Cover
Cover - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2022 | Feb. 21, 2023 | Jun. 30, 2022 | |
Document Information [Line Items] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2022 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 001-39942 | ||
Entity Registrant Name | Shoals Technologies Group, Inc. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 85-3774438 | ||
Entity Address, Address Line One | 1400 Shoals Way | ||
Entity Address, City or Town | Portland | ||
Entity Address, State or Province | TN | ||
Entity Address, Postal Zip Code | 37148 | ||
City Area Code | (615) | ||
Local Phone Number | 451-1400 | ||
Title of 12(b) Security | Class A Common Stock, $0.00001 Par Value | ||
Trading Symbol | SHLS | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 1.5 | ||
Documents Incorporated by Reference | Portions of the registrant’s definitive proxy statement to be filed with the Securities and Exchange Commission, or SEC, subsequent to the date hereof pursuant to Regulation 14A in connection with the registrant’s 2023 Annual Meeting of Stockholders, are incorporated by reference into Part III of this Annual Report on Form 10-K. We intend to file such proxy statement with the SEC not later than 120 days after the conclusion of the registrant’s fiscal year ended December 31, 2022. | ||
Amendment Flag | false | ||
Entity Central Index Key | 0001831651 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2022 | ||
Class A Common Stock | |||
Document Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 138,115,306 | ||
Class B Common Stock | |||
Document Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 31,419,913 |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2022 | |
Audit Information [Abstract] | |
Auditor Name | BDO USA, LLP |
Auditor Location | Austin, Texas |
Auditor Firm ID | 243 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Current Assets | ||
Cash and cash equivalents | $ 8,766 | $ 5,006 |
Accounts receivable, net | 50,575 | 31,499 |
Unbilled receivables | 16,713 | 13,533 |
Inventory, net | 72,854 | 38,368 |
Other current assets | 4,632 | 5,042 |
Total Current Assets | 153,540 | 93,448 |
Property, plant and equipment, net | 16,870 | 15,574 |
Goodwill | 69,941 | 69,436 |
Other intangible assets, net | 56,585 | 65,236 |
Deferred tax assets | 291,634 | 176,958 |
Other assets | 6,325 | 5,762 |
Total Assets | 594,895 | 426,414 |
Current Liabilities | ||
Accounts payable | 9,481 | 19,985 |
Accrued expenses and other | 17,882 | 7,728 |
Deferred revenue | 23,259 | 1,841 |
Long-term debt—current portion | 2,000 | 2,000 |
Total Current Liabilities | 52,622 | 31,554 |
Revolving line of credit | 48,000 | 55,140 |
Long-term debt, less current portion | 189,063 | 189,913 |
Payable pursuant to the tax receivable agreement | 0 | 156,374 |
Other long-term liabilities | 4,221 | 931 |
Total Liabilities | 293,906 | 433,912 |
Commitments and Contingencies (Note 15) | ||
Stockholders’ Equity (Deficit) | ||
Preferred stock, $0.00001 par value - 5,000,000 shares authorized; none issued and outstanding as of December 31, 2022 and 2021 | 0 | 0 |
Additional paid-in capital | 256,894 | 95,684 |
Accumulated earnings (deficit) | 34,478 | (93,133) |
Total stockholders’ equity attributable to Shoals Technologies Group, Inc. | 291,374 | 2,553 |
Non-controlling interests | 9,615 | (10,051) |
Total stockholders’ equity (deficit) | 300,989 | (7,498) |
Total Liabilities and Stockholders’ Equity (Deficit) | 594,895 | 426,414 |
Class A Common Stock | ||
Stockholders’ Equity (Deficit) | ||
Common stock | 1 | 1 |
Class B Common Stock | ||
Stockholders’ Equity (Deficit) | ||
Common stock | $ 1 | $ 1 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2022 | Dec. 31, 2021 |
Preferred stock, par value (in USD per share) | $ 0.00001 | $ 0.00001 |
Preferred stock authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred stock issued (in shares) | 0 | |
Preferred stock outstanding (in shares) | 0 | 0 |
Class A Common Stock | ||
Common stock, par value (in USD per share) | $ 0.00001 | $ 0.00001 |
Common stock authorized (in shares) | 1,000,000,000 | 1,000,000,000 |
Common stock issued (in shares) | 137,904,663 | 112,049,981 |
Common stock, shares outstanding (in shares) | 137,904,663 | 112,049,981 |
Class B Common Stock | ||
Common stock, par value (in USD per share) | $ 0.00001 | $ 0.00001 |
Common stock authorized (in shares) | 195,000,000 | 195,000,000 |
Common stock issued (in shares) | 31,419,913 | 54,794,479 |
Common stock, shares outstanding (in shares) | 31,419,913 | 54,794,479 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Revenue | $ 326,940 | $ 213,212 | $ 175,518 |
Cost of revenue | 195,629 | 130,567 | 108,972 |
Gross profit | 131,311 | 82,645 | 66,546 |
Operating expenses | |||
General and administrative expenses | 55,908 | 37,893 | 21,008 |
Depreciation and amortization | 9,073 | 8,520 | 8,262 |
Total operating expenses | 64,981 | 46,413 | 29,270 |
Income from operations | 66,330 | 36,232 | 37,276 |
Interest expense, net | (18,538) | (14,549) | (3,510) |
Payable pursuant to the tax receivable agreement adjustment | (6,675) | (1,663) | 0 |
Gain on termination of tax receivable agreement | 110,883 | 0 | 0 |
Loss on debt repayment | 0 | (15,990) | 0 |
Income before income taxes | 152,000 | 4,030 | 33,766 |
Income tax expense | (8,987) | (86) | 0 |
Net income | 143,013 | 3,944 | 33,766 |
Less: net income attributable to non-controlling interests | 15,402 | 1,596 | 0 |
Net income attributable to Shoals Technologies Group, Inc. | $ 127,611 | $ 2,348 | $ 33,766 |
Earnings (loss) per share of Class A common stock: | |||
Basic (in USD per share) | $ 1.11 | ||
Diluted (in USD per share) | $ 0.85 | ||
Weighted average shares of Class A common stock outstanding: | |||
Basic (in shares) | 114,495 | ||
Diluted (in shares) | 167,631 | ||
Class A Common Stock | |||
Earnings (loss) per share of Class A common stock: | |||
Basic (in USD per share) | $ 1.11 | ||
Diluted (in USD per share) | $ 0.85 | ||
Weighted average shares of Class A common stock outstanding: | |||
Basic (in shares) | 114,495 | ||
Diluted (in shares) | 167,631 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Members' / Stockholders' Equity (Deficit) - USD ($) $ in Thousands | Total | Class A Common Stock | Class B Common Stock | Members’ Equity (Deficit) | Common Stock Class A Common Stock | Common Stock Class B Common Stock | Additional Paid-In Capital | Accumulated Deficit | Non-Controlling Interests |
Members' equity at beginning of period at Dec. 31, 2019 | $ 149,906 | ||||||||
Balance at beginning of period (in shares) at Dec. 31, 2019 | 0 | 0 | |||||||
Balance at beginning of period at Dec. 31, 2019 | $ 149,906 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Member distributions | (376,046) | (376,046) | |||||||
Equity-based compensation | 8,251 | 8,251 | |||||||
Net income | 33,766 | 33,766 | |||||||
Members' equity at end of period at Dec. 31, 2020 | (184,123) | ||||||||
Balance at end of period (in shares) at Dec. 31, 2020 | 0 | 0 | |||||||
Balance at end of period at Dec. 31, 2020 | (184,123) | $ 0 | $ 0 | 0 | 0 | 0 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income | 3,944 | ||||||||
Distributions to non-controlling interests | (4,800) | ||||||||
Members' equity at end of period at Dec. 31, 2021 | 0 | ||||||||
Balance at end of period (in shares) at Dec. 31, 2021 | 112,049,981 | 54,794,479 | 112,049,981 | 54,794,479 | |||||
Balance at end of period at Dec. 31, 2021 | (7,498) | $ 1 | $ 1 | 95,684 | (93,133) | (10,051) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income | 143,013 | 127,611 | 15,402 | ||||||
Issuance of Class A common stock sold in IPO/follow-on offering, net of underwriting discounts and commissions and offering costs (in shares) | 2,000,000 | ||||||||
Issuance of Class A common stock sold in IPO, net of underwriting discounts and commissions and offering costs | 41,224 | 41,224 | |||||||
Exchange of Class B to Class A common stock (in shares) | 23,374,566 | (23,374,566) | |||||||
Exchange of Class B to Class A common stock | 115,396 | 115,396 | |||||||
Equity-based compensation | 17,913 | 17,913 | |||||||
Activity under stock compensation plan | (1,297) | (6,719) | 5,422 | ||||||
Distributions to non-controlling interests | (7,762) | (7,762) | |||||||
Vesting of restricted stock units (in shares) | 480,116 | ||||||||
Reallocation of non-controlling interests | 0 | (6,604) | 6,604 | ||||||
Members' equity at end of period at Dec. 31, 2022 | $ 0 | ||||||||
Balance at end of period (in shares) at Dec. 31, 2022 | 137,904,663 | 31,419,913 | 137,904,663 | 31,419,913 | |||||
Balance at end of period at Dec. 31, 2022 | $ 300,989 | $ 1 | $ 1 | $ 256,894 | $ 34,478 | $ 9,615 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Cash Flows from Operating Activities | |||
Net income | $ 143,013 | $ 3,944 | $ 33,766 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | |||
Depreciation and amortization | 10,509 | 10,053 | 9,405 |
Amortization/write off of deferred financing costs | 1,365 | 5,969 | 351 |
Equity-based compensation | 16,108 | 11,286 | 8,251 |
Provision for credit losses | 200 | 0 | 0 |
Provision for obsolete or slow-moving inventory | 2,073 | (1,418) | 188 |
Deferred taxes | 8,406 | (1,476) | 0 |
Payable pursuant to the tax receivable agreement adjustment | 6,675 | 1,663 | 0 |
Gain on termination of tax receivable agreement | (110,883) | 0 | 0 |
Gain on sale of assets | 0 | 52 | 0 |
Changes in assets and liabilities, net of business acquisition: | |||
Accounts receivable | (19,207) | 818 | 288 |
Unbilled receivables | (3,180) | (9,739) | (1,289) |
Inventory | (36,927) | (17,188) | (6,475) |
Other assets | 244 | 341 | 643 |
Accounts payable | (11,029) | (3,877) | 4,251 |
Accrued expenses and other | 10,670 | (6,179) | 4,949 |
Deferred revenue | 21,418 | 1,668 | (246) |
Net Cash Provided by (Used in) Operating Activities | 39,455 | (4,083) | 54,082 |
Cash Flows Used In Investing Activities | |||
Purchases of property, plant and equipment | (3,154) | (4,126) | (3,236) |
Acquisition of a business, net of cash acquired | 0 | (12,909) | 0 |
Other | (503) | 0 | 0 |
Net Cash Used in Investing Activities | (3,657) | (17,035) | (3,236) |
Cash Flows from Financing Activities | |||
Distributions to non-controlling interests | (7,762) | (4,837) | (376,046) |
Employee withholding taxes related to net settled equity awards | (1,297) | (137) | 0 |
Deferred financing costs | 0 | (94) | (11,821) |
Proceeds from issuance of Class A common stock sold in an IPO, net of underwriting discounts and commissions | 0 | 278,833 | 0 |
Proceeds from issuance of Class A common stock in follow-on offering, net of underwriting discounts and commissions | 42,943 | 281,064 | 0 |
Payment of debt assumed in acquisition | 0 | (1,537) | 0 |
Deferred offering costs | (1,463) | (9,704) | (3,738) |
Early termination payment of tax receivable agreement | (58,000) | 0 | 0 |
Payment of fees for tax receivable agreement termination | (1,870) | 0 | 0 |
Net Cash Provided by (Used in) Financing Activities | (36,589) | 20,602 | (47,855) |
Net Increase (Decrease) in Cash, Cash Equivalents and Restricted Cash | (791) | (516) | 2,991 |
Cash, Cash Equivalents and Restricted Cash—Beginning of Period | 9,557 | 10,073 | 7,082 |
Cash, Cash Equivalents and Restricted Cash—End of Period | 8,766 | 9,557 | 10,073 |
Supplemental Cash Flows Information: | |||
Cash paid for interest | 12,840 | 10,809 | 3,033 |
Cash paid for taxes | 786 | 1,190 | 0 |
Non-cash investing and financing activities: | |||
Reclassification of deferred offering costs to additional paid-in capital | 0 | 3,902 | 0 |
Recording of deferred tax assets related to exchanges of Class B common stock to Class A common stock | 123,157 | 187,915 | 0 |
Recording of amounts payable pursuant to tax receivable agreement | 7,761 | 154,711 | 0 |
Capital contribution related to tax receivable agreement exchanges of Class B common stock to Class A common stock | 115,396 | 27,011 | 0 |
Income tax receivable from merger due to former owner | 0 | 3,842 | 0 |
Deferred tax asset and additional paid-in capital from ConnectPV | 0 | 238 | 0 |
Class A common stock issued in ConnectPV acquisition | 0 | 6,500 | 0 |
IPO | |||
Cash Flows from Financing Activities | |||
Purchase of LLC Interests | 0 | (124,312) | 0 |
Follow-on Offering | |||
Cash Flows from Financing Activities | |||
Purchase of LLC Interests | 0 | (281,064) | 0 |
Term Loan Facility | |||
Cash Flows from Financing Activities | |||
Proceeds from credit facility | 0 | 0 | 350,000 |
Repayments of credit facility | (2,000) | (152,750) | 0 |
Revolving Credit Facility | |||
Cash Flows from Financing Activities | |||
Proceeds from credit facility | 46,000 | 49,140 | 20,000 |
Repayments of credit facility | (53,140) | (14,000) | 0 |
Term Loan | |||
Cash Flows from Financing Activities | |||
Payments on senior debt - term loan | 0 | 0 | (26,250) |
Delayed Draw Term Loan | |||
Cash Flows from Financing Activities | |||
Proceeds from credit facility | 0 | 0 | 20,000 |
Repayments of credit facility | $ 0 | $ 0 | $ (20,000) |
