(5,409 |
) |
|
|
135 |
|
Warranty provision |
|
621 |
|
|
|
123 |
|
|
|
1,215 |
|
|
|
425 |
|
Provision for inventory obsolescence |
|
— |
|
|
|
1,236 |
|
|
|
409 |
|
|
|
1,236 |
|
Changes in operating assets and liabilities, net of business
acquisition |
|
|
|
|
|
|
|
Accounts receivable |
|
(67,344 |
) |
|
|
(25,393 |
) |
|
|
(111,612 |
) |
|
|
(30,393 |
) |
Inventories |
|
(30,941 |
) |
|
|
(14,197 |
) |
|
|
(77,191 |
) |
|
|
(20,443 |
) |
Income tax receivables |
|
14,862 |
|
|
|
(3,767 |
) |
|
|
(7,062 |
) |
|
|
9,236 |
|
Prepaid expenses and other |
|
(6,336 |
) |
|
|
4,042 |
|
|
|
(376 |
) |
|
|
826 |
|
Accounts payable |
|
15,094 |
|
|
|
9,178 |
|
|
|
74,645 |
|
|
|
(1,378 |
) |
Accounts payable - related party |
|
— |
|
|
|
(1,622 |
) |
|
|
(132 |
) |
|
|
(1,622 |
) |
Accrued expenses and other |
|
(3,671 |
) |
|
|
(15,675 |
) |
|
|
3,356 |
|
|
|
(10,541 |
) |
Income tax payable |
|
4,158 |
|
|
|
(10,881 |
) |
|
|
(4,602 |
) |
|
|
(8,814 |
) |
Lease liabilities |
|
(1,385 |
) |
|
|
(179 |
) |
|
|
4,700 |
|
|
|
68 |
|
Deferred revenue |
|
65,902 |
|
|
|
(38,422 |
) |
|
|
47,263 |
|
|
|
(98,363 |
) |
Net cash used in operating activities |
|
(10,667 |
) |
|
|
(91,961 |
) |
|
|
(60,764 |
) |
|
|
(134,109 |
) |
Cash
flows from investing activities |
|
|
|
|
|
|
|
Purchase of property, plant and equipment |
|
(1,538 |
) |
|
|
(630 |
) |
|
|
(3,895 |
) |
|
|
(1,200 |
) |
Acquisition of STI, net of cash acquired |
|
(2 |
) |
|
|
— |
|
|
|
(373,818 |
) |
|
|
— |
|
Investment in equity security |
|
— |
|
|
|
(1,975 |
) |
|
|
— |
|
|
|
(11,975 |
) |
Net cash used in investing activities |
|
(1,540 |
) |
|
|
(2,605 |
) |
|
|
(377,713 |
) |
|
|
(13,175 |
) |
Cash
flows from financing activities |
|
|
|
|
|
|
|
Proceeds from Series A issuance |
|
— |
|
|
|
— |
|
|
|
33,098 |
|
|
|
— |
|
Proceeds from common stock issuance |
|
— |
|
|
|
— |
|
|
|
15,885 |
|
|
|
— |
|
Series A equity issuance costs |
|
(400 |
) |
|
|
— |
|
|
|
(575 |
) |
|
|
— |
|
Common stock issuance costs |
|
— |
|
|
|
— |
|
|
|
(450 |
) |
|
|
— |
|
Payments on revolving credit facility |
|
(33,000 |
) |
|
|
— |
|
|
|
(33,000 |
) |
|
|
— |
|
Proceeds from issuance of other debt |
|
24,370 |
|
|
|
— |
|
|
|
30,599 |
|
|
|
— |
|
Proceeds from revolving credit facility |
|
49,000 |
|
|
|
102,000 |
|
|
|
101,000 |
|
|
|
102,000 |
|
Principal payments on debt |
|
(18,009 |
) |
|
|
(1,075 |
) |
|
|
(22,377 |
) |
|
|
(31,075 |
) |
Contingent consideration |
|
— |
|
|
|
(7,810 |
) |
|
|
(1,483 |
) |
|
|
(7,810 |
) |
Debt issuance costs |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(6,590 |
) |
Net cash provided by financing activities |
|
21,961 |
|
|
|
93,115 |
|
|
|
122,697 |
|
|
|
56,525 |
|
Effect
of exchange rate changes on cash and cash equivalent balances |
|
(8,199 |
) |
|
|
— |
|
|
|
(844 |
) |
|
|
— |
|
Net
change in cash and cash equivalents |
|
1,555 |
|
|
|
(1,451 |
) |
|
|
(316,624 |
) |
|
|
(90,759 |
) |
Cash and
cash equivalents, beginning of period |
|
49,491 |
|
|
|
19,133 |
|
|
|
367,670 |
|
|
|
108,441 |
|
Cash and cash equivalents, end
of period |
$ |
51,046 |
|
|
$ |
17,682 |
|
|
$ |
51,046 |
|
|
$ |
17,682 |
|
|
|
|
|
|
|
|
|
Supplemental Cash Flow Information |
|
|
|
|
|
|
|
Stock
consideration paid for acquisition of STI |
$ |
— |
|
|
$ |
— |
|
|
$ |
200,224 |
|
|
$ |
— |
|
Array Technologies,
Inc.Adjusted EBITDA and Adjusted Net Income
Reconciliation (unaudited)(in thousands)
The following table reconciles net loss to common
