SolarCity Announces Fourth Quarter and Full Fiscal Year 2012 Financial Results
Customer base increased 243% in 2012, company surpassed $1 billion in solar energy systems deployed
SAN MATEO, Calif.--(BUSINESS WIRE)-- SolarCity (Nasdaq: SCTY), a leading provider of clean energy, today announced financial results for its fourth quarter and full year ended December 31, 2012.
"SolarCity grew its customer base more than 243% in 2012 and surpassed $1 billion in solar energy systems deployed. Customers consistently choose SolarCity over alternatives, whether they are solar providers or utility companies. We sign up a new customer every five minutes," said Lyndon Rive, CEO.
"SolarCity's growth is proof that the company's vertically-integrated model—to provide cleaner energy directly to customers at a discount to utility rates—is the key to attracting homeowners and businesses to solar," continued Rive. "Furthermore, despite our triple-digit growth rate, we've scarcely begun to tap the potential of the distributed solar market. Less than half of one percent of energy consumers in the U.S. have adopted solar, and a massive growth opportunity remains."
Operating Activities
SolarCity's operating activities include collecting energy contract payments, acquiring new customers, operating and maintaining solar energy systems, technology development and additional activities that enable selling energy to customers.
Q4 2012 Operating Activity Highlights
- 48 MW Deployed, an increase of 129% from the prior year period
- 8,557 Total Customers, an increase of 192% from the prior year period
- 6,810 Energy Contracts, an increase of 190% from the prior year period
- 4,992 Transactions from other energy products and services, an increase of 350% from the prior year period
Full Year 2012 Operating Activity Highlights
- 157 MW Deployed, an increase of 118% from the prior year
- 30,950 Total Customers, an increase of 243% from the prior year
- 26,327 Energy Contracts, an increase of 269% from the prior year
- 15,425 Transactions from other energy products and services, an increase of 315% from the prior year
- $1,091 Million Nominal Contracted Payments Remaining, an increase of 124% from the prior year
Investing Activities
SolarCity's investing activities are primarily comprised of the Company's investments in distributed generation solar energy systems under energy contracts.
Q4 2012 Investing Activity Highlights
- Investments in Solar Energy Systems of $151.3 million
Full Year 2012 Investing Activity Highlights
- Investments in Solar Energy Systems of $449.1 million
Financing Activities
SolarCity's financing activities are primarily comprised of the financing funds we raise with partners to finance our investments in solar energy systems.
Financing Activity Highlights
- Recently completed first restructuring of three financing funds, which lowered the cost of financing the contracted payments from more than 8% to 3.45%
- Available financing funds for 115 MW as of February 28, 2013
GAAP Cash Flow Statement
With each new Energy Contract, we create a recurring, predictable cash flow stream. Our financial strategy is to maximize retained value for shareholders by covering Investing activities with cash generated from Financing and Operating activities. By this definition, the Company achieved positive net cash flow in Q4 2012.
For the year ended December 31, 2012, net cash provided by Operating activities was $60.3 million, net cash used in Investing activities was $449.1 million and net cash provided by Financing activities was $498.3 million. Net cash provided by Financing activities before equity issuances was $323.1 million and the net cash provided by the equity issuances was $175.2 million. The net increase in cash and cash equivalents for the year ended December 31, 2012 was $109.6 million.
Condensed GAAP Statements of Cash Flows (in Thousands) | ||||||||||||||
Three months | Three months | Year Ended December 31, | ||||||||||||
| 2011 | 2012 | 2011 | 2012 | |||||||||||
| Net cash provided by (used in): | ||||||||||||||
| Operating activities | $82,263 | $64,723 | $18,082 | $60,333 | ||||||||||
| Investing activities | ($95,270 | ) | ($151,288 | ) | ($304,252 | ) | ($449,059 | ) | ||||||
| Financing activities | ($13,231 | ) | $104,548 | $256,284 | $323,129 | |||||||||
| Total net cash provided (used) prior to equity issuance | ($26,238 | ) | $17,983 | ($29,886 | ) | ($65,597 | ) | |||||||
| Net cash provided by equity issuance | $112 | $92,779 | $22,087 | $175,206 | ||||||||||
| Net increase (decrease) in cash and cash equivalents | ($26,126 | ) | $110,762 | ($7,799 | ) | $109,609 | ||||||||
2012 Fourth Quarter GAAP Results
Recurring Operating Leases Revenue grew 100%, to $14.0 million from $7.0 million in the fourth quarter of 2011, and total revenues grew to $25.3 million from $20.7 million over the same period. Gross Profit grew to $14.0 million from $8.3 million in the fourth quarter of 2011. Gross profit margin increased to 56% compared to 40% in the fourth quarter of 2011. Total Operating Expenses were $37.9 million compared to $22.3 million in the fourth quarter of 2011. Loss from Operations was $23.8 million compared to $14.0 million in the fourth quarter of 2011.