Organization and Business
Organization and Business | 12 Months Ended |
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Business | Organization and Business Shoals Technologies Group, Inc. (the “Company”) was formed as a Delaware corporation on November 4, 2020 for the purpose of facilitating an initial public offering (“IPO”) and other related organizational transactions to carry on the business of Shoals Parent LLC and its subsidiaries (“Shoals Parent”). Shoals Parent is a Delaware limited liability company formed on May 9, 2017. The Company is headquartered in Portland, Tennessee and is a manufacturer of electrical balance of systems (“EBOS”) solutions and components for solar, battery storage and electric vehicle charging applications, selling to customers across the United States and internationally. Shoals Parent, through its wholly-owned subsidiaries, Shoals Intermediate Holdings LLC (“Intermediate”) and Shoals Holdings LLC (“Holdings”) owns four other subsidiaries through which it conducts substantially all operations: Shoals Technologies, LLC, Shoals Technologies Group, LLC, Solon, LLC, (collectively “Shoals”) and Shoals Connect LLC. Shoals Parent acquired Shoals on May 25, 2017. On August 26, 2021, the Company acquired 100% of the stock of ConnectPV, Inc. (“ConnectPV”) with cash and Class A common stock. The acquisition was accounted for as a business combination and following the acquisition, the Company immediately converted ConnectPV to a limited liability company (Shoals Connect LLC) and contributed the entity to Shoals Parent, LLC through a series of transactions – see Note 3 - Acquisition of ConnectPV. Initial Public Offering On January 29, 2021, the Company completed an IPO of 11,550,000 shares of Class A common stock at a public offering price of $25.00 per share, including shares issued pursuant to the underwriters’ over-allotment option. The Company received $278.8 million in proceeds, net of underwriting discounts and commissions of $9.9 million, which was used to purchase 6,315,790 newly-issued membership interests (“LLC Interests”) from Shoals Parent and 5,234,210 LLC Interests from the founder and Class B unit holder in Shoals Parent at a price per interest equal to the IPO price of $25.00 per share. Organizational Transactions In connection with the IPO, the Company and Shoals Parent completed a series of transactions (the “Organizational Transactions”) including the following: • the limited liability company agreement (the “LLC Agreement”) of Shoals Parent was amended and restated to, among other things, (i) provide for a new single class of LLC Interests in Shoals Parent, (ii) exchange all of the then existing membership interests of the holders of Shoals Parent membership interests for LLC Interests and (iii) appoint the Company as the sole managing member of Shoals Parent; • the Company’s certificate of incorporation was amended and restated to, among other things, (i) provide for Class A common stock with voting and economic rights (ii) provide for Class B common stock with voting rights but no economic rights and (iii) issue 78,300,817 shares of Class B common stock to the former Class B and Class C members of Shoals Parent (the “Continuing Equity Owners”) on a one-to-one basis with the number of LLC Interests they own; and • the acquisition, by merger, of Shoals Investment CTB or the former Class A member of Shoals Parent (the “Class A Shoals Equity Owners”), for which the Company issued 81,977,751 shares Class A common stock as merger consideration (the “Merger”). Follow-On Offerings On July 16, 2021, the Company completed a follow-on offering consisting of 4,989,692 shares of Class A common stock offered by selling stockholders and 10,402,086 shares of Class A common stock offered by the Company. The Company used the proceeds of the sale of Class A common stock to purchase an equal number of LLC Interests and Class B common stock from our founder and management. On December 6, 2022, the Company completed a follow-on offering consisting of 27,900,000 shares of Class A common stock offered by the selling stockholders and 2,000,000 shares of Class A common stock offered by the Company. The Company used the proceeds of the sale of Class A common stock together with cash on hand, to make a payment of $58.0 million to terminate the Tax Receivable Agreement (“TRA”). See Note 17 – Payable Pursuant to the Tax Receivable Agreement. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of Accounting and Presentation The consolidated financial statements have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Principles of Consolidation The consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Reclassifications Certain prior period amounts have been reclassified to conform to the current period presentation. Non-controlling Interests The non-controlling interests on the consolidated statement of operations represents the portion of earnings or loss attributable to the economic interests in the Company’s subsidiary, Shoals Parent, held by the Continuing Equity Owners. Non-controlling interests on the consolidated balance sheet represents the portion of net assets of the Company attributable to the Continuing Equity Owners, based on the portion of the LLC Interests owned by such unit holders. As of December 31, 2022, the non-controlling interests were 18.56%. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates include revenue recognition, allowance for credit losses, useful lives of property, plant and equipment and other intangible assets, impairment of long-lived assets, allowance for obsolete or slow moving inventory, payable pursuant to the TRA, valuation allowance on deferred tax assets and equity-based compensation expense. Impact of Macroeconomic Events In 2022, macroeconomic events, including the ongoing COVID-19 pandemic, impacted our business in the following ways: • Our ability to obtain raw materials from domestic and international suppliers required to manufacture our components; and • Our ability to secure inbound logistics to our facilities, with additional delays linked to international border crossings. Significant levels of inflation have increased energy prices, freight premiums, and other operating costs. As a result of inflation, during 2022, the Federal Reserve increased interest rates resulting in higher interest rates associated with our Senior Secured Credit Agreement, as defined below. Any additional increases in interest rates by the Federal Reserve would have a corresponding increase in the interest rates charged under our Senior Secured Credit Agreement. The eventual implications of higher government deficits and debt, tighter monetary policy, and potentially higher long-term interest rates may drive a higher cost of capital during 2023. The Company does not directly source raw materials from Europe. However, the ongoing conflict in Ukraine has reduced the availability of certain material that can be sourced in Europe and, as a result, increased global costs for the procurement of some inputs and materials used in our products. We do not know the ultimate severity or duration of the conflict in Ukraine, but we are continuously monitoring the situation and evaluating our procurement strategy and supply chain as to reduce any negative impact on our business, financial condition, and results of operations. As response to supply chain constraints, in 2022 we increased certain raw materials inventory, partly to limit the potential impact of supply chain issues of raw materials in the near term. To date we have not had any material adverse effects on our financial results from these events. Cash and Cash Equivalents The Company considers cash and cash equivalents to include cash on hand, cash held in demand deposit accounts, and all highly liquid financial instruments purchased with a maturity of three months or less. Restricted Cash Restricted cash is included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. Restricted cash is restricted as to withdrawal or use. Prior to the termination of the TRA, tax distributions paid by Shoals Parent to the Company were restricted under the LLC Agreement for future payments under the TRA and totaled $4.6 million as of December 31, 2021. A reconciliation of cash, cash equivalents and restricted cash to the consolidated statement of cash flows is as follows (in thousands): As of December 31, 2022 2021 2020 Cash and cash equivalents $ 8,766 $ 5,006 $ 10,073 Restricted cash included in other current asset — — — Restricted cash included in other assets — 4,551 — Total cash, cash equivalents and restricted cash $ 8,766 $ 9,557 $ 10,073 Accounts Receivable and Allowance for Credit Losses Accounts receivable is comprised of amounts billed to customers, net of an allowance for credit losses. Interest is not charged on receivables. The allowance for credit losses is estimated by management and is based on historical experience, current conditions and reasonable forecasts. Periodically, management reviews the accounts receivable balances of its customers and adjusts the allowance based on current circumstances and charges off uncollectible receivables when all attempts to collect have failed, although collection efforts may continue. Unbilled Receivables Unbilled receivables arise when the Company recognizes revenue for amounts which cannot yet be billed under terms of the contract with the customer. Inventory Inventories consist of raw materials. Inventories are stated at the lower of cost or net realizable value. Cost is calculated using the first-in first-out method. Provisions are made to reduce excess or obsolete inventories to their estimated net realizable values. Property, Plant, and Equipment Property, plant, and equipment acquired in the acquisition of Shoals and ConnectPV are recorded at fair value at the date of acquisition; all other property, plant and equipment are recorded at cost, net of accumulated depreciation. Improvements, betterments and replacements which significantly extend the life of an asset are capitalized. Depreciation is computed using the straight-line method over the estimated useful lives of the respective assets. Repair and maintenance costs are expensed as incurred. A gain or loss on the sale of property, plant and equipment is calculated as the difference between the cost of the asset disposed of, net of accumulated depreciation, and the sales proceeds received. A gain or loss on an asset disposal is recognized in the period that the sale occurs. Impairment of Long-Lived Assets When events, circumstances or operating results indicate that the carrying values of long-lived assets might not be recoverable through future operations, the Company prepares projections of the undiscounted future cash flows expected to result from the use of the assets and their eventual disposition. If the projections indicate that the recorded amounts are not expected to be recoverable, such amounts are reduced to estimated fair value. Fair value is estimated based upon internal evaluation of each asset that includes quantitative analyses of net revenue and cash flows, review of recent sales of similar assets and market responses based upon discussions in connection with offers received from potential buyers. Management determined there was no impairment for the years ended December 31, 2022, 2021 and 2020. Goodwill Goodwill is assessed using either a qualitative assessment or quantitative approach to determine whether it is more likely than not that the fair value of the reporting unit is less than the carrying amount. The qualitative assessment evaluates factors including macroeconomic conditions, industry-specific and company-specific considerations, legal and regulatory environments, and historical performance. If the Company determines that is more likely than not that the fair value of a reporting unit is less than its carrying value, a quantitative assessment is performed. Otherwise, no further assessment is required. The quantitative approach compares the estimate fair value of the reporting units to its carrying amount, including goodwill. Impairment is indicated if the estimated fair value of the reporting unit is less than the carrying amount of the reporting unit, and an impairment charge is recognized for the differential. The Company completes its annual goodwill impairment test as of October 1 each year. For the years ended December 31, 2022, 2021 and 2020, the Company performed a qualitative assessment of its goodwill and determined no impairment. Since the Company’s formation on May 9, 2017, the Company has not had any goodwill impairment. Amortizable and Other Intangible Assets The Company amortizes identifiable intangible assets consisting of customer relationships, developed technology, trade names, backlog and noncompete agreements because these assets have finite lives. The Company’s intangible assets with finite lives are amortized on a straight‐line basis over the estimated useful lives. The basis of amortization approximates the pattern in which the assets are utilized over