shareholders to Adjusted EBITDA:
|
Three Months EndedJune 30, |
|
Six Months EndedJune 30, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Net
loss |
$ |
(2,777 |
) |
|
$ |
(5,517 |
) |
|
$ |
(24,831 |
) |
|
$ |
(941 |
) |
Preferred dividends and accretion |
|
12,182 |
|
|
|
— |
|
|
|
23,788 |
|
|
|
— |
|
Net loss
to common shareholders |
$ |
(14,959 |
) |
|
$ |
(5,517 |
) |
|
$ |
(48,619 |
) |
|
$ |
(941 |
) |
Other expense, net |
|
2,107 |
|
|
|
122 |
|
|
|
(2,499 |
) |
|
|
200 |
|
Preferred dividends and
accretion |
|
12,182 |
|
|
|
— |
|
|
|
23,788 |
|
|
|
— |
|
Interest expense |
|
8,021 |
|
|
|
6,651 |
|
|
|
14,963 |
|
|
|
15,660 |
|
Income
tax benefit |
|
(14,195 |
) |
|
|
(1,830 |
) |
|
|
(26,638 |
) |
|
|
(132 |
) |
Depreciation expense |
|
616 |
|
|
|
608 |
|
|
|
1,204 |
|
|
|
1,212 |
|
Amortization of intangibles |
|
24,163 |
|
|
|
5,875 |
|
|
|
46,716 |
|
|
|
11,752 |
|
Equity-based compensation |
|
2,971 |
|
|
|
4,120 |
|
|
|
7,479 |
|
|
|
12,031 |
|
Contingent consideration |
|
(1,678 |
) |
|
|
(13 |
) |
|
|
(5,409 |
) |
|
|
135 |
|
Legal
expense(a) |
|
1,733 |
|
|
|
99 |
|
|
|
2,779 |
|
|
|
143 |
|
M&A(b) |
|
— |
|
|
|
— |
|
|
|
5,588 |
|
|
|
— |
|
Other
costs (c) |
|
4,981 |
|
|
|
(224 |
) |
|
|
7,327 |
|
|
|
6,590 |
|
Adjusted EBITDA |
$ |
25,942 |
|
|
$ |
9,891 |
|
|
$ |
26,679 |
|
|
$ |
46,650 |
|
(a) Represents certain legal fees and other
related costs associated with (i) a patent infringement action
against a competitor for which a judgement has been entered in our
favor and successful defense of a related matter and (ii) An action
against a competitor in connection with violation of a
non-competition agreement and misappropriation of trade secrets,
which has been settled subsequent to June 30, 2022 and (iii)
actions filed against the company and certain officers and
directors alleging violations of the Securities Exchange Acts of
1934 and 1933. We consider these costs not representative of legal
costs that we will incur from time to time in the ordinary course
of our business.
(b) Represents fees related to the acquisition
of STI Norland.
(c) For the three months ended June 30, 2022,
other costs represent (i) $2.8 million in remediation and damages
incurred because of a shutdown of a key supplier due to a severe
weather event, (ii) $1.3 million associated with the transition of
CEOs as well as other one-time payroll related costs that we do not
anticipate repeating in the future, (iii) $0.8 million related to
certain professional fees incurred related to the integration of
STI Norland. For the three months ended June 30, 2021, (i)
reimbursement of certain professional fees & payroll related
costs we do not expect to incur in the future of ($0.2) million.
For the six months ended June 30, 2022, (i) $ $2.8 million in
remediation and damages incurred because of a shutdown of a key
supplier due to a severe weather event, (ii) $3.6 million
associated with the transition of CEOs as well as other one-time
payroll related costs that we do not anticipate repeating in the
future, (iii) $0.9 million related to certain professional fees
incurred related to integration. For the six months ended June 30,
2021, other costs represent (i) $3.2 million of one-time logistics
charges incurred primarily due to weather events and port issues
(ii) Certain costs associated with our IPO and Follow-on Offering
of $1.7 million, (iii) Certain professional fees & payroll
related costs we do not expect to incur in the future of $1.7
million.
