Press Release Details

Vivint Solar Reports Second Quarter 2020 Results

Aug, 05 2020

LEHI, Utah, Aug. 5, 2020 /PRNewswire/ -- Vivint Solar, Inc. (NYSE: VSLR), today announced financial results for the second quarter ended June 30, 2020.

Second Quarter 2020 Operating Highlights 

Key operating and development highlights include:

  • MWs Installed of approximately 44 MWs for the quarter. This is above the high end of the company's guidance of 35 to 38 MWs for the quarter. Total cumulative MWs installed were approximately 1,394 MWs.
  • Installations were 6,735 for the quarter. Cumulative installations were 203,264.
  • Estimated Gross Retained Value increased by approximately $85 million during the quarter to approximately $2.5 billion. Estimated Gross Retained Value per Watt at quarter end was $1.98.
  • Cost per Watt was $3.87, an increase from $3.80 in the first quarter of 2020 and an increase from $3.56 in the second quarter of 2019.
  • Margin created was $37 million. Unlevered NPV per Watt was $0.84.

Financing Activity

As of June 30, 2020, Vivint Solar had $429 million in undrawn capacity in various debt facilities and approximately 192 MWs of Undeployed Tax Equity Financing Capacity.

Summary Second Quarter 2020 Financial Results

$ amounts in millions, except per share data













Three Months Ended June 30th



2020



2019



YoY


Revenue:












     Customer agreements and incentives

$

81.8



$

63.4



up 29%


     Solar energy system and product sales


24.6




27.4



down 10%


Total Revenue


106.4




90.8



up 17%


Cost of revenue:












     Customer agreements and incentives


44.3




43.1



up 3%


     Solar energy system and product sales


15.6




15.8



down 1%


Total cost of revenue


60.0




58.9



up 2%


Gross profit


46.4




31.9



up 46%


Loss from operations


(26.1)




(36.9)



up 29%


Net loss attributable to common stockholders

$

(1.2)



$

(28.6)



up 96%


Net loss attributable per share to common stockholders

$

(0.01)



$

(0.24)



up 96%


Non-GAAP net loss per share

$

(0.68)



$

(0.73)



up 7%













Note: Totals may not sum due to rounding.











About Vivint Solar

Vivint Solar is a leading full-service residential solar provider in the United States. With the help of Vivint Solar, homeowners can power their homes with clean, renewable energy, typically achieving significant financial savings over time. Vivint Solar designs and installs solar energy systems for homeowners and offers monitoring and maintenance services. In addition to being able to purchase a solar energy system outright, homeowners may benefit from Vivint Solar's affordable, flexible financing options, including power purchase agreements, or lease agreements, where available. Vivint Solar also offers solar plus storage systems with LG Chem home batteries and electric vehicle chargers with ChargePoint Home. 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. 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 continued negative impact of the COVID-19 pandemic on general economic conditions, the capital and credit markets, and Vivint Solar's business, financial condition, liquidity and results of operations; 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, product offering mix, and costs 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 potential inaccuracy of the assumptions employed in calculating our operating metrics; the course and outcome of litigation and investigations; 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 and expressly disclaims 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 Vivint Solar. These documents are available on both the EDGAR section of the SEC's website at www.sec.gov and the investor relations section of Vivint Solar's website at investors.vivintsolar.com/.


Vivint Solar, Inc.


Condensed Consolidated Unaudited Balance Sheets


(In thousands)











June   30,



December   31,



2020



2019


ASSETS








Current assets:








Cash and cash equivalents

$

336,137



$

166,048


Accounts receivable, net


32,162




24,314


Inventories


13,144




20,576


Prepaid expenses and other current assets


27,818




41,137


Total current assets


409,261




252,075


Restricted cash and cash equivalents


86,809




89,892


Solar energy systems, net


1,873,031




1,759,861


Property and equipment, net


20,021




17,500


Other non-current assets, net


716,186




680,062


TOTAL ASSETS

$

3,105,308



$

2,799,390


LIABILITIES, REDEEMABLE NON-CONTROLLING INTERESTS AND EQUITY








Current liabilities:








Accounts payable

$

27,178



$

59,007


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


15,458




10,253


Accrued compensation


25,435




34,149


Current portion of long-term debt


24,664




16,405


Current portion of deferred revenue


20,260




40,715


Current portion of finance lease obligation


2,534




2,274


Accrued and other current liabilities


85,847




78,539


Total current liabilities


201,376




241,342


Long-term debt, net of current portion


1,794,990




1,483,256


Deferred revenue, net of current portion


24,516




17,631


Finance lease obligation, net of current portion


6,029




6,443


Deferred tax liability, net


636,869




583,695


Other non-current liabilities


139,449




74,423


Total liabilities


2,803,229




2,406,790


Commitments and contingencies








Redeemable non-controlling interests


114,989




115,384


Stockholders' equity:








Common stock


1,254




1,231


Additional paid-in capital


600,627




591,639


Accumulated other comprehensive loss


(41,589)




(20,436)


Accumulated deficit


(423,787)




(381,961)


Total stockholders' equity


136,505




190,473


Non-controlling interests


50,585




86,743


Total equity


187,090




277,216


TOTAL LIABILITIES, REDEEMABLE NON-CONTROLLING INTERESTS AND

   EQUITY

$

3,105,308



$

2,799,390


 


Vivint Solar, Inc.


