* Successful repositioning of company as a SEF developer for utilities and commercial prospects coupled with reduced operating expenses resulted in a profitable fourth quarter.
* We successfully commissioned the second 2.4-megawatt phase of the Aerojet project, bringing the full 6-megawatt system into operation.
* We were awarded the 5-megawatt rooftop project for White Rose Foods in New Jersey, believed to be the largest rooftop system in the United States.
* We began construction of the 1.75-megawatt elevated shade structure for RV storage at the Temescal Canyon RV storage center in Temescal, CA.
* The Company was awarded the contract for and began construction of 2.24 megawatts comprised of multiple systems across the Baldwin Park Unified School District in Baldwin Park, CA.
* The Company was awarded the contract for and began construction of a distributed generation system for 20th Century Fox Film Corporation at its Century City, California headquarters and studio complex.
* We received the outstanding $9 million payment for Aerojet project in August.
Management Comments:
“Despite the extended delay we experienced in receiving funds from the owners of the Aerojet development, and its effect on our performance last year, we still managed to achieve several important objectives. Key among these was the rapid reduction of our quarterly operating expense. Another significant milestone was our receipt of the outstanding $9 million for the Aerojet project in August,” said Steve Kircher, CEO for SPI. “ Additionally, we closed our Yes! Solar Solutions division and began construction on several new projects. We contracted a five-megawatt distributed generation project in New Jersey, which we believe will be the largest rooftop solar energy facility installation in the United States when completed. We also continued to pursue several other significant projects across North America and Europe,” Mr. Kircher continued. “The watershed event for our company, which was developing in the fourth quarter, occurred just after the first of the year when we announced the purchase of a 70% interest in SPI by LDK Solar, a NYSE traded company, and arguably one of the premier solar companies in the world today. Coupled with our focus on commercial and utility projects, we believe this transaction to be transformative for the Company as it strongly positions us to become a premier solar developer in both of these market segments,” Mr. Kircher stated. “While protracted inclement weather throughout the United States has impacted construction starts, we anticipate 2011 to be a record year for SPI with projected revenue in the $70 million range. We believe that transitional aspects of the SPI-LDK transaction are setting the stage for rapid growth for the second quarter of 2011,” Mr. Kircher concluded.
Financial Information:
Fourth Quarter of 2010 Results
Net sales for the fourth quarter of 2010 were $13.2 million, a decrease of 6.0%, compared to $14.1 million in net sales in the fourth quarter of 2009. On a year-over-year basis, decrease in the fourth quarter is attributed to a decrease in commercial solar construction and direct module sales.
Gross profit for the fourth quarter 2010 was $2.5 million, or 18.6% of sales, compared to $(561) thousand, or (4.0%) of sales, in the fourth quarter of 2009.
Operating expenses for the fourth quarter of 2010 were $2.3 million (17.2% of sales) compared to $3.8 million (26.8% of sales) for the same period last year. Other expenses, including interest were $98 thousand for the fourth quarter of 2010 compared to $10 thousand for the comparative period a year ago. Net income for the fourth quarter of 2010 was $230 thousand, compared to a net loss of $4.4 million, in the fourth quarter of 2009.
2010 Results
For the year ended December 31, 2010, the Company reported net sales of $34.0 million, a decrease of 35.2% over net sales of $52.6 million for 2009. Gross profit was $4.8 million, or 14.0% of sales compared to gross profit of $6.8 million, or 12.9% of sales in 2009.
For the year ended December 31, 2010, the Company reported operating expenses were $12.2 million or 35.8% of sales, compared to $13.7 million or 25.9% of sales for 2009. Net loss for 2010 was $8.9 million, or $0.17 per basic and diluted share, compared to a net loss of $7.0 million, or $0.17 per basic and diluted share, in 2009.
Balance Sheet
Cash and cash equivalents at December 31, 2010 were $1.4 million. Common shares outstanding at December 31, 2010 were 52,292,576. Accounts receivable and costs and estimated earnings in excess of billings were $8.2 million at year end. Inventory decreased 21.6% to $4.1 million.
2011 Outlook:
Based on our new level of working capital provided by the LDK investment, committed backlog and project execution capability we are comfortable with a revenue target of $70 million for fiscal 2011.
Solar Power, Inc. (SPI) is a vertically integrated photovoltaic solar developer offering its own brand of high-quality, low-cost distributed generation and utility-scale solar energy facility development services. Through the Company’s close relationship with LDK Solar, SPI extends the reach of its vertical integration from silicon to system. From project development, to project financing and to post-construction asset management, SPI delivers turnkey world-class photovoltaic solar energy facilities to its business, government and utility customers.