their estimated useful lives. The Company reviews for impairment indicators of finite-lived intangibles, as described in the “Impairment of Long-Lived Assets” significant accounting policy. Deferred Offering Costs Deferred offering costs consist primarily of registration fees, filing fees, listing fees, specific legal and accounting costs and transfer agent fees, which are direct and incremental fees related to the IPO and follow-on offerings. Deferred Financing Costs Costs incurred to issue debt are capitalized and recorded net of the related debt and amortized using the effective interest method as a component of interest expense over the terms of the related debt agreement. Revenue Recognition The Company recognizes revenue primarily from the sale of EBOS systems and components. The Company determines its revenue recognition through the following steps: (i) identification of the contract or contracts with a customer, (ii) identification of the performance obligations within the contract, (iii) determination of the transaction price, (iv) allocation of the transaction price to the performance obligations within the contract, and (v) recognition of revenue as the performance obligation has been satisfied. The Company’s contracts with customers predominately are accounted for as one performance obligation, as the majority of the obligations under the contracts relate to a single project. For each contract entered into, the Company determines the transaction price based on the consideration expected to be received. The transaction price identified is allocated to each distinct performance obligation to deliver a good or service based on the relative standalone selling prices. Management has concluded that the prices negotiated with each individual customer are representative of the standalone selling price of the product. The Company primarily recognizes revenue over time as a result of the continuous transfer of control of its product to the customer using the output method based on units manufactured. This continuous transfer of control to the customer is supported by clauses in the contracts that provide rights to payment of the transaction price associated with work performed to date on products that do not have an alternative use to the Company. Management believes that recognizing revenue using the output method based on units manufactured best depicts the extent of transfer of control to the customer. In certain instances the promised goods do have an alternative use. In these instances revenue is recognized when the customer obtains control of the product. Contracts of this nature typically include customer acceptance clauses, which results in revenue recognition occurring upon customer acceptance. The manufacturing process generally takes less than one week to complete production. The accounting for each contract involves a judgmental process of estimating total sales, costs, and profit for each performance obligation. Cost of revenue is recognized based on the unit of production. The amount reported as revenue is determined by adding a proportionate amount of the estimated profit to the amount reported as cost of revenue. The Company has elected to adopt certain practical expedients and exemptions as allowed under the new revenue recognition guidance such as (i) recording sales commissions as incurred because the amortization period is less than one year, (ii) excluding any collected sales tax amounts from the calculation of revenue, and (iii) accounting for shipping and handling activities that are incurred after the customer has obtained control of the product as fulfillment costs rather than a separate service provided to the customer for which consideration would need to be allocated (see Shipping and Handling). Shipping and Handling The Company accounts for shipping and handling related to contracts with customers as costs to fulfill its promise to transfer the associated products. Accordingly, payment by the Company’s customers for shipping and handling costs for delivery of the Company’s products are recorded as a component of revenue in the accompanying consolidated statements of operations. Shipping and handling expenses are included as a component of cost of revenue as incurred and totaled $7.0 million, $5.2 million and $4.9 million for the years ended December 31, 2022, 2021 and 2020, respectively. Concentrations The Company has cash deposited at certain financial institutions which, at times, may exceed the limits provided by the Federal Deposit Insurance Corporation (“FDIC”). The Company has not experienced any losses on such amount and believes it is not subject to significant credit risk related to cash balances. As of December 31, 2022, $8.3 million of the Company’s bank balances were in excess of FDIC insurance limits. The Company had the following revenue concentrations representing 10% or more of revenue for any period in the years ended December 31, 2022, 2021 and 2020 and related accounts receivable concentrations as of December 31, 2022 and 2021: 2022 2021 2020 Revenue % Accounts Revenue % Accounts Revenue % Customer A 6.3 % 5.1 % 11.3 % 4.6 % 21.8 % Customer B 7.0 % 8.4 % 18.3 % 15.8 % 18.4 % Customer C 6.0 % 12.6 % 10.0 % 23.7 % 9.4 % Fair Value Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company follows a fair value hierarchy which requires the Company to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Three levels of inputs may be used to measure fair value, as follows: • Level 1 – Quoted prices in active markets for identical assets or liabilities. • Level 2 – Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. • Level 3 – Unobservable inputs that are supported by little or no market activity that are significant to the fair value of the assets or liabilities. The fair values of the Company’s cash and cash equivalents, accounts receivable, and accounts payable approximate their carrying values due to their short maturities. The carrying value of the Company’s long-term debt approximates fair value, as it is based on current market rates at which the Company could borrow funds with similar terms. The Company follows the provisions of Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 820-10 for nonfinancial assets and liabilities measured at fair value on a nonrecurring basis. As it relates to the Company, this applies to certain nonfinancial assets and liabilities acquired in business combinations. Income Taxes Pre-IPO Income Taxes Shoals Parent was treated as a partnership and was not subject to federal income tax; rather, Shoals Parent’s taxable income was passed through to its members and subject to federal income tax at the member level. Shoals Parent is the sole member of the following subsidiary LLCs, which are treated as disregarded entities for federal income tax purposes: Intermediate, Holdings, and Shoals. The activities of Shoals Parent and its subsidiary LLCs are reported on the federal income tax return of Shoals Parent. Shoals Parent and its subsidiary LLCs are generally not subject to state income tax; however, Shoals Technologies Group, LLC and Shoals Technologies, LLC pay various state and franchise taxes. Post-IPO Income Taxes The Company is taxed as a corporation for U.S. federal and state income tax purposes. The Company’s sole material asset is Shoals Parent, which is a limited liability company that is taxed as a partnership for US federal and certain state and local income tax purposes. Shoals Parent’s net taxable income and related tax credits, if any, are passed through to its members and included in the member’s tax returns. The Company accounts for income taxes using the asset and liability method. Under this method, deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are calculated by applying existing tax laws and the rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in the year of the enacted rate change. In assessing the realizability of deferred tax assets, management considers whether it is more-likely-than-not that the deferred tax assets will be realized. In making such a determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, carryback potential if permitted under the tax law, and results of recent operations. The Company accounts for uncertainty in income taxes using a recognition and measurement threshold for tax positions taken or expected to be taken in a tax return, which are subject to examination by federal and state taxing authorities. The tax benefit from an uncertain tax position is recognized when it is more likely than not that the position will be sustained upon examination by taxing authorities based on the technical merits of the position. The amount of the tax benefit recognized is the largest amount of the benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. The effective tax rate and the tax basis of assets and liabilities reflect management’s estimates of the ultimate outcome of various tax uncertainties. The Company recognizes penalties and interest related to uncertain tax positions within the income tax expense financial statement caption in the accompanying consolidated statements of operations. The Company did not have any material interest and penalties during the years ended December 31, 2022, 2021 and 2020. The Company files U.S. federal and certain state income tax returns. The income tax returns of the Company are subject to examination by U.S. federal and state taxing authorities for various time periods, depending on each jurisdictions’ rules, beginning generally after the income tax returns are filed. Product Warranty The Company offers an assurance type warranty for its products against manufacturer defects and does not contain a service element. For these assurance type warranties, a provision for estimated future costs related to warranty expense is recorded when they are probable and reasonably estimable. This provision is based on historical information on the nature, frequency and average cost of claims for each product line. When little or no experience exists for an immature product line, the estimate is based on comparable product lines. Specific reserves are established once an issue is identified with the amounts for such reserves based on the estimated cost of correction. These estimates are re-evaluated on an ongoing basis using best-available information and revisions to estimates are made as necessary. As of December 31, 2022 and 2021 our estimated accrued warranty reserve was $0.6 million and $0.1 million, respectively. Acquisition Accounting The Company accounts for its business acquisitions under the acquisition method of accounting in ASC 805. The excess of the purchase price over the estimated fair values of the net assets acquired is recorded as goodwill. Determining the fair value of assets acquired and liabilities assumed requires management’s judgment and often involves the use of significant estimates and assumptions, including assumptions with respect to future cash inflows and outflows, discount rates, asset lives, and market multiples amongst other items. Equity-Based Compensation The Company recognizes equity-based compensation expense based on the equity award’s grant date fair value. The determination of the fair value of equity awards issued to employees of the Company is based upon the closing market price of the Company’s common stock on the day prior to the grant date. Equity-based compensation expense related to performance stock units is recognized if it is probable that the performance condition will be satisfied. The Company accounts for forfeitures as they occur. The grant date fair value of each unit is amortized on a straight-line basis over the requisite service period, including those units with graded vesting. However, the amount of equity-based compensation at any date is at least equal to the portion of the grant date fair value of the award that is vested. Earnings per Share (“EPS”) Basic EPS is computed by dividing net income available to common stockholders by the weighted average shares outstanding during the period. Diluted EPS takes into account the potential dilution that could occur if securities or other contracts to issue shares, such as unvested restricted stock units, were exercised and converted into shares. Diluted EPS is computed by dividing net income available to common stockholders by the weighted average shares outstanding during the period, increased by the number of additional shares that would have been outstanding if the potential shares had been issued and were dilutive. Segment Reporting ASC 280 (“Segment Reporting”) establishes standards for reporting information about operating segments. Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance. The Company manages its business on the basis of one operating and reportable segment and derives revenues from selling its product. Advertising Expenses Advertising expenses are expensed as incurred. Advertising expenses for the years ended December 31, 2022, 2021 and 2020 were not material to our consolidated financial statements. Research and Development Expenses Research and development expenses are expensed as incurred. Research and development expenses for the years ended December 31, 2022, 2021 and 2020 were not material to our consolidated financial statements. New Accounting Standards Adopted On January 1, 2022, the Company adopted Accounting Standards Update (“ASU”) No. 2016-02 (Topic 842) “Leases” which supersedes the lease recognition requirements in Accounting Standards Codification (“ASC”) Topic 840, “Leases” . Under ASU No. 2016-02, lessees are required to recognize assets and liabilities on the consolidated balance sheets for most leases and provide enhanced disclosures. For companies that are not emerging growth companies (“EGCs”), the ASU was effective for fiscal years beginning after December 15, 2018. For EGCs, the ASU is effective for fiscal years beginning after December 15, 2021. The Company adopted the new standard using the modified retrospective method by recording a right-of-use asset of $1.2 million, short-term portion of lease liabilities of $0.4 million and long-term portion of lease liabilities of $0.8 million as of the effective date. Prior periods will not be restated and will continue to be reported under Topic 840 guidance in effect during those periods. The Company applied the package of practical expedients to leases that commenced before the effective date whereby the Company elected to not reassess the following: (i) whether any expired or existing contracts contain leases; (ii) the lease classification for any expired or existing leases; and (iii) initial direct costs for any existing leases. The adoption did not have a material impact on its consolidated statements of operations or its consolidated statements of cash flows. See Note 14 - Leases for further information and disclosures related to the adoption of this standard. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses , which was subsequently amended by ASU No. 2018-19 and ASU No. 2019-10, and which requires the measurement of expected credit losses for financial instruments carried at amortized cost held at the reporting date based on historical experience, current conditions and reasonable forecasts. The updated guidance also amends the current other-than-temporary impairment model for available-for-sale debt securities by requiring the recognition of impairments relating to credit losses through an allowance account and limits the amount of credit loss to the difference between a security’s amortized cost basis and its fair value. In addition, the length of time a security has been in an unrealized loss position will no longer impact the determination of whether a credit loss exists. The main objective of this ASU is to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. The standard was adopted on December 31, 2022 as the Company lost its status as an Emerging Growth Company effective December 31, 2022 and therefore was required to adopt the standard for the year ending December 31, 2022. As the Company’s credit losses are typically minimal, the adoption of this standard did not have a significant impact on the consolidated financial statements. Not Yet Adopted In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805) Accounting for Contract Assets and Contract Liabilities from Contracts with Customers . This ASU requires that contract assets and contract liabilities acquired in a business combination be recognized and measured in accordance with Topic 606. At the acquisition date, an acquirer should account for the related revenue contracts in accordance with Topic 606 as if it had originated the contracts. This guidance is effective for fiscal years beginning after December 15, 2022, including interim periods within that fiscal year. Early adoption of the amendments is permitted, including adoption in an interim period. An entity that early adopts in an interim period should apply the amendments (1) retrospectively to all business combinations for which the acquisition date occurs on or after the beginning of the fiscal year that includes the interim period of early application and (2) prospectively to all business combinations that occur on or after the date of initial application. We are currently evaluating the impact of the new standard on our financial statements and related disclosures. Management does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s financial statements. |
Acquisition of ConnectPV
Acquisition of ConnectPV | 12 Months Ended |
Dec. 31, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Acquisition of ConnectPV | Acquisition of ConnectPV On August 26, 2021, the Company acquired 100% of the common stock of ConnectPV. The acquisition of ConnectPV was accounted for as a business combination using the acquisition method of accounting. The aggregate purchase price was $13.8 million in cash (net of $0.8 million cash acquired) and 209,437 shares of Class A common stock valued at $6.5 million. The cash portion of the purchase price was funded by borrowing under our Revolving Credit Facility (as defined below). The purchase price paid has been allocated to record the acquired assets and assumed liabilities based upon their estimated fair value. When determining the fair values of the assets acquired and assumed liabilities, management made significant estimates, judgements and assumptions. Management estimated that consideration paid exceeded the fair value of the net assets acquired. Therefore, goodwill of $19.8 million was recorded. The goodwill recognized was primarily attributable to the workforce and synergies related to the Company’s EBOS solutions and components business that are expected to arise from the ConnectPV acquisition. The following table is the balance sheet of ConnectPV as of the acquisition date, August 26, 2021, and includes the estimated fair value of the assets acquired and assumed liabilities. The estimated fair value allocated to certain property, plant and equipment, identifiable intangible assets and goodwill was determined based on a combination of market, cost and income approaches with the assistance of a third-party valuation firm (in thousands): Purchase Price Allocation Cash and cash equivalents $ 849 Accounts receivable 5,382 Inventory 4,273 Other current assets 1,583 Total current assets 12,087 Property, plant and equipment 438 Goodwill 19,765 Other intangible assets 1,600 Total Assets 33,890 Accounts payable 9,440 Accrued expenses 2,655 Debt 1,537 Total Liabilities 13,632 Net assets acquired $ 20,258 The Company expensed acquisition-related costs of $2.3 million which are included in general and administrative expenses in the consolidated statement of operations for the year ended December 31, 2021. The goodwill and acquisition costs are not deductible for tax purposes. Pro Forma Financial Information (Unaudited) The pro forma information below gives effect to the ConnectPV acquisition as if it had been completed on the first day of each period presented. The pro forma results of operations are presented for informational purposes only. As such, they are not necessarily indicative of the Company’s results had the acquisition been completed on the first day of each period presented, nor do they intend to represent the Company’s future results. The pro forma information does not reflect any cost savings from operating efficiencies or synergies that could result from the acquisition and does not reflect additional revenue opportunities following the acquisition. The pro forma information includes adjustments to record the assets and liabilities associated with the acquisition at their respective fair values, based on available information and to give effect to the financing for the acquisition (in thousands): Year Ended 2021 2020 Revenue $ 229,709 $ 200,892 Net income $ 3,305 $ 29,861 |
Accounts Receivable
Accounts Receivable | 12 Months Ended |
Dec. 31, 2022 | |
Receivables [Abstract] | |
Accounts Receivable | Accounts ReceivableAccounts receivable, net consists of the following (in thousands): December 31, 2022 2021 Accounts receivable $ 51,061 $ 32,015 Less: allowance for credit losses (486) (516) Accounts receivable, net $ 50,575 $ 31,499 |
Inventory
Inventory | 12 Months Ended |
Dec. 31, 2022 | |
Inventory Disclosure [Abstract] | |
Inventory | Inventory Inventory, net consists of the following (in thousands): December 31, 2022 2021 Raw materials $ 75,778 $ 39,265 Allowance for obsolete or slow-moving inventory (2,924) (897) Inventory, net $ 72,854 $ 38,368 |
Property, Plant and Equipment
Property, Plant and Equipment | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Property, Plant and Equipment Property, plant, and equipment, net consists of the following (in thousands): Estimated Useful Lives (Years) December 31, 2022 2021 Land N/A $ 840 $ 840 Building and land improvements 5-40 9,031 7,801 Machinery and equipment 3-5 12,371 10,693 Furniture and fixtures 3-7 1,787 1,775 Vehicles 5 125 65 24,154 21,174 Less: accumulated depreciation (7,284) (5,600) Property, plant and equipment, net $ 16,870 $ 15,574 Depreciation expense for the years ended December 31, 2022, 2021 and 2020 was $1.9 million, $1.7 million and $1.4 million, respectively. During the years ended December 31, 2022, 2021 and 2020, $1.5 million, $1.5 million and $1.1 million, respectively, of depreciation expense was allocated to cost of revenue. During the years ended December 31, 2022, 2021 and 2020, $0.4 million, $0.2 million and $0.3 million, respectively, of depreciation expense was allocated to operating expenses. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible AssetsGoodwill Goodwill relates to the acquisition of Shoals and ConnectPV. As of December 31, 2022 and 2021, goodwill totaled $69.9 million and $69.4 million, respectively. Changes in the carrying amount of goodwill during the years ended December 31, 2022 and 2021 are shown below (in thousands): Goodwill Balance at December 31, 2020 $ 50,176 Acquisition of ConnectPV 19,260 Balance at December 31, 2021 69,436 Adjustments related to finalization of working capital in the acquisition of ConnectPV 505 Balance at December 31, 2022 $ 69,941 Other Intangible Assets Other intangible assets, net consisted of the following (in thousands): Estimated Useful Lives (Years) December 31, 2022 2021 Amortizable: Costs: Customer relationships 13 $ 53,100 $ 53,100 Developed technology 13 34,600 34,600 Trade names 13 11,900 11,900 Backlog 1 600 600 Noncompete agreements 5 2,000 2,000 Total amortizable intangibles 102,200 102,200 Accumulated amortization: Customer relationships 22,925 18,629 Developed technology 14,860 12,199 Trade names 5,230 4,103 Backlog 600 200 Noncompete agreements 2,000 1,833 Total accumulated amortization 45,615 36,964 Total other intangible assets, net $ 56,585 $ 65,236 Amortization expense related to intangible assets amounted to $8.7 million, $8.4 million and $8.0 million for the years ended December 31, 2022, 2021 and 2020, respectively. Estimated future annual amortization expense for other intangible assets, net are as follows (in thousands): For the Year Ended December 31, Amortization Expense 2023 $ 7,918 2024 7,585 2025 7,585 2026 7,585 2027 7,585 Thereafter 18,327 $ 56,585 |
Accrued Expenses and Other
Accrued Expenses and Other | 12 Months Ended |
Dec. 31, 2022 | |
Payables and Accruals [Abstract] | |
Accrued Expenses and Other | Accrued Expenses and Other Accrued expenses and other consists of the following (in thousands): December 31, 2022 2021 Accrued compensation $ 4,917 $ 2,882 Accrued interest 7,226 3,095 Other accrued expenses 5,739 1,751 Total accrued expenses and other $ 17,882 $ 7,728 |
Long-Term Debt