Condensed Consolidated Unaudited Statements of Operations


(In thousands, except per share data)



















Three Months Ended



Six Months Ended



June   30,



June   30,



2020



2019



2020



2019


Revenue:
















Customer agreements and incentives

$

81,835



$

63,355



$

133,111



$

102,958


Solar energy system and product sales


24,559




27,402




64,434




57,170


Total revenue


106,394




90,757




197,545




160,128


Cost of revenue:
















Cost of revenue—customer agreements and incentives


44,331




43,074




97,154




83,265


Cost of revenue—solar energy system and product sales


15,627




15,791




37,675




33,054


Total cost of revenue


59,958




58,865




134,829




116,319


Gross profit


46,436




31,892




62,716




43,809


Operating expenses:
















Sales and marketing


35,394




37,037




75,002




66,671


Research and development


286




524




842




993


General and administrative


36,860




31,205




64,886




54,254


Total operating expenses


72,540




68,766




140,730




121,918


Loss from operations


(26,104)




(36,874)




(78,014)




(78,109)


Interest expense, net


24,712




19,472




46,344




38,599


Other expense, net


1,145




1,365




29,503




2,750


Loss before income taxes


(51,961)




(57,711)




(153,861)




(119,458)


Income tax expense


32,406




29,950




55,820




57,437


Net loss


(84,367)




(87,661)




(209,681)




(176,895)


Net loss attributable to non-controlling interests and redeemable

   non-controlling interests


(83,126)




(59,094)




(168,180)




(122,086)


Net loss attributable to common stockholders

$

(1,241)



$

(28,567)



$

(41,501)



$

(54,809)


Net loss attributable per share to common stockholders:
















Basic and diluted

$

(0.01)



$

(0.24)



$

(0.33)



$

(0.45)


Weighted-average shares used in computing net loss attributable

   per share to common stockholders:
















Basic and diluted


124,844




120,869




124,383




120,589


 


Vivint Solar, Inc.


Condensed Consolidated Unaudited Statements of Cash Flows


(In thousands)



















Three Months Ended



Six Months Ended



June   30,



June   30,



2020



2019



2020



2019


CASH FLOWS FROM OPERATING ACTIVITIES:
















Net loss

$

(84,367)



$

(87,661)



$

(209,681)



$

(176,895)


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
















Depreciation and amortization


26,521




21,658




47,745




39,317


Deferred income taxes


33,137




29,951




61,074




57,678


Stock-based compensation


4,325




4,156




8,264




7,835


Loss on solar energy systems and property and equipment


4,723




2,924




9,534




4,157


Noncash interest and other expense


2,072




1,657




3,625




3,302


Reduction in lease pass-through financing obligation


(1,411)




(1,337)




(2,123)




(2,032)


Losses on interest rate swaps


1,145




1,366




29,503




2,750


Changes in operating assets and liabilities:
















Accounts receivable, net


(6,210)




(8,194)




(8,158)




(13,979)


Inventories


1,239




(1,539)




7,432




186


Prepaid expenses and other current assets


5,586




(1,930)




11,813




816


Other non-current assets, net


(43,147)




(38,093)




(94,263)




(64,632)


Accounts payable


(4,349)




(1,360)




713




516


Accrued compensation


(3,126)




3,069




(8,586)




(999)


Deferred revenue


(238)




3,448




(13,570)




717


Accrued and other liabilities


9,200




794




5,916




179


Net cash used in operating activities


(54,900)




(71,091)




(150,762)




(141,084)


CASH FLOWS FROM INVESTING ACTIVITIES:
















Payments for the cost of solar energy systems


(56,057)




(59,874)




(135,247)




(124,400)


Payments for property and equipment


(565)




(703)




(2,926)




(994)


Proceeds from disposals of solar energy systems and property and

   equipment


467




479




1,357




1,128


Purchase of intangible assets


(299)




(115)




(527)




(115)


Net cash used in investing activities


(56,454)




(60,213)




(137,343)




(124,381)


CASH FLOWS FROM FINANCING ACTIVITIES:
















Proceeds from investment by non-controlling interests and

   redeemable non-controlling interests


76,078




75,270




161,827




159,638


Distributions paid to non-controlling interests and redeemable

   non-controlling interests


(12,737)




(9,038)




(24,995)




(18,051)


Proceeds from long-term debt


270,040




71,809




347,413




133,164


Payments on long-term debt


(14,630)




(15,320)




(19,703)




(20,913)


Payments for debt issuance and deferred offering costs


(9,604)




(2,962)




(9,604)




(2,962)


Proceeds from lease pass-through financing obligation


665




654




1,542




1,518


Principal payments on finance lease obligations


(920)




