Sunworks Provides Update on 2017 Full Year Results and Expectations for 2018
Announces Participation in the 30th Annual ROTH Conference on March 12th
Company Schedules Fourth-Quarter and Full-Year 2017 Earnings Release and Conference Call for March 28th
ROSEVILLE, Calif. , March 08, 2018 (GLOBE NEWSWIRE) -- Sunworks, Inc. (Nasdaq:SUNW), a provider of solar power solutions for agriculture, commercial and industrial (ACI), public works and residential markets, today provided an update based on unaudited financial results for the fourth quarter and full year of 2017 and its expectations for 2018.
Chuck Cargile, Sunworks Chief Executive Officer said, “2017 was an important and pivotal transition year for Sunworks that included significant restructuring and operational enhancements that will position us for profitable growth in 2018. I am encouraged with the progress we are making and believe our results in 2018 will reflect the benefits of our efforts. While the independent audit of our financial results is substantially complete, an annual investor conference is taking place before we will report our results for the fourth quarter and audited full year, so we are providing the following update.”
- Revenue for the fourth quarter of 2017 is expected to be slightly higher than the $18.4 million recorded in the prior year fourth quarter and net loss for the quarter is expected to be less than the $3.7 million loss in the fourth quarter of 2016.
- Full year revenue is expected to decline approximately 10% from the prior year $86.4 million. The company noted that the overall solar industry experienced significant disruption during 2017, primarily resulting from the ongoing discussions related to tariffs and quotas on imported panels. The tariff issue was decided in January 2018.
- Gross margin for the full year of 2017 is expected to decline because of many older projects completed in the second half of 2017 at profit levels well below original expectations.
- Operating expenses for the full year are expected to decline by approximately $10 million, or one-third, because of the company’s aggressive restructuring of the business during the year. Excluding stock-based compensation, the company anticipates total operating expenses to decline more than 20% year-over-year.
Chuck Cargile, Sunworks Chief Executive Officer said, “As previously disclosed, we conducted a thorough review of all projects in process and in backlog during the second half of 2017 to ensure that all cost estimates and percentages of completion were appropriate. As a result, we incurred significant charges that negatively impacted our gross margins for the third and fourth quarter of the year. Based on this in-depth review, we believe the gross margins in the second half of 2017 will reflect a low-water mark and we will deliver improved gross margins over the course 2018. In addition, we have put in place a rigorous review and approval process for all new projects to ensure that going forward, all cost estimates are acceptable and will only lead to better gross margins throughout the life of the project. Also, during the second half of the year, we significantly re-aligned our cost structure. We anticipate our fourth quarter operating expenses will be approximately 30% lower than the prior year fourth quarter. Our total employee headcount today is almost 20 percent below the peak in August of 2017. We have made cuts in our discretionary spending, reduced the size of our board of directors and streamlined our management team, all while maintaining our ability to improve our business and serve our customers.”
- New projects booked in the first quarter are expected to exceed $30 million, with the majority expected to result in installation revenue in 2018.
- Based on backlog and the momentum of new sales, the company expects full year revenue to increase in the range of 10 percent to 20 percent year-over-year.
- The company expects to be profitable for the full year of 2018.
Commenting on the outlook for 2018, Mr. Cargile stated, “We are happy to have 2017 behind us and are optimistic about our position for 2018. The negative overhang from the trade tariff decision appears to be dissipating and the results of our internal improvement initiatives are taking hold. We have significant momentum in terms of new orders, having already booked more than $25 million of new projects in 2018, including one new project exceeding $10 million and several other multi-million-dollar projects. We also expect to benefit from the profit improvement actions implemented in 2017. While we are experiencing typical first quarter seasonality to start to the year, we expect our enhanced business discipline, processes and controls to lead to more predictable and profitable results. We are excited about the opportunities for Sunworks in 2018 and beyond.”
ROTH Conference Presentation and Webcast
Chuck Cargile, Chief Executive Officer will present at the 30th Annual ROTH Conference on Monday, March 12, 2018 at 12:30 pm PT (3:30 pm ET). An audio webcast of the company’s group presentation will be broadcasted live and will be achieved for at least 90 days on the investor relations section of the Sunworks website at http://ir.sunworksusa.com.
Investors attending the conference who wish to meet Mr. Cargile for a one-on-one meeting should contact their ROTH sales representative or Hayden IR at [email protected]
Fourth Quarter and Full Year 2017 Earnings Release
The Company expects to report its fourth quarter and full year 2017 financial results after the market closes on Wednesday, March 28, 2018.
Management will host a conference call to discuss these results on Wednesday March 28, 2018 at 5 p.m. ET (2 pm PT). To access the call, please dial 1-877-407-0778 (toll free) or 1-201-689-8565. The conference call will also be broadcast live over the Internet, which can be accessed via the Investor Relations section of Sunworks’ web site at http://ir.sunworksusa.com. All participants should call or access the website approximately five minutes before the conference begins.
The webcast will be available for replay for at least 90 days. A telephonic replay of this conference call will also be available by dialing 1-877-481-4010 (toll free) and using the replay ID #26784 until 5 p.m. ET on April 11, 2018.
About Sunworks, Inc.
Sunworks, Inc. (NASDAQ:SUNW) is a premier provider of high performance solar power systems. We are committed to quality business practices that exceed industry standards and uphold our ideals of ethics and safety.
Sunworks continues to grow its presence, expanding nationally with regional and local offices. We strive to consistently deliver high quality, performance-oriented solutions for customers in a wide range of industries including agricultural, commercial and industrial, federal, public works, and residential.
Our dedication to excellence is reflected in our 25-year warranty, a benchmark that we stand by to support our customers above and beyond their expectations.
Sunworks’ diverse, seasoned workforce includes distinguished veterans who bring a sense of pride, discipline, and professionalism to their interaction with customers.
All our employees uphold our company’s guiding principles each day. Sunworks is a member of the Solar Energy Industries Association (SEIA) and is a proud advocate for the advancement of solar power. For more information, visit www.sunworksusa.com
Safe Harbor Statement
Matters discussed in this press release contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. When used in this press release, the words "anticipate," "believe," "estimate," “will,” "may," "intend," "expect" and similar expressions identify such forward-looking statements. Actual results, performance or achievements could differ materially from those contemplated, expressed or implied by the forward-looking statements contained herein. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, these statements are based largely on the expectations of the Company and are subject to a number of risks and uncertainties. These risks include, but are not limited to, risks and uncertainties associated with: the impact of economic, competitive, regulatory, environmental and other factors affecting the Company and its operations, markets, products, and prospects for sales, lower revenues, failure to earn profit, higher costs than expected, persistent operating losses, ownership dilution, inability to repay debt, failure of acquired businesses to perform as expected, the inability to complete projects within anticipated timeframes and costs, the impact of tariffs imposed by governmental bodies, the impact on the national and local economies resulting from terrorist actions, and U.S. actions subsequently; and other factors detailed in reports filed by the Company. We also refer you to the risks described in “Risk Factors” in Part I, Item 1A of Sunworks, Inc.’s Annual Report on Form 10-K and in the other reports and documents we file with the Securities and Exchange Commission from time to time.
Any forward-looking statement made by us in this press release is based only on information currently available to us and speaks only as of the date on which it is made. We undertake no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.
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