Long-Term Debt | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Long-Term Debt Long-term debt consists of the following (in thousands): December 31, 2022 2021 Term Loan Facility $ 195,250 $ 197,250 Revolving Credit Facility 48,000 55,140 Less: deferred financing costs (4,187) (5,337) Total debt, net of deferred financing costs 239,063 247,053 Less: current portion (2,000) (2,000) Long-term debt, net current portion $ 237,063 $ 245,053 The aggregate amounts of principal maturities on the Company’s long-term debt is as follows (in thousands): For the Year Ended December 31, 2023 $ 2,000 2024 2,000 2025 2,000 2026 237,250 $ 243,250 Senior Secured Credit Agreement On November 25, 2020 Shoals Holdings, entered into a senior secured credit agreement (as amended, the “Senior Secured Credit Agreement”), consisting of (i) a $350.0 million senior secured six-year term loan facility (the “Term Loan Facility”), (ii) a $30.0 million senior secured delayed draw term loan facility, which matures concurrently with the six -year Term Loan Facility (the “Delayed Draw Term Loan Facility”) and (iii) an uncommitted super senior first out revolving credit facility (the “Revolving Credit Facility”). In December 2020, Shoals Holdings entered into two amendments to the Senior Secured Credit Agreement in order to obtain a $100.0 million increase (the “Revolver Upsize”) to the Revolving Credit Facility and modify the terms of the interest rate and prepayment premium. As part of the first amendment the Company repaid and terminated all outstanding commitments under the Delayed Draw Term Loan Facility. On January 29, 2021, the Company used proceeds from the IPO to repay $150.0 million of outstanding borrowings under the Term Loan Facility. The repayment of a portion of the borrowings under the Term Loan Facility resulted in a $16.0 million loss on debt repayment as the result of the $11.3 million prepayment premium and $4.7 million write-off of a portion of the deferred financing costs. On May 2, 2022, Shoals Holdings entered into an amendment to the Senior Secured Credit Agreement in order to increase the amount available for borrowing under the Revolving Credit Facility from $100.0 million to $150.0 million. The amendment also set forth Secured Overnight Financing Rate (“SOFR”) as the benchmark rate to succeed London Interbank Offered Rate and amended the financial covenant such that, commencing with September 30, 2022, Shoals Holdings shall not permit its Consolidated First Lien Secured Leverage Ratio (as defined in the Senior Secured Credit Agreement) to exceed 6.50:1.00. As of December 31, 2022, the outstanding balance of the Term Loan Facility was $195.3 million. The balance of the Term Loan Facility is presented in the accompanying consolidated balance sheets net of deferred financing fees of $4.2 million and $5.3 million as of December 31, 2022 and 2021, respectively. The deferred financing fees are being amortized using the effective interest method. The effective interest rate as of December 31, 2022 and 2021, was 7.06% and 6.42%, respectively. As of December 31, 2022, the Revolving Credit Facility balance was $48.0 million and the Company had $102.0 million of availability under the Revolving Credit Facility. Interest Rate The interest rates applicable to the loans under the Term Loan Facility are based on a rate of interest determined by reference to either: (i) a base rate plus an applicable margin equal to (a) on and after December 30, 2020 until the later of either (1) February 28, 2021 or (2) December 31, 2022 so long as Holdings has prepaid the loans under the Term Loan Facility on or prior to February 28, 2021 in an amount that results in the aggregate outstanding principal amount of loans under the Term Loan Facility being equal to or less than the sum of (A) $200.0 million minus (B) any mandatory prepayments of the principal amount of loans under the Term Loan Facility or amortization payments made prior to February 28, 2021, 2.25% and (b) thereafter, either (1) if Holdings has consummated an IPO the net cash proceeds of which have been used to repay the principal amount of the loans under the Term Loan Facility in an amount no less than $70.0 million, 4.75% or (2) otherwise, 5.00%; or (ii) a SOFR rate plus an applicable margin equal to (a) on and after December 30, 2020 until the later of either (1) February 28, 2021 or (2) December 31, 2022 so long as Holdings has prepaid the loans under the Term Loan Facility on or prior to February 28, 2021 in an amount that results in the aggregate outstanding principal amount of loans under the Term Loan Facility being equal to or less than the sum of (A) $200.0 million minus (B) any mandatory prepayments of the principal amount of loans under the Term Loan Facility or amortization payments made prior to February 28, 2021, 3.25% and (b) thereafter, either (1) if Holdings has consummated an IPO the net cash proceeds of which have been used to repay the principal amount of the loans under the Term Loan Facility in an amount no less than $70.0 million, 5.75% or (2) otherwise, 6.00%. The interest rates applicable to the loans under the Revolving Credit Facility are based on a rate of interest determined by reference to either (i) a base rate plus an applicable margin equal to 2.25% or (ii) a SOFR rate plus an applicable margin equal to 3.25%. As of December 31, 2022, interest rates on the Term Loan Facility was SOFR plus 3.25%, or 7.51%, and the Revolving Credit Facility was SOFR plus 3.25%, ranging from 7.00% to 7.92%. Guarantees and Security The obligations under the Senior Secured Credit Agreement are guaranteed by Shoals Intermediate Holdings and its wholly owned domestic subsidiaries other than certain immaterial subsidiaries and other excluded subsidiaries. The obligations under the Senior Secured Credit Agreement are secured by a first priority security interest in substantially all of Holdings’ and the other guarantors’ existing and future property and assets, including accounts receivable, inventory, equipment, general intangibles, intellectual property, investment property, other personal property, material owned real property, cash and proceeds of the foregoing. Prepayments and Amortization Loans under the Revolving Credit Facility may be voluntarily prepaid, at Shoals Holdings’ option, in whole, or in part, in each case without premium or penalty. Loans under the Term Loan Facility may be voluntarily prepaid, at Holdings’ option, in whole, or in part, in each case without premium or penalty other than (i) a prepayment premium in an amount equal to (a) if such prepayment occurs prior to the first anniversary of the Senior Secured Credit Agreement Closing Date, a make-whole premium, (b) if such prepayment occurs on or after the first anniversary but prior to the second anniversary of the Senior Secured Credit Agreement Closing Date, 2.00% and (c) if such prepayment occurs on or after the second anniversary but prior to the third anniversary of the Senior Secured Credit Agreement Closing Date, 1.00% and (ii) with respect to prepayments in connection with an IPO, a change of control or a transformative disposition subject to certain exceptions and conditions, a prepayment premium equal to (a) if such prepayment occurs prior to the first anniversary of the Senior Secured Credit Agreement Closing Date, 2.00% and (b) if such prepayment occurs after the first anniversary of the Senior Secured Credit Agreement Closing Date but prior to the second anniversary of the Senior Secured Credit Agreement Closing Date, 1.00%. Notwithstanding anything to the contrary in the preceding paragraph, in the event that, on or after December 30, 2020 but prior to February 28, 2021, Shoals Holdings made any prepayment (including with respect to any acceleration) of any loans under the Term Loan Facility, Holdings would pay a premium on such prepayments made up to $150.0 million of the principal amount of such loans prepaid in an amount equal to 7.50% multiplied by the principal amount of such loans prepaid, which, if applicable, would be in lieu of any applicable prepayment premium set forth in the preceding paragraph or in the paragraph below; provided that no amortization payments or mandatory prepayments required under the Senior Secured Credit Agreement shall be subject to the prepayment premium set forth in this paragraph. On January 29, 2021, the Company used proceeds from the IPO to repay $150.0 million of outstanding borrowings under the Term Loan Facility resulting in a prepayment premium of $11.3 million. Additionally, after February 28, 2021 but prior to the second anniversary of the Senior Secured Credit Agreement Closing Date, up to $175.0 million of the outstanding principal amount of the Term Loan Facility may be voluntarily prepaid upon the consummation of an IPO with proceeds from such IPO, subject to a prepayment premium in an amount equal to 1.00% in lieu of any applicable call protection premiums set forth in the second preceding paragraph. The Senior Secured Credit Agreement requires mandatory prepayments, but not permanent reductions of commitments thereunder, for excess cash flow, asset sales, subject to a right of reinvestment, and refinancing facilities. The Term Loan Facility amortizes in equal quarterly installments in aggregate annual amounts equal to 1.00% per annum of the original principal amount of the loans funded thereunder. There is no scheduled amortization under the Revolving Credit Facility. Restrictive Covenants and Other Matters The Senior Secured Credit Agreement contains affirmative and negative covenants that are customary for financings of this type, including covenants that restrict our incurrence of indebtedness, incurrence of liens, dispositions, investments, acquisitions, restricted payments, and transactions with affiliates. The Senior Secured Credit Agreement also includes customary events of default, including the occurrence of a change of control. The Revolving Credit Facility also includes a Consolidated Leverage Ratio financial covenant that is tested on the last day of each fiscal quarter. To remain in compliance with the financial covenant, Shoals Intermediate Holdings shall not permit the Consolidated Leverage Ratio, as of the last day of any quarter, to be greater than 6.50 to 1.00. As of December 31, 2022, the Company was in compliance with all the required covenants. |
Earnings per Share ("EPS")
Earnings per Share ("EPS") | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share [Abstract] | |
Earnings per Share ("EPS") | Earnings per Share (“EPS”) Basic EPS of Class A common stock is computed by dividing net income (loss) attributable to the Company by the weighted average number of shares of Class A common stock outstanding during the period. Diluted EPS of Class A common stock is computed similarly to basic EPS except the weighted average shares outstanding are increased to include additional shares from the exchange of Class B common stock under the if-converted method and the assumed exercise of any common stock equivalents using the treasury stock method, if dilutive. The Company’s restricted/performance stock units are considered common stock equivalents for this purpose. All earnings prior to and up to January 26, 2021, the date of the IPO, were entirely allocable to non-controlling interests and, as a result, EPS information is not applicable for reporting periods prior to this date. Consequently, only the net income (loss) allocable to Shoals Technologies Group, Inc. from the period subsequent to January 26, 2021 is included in the net income (loss) attributable to the stockholders of Class A common stock for the periods ended December 31, 2022. Basic and diluted EPS of Class A common stock have been computed as follows (in thousands, except per share amounts): Year Ended December 31, 2022 Period from January 27, 2021 to December 31, 2021 Numerator: Net income (loss) attributable to Shoals Technologies Group, Inc. - basic $ 127,611 $ (327) Reallocation of net income attributable to non-controlling interests from the assumed exchange of Class B common stock 15,402 — Net income (loss) attributable to Shoals Technologies Group, Inc. - diluted $ 143,013 $ (327) Denominator: Weighted average shares of Class A common stock outstanding - basic 114,495 99,269 Effect of dilutive securities: Restricted / performance stock units 308 — Class B common stock 52,828 — Weighted average shares of Class A common stock outstanding - diluted 167,631 99,269 Earnings (loss) per share of Class A common stock - basic $ 1.11 $ ( 0.00 ) Earnings (loss) per share of Class A common stock - diluted $ 0.85 $ ( 0.00 ) |
Equity-Based Compensation
Equity-Based Compensation | 12 Months Ended |
Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Equity-Based Compensation | Equity-Based Compensation 2021 Long-term Incentive Plan On January 26, 2021, the Shoals Technologies Group, Inc. 2021 Long-Term incentive Plan (the “2021 Incentive Plan”) became effective. The 2021 Incentive Plan authorized 8,768,124 new shares, subject to adjustment pursuant to the 2021 Incentive Plan. Restricted Stock Units During the period from January 26, 2021 to December 31, 2021, the Company granted 1,701,306 restricted stock units (“RSUs”) to certain employees, officers and directors of the Company. The RSUs had grant date fair values ranging from $21.50 to $34.60 per unit and generally vest ratably over either 4 years or 3 years, except for some officer and employee grants for bonuses which immediately vested or vest over 1 year. There were a limited number of awards with immediate vesting. During the year ended December 31, 2022, the Company granted 727,001 restricted stock units (“RSUs”) to certain employees, officers and directors of the Company. The RSUs have grant date fair values ranging from $10.42 to $25.82 per unit and generally vest ratably over 3 years, except for some officer and employee grants for bonuses which immediately vested. Activity under the 2021 Incentive Plan for RSUs was as follows: Restricted Weighted Average Price Outstanding, December 31, 2020 — $ — Granted 1,701,306 $ 27.61 Forfeited (23,738) $ 29.46 Vested (44,724) $ 28.60 Outstanding, December 31, 2021 1,632,844 $ 27.55 Granted 727,001 $ 13.78 Forfeited (63,534) $ 25.56 Vested (559,336) $ 26.05 Outstanding, December 31, 2022 1,736,975 $ 22.34 Performance Stock Units During the year ended December 31, 2022, the Company granted an aggregate of 256,305 Performance Stock Units (“PSUs”) to certain executives. The PSUs cliff vest after 3.0 years upon meeting certain revenue and gross margin targets and contain certain modifiers which could increase or decrease the ultimate number of Class A common stock issued to the executives. The PSUs were valued using the market value of the Class A common stock on the grant date ranging from $10.42 to $20.58 per PSUs. Based on results achieved in 2022 and the forecasted amounts over the remainder of the performance period, the Company expects the units to vest and the modifier to be achieved related to the revenue target. Activity under the 2021 Incentive Plan for PSUs was as follows: Performance Weighted Average Price Outstanding, December 31, 2021 — $ — Granted 256,305 $ 11.89 Vested — $ — Forfeited — $ — Outstanding, December 31, 2022 256,305 $ 11.89 During the years ended December 31, 2022 and 2021, the Company recognized $16.1 million and $11.3 million, respectively, in equity-based compensation. As of December 31, 2022, the Company had $31.9 million of unrecognized compensation costs which is expected to be recognized over a period of 2.1 years. Pre-IPO Class C Units The Company accounted for equity grants to employees (Class C units) as equity-based compensation. The Class C units contained vesting provisions as defined in the agreement. Vested units did not forfeit upon termination and represented a residual interest in the Company. Equity-based compensation cost was measured at the grant date fair value and was recognized on a straight-line basis over the requisite service period, including those units with graded vesting with a corresponding credit to members’ equity (deficit). However, the amount of equity-based compensation at any date was at least equal to the portion of the grant date value of the award that was vested. In May 2020, the Company issued 11,150,000 Class C units to certain employees of the Company of which approximately 77% were vested on the grant date. The fair value of such units was determined by management with the assistance of a third party valuation firm by considering a number of factors, including comparison companies, operating and financial performance, the lack of liquidity of the units, and general and industry specific economic outlook, amongst other factors. The grant date fair value of the Class C units granted during 2020 was $0.74 per unit. In November 2020, the Company modified and accelerated the remaining vesting on the unvested Class C units. On January 26, 2021 as part of the Corporate Conversion the 11,150,000 Class C Units were converted into 9,986,025 LLC Interest in Shoals Parent. For the year ended December 31, 2020 the Company recognized $8.3 million in equity-based compensation. At December 31, 2020, the Company had no remaining unrecognized compensation costs related to Class C units. There were no forfeitures during the year ended December 31, 2020. |
Stockholders_ Equity (Deficit)
Stockholders’ Equity (Deficit) | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
Stockholders’ Equity (Deficit) | Stockholders’ Equity (Deficit) Amendment and Restatement of Certificate of Incorporation As discussed in Note 1, on January 26, 2021, the Company’s certificate of incorporation was amended and restated to, among other things, provide for the (i) authorization of 1,000,000,000 shares of Class A common stock with a par value of $0.00001 per share; (ii) authorization of 195,000,000 shares of Class B common stock with a par value of $0.00001 per share; (iii) authorization of 5,000,000 shares of preferred stock that may be issued from time to time by the Company’s Board of Directors in one or more series; and (iv) establishment of a classified board of directors, divided into three classes, the members of which will serve for staggered terms. Holders of Class A common stock and Class B common stock are entitled to one vote per share and, except as otherwise required, will vote together as a single class on all matters on which stockholders generally are entitled to vote. Holders of Class B common stock are not entitled to receive dividends and will not be entitled to receive any distributions upon the liquidation, dissolution or winding up of the Company. Shares of Class B common stock may only be issued to the extent necessary to maintain the one-to-one ratio between the number of LLC Interests held by the Continuing Equity Owners and the number of shares of Class B common stock held by the Continuing Equity Owners. Shares of Class B common stock are transferable only together with an equal number of LLC Interests. Shares of Class B common stock will be canceled on a one-for-one basis if the Company, at the election of a Continuing Equity Owner, redeem or exchange LLC Interests. The Company must, at all times, maintain a one-to-one ratio between the number of shares of Class A common stock issued by the Company and the number of LLC Interests owned by the Company (subject to certain exceptions for treasury shares and shares underlying certain convertible or exchangeable securities). Initial Public Offering As discussed in Note 1, on January 29, 2021, the Company closed an IPO of 11,550,000 shares of the Class A common stock at a public offering price of $25.00 per share. The Company received $278.8 million in proceeds, net of underwriting discounts and commissions, which was used to purchase 6,315,790 LLC Interests from Shoals Parent and 5,234,210 LLC Interests from the founder and Class B unit holder in Shoals Parent at a price per interest equal to the IPO price of the Class A common stock of $25.00 per share. Shoals Parent Recapitalization As noted above, in connection with the IPO, the limited liability company agreement of Shoals Parent was amended and restated to, among other things, (i) provide for a new single class of common membership interests in Shoals Parent, or the LLC Interests; (ii) exchange all of the then existing membership interests of the Continuing Equity Owners for LLC Interests (iii) exchange all the then existing membership interest of the Class A Shoals Equity Owners for LLC Interests and (iv) appoint the Company as the sole managing member of Shoals Parent. The Company has a majority economic interest in, is the sole managing member of, has the sole voting power in, and controls the management of Shoals Parent. The amendment also requires that Shoals Parent, at all times, maintain (i) a one-to-one ratio between the number of shares of Class A common stock issued by the Company and the number of LLC Interests owned by the Company and (ii) a one-to-one ratio between the number of shares of Class B common stock owned by the Continuing Equity Owners and the number of LLC Interests owned by the Continuing Equity Owners. Acquisition of Former Shoals Equity Owners |
Non-Controlling Interests
Non-Controlling Interests | 12 Months Ended |
Dec. 31, 2022 | |
Noncontrolling Interest [Abstract] | |
Non-Controlling Interests | Non-Controlling Interests As of December 31, 2022, the Company owned 81.44% of Shoals Parent. The following table summarizes the effects of the changes in ownership in Shoals Parent on equity: Year Ended December 31, 2022 Period from January 27, 2021 to December 31, 2021 Net income attributable to non-controlling interest $ 15,402 $ 1,596 Transfers to non-controlling interests Decrease as a result of the Organizational Transactions — (88,644) Increase as a result of newly issued LLC Interests in IPO — 70,976 Increase as a result of activity under equity-based compensation plan 5,422 3,618 Decrease from tax distributions to non-controlling interest (7,762) (4,837) Reallocation of non-controlling interest 6,604 7,240 Change from net income attributable to/from non-controlling interest and transfers to non-controlling interest $ 19,666 $ (10,051) Issuance of Additional LLC Interests Under the LLC Agreement, the Company is required to cause Shoals Parent to issue additional LLC Interests to the Company when the Company issues additional shares of Class A common stock. Other than as it relates to the issuance of Class A common stock in connection with an equity incentive program, the Company must contribute to Shoals Parent net proceeds and property, if any, received by the Company with respect to the issuance of such additional shares of Class A common stock. The Company must cause Shoals Parent to issue a number of LLC Interests equal to the number of shares of Class A common stock issued such that, at all times, the number of LLC Interests held by the Company equals the number of outstanding shares of Class A common stock. During the years ended December 31, 2022 and 2021, the Company caused Shoals Parent to issue to the Company a total of 480,116 and 40,665 LLC Interests, respectively, for the vesting of awards granted under the Shoals Technologies Group, Inc. 2021 Long-Term Incentive Plan. Distributions for Taxes As a limited liability company (treated as a partnership for income tax purposes), Shoals Parent does not incur significant federal, state or local income taxes, as these taxes are primarily the obligations of its members. As authorized by the LLC Agreement, Shoals Parent is required to distribute cash, to the extent that Shoals Parent has cash available, on a pro rata basis, to its members to the extent necessary to cover the members’ tax liabilities, if any, with respect to each member’s share of Shoals Parent taxable earnings. Shoals Parent makes such tax distributions to its members quarterly, based on the single highest marginal tax rate applicable to its members applied to projected year-to-date taxable income, with a final accounting once actual taxable income or loss has been determined. During the years ended December 31, 2022 and 2021, tax distributions to non-controlling LLC Interests holders was $7.8 million and $4.8 million, respectively. Other Distributions Pursuant to the LLC Agreement, the Company has the right to determine when distributions will be made to LLC members and the amount of any such distributions. If the Company authorizes a distribution, such distribution will be made to the members of the LLC (including the Company) pro rata in accordance with the percentages of their respective LLC units. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Leases | Leases Effective January 1, 2022, the Company adopted ASC 842 Leases using the modified retrospective approach. The Company elected the use of the package of practical expedients permitted under the transition guidance which allows the Company not to reassess whether a contract contains a lease, carry forward the historical lease classification and not reassess initial direct lease costs. The Company also elected to apply the short-term measurement and recognition exemption in which the right-of-use (“ROU”) assets and lease liabilities are not recognized for short-term leases. Adoption of this standard resulted in recording of net operating lease ROU assets and corresponding operating lease liabilities of $1.2 million and $1.2 million, respectively. The standard did not materially affect the consolidated statements of income and had no impact on the consolidated statements of cash flows. The following table summarizes the balances as it relates to leases at the end of the period (in thousands): (*) December 31, 2022 ROU asset Other assets $ 4,060 Lease liability, current portion Accrued expenses and other $ 1,162 Lease liability, long-term portion Other long-term liabilities 3,256 Total lease liability $ 4,418 (*) Location on the consolidated balance sheet The Company determines if an arrangement is a lease at its inception. Operating lease ROU assets and lease liabilities are recognized at commencement date based on the present value of lease payments over the lease term. Operating lease ROU assets also include any initial direct costs and prepayments less lease incentives. Lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise such options. As the Company’s leases generally do not provide an implicit rate, the Company uses its collateralized incremental borrowing rate based on the information available at the lease commencement date, including lease term, in determining the present value of lease payments. Lease expense for these leases is recognized on a straight-line basis over the lease term. Operating lease arrangements are comprised primarily of real estate and equipment agreements for which the right-of-use assets are included in other assets and the corresponding lease liabilities, depending on their maturity, are included in accrued expenses and other or other long-term liabilities in the consolidated balance sheets. The Company also elected to apply the practical expedient to consider non-lease components as a part of the lease. The Company’s leases contain certain non-lease components for common area maintenance which are variable on a month to month basis and as such recorded as a variable lease expense as incurred. The details of the Company’s operating leases are as follows (in thousands): Year Ended Operating lease expense $ 1,126 Variable lease