2012 Full Year GAAP Results
Recurring Operating Leases Revenue grew 106% to $47.6 million from $23.1 million in 2011, and total revenue grew to $128.7 million from $59.6 million over the same period. Gross Profit grew to $50.9 million from $12.4 million in 2011. Gross profit margin increased to 40% from 21% in 2011. Total Operating Expenses were $119.7 million compared to $73.7 million in 2011. Loss from Operations was $68.9 million compared to $61.3 million in 2011.
Earnings Conference Call
The Company will hold a conference call today to discuss its fourth quarter and full year results and its outlook for 2013 at 5:00 pm Eastern. A live webcast of the call may be accessed over the Internet from the Company's Investor Relations website at http://investors.solarcity.com.
Participants should follow the instructions provided on the website to download and install the necessary audio applications. In addition, an earnings related presentation will be available on the Company's Investor Relations site at 5:00 pm Eastern. The conference call can be accessed live over the phone by dialing 1-877-407-4018, or for international callers, 1-201-689-8471. A replay will be available one hour after the call and can be accessed by dialing 1-877-870-5176, or for international callers, 1-858-384-5517. The passcode for the live call and the replay is 408735. The replay will be available until March 13, 2013.
About SolarCity
SolarCity® (NASDAQ: SCTY) provides clean energy. The company has disrupted the century-old energy industry by providing renewable electricity directly to homeowners, businesses and government organizations for less than they spend on utility bills. SolarCity gives customers control of their energy costs to protect them from rising rates. The company offers solar power, energy efficiency and electric vehicle services, and makes clean energy easy by taking care of everything from design and permitting to monitoring and maintenance. SolarCity currently serves 14 states and signs a new customer every five minutes. Visit the company online at www.solarcity.com and follow the company on Facebook & Twitter.
Forward Looking Statements
This press release contains forward-looking statements that involve risks and uncertainties, including statements regarding SolarCity's customer and market growth opportunities, financial strategies for cash generation and increasing shareholder value, the deployment of megawatts currently included in backlog, the amount of megawatts that can be deployed based on committed available financing, additional financial and operational forecasts to be discussed during the conference call referenced in this release, and assumptions relating to the foregoing.
Forward-looking statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the times at, or by, which such performance or results will be achieved, if at all. Forward-looking statements 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 the effect of electric utility industry regulations, net metering and related policies, the availability and amount of rebates, tax credits and other financial incentives, the availability and amount of financing from fund investors, the retail price of utility-generated electricity or the availability of alternative energy sources, risks associated with SolarCity's rapid growth, risks that consumers who have executed energy contracts included in reported nominal contracted payments remaining and backlog may seek to cancel those contracts, SolarCity's limited operating history, particularly as a new public company, changes in strategic planning decisions by management or reallocation of internal resources, and general market, political, economic and business conditions. You should read the section entitled "Risk Factors" in our registration statement on Form S-1, which has been filed with the Securities and Exchange Commission and identifies certain of these and additional risks and uncertainties. We do not undertake any obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments or otherwise.