Array Technologies,
Inc.Adjusted EBITDA and Adjusted Net Income
Reconciliation (unaudited)(in thousands)
The following table reconciles net loss to
common shareholders to Adjusted Net Income:
|
Three Months EndedJune 30, |
|
Six Months EndedJune 30, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Net
loss |
$ |
(2,777 |
) |
|
$ |
(5,517 |
) |
|
$ |
(24,831 |
) |
|
$ |
(941 |
) |
Preferred dividends and accretion |
|
12,182 |
|
|
|
— |
|
|
|
23,788 |
|
|
|
— |
|
Net loss
to common shareholders |
$ |
(14,959 |
) |
|
$ |
(5,517 |
) |
|
$ |
(48,619 |
) |
|
$ |
(941 |
) |
Amortization of intangibles |
|
24,163 |
|
|
|
5,875 |
|
|
|
46,716 |
|
|
|
11,752 |
|
Amortization of debt discount and issuance costs |
|
1,576 |
|
|
|
1,532 |
|
|
|
3,286 |
|
|
|
5,118 |
|
Preferred accretion |
|
5,765 |
|
|
|
— |
|
|
|
11,118 |
|
|
|
— |
|
Equity
based compensation |
|
2,971 |
|
|
|
4,120 |
|
|
|
7,479 |
|
|
|
12,031 |
|
Contingent consideration |
|
(1,678 |
) |
|
|
(13 |
) |
|
|
(5,409 |
) |
|
|
135 |
|
Legal
expense(a) |
|
1,733 |
|
|
|
99 |
|
|
|
2,779 |
|
|
|
143 |
|
M&A
(b) |
|
— |
|
|
|
— |
|
|
|
5,588 |
|
|
|
— |
|
Other
costs(c) |
|
4,981 |
|
|
|
(224 |
) |
|
|
7,327 |
|
|
|
6,590 |
|
Income
tax expense of adjustments(d) |
|
(10,331 |
) |
|
|
(2,858 |
) |
|
|
(19,007 |
) |
|
|
(6,470 |
) |
Adjusted Net Income |
$ |
14,221 |
|
|
$ |
3,014 |
|
|
$ |
11,258 |
|
|
$ |
28,358 |
|
|
|
|
|
|
|
|
|
Net
(loss) per share of common stock |
|
|
|
|
|
|
|
Basic
and diluted |
$ |
(0.10 |
) |
|
$ |
(0.04 |
) |
|
$ |
(0.33 |
) |
|
$ |
(0.01 |
) |
Weighted
average number of shares of common |
|
|
|
|
|
|
|
Basic
and diluted |
|
150,203 |
|
|
|
126,994 |
|
|
|
149,246 |
|
|
|
126,994 |
|
Adjusted
net income per share of common stock |
|
|
|
|
|
|
|
Basic |
$ |
0.09 |
|
|
$ |
0.02 |
|
|
$ |
0.08 |
|
|
$ |
0.22 |
|
Diluted |
$ |
0.09 |
|
|
$ |
0.02 |
|
|
$ |
0.08 |
|
|
$ |
0.22 |
|
Weighted
average number of shares of common stock |
|
|
|
|
|
|
|
Basic |
|
150,203 |
|
|
|
126,994 |
|
|
|
149,246 |
|
|
|
126,994 |
|
Diluted |
|
150,420 |
|
|
|
127,108 |
|
|
|
149,397 |
|
|
|
313,596 |
|
(a) Represents certain legal fees and other
related costs associated with (i) a patent infringement action
against a competitor for which a judgement has been entered in our
favor and successful defense of a related matter and (ii) An action
against a competitor in connection with violation of a
non-competition agreement and misappropriation of trade secrets
which has been settled subsequent to June 30, 2022, and (iii)
actions filed against the company and certain officers and
directors alleging violations of the Securities Exchange Acts of
1934 and 1933. We consider these costs not representative of legal
costs that we will incur from time to time in the ordinary course
of our business.
(b) Represents fees related to the acquisition
of STI Norland.
(c) For the three months ended June 30, 2022,
other costs represent (i) $2.8 million in remediation and damages
incurred because of a shutdown of a key supplier due to a severe
weather event, (ii) $1.3 million associated with the transition of
CEOs as well as other one-time payroll related costs that we do not
anticipate repeating in the future, (iii) $0.8 million related to
certain professional fees incurred related to the integration of
STI Norland. For the three months ended June 30, 2021, (i)
reimbursement of certain professional fees & payroll related
costs we do not expect to incur in the future of ($0.2) million.
For the six months ended June 30, 2022, (i) $2.8 million in
remediation and damages incurred because of a shutdown of a key
supplier due to a severe weather event, (ii) $3.6 million
associated with the transition of CEOs as well as other one-time
payroll related costs that we do not anticipate repeating in the
future, (iii) $0.9 million related to certain professional fees
incurred related to the integration of STI Norland. For the six
months ended June 30, 2021, other costs represent (i) $3.2 million
of one-time logistics charges incurred primarily due to weather
events and port issues (ii) Certain costs associated with our IPO
and Follow-on Offering of $1.7 million, (iii) Certain professional
fees & payroll related costs we do not expect to incur in the
future of $1.7 million.
(d) Represents the estimated tax impact of all
Adjusted Net Income add-backs, excluding those which represent
permanent differences between book versus tax.
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