SunPower Corporation Announces Third Quarter 2009 (Oct 22, 2009)

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SunPower Corporation Announces Third Quarter 2009 Results

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October 22, 2009

San Jose , CA, USA: SunPower Corporation Announces Third Quarter 2009 Results

SunPower Corporation today announced financial results for its 2009 third quarter which ended September 27, 2009. Revenue for the 2009 third quarter was $466 million which compares to $298 million in the second quarter of 2009 and $378 million in the third quarter of 2008. The company's Components and Systems segments accounted for 64% and 36% of third-quarter 2009 revenue, respectively.

"Our third-quarter results demonstrate the value of our diversified market and vertical integration strategy as we benefitted from our growing dealer channel and successfully executed on our large scale project commitments," said Tom Werner, SunPower's CEO. "We further expanded our dealer partner network into countries such as France, Korea and Canada, and added new partners to our existing markets. As we build our utility and power plant business around the world, our superior technology performance and rapid deployment capability continues to make SunPower a preferred partner with customers and financiers.

"Operationally, our global Engineering, Procurement and Construction team achieved a new record in the third quarter with more than 60 megawatts (MW) of SunPower power plants under construction. The 25-MW DeSoto power plant, commissioned for Florida Power & Light, has now surpassed Nellis Air Force Base as the largest operating solar photovoltaic power plant in North America. In Europe, the financing of our Montalto project, the largest power plant in Italy, demonstrates SunPower's bankability as a fully integrated supplier. With strong market demand continuing, all of our manufacturing facilities are now fully operational, resulting in unit cost reductions in line with our plan," concluded Werner.

On a Generally Accepted Accounting Principles (GAAP) basis for the 2009 third quarter, SunPower reported gross margin of 19.1%, operating income of $34.6 million and net income per diluted share of $0.13. GAAP net income per share for the third quarter of 2009 includes $5.3 million, or $0.03 per share, of non-cash interest charges associated with the adoption of the new accounting guidance, which impacts how companies account for interest expense on convertible bonds.

On a non-GAAP basis, adjusted to exclude non-cash charges for amortization of intangible assets of $4.1 million, stock-based compensation of $13.1 million and non-cash interest expense of $5.3 million, SunPower reported total gross margin of 20.7%. Operating income for the quarter was $52.1 million and net income per share was $0.42. This compares with second-quarter 2009 non-GAAP gross margin of 22.6%, operating income of $26.8 million and $0.24 net income per share. For the 2009 third quarter, the Components segment non-GAAP gross margin was 23.4% and Systems segment gross margin was 16.0%.

The company updated its fiscal year 2009 total company non-GAAP guidance as follows: total revenue of $1.425 billion to $1.50 billion, net income per diluted share of $1.15 to $1.25, capital expenditures of $200 million to $225 million, and production of approximately 400 MW.

"The company's continued focus on working capital management is showing positive results as we successfully managed inventory levels and ended the quarter with a stronger balance sheet and more than $800 million in cash and investments," said Dennis Arriola, SunPower's CFO. "Although the financing markets remain challenging, we're starting to see some improvement in the availability of financing for our projects. By starting the fourth quarter with a solid backlog of business and a growing pipeline of opportunities, we are confident that SunPower will finish the year strongly and is well positioned for growth in 2010."

For fiscal year 2009, the company expects the following total company GAAP results: revenue of $1.425 billion to $1.50 billion and net income per diluted share of $0.50 to $0.60. GAAP earnings per share guidance for 2009 includes a $0.21 per share one-time, non-taxable gain related to the company's second-quarter 2009 capital raise and approximately $0.13 per share for non-cash charges related to the company's adoption of new accounting guidance.