| SolarCity Corporation | |||||||
| Condensed Consolidated Balance Sheets | |||||||
| (In Thousands) | |||||||
| December 31, | December 31, | ||||||
| 2012 | 2011 | ||||||
| Assets | |||||||
| Current assets: | |||||||
| Cash and cash equivalents | $ | 160,080 | $ | 50,471 | |||
| Restricted cash | 7,516 | 1,796 | |||||
| Accounts receivable — net | 25,145 | 10,651 | |||||
| Rebates receivable | 17,501 | 13,684 | |||||
| Inventories | 87,903 | 142,742 | |||||
| Deferred income tax asset | 5,770 | 4,306 | |||||
| Prepaid expenses and other current assets | 11,502 | 17,872 | |||||
| Total current assets | 315,417 | 241,522 | |||||
| Restricted cash | 2,810 | 3,764 | |||||
| Solar energy systems, leased and to be leased — net | 1,002,184 | 535,609 | |||||
| Property and equipment — net | 18,635 | 14,421 | |||||
| Other assets | 22,796 | 17,857 | |||||
| Total assets | $ | 1,361,842 | $ | 813,173 | |||
| Liabilities and equity | |||||||
| Current liabilities: | |||||||
| Accounts payable | $ | 62,986 | $ | 162,586 | |||
| Distributions payable to noncontrolling interests | 12,028 | 6,216 | |||||
| Current portion of deferred U.S. Treasury grants income | 11,376 | 5,430 | |||||
| Accrued and other current liabilities | 52,334 | 30,574 | |||||
| Customer deposits | 8,753 | 13,933 | |||||
| Current portion of deferred revenue | 31,516 | 13,504 | |||||
| Borrowings under bank line of credit | — | 5,582 | |||||
| Current portion of long-term debt | 20,613 | 2,640 | |||||
| Current portion of lease pass-through financing obligation | 13,622 | 6,060 | |||||
| Current portion of sale leaseback financing obligation | 389 | 361 | |||||
| Total current liabilities | 213,617 | 246,886 | |||||
| Deferred revenue, net of current portion | 204,396 | 101,359 | |||||
| Long-term debt, net of current portion | 83,533 | 14,581 | |||||
| Long-term deferred tax liability | 5,790 | 4,313 | |||||
| Lease passthrough financing obligation, net of current portion | 125,884 | 46,541 | |||||
| Sale leaseback financing obligation, net of current portion | 14,755 | 15,144 | |||||
| Deferred U.S. Treasury grants income, net of current portion | 286,884 | 132,004 | |||||
| Convertible redeemable preferred stock warrant liabilities | — | 5,325 | |||||
| Other liabilities | 112,056 | 36,314 | |||||
| Total liabilities | 1,046,915 | 602,467 | |||||
| Convertible redeemable preferred stock | — | 125,722 | |||||
| Total stockholders' equity (deficit) | 214,320 | (37,662 | ) | ||||
| Noncontrolling interests in subsidiaries | 100,607 | 122,646 | |||||
| Total equity | 314,927 | 210,706 | |||||
| Total liabilities, convertible redeemable preferred stock and equity | $ | 1,361,842 | $ | 813,173 | |||
| SolarCity Corporation | ||||||||
| Consolidated Statements of Operations | ||||||||
| (In Thousands, Except Share and Per Share Amounts) | ||||||||
| Three Months Ended December 31, | ||||||||
| 2012 | 2011 | |||||||
| Revenue: | ||||||||
| Operating leases | $ | 14,032 | $ | 7,042 | ||||
| Solar energy systems sales | 11,241 | 13,700 | ||||||
| Total revenues | 25,273 | 20,742 | ||||||
| Cost of revenue: | ||||||||
| Operating leases | 4,731 | 2,429 | ||||||
| Solar energy systems | 6,505 | 10,003 | ||||||
| Total cost of revenues | 11,236 | 12,432 | ||||||
| Gross profit | 14,037 | 8,310 | ||||||
| Operating expenses: | ||||||||
| Sales and marketing | 19,416 | 14,758 | ||||||
| General and administrative | 18,451 | 7,538 | ||||||
| Total operating expenses | 37,867 | 22,296 | ||||||
| Loss from operations | (23,830 | ) | (13,986 | ) | ||||
| Interest expense | 5,220 | 1,756 | ||||||
| Other expense (income), net | (15,376 | ) | 1,213 | |||||
| Loss before income taxes | (13,674 | ) | (16,955 | ) | ||||
| Income tax provision | 53 | (30 | ) | |||||
