), a Silicon Valley-based manufacturer of high-efficiency solar
cells, reported a first quarter 2012 adjusted loss of 23
cents per share, versus earnings per share of 15 cents in the
year-ago quarter. However, the figure came in line with the Zacks
On a GAAP basis, the company posted a loss of 67 cents per share
versus a loss of 2 cents in the year-ago quarter.
During the quarter, the variation of 44 cents between GAAP and
adjusted earnings came from charges related to Utility and power
plant project in December 2011 of 15 cents, charges related to
restructuring plan of 3 cents, charges related to amortization of
intangible assets of 2 cents, acquisition and integration costs of
1 cent, change in European government incentives of 9 cents,
non-cash interest expense of 6 cents, a tax effect of 6 cents and a
gain on sale of equity interest in unconsolidated investee of 2
SunPower generated revenues of $580.1 million, up 28.5% year
over year. It was also above the Zacks Consensus Estimate by $94.1
million. Total operating expenses during the quarter were $96
million, up 6.8% year over year.
The company was involved in restructuring activities in 2011. As
a result of the realignment, the company began reporting on a
regional basis beginning this quarter.
During the quarter under review, revenue generated in the
Americas was $367.7 million compared with $203.9 million in the
prior-year period. Revenues in Europe, the Middle East and Africa
(EMEA) were $155.9 million versus $200.5 million in the year-ago
quarter. Revenues from Asia-Pacific (APAC) were $56.5 million, up
20.3% year over year.
At the end of the reported period, SunPower had cash and cash
equivalents of $302.1 million, compared with $367.9 million at the
end of the first quarter of 2011. Convertible debt increased to
$426.9 million from $598.6 million at the end the of prior-year
During the quarter, net cash used for operating activities was
$136.6 million compared with $174.7 million in the prior-year
period. Capital expenditures during the period were $32.8 million
versus $44.8 million in the year-ago period.
For the second quarter of 2012, the company expects total
revenue to be in the range of $575 million to $650 million. For
fiscal 2012, the revenue guidance is in a band of $2,600 million
and $3,000 million. It expects electricity generation to be in the
range of 250MW to 275 MW in the second quarter and in the range of
900MW to 1,200MW in fiscal 2012.
The company expects adjusted loss per share to be in the range
of 20 cents to 5 cents in the second quarter of 2012 and GAAP loss
per share to be in the range of 95 cents to 80 cents in fiscal
In addition to investing in cost reduction initiatives, the
company expects to generate an unrestricted cash balance of more
than $300 million at the end of fiscal 2012.
SunPower is a vertically-integrated solar manufacturer, with a
presence along the entire solar value chain from cells through
installation. However, in the near term, the company is witnessing
cascading Average Selling Prices ("ASP") and margins in its
residential and small commercial markets segment. We expect this
trend to continue in the near future with valuation further
restrained by the higher cost structure of the company compared to
its peers, the glut of solar panels in the market, lower ASPs and
foreign exchange risk.
The company presently retains a short-term Zacks #3 Rank (Hold).
We have a long-term Underperform recommendation on the stock.
The company mainly competes with
Suntech Power Holdings Co. Ltd.
SUNPOWER CORP-A (SPWR): Free Stock Analysis
SUNTECH PWR HLD (STP): Free Stock Analysis
To read this article on Zacks.com click here.