SunPower Reports First-Quarter 2009 Results

April 26, 2009 by Jeff Shepard

SunPower Corp. announced financial results for its 2009 first quarter which ended March 29, 2009. Revenue for the 2009 first quarter was $214 million and compares to revenues of $401 million in the fourth quarter of 2008 and $274 million in the first quarter of last year. The Components and Systems segments each accounted for 50% of first-quarter 2009 revenue.

"The first quarter of 2009 was the most challenging quarter we’ve seen since SunPower went public in 2005," said Tom Werner, SunPower’s CEO. "Our quarterly performance was impacted by seasonality, the continuing effects of the credit crisis and difficult economic conditions. Despite these headwinds we were able to deliver strong gross margins in our Components business and positive non-GAAP net income. We have responded to current market conditions by moving to a demand-driven manufacturing model and reducing our planned operating expenses to align with our adjusted revenue outlook. Our recent announcements with FPL Group, Exelon and Xcel are representative of the range of opportunities in our utility and power plant business pipeline. Looking forward, we see positive trends emerging in a number of market segments, including the rooftop, distributed power plant and utility markets that give us confidence that we are well positioned for growth in the second half of 2009, 2010 and beyond.

"We were also pleased to announce today our expanded partnership with FPL Group through a significant supply agreement for future solar projects. This builds on our successful commencement of construction of the 25 megawatt DeSoto Next Generation Solar Energy Center in the first quarter of 2009. We look forward to working with FPL Group on future solar power plants around the country."

On a GAAP basis for the 2009 first quarter, SunPower reported gross margin of 22.3%, an operating loss of $2.5 million and a net loss per share of ($0.06). GAAP net loss per share for the first quarter of 2009 includes a $5.0 million expense, or $0.06 per share, for non-cash charges related to adoption of new FASB accounting rule FSP APB 14-1, 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 $9.5 million and non-cash interest expense of $5.0 million, SunPower reported total gross margin of 24.3%, operating income of $11.5 million and net income per diluted share of $0.05. This compares with fourth-quarter 2008 non-GAAP gross margin of 29.9%, operating income of $77.5 million and $0.69 net income per diluted share. For the 2009 first quarter, Components segment gross margin was 29.5% and Systems segment gross margin was 19.0%.