| Net loss | (13,621 | ) | (16,985 | ) | ||||
| Net loss attributable to noncontrolling interests | (10,578 | ) | (31,058 | ) | ||||
| Net income (loss) attributable to stockholders | $ | (3,043 | ) | $ | 14,073 | |||
| Net income (loss) attributable to common stockholders | ||||||||
| Basic | $ | (13,134 | ) | $ | 2,710 | |||
| Diluted | $ | (27,950 | ) | $ | 3,673 | |||
| Net income (loss) per share attributable to common stockholders | ||||||||
| Basic | $ | (0.54 | ) | $ | 0.26 | |||
| Diluted | $ | (1.10 | ) | $ | 0.24 | |||
| Weighted average shares used to compute net income (loss) per | ||||||||
| share attributable to common stockholders | ||||||||
| Basic | 24,283,731 | 10,374,820 | ||||||
| Diluted | 25,310,651 | 15,413,884 | ||||||
| SolarCity Corporation | ||||||||||||
| Consolidated Statements of Operations | ||||||||||||
| (In Thousands, Except Share and Per Share Amounts) | ||||||||||||
| Year Ended December 31, | ||||||||||||
| 2012 | 2011 | 2010 | ||||||||||
| Revenue: | ||||||||||||
| Operating leases | $ | 47,616 | $ | 23,145 | $ | 9,684 | ||||||
| Solar energy systems sales | 81,046 | 36,406 | 22,744 | |||||||||
| Total revenues | 128,662 | 59,551 | 32,428 | |||||||||
| Cost of revenue: | ||||||||||||
| Operating leases | 13,346 | 5,718 | 3,191 | |||||||||
| Solar energy systems | 64,429 | 41,418 | 26,953 | |||||||||
| Total cost of revenues | 77,775 | 47,136 | 30,144 | |||||||||
| Gross profit | 50,887 | 12,415 | 2,284 | |||||||||
| Operating expenses: | ||||||||||||
| Sales and marketing | 69,392 | 42,004 | 22,404 | |||||||||
| General and administrative | 50,355 | 31,664 | 19,227 | |||||||||
| Total operating expenses | 119,747 | 73,668 | 41,631 | |||||||||
| Loss from operations | (68,860 | ) | (61,253 | ) | (39,347 | ) | ||||||
| Interest expense | 20,142 | 9,272 | 4,901 | |||||||||
| Other expense, net | 2,519 | 3,097 | 2,761 | |||||||||
| Loss before income taxes | (91,521 | ) | (73,622 | ) | (47,009 | ) | ||||||
| Income tax provision | (54 | ) | (92 | ) | (65 | ) | ||||||
| Net loss | (91,575 | ) | (73,714 | ) | (47,074 | ) | ||||||
| Net loss attributable to noncontrolling interests | (27,384 | ) | (117,230 | ) | (8,457 | ) | ||||||
| Net income (loss) attributable to stockholders | $ | (64,191 | ) | $ | 43,516 | $ | (38,617 | ) | ||||
| Net income (loss) attributable to common stockholders | ||||||||||||
| Basic | $ | (74,282 | ) | $ | 8,225 | $ | (38,617 | ) | ||||
| Diluted | $ | (74,559 | ) | $ | 10,989 | $ | (38,617 | ) | ||||
| Net income (loss) per share attributable to common stockholders | ||||||||||||
| Basic | $ | (5.22 | ) | $ | 0.82 | $ | (4.50 | ) | ||||
| Diluted | $ | (5.23 | ) | $ | 0.76 | $ | (4.50 | ) | ||||
| Weighted average shares used to compute net income (loss) per | ||||||||||||
| share attributable to common stockholders | ||||||||||||
| Basic | 14,240,187 | 9,977,646 | 8,583,772 | |||||||||
| Diluted | 14,267,767 | 14,523,734 | 8,583,772 | |||||||||
| SolarCity Corporation | ||||||||||||
| Condensed Consolidated Statements of Cash Flows | ||||||||||||
| (In Thousands) | ||||||||||||
| Year Ended December 31, | ||||||||||||
| 2012 | 2011 | 2010 | ||||||||||
| Operating activities: | ||||||||||||
| Net loss | $ | (91,575 | ) | $ | (73,714 | ) | $ | (47,074 | ) | |||
| Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | ||||||||||||
| Loss on disposal of property, plant and equipment | 17 | 336 | 26 | |||||||||
| Depreciation and amortization net of amortization of deferred U.S. Treasury grant income | 21,008 | 12,338 | 5,733 | |||||||||
| Interest on lease pass-thorough financing obligation | 12,001 | 7,373 | 3,285 | |||||||||
| Stock-based compensation | 10,734 | 5,101 | 1,773 | |||||||||
| Donations of common stock to a charitable organization | — | 119 | — | |||||||||