(306)




(2,116)




(577)


Proceeds from issuance of common stock, net of withholding

   taxes paid


(280)




231




747




270


Net cash provided by financing activities


308,612




120,338




455,111




252,087


NET INCREASE (DECREASE) IN CASH AND CASH

   EQUIVALENTS, INCLUDING RESTRICTED AMOUNTS


197,258




(10,966)




167,006




(13,378)


CASH AND CASH EQUIVALENTS, INCLUDING RESTRICTED

   AMOUNTS—Beginning of period


225,688




288,484




255,940




290,896


CASH AND CASH EQUIVALENTS, INCLUDING RESTRICTED

   AMOUNTS—End of period

$

422,946



$

277,518



$

422,946



$

277,518


 

Vivint Solar, Inc.


Key Operating Metrics















Three Months Ended



June   30,



March   31,



June   30,



2020



2020



2019


 Installations


6,735




8,238




8,163


 Megawatts installed


43.6




56.1




56.0















As of



June   30,



March   31,



June   30,



2020



2020



2019


 Cumulative installations


203,264




196,529




169,275


 Cumulative megawatts installed


1,393.7




1,350.1




1,162.5


 Estimated nominal contracted payments remaining (in millions)

$

4,784.3



$

4,636.6



$

3,976.2


      Estimated retained value under energy contracts (in millions)

$

1,810.5



$

1,747.7



$

1,587.0


      Estimated retained value of renewal (in millions)

$

652.3



$

630.6



$

531.6


 Estimated gross retained value (in millions)

$

2,462.8



$

2,378.3



$

2,118.6


 Estimated gross retained value per watt

$

1.98



$

1.97



$

2.02


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 June 30, 2020, 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

$

2,119.4



$

1,810.5



$

1,564.9


 Estimated retained value of renewal


995.5




652.3




432.4


 Total estimated gross retained value

$

3,114.9



$

2,462.8



$

1,997.3


 

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

We report GAAP EPS, which is based upon net 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. 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 ($0.68) and ($1.69) for the three and six months ended June 30, 2020.

Vivint Solar, Inc.


Reconciliation from GAAP EPS to Non-GAAP EPS


(In thousands, except per share data)



































Three Months Ended



June   30, 2020



June   30, 2019



Net Loss



EPS



Net Loss



EPS


Net loss attributable to common stockholders

$

(1,241)



$

(0.01)



$

(28,567)



$

(0.24)


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


(83,126)




(0.67)




(59,094)




(0.49)


Non-GAAP net loss

$

(84,367)



$

(0.68)



$

(87,661)



$

(0.73)


Weighted-average shares used in computing net loss per share






124,844








120,869


 



Six Months Ended



June   30, 2020



June   30, 2019



Net Loss



EPS



Net Loss



EPS


Net loss attributable to common stockholders

$

(41,501)



$

(0.33)



$

(54,809)



$

(0.45)


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


(168,180)



$

(1.36)




(122,086)



$

(1.02)


Non-GAAP net loss

$

(209,681)



$

(1.69)



$

(176,895)



$

(1.47)


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






124,383








120,589


 

Glossary of Definitions

"Cost per Watt"  represents the unit costs of installed solar energy systems on customers' premises. Please refer to Vivint Solar's Estimated Cost per Watt Methodology found on the investor relations page of Vivint Solar's website.

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

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

"MWs 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.

"EstimatedNominal 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.

"EstimatedGrossRetained Value" represents the net cash flows, discounted at 6%, that Vivint Solar expects to receive from customers pursuant to long-term customer contracts plus the value of contracted SRECs net of estimated cash distributions to fund investors, debt associated with our forward flow facilities, 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 and 25 year terms of Vivint Solar's contracts plus the value of contracted SRECs, which Vivint Solar refers to as estimated retained value under energy contracts, and the estimated retained value associated with an assumed 5 and 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.

"EstimatedGrossRetained 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.

"Project Value" represents the net cash flows, discounted at 6% that Vivint Solar expects to receive from customers net of estimated distributions to fund investors and operating expenses, estimated utility and state incentives, and estimated finance proceeds from fund investors.

"NPV per Watt" represents the estimated weighted average unit margin of Vivint Solar's PPA / Lease business and its system sales business. It is calculated by dividing Margin Created during the period by the total MWs Installed during the period.

"Margin Created" represents the estimated margin created during the period. It is the estimated expected value of the PPA / Lease agreements and the value of the system sales less the costs required to create the value. Specifically, it is the sum of the Project Value per Watt multiplied by MWs Installed – PPA/Lease and Revenue – solar energy system and product sales less total creation costs.

"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:

Wyatt Semanek
Public Relations Manager
385-202-6577
pr@vivintsolar.com

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SOURCE Vivint Solar, Inc.

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Contact

Investors

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

Press

Wyatt Semanek
Manager, Public Relations
385-202-6577
pr@vivintsolar.com

Government Affairs

Erica Dahl
Vice President, Government Affairs
385-455-5501
erica.dahl@vivintsolar.com