expense 142 Short-term lease expense 177 Total lease expense $ 1,445 The following table presents the maturities of lease liabilities as of December 31, 2022 (in thousands): For the Year Ended December 31, Operating Leases 2023 $ 1,337 2024 1,261 2025 958 2026 950 2027 325 Total lease payments 4,831 Less: Imputed lease interest (413) Total lease liabilities $ 4,418 The Company’s weighted average remaining lease-term and weighted average discount rate are as follows: Year Ended Weighted average remaining lease-term 3.9 years Weighted average discount rate 4.5 % Supplemental cash flow and other information related to operating leases are as follows (in thousands): Year Ended Operating cash flows from operating leases $ 1,295 Non-cash investing activities: Lease liabilities arising from obtaining right-of-use assets as of January 1, 2022 $ 1,239 Lease liabilities arising from obtaining right-of-use assets during the year ended December 31, 2022 $ 3,990 The following table represents future minimum lease obligations under non-cancelable operating leases accounted for in accordance with ASC 840, as of December 31, 2021 (in thousands): For the Year Ended December 31, Operating Leases 2022 $ 489 2023 499 2024 200 2025 58 2026 6 Total $ 1,252 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Litigation The Company is from time to time subject to legal proceedings and claims, which arise in the normal course of its business. In the opinion of management and legal counsel, the amount of losses that may be sustained, if any, would not have a material effect on the financial position, results of operations or cash flows of the Company. Surety Bonds The Company provides surety bonds to various parties as required for certain transactions initiated during the ordinary course of business to guarantee the Company’s performance in accordance with contractual or legal obligations. As of December 31, 2022, the maximum potential payment obligation with regard to surety bonds was $8.7 million. Employee Benefit Plan The Company has a 401(k) retirement plan for substantially all of its employees based on certain eligibility requirements. Effective January 1, 2021 the Company began making matching contributions to the plan and may also provide discretionary contributions to the plan at the discretion of management. No such discretionary contributions have been made since inception of the plan. For the years ended December 31, 2022 and 2021, the Company made matching contributions totaling $0.3 million and $0.2 million, respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes In August 2022, the U.S. President signed into law the Inflation Reduction Act of 2022 (the “IRA”), which revised U.S. tax law by, among other things, including a new corporate alternative minimum tax (the “CAMT”) of 15% on certain large corporations, imposing a 1% excise tax on stock buybacks, and providing incentives to address climate change, including the introduction of advanced manufacturing production tax credits. The provisions of the IRA are generally effective for tax years beginning after 2022. Given the complexities of the IRA, which is pending technical guidance and regulations from the Internal Revenue Service and U.S. Treasury Department, we will continue to monitor these developments and evaluate the potential future impact to our results of operations. The Company is taxed as a subchapter C corporation and is subject to federal and state income taxes. The Company’s sole material asset is Shoals Parent, which is a limited liability company that is taxed as a partnership for US federal and certain state and local income tax purposes. Shoals Parent’s net taxable income and related tax credits, if any, are passed through to its members and included in the member’s tax returns. Shoals Parent is subject to and reports an entity level tax in various states. The income tax burden on the earnings taxed to the noncontrolling interest holders is not reported by the Company in its consolidated financial statements under U.S. GAAP. As a result, the Company’s effective tax rate differs materially from the statutory rate. Our effective income tax rate for the years ended December 31, 2022 and 2021, was 6% and 2% respectively. The components of income before income taxes are as follows (in thousands): Year Ended December 31, 2022 2021 Domestic $ 152,000 $ 4,030 Foreign — — Income before income taxes $ 152,000 $ 4,030 The components of income tax expense are as follows (in thousands): Year Ended December 31, 2022 2021 Current income taxes: Federal $ — $ — State 554 631 Foreign — — Total current income taxes 554 631 Deferred income taxes: Federal 13,639 397 State (5,233) (1,873) Foreign — — Total deferred income taxes 8,406 (1,476) Other tax expense 27 931 Income tax expense $ 8,987 $ 86 The differences between income taxes expected at the U.S. federal statutory income tax rate and the reported income tax expense are summarized as follows (in thousands): Year Ended December 31, 2022 2021 U.S. federal income taxes at statutory rate $ 31,920 $ 846 State and local income tax net of federal benefit 4,786 (1,380) Permanent tax adjustments 268 342 Pre-IPO income — (562) Non-controlling interest (3,289) (342) Termination of TRA (15,905) 349 Remeasurement of deferred taxes (5,966) (1,939) Research and development credit — (77) Uncertain tax positions 27 789 Change in valuation allowance (1,983) 1,983 Other (871) 77 Income tax expense $ 8,987 $ 86 The income tax burden on the earnings taxed to the noncontrolling interests holders is not reported by the Company in its consolidated financial statements under U.S. GAAP. As a result, the Company’s effective tax rate differs materially from the statutory rate. The primary factors impacting the effective tax rate are the allocation of income taxes to the noncontrolling interest, remeasurement of deferred tax attributes due to tax rate changes, state taxes and changes in our valuation allowance. The components of the deferred tax assets and liabilities are as follows (in thousands): Year Ended December 31, 2022 2021 Investment in Shoals Parent $ 286,759 $ 161,078 Tax receivable agreement — 13,014 Net operating loss 4,626 3,772 Other 249 1,077 Total deferred income taxes 291,634 178,941 Valuation allowance — (1,983) Net deferred tax asset $ 291,634 $ 176,958 The Company has recorded deferred tax assets of $286.8 million, included above in Investment in Shoals Parent, associated with basis differences in the net assets of Shoals Parent and pursuant to making an election under Section 754 of the Internal Revenue Code of 1986, as amended. Prior to termination of the TRA, the aggregate payable pursuant to the TRA represented 85% of the tax benefits that the Company expected to receive in connection with the Section 754 election. As of December 31, 2022, the Company has $20.2 million and $6.4 million federal and state net operating loss carryforwards, respectively. If not utilized, $20.2 million of the federal net operating loss can be carried forward indefinitely. If not utilized, $0.4 million of the state net operating loss can be carried forward indefinitely and $6.0 million will expire between 2036-2042. Quarterly, the Company considers whether it is more-likely-than-not that the deferred tax assets will be realized based on available positive and negative evidence. As of December 31, 2022, we determined, based upon weighing all positive and negative evidence, that a valuation allowance related to state taxes was no longer required. Accordingly, we reversed the valuation allowance related to state taxes. As of December 31, 2021, the valuation allowance of $2.0 million related to state taxes. Uncertain Tax Positions The Company accounts for uncertainty in income taxes using a recognition and measurement threshold for tax positions taken or expected to be taken in a tax return, which are subject to examination by federal and state taxing authorities. The tax benefit from an uncertain tax position is recognized when it is more likely than not that the position will be sustained upon examination by taxing authorities based on the technical merits of the position. The amount of the tax benefit recognized is the largest amount of the benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. The effective tax rate and the tax basis of assets and liabilities reflect management’s estimates of the ultimate outcome of various tax uncertainties. As of December 31, 2022 and 2021, the Company has recorded $1.0 million and $0.9 million, respectively, of gross unrecognized tax benefits inclusive of interest and penalties, all of which, if recognized, would favorably impact the effective tax rate. The Company recognizes penalties and interest related to uncertain tax positions within the provision (benefit) for income taxes line in the accompanying consolidated statements of operations. The following table presents a reconciliation of the total amounts of unrecognized tax benefits, excluding interest and penalties as follows (in thousands): Year Ended December 31, 2022 2021 Beginning Balance $ 604 $ — Gross increases - tax positions in prior period — 604 Gross decreases - tax positions in prior period — — Gross increases - tax positions in current period — — Settlement — — Lapse of statute of limitations — — Ending balance $ 604 $ 604 We do not expect a significant change in our uncertain tax benefits in the next twelve months. The Company files U.S. federal and certain state income tax returns. The income tax returns of the Company are generally subject to examination by U.S. federal and state taxing authorities for years beginning after 2018. |
Payable Pursuant to the Tax Rec
Payable Pursuant to the Tax Receivable Agreement | 12 Months Ended |
Dec. 31, 2022 | |
Tax Receivable Agreement [Abstract] | |
Payable Pursuant to the Tax Receivable Agreement | Payable Pursuant to the Tax Receivable AgreementThe Company had a TRA with the Founder, a “related party,” and a former equity owner of Shoals Investment CTB (the “TRA Owners”) that provided for the payment by the Company to the TRA Owners (or their permitted assignees) of 85% of the amount of the benefits, if any, that the Company actually realized or was deemed to realize as a result of (i) the Company’s allocable share of existing tax basis acquired in connection with the Organizational Transactions (including Blocker’s share of existing tax basis) and increases to such allocable share of existing tax basis, (ii) certain increases in the tax basis of assets of Shoals Parent and its subsidiaries resulting from purchases or exchanges of LLC Interests, and (iii) certain other tax benefits related to the Company entering into the TRA, including those attributable to payments made under the TRA. These contractual payment obligations were obligations of the Company and not of Shoals Parent. The Company’s payable pursuant to the TRA was determined on an undiscounted basis in accordance with ASC 450, Contingencies , since the contractual payment obligations were deemed to be probable and reasonably estimable. For purposes of the TRA, the benefit deemed realized by the Company was computed by comparing the actual income tax liability of the Company (calculated with certain assumptions) to the amount of such taxes that the Company would have been required to pay had there been no increase to the tax basis of the assets of Shoals Parent as a result of the purchases or exchanges, and had the Company not entered into the TRA. When estimating the expected tax rate to use in order to determine the tax benefit expected to be recognized from the Company’s increased tax basis as a result of exchanges of LLC Interests by the TRA Owners, the Company continuously monitored changes in its overall tax posture, including changes resulting from new legislation and changes as a result of new jurisdictions in which the Company was subject to tax. On November 29, 2022, the Company entered into an amendment to the TRA (the “TRA Amendment”), dated as of January 29, 2021, pursuant to which the parties thereto agreed to grant the Company a right to terminate the TRA until December 31, 2022 (the “TRA Termination Right”) in exchange for a termination consideration of $58.0 million, payable in cash. The Company reassessed the liability related to the payable pursuant to the TRA at the TRA Amendment date and concluded it was probable that the expected payments related to the payable pursuant to the TRA had changed. As a result of this change, the Company remeasured the payable pursuant to the TRA to $58.0 million on the TRA Amendment date, resulting in a gain on the termination of the TRA of $110.9 million. As part of the evaluation to determine if the gain should be recognized as income in the consolidated statement of operations or a stockholder contribution the Company concluded the termination of the TRA was negotiated in an arm’s length transaction with the majority owner of the TRA, a third party, and both the third party and the related party received the same value based upon ownership percentage, and therefore, the gain should be recorded in the consolidated statement of operations. The Company exercised its TRA Termination Right, and the TRA was terminated on December 6, 2022. The following table reflects the changes to the Company’s payable pursuant to the TRA (in thousands): Year ended 2022 2021 Beginning balance $ 156,374 $ — Additions to TRA: Exchange of LLC Interests for Class A common stock 7,761 140,293 Merger of Shoals investment CTB — 14,418 Adjustment for change in estimated effective income tax rate 6,675 1,663 Adjustment related to TRA termination (112,810) — Early termination payment of TRA (58,000) — Payable pursuant to TRA $ — $ 156,374 |