| Revaluation of convertible redeemable preferred stock warrants | 1,898 | 2,050 | 1,998 | |||||||||
| Revaluation of preferred stock forward contract | 350 | — | — | |||||||||
| Deferred income taxes | 13 | 7 | — | |||||||||
| Reduction in lease pass-through financing obligation | (16,159 | ) | (23,528 | ) | (7,421 | ) | ||||||
| Changes in operating assets and liabilities, net | 122,046 | 88,000 | 37,862 | |||||||||
| Net cash provided by (used in) operating activities | 60,333 | 18,082 | (3,818 | ) | ||||||||
| Investing activities: | ||||||||||||
| Payments for the cost of solar energy systems, leased and to be leased | (440,692 | ) | (292,933 | ) | (156,495 | ) | ||||||
| Purchase of property and equipment | (8,367 | ) | (8,772 | ) | (6,300 | ) | ||||||
| Acquisition of business, net of cash acquired | — | (2,547 | ) | (67 | ) | |||||||
| Net cash used in investing activities | (449,059 | ) | (304,252 | ) | (162,862 | ) | ||||||
| Financing activities: | ||||||||||||
| Investment fund financings and bank borrowings: | ||||||||||||
| Borrowings under long-term debt | 133,386 | 17,270 | 1,292 | |||||||||
| Repayments of long-term debt | (52,299 | ) | (3,158 | ) | (1,014 | ) | ||||||
| Borrowings under bank line of credit | 19,418 | 5,582 | — | |||||||||
| Repayments of bank line of credit | (25,000 | ) | (4,495 | ) | — | |||||||
| Proceeds from sale-leaseback financing obligation | — | — | 18,266 | |||||||||
| Repayments of sale-leaseback financing obligation | (361 | ) | (574 | ) | (7,603 | ) | ||||||
| Proceeds from lease pass-through financing obligation | 145,846 | 64,135 | 61,106 | |||||||||
| Repayment of capital lease obligations | (28,442 | ) | (7,323 | ) | — | |||||||
| Proceeds from investment by noncontrolling interests in subsidiaries | 161,426 | 207,970 | 97,082 | |||||||||
| Distributions paid to noncontrolling interest in a subsidiary | (144,493 | ) | (88,636 | ) | (25,039 | ) | ||||||
| Proceeds from U.S. Treasury grants | 113,648 | 65,513 | 20,084 | |||||||||
| Net cash provided by financing activities before equity issuances | 323,129 | 256,284 | 164,174 | |||||||||
| Equity issuances: | ||||||||||||
| Proceeds of issuance of common stock | 92,386 | — | — | |||||||||
| Proceeds from exercise of stock options | 1,724 | 1,090 | 92 | |||||||||
| Proceeds from the exercise of convertible redeemable preferred stock warrants | 228 | — | — | |||||||||
| Proceeds from issuance of convertible redeemable preferred stock warrants | — | 1,297 | 1,368 | |||||||||
| Proceeds from issuance of convertible redeemable preferred stock | 80,868 | 19,700 | 21,404 | |||||||||
| Net cash provided by equity issuances | 175,206 | 22,087 | 22,864 | |||||||||
| Net cash provided by financing activities | 498,335 | 278,371 | 187,038 | |||||||||
| Net increase in cash and cash equivalents | 109,609 | (7,799 | ) | 20,358 | ||||||||
| Cash and cash equivalents, beginning of period | 50,471 | 58,270 | 37,912 | |||||||||
| Cash and cash equivalents, end of period | $ | 160,080 | $ | 50,471 | $ | 58,270 | ||||||
Operating Activity Metrics | Q4 2011 | Q4 2012 | 2011 | 2012 | Cumulative | |||||
| Total MW Deployed (1) | 21 | 48 | 72 | 157 | 287 | |||||
| Number of Customers (2) | 2,928 | 8,557 | 9,034 | 30,950 | 50,532 | |||||
| Number of Energy Contracts (3) | 2,345 | 6,810 | 7,132 | 26,327 | 40,456 | |||||
| Transactions from other energy products and services (4) | 1,110 | 4,992 | 3,716 | 15,425 | 19,630 | |||||
| Nominal contracted payments remaining as of year end $M (5) | $486 | $1,091 | ||||||||
As of 2/28/13 | ||||||||||
| Backlog (6) | 194 MW | |||||||||
Investing Activity Metrics | Q4 2011 | Q4 2012 | 2011 | 2012 | Cumulative | |||||
| Investments in Solar Energy Systems $M (7) | $95 | $151 | $304 | $449 | $1,011 | |||||
Financing Activity Metrics | As of 2/28/13 | |||||||||
| Finance Available (8) | 115 MW | |||||||||
| "MW" or "megawatts" represents the DC nameplate megawatt production capacity. | ||||||||||
| (1) "MW Deployed" represents the megawatt production capacity of solar energy systems that have had all required building department inspections completed during the applicable period. This metric includes solar energy systems deployed under Energy Contracts as well as solar energy system direct sales. | ||||||||||
| (2) "Customers" includes all residential, commercial and government buildings where we have installed or contracted to install a solar energy system, or performed or contracted to perform an energy efficiency evaluation or other energy efficiency services. Note that we have previously referred to the foregoing as "Buildings" and have chosen to redefine as we believe "customers" is a more appropriate descriptor. | ||||||||||
(3) "Energy Contracts" includes all residential, commercial and government leases and power purchase agreements pursuant to which consumers use or will use energy generated by a solar energy system that we have sold or contracted to sell to the consumer or that we have installed or contracted to install. For landlord-tenant structures in which we contract with the landlord or development company, we include each residence as an individual contract. For commercial customers with multiple locations, each location is deemed a contract if we maintain a separate contract for that location. Note that we have previously referred to the foregoing as "Customers" and have chosen to redefine as we believe "energy contracts" is a more appropriate descriptor. | ||||||||||
(4) "Transactions from other energy products and services" includes all transactions during the period when we perform or contract to perform a service or provide, install or contract to install a product. It excludes the outright sale or installation of a solar energy system under an Energy Contract and any related monitoring. Examples of such transactions are energy efficiency audits, energy efficiency retrofits, and electric vehicle charging stations. | ||||||||||
| (5) "Nominal Contracted Payments Remaining" equals the sum of cash payments obligated to be paid to us under our Energy Contracts over the remaining term of such contracts. This metric includes Energy Contracts for solar energy systems already deployed and in Backlog. As an example, if a customer is 2 years into her 20 year contract, then 18 years of contract payments remain. As an additional example, if a customer chose to pre-pay her Energy Contract, then it is included in Nominal Contracted Payments Remaining only while it is in Backlog as the pre-payment has not been received. Payments for direct sales are not included. | ||||||||||
(6) "Backlog" represents the aggregate megawatt capacity of solar energy systems not yet deployed as of the date specified pursuant to Energy Contracts and contracts for solar energy system direct sales executed as of such date. | ||||||||||
| (7) "Investments in Solar Energy Systems" represents the sum of payments for the cost of solar energy systems leased and to be leased, purchase of property and equipment and acquisition of business net of cash required. Investments in Solar Energy Systems does not include solar energy system direct sales or solar energy systems sold via sale-leaseback structures. | ||||||||||
| (8) "Finance Available" represents a forecast of the amount of MW that can be deployed based on committed available financing for Energy Contracts. |
SolarCity
Jonathan Bass, 650-963-5156 (Media)
press@solarcity.com
or
SolarCity Investor Relations, 650-963-5920
investors@solarcity.com
Source: SolarCity
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