Revenue Recognition
Revenue Recognition | 12 Months Ended |
Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Revenue Recognition Disaggregation of revenue Based on Topic 606 provisions, the Company disaggregates its revenue from contracts with customers based on product type. Revenue by product type is disaggregated between system solutions and components. System solutions are contracts under which the Company provides multiple products typically in connection with the design and specification of an entire EBOS system. Components represents sales of individual components. The following table presents the Company’s revenue disaggregated by product type (in thousands): Year Ended December 31, 2022 2021 2020 System solutions $ 254,415 $ 155,818 $ 116,720 Components 72,525 57,394 58,798 Total revenue $ 326,940 $ 213,212 $ 175,518 Contract Balances The timing of revenue recognition, billings and cash collections results in billed accounts receivable, unbilled receivables (contract assets), retainage (contract assets), and deferred revenue (contract liabilities) on the consolidated balance sheet, recorded on a contract-by-contract basis at the end of each reporting period. The Company’s contract balances consist of the following (in thousands): December 31, (*) 2022 2021 Billed accounts receivable Accounts receivable, net $ 48,571 $ 26,669 Retainage Accounts receivable, net $ 2,004 $ 4,830 Unbilled receivables Unbilled receivables $ 16,713 $ 13,533 Deferred revenue Accrued expenses and other $ 23,259 $ 1,841 (*) Location on the consolidated balance sheet The majority of the Company’s contract amounts are billed as work progresses in accordance with agreed-upon contractual terms, which generally coincide with the shipment of one or more phases of the project. Billing sometimes occurs subsequent to revenue recognition, resulting in unbilled receivables. The changes in unbilled receivables relate to fluctuations in the timing of billings for the Company’s revenue recognized over-time. As of December 31, 2020, billed accounts receivable and unbilled receivables were $24.2 million and $3.8 million, respectively. Certain contracts contain retainage provisions. Retainage represents a contract asset for the portion of the contract price earned by the Company for work performed but held for payment by the customer as a form of security until the Company obtains specified milestones. The Company typically bills retainage amounts as work is performed. Retainage provisions are not considered a significant financing component because they are intended to protect the customer in the event that some or all of the obligations under the contract are not completed. The changes in retainage relate to fluctuations in the timing of retainage billings and achievement of specified milestones. As of December 31, 2020, retainage was $2.8 million. |
Related Party Transaction
Related Party Transaction | 12 Months Ended |
Dec. 31, 2022 | |
Related Party Transactions [Abstract] | |
Related Party Transaction | Related Party TransactionOur Founder is a party to the TRA and received approximately 45% of the TRA Termination Consideration. See Note 17 - Payable Pursuant to the Tax Receivable Agreement. As part of the LLC Agreement we are required to pay tax distributions to the non-controlling interest holders, some of which are considered related parties. See Note 13 - Non-Controlling Interests. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent EventsOn February 24, 2023, we entered into a separation agreement with our Chief Executive Officer, memorializing the terms and conditions of his termination for disability for health reasons, effective as of March 15, 2023. As a result of the separation, pursuant to his grant agreements, subject to our Chief Executive Officer’s continued employment in good standing with the Company through March 15, 2023 and certain other conditions, all unvested RSUs will accelerate and immediately vest, and a prorated portion of unvested PSUs will accelerate and immediately vest based on target performance, determined by the number of days of employment with the Company during the three-year performance period that started on January 1, 2022. In connection with the acceleration of the RSUs and PSUs, we estimate that equity-based compensation expense related to the separation will total $4.0 million, which will be recognized during the three months ended March 31, 2023. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Basis of Accounting and Presentation | Basis of Accounting and PresentationThe consolidated financial statements have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. |
Reclassifications | Reclassifications Certain prior period amounts have been reclassified to conform to the current period presentation. |
Non-controlling Interests | Non-controlling Interests The non-controlling interests on the consolidated statement of operations represents the portion of earnings or loss attributable to the economic interests in the Company’s subsidiary, Shoals Parent, held by the Continuing Equity Owners. Non-controlling interests on the consolidated balance sheet represents the portion of net assets of the Company attributable to the Continuing Equity Owners, based on the portion of the LLC Interests owned by such unit holders. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates include revenue recognition, allowance for credit losses, useful lives of property, plant and equipment and other intangible assets, impairment of long-lived assets, allowance for obsolete or slow moving inventory, payable pursuant to the TRA, valuation allowance on deferred tax assets and equity-based compensation expense. |
Cash and Cash Equivalents and Restricted Cash | Cash and Cash Equivalents The Company considers cash and cash equivalents to include cash on hand, cash held in demand deposit accounts, and all highly liquid financial instruments purchased with a maturity of three months or less. Restricted Cash |
Accounts Receivable and Allowance for Credit Losses | Accounts Receivable and Allowance for Credit Losses Accounts receivable is comprised of amounts billed to customers, net of an allowance for credit losses. Interest is not charged on receivables. The allowance for credit losses is estimated by management and is based on historical experience, current conditions and reasonable forecasts. Periodically, management reviews the accounts receivable balances of its customers and adjusts the allowance based on current circumstances |
Unbilled Receivables | Unbilled ReceivablesUnbilled receivables arise when the Company recognizes revenue for amounts which cannot yet be billed under terms of the contract with the customer. |
Inventory | InventoryInventories consist of raw materials. Inventories are stated at the lower of cost or net realizable value. Cost is calculated using the first-in first-out method. Provisions are made to reduce excess or obsolete inventories to their estimated net realizable values. |
Property, Plant, and Equipment | Property, Plant, and Equipment Property, plant, and equipment acquired in the acquisition of Shoals and ConnectPV are recorded at fair value at the date of acquisition; all other property, plant and equipment are recorded at cost, net of accumulated depreciation. Improvements, betterments and replacements which significantly extend the life of an asset are capitalized. Depreciation is computed using the straight-line method over the estimated useful lives of the respective assets. Repair and maintenance costs are expensed as incurred. |
Impairment of Long-Lived Assets | Impairment of Long-Lived AssetsWhen events, circumstances or operating results indicate that the carrying values of long-lived assets might not be recoverable through future operations, the Company prepares projections of the undiscounted future cash flows expected to result from the use of the assets and their eventual disposition. If the projections indicate that the recorded amounts are not expected to be recoverable, such amounts are reduced to estimated fair value. Fair value is estimated based upon internal evaluation of each asset that includes quantitative analyses of net revenue and cash flows, review of recent sales of similar assets and market responses based upon discussions in connection with offers received from potential buyers. |
Goodwill | Goodwill Goodwill is assessed using either a qualitative assessment or quantitative approach to determine whether it is more likely than not that the fair value of the reporting unit is less than the carrying amount. The qualitative assessment evaluates factors including macroeconomic conditions, industry-specific and company-specific considerations, legal and regulatory environments, and historical performance. If the Company determines that is more likely than not that the fair value of a reporting unit is less than its carrying value, a quantitative assessment is performed. Otherwise, no further assessment is required. The quantitative approach compares the estimate fair value of the reporting units to its carrying amount, including goodwill. Impairment is indicated if the estimated fair value of the reporting unit is less than the carrying amount of the reporting unit, and an impairment charge is recognized for the differential. |
Amortizable and Other Intangible Assets | Amortizable and Other Intangible AssetsThe Company amortizes identifiable intangible assets consisting of customer relationships, developed technology, trade names, backlog and noncompete agreements because these assets have finite lives. The Company’s intangible assets with finite lives are amortized on a straight‐line basis over the estimated useful lives. The basis of amortization approximates the pattern in which the assets are utilized over their estimated useful lives. The Company reviews for impairment indicators of finite-lived intangibles, as described in the “Impairment of Long-Lived Assets” significant accounting policy. |
Deferred Offering Costs | Deferred Offering Costs Deferred offering costs consist primarily of registration fees, filing fees, listing fees, specific legal and accounting costs and transfer agent fees, which are direct and incremental fees related to the IPO and follow-on offerings. |
Deferred Financing Costs | Deferred Financing Costs Costs incurred to issue debt are capitalized and recorded net of the related debt and amortized using the effective interest method as a component of interest expense over the terms of the related debt agreement. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue primarily from the sale of EBOS systems and components. The Company determines its revenue recognition through the following steps: (i) identification of the contract or contracts with a customer, (ii) identification of the performance obligations within the contract, (iii) determination of the transaction price, (iv) allocation of the transaction price to the performance obligations within the contract, and (v) recognition of revenue as the performance obligation has been satisfied. The Company’s contracts with customers predominately are accounted for as one performance obligation, as the majority of the obligations under the contracts relate to a single project. For each contract entered into, the Company determines the transaction price based on the consideration expected to be received. The transaction price identified is allocated to each distinct performance obligation to deliver a good or service based on the relative standalone selling prices. Management has concluded that the prices negotiated with each individual customer are representative of the standalone selling price of the product. The Company primarily recognizes revenue over time as a result of the continuous transfer of control of its product to the customer using the output method based on units manufactured. This continuous transfer of control to the customer is supported by clauses in the contracts that provide rights to payment of the transaction price associated with work performed to date on products that do not have an alternative use to the Company. Management believes that recognizing revenue using the output method based on units manufactured best depicts the extent of transfer of control to the customer. In certain instances the promised goods do have an alternative use. In these instances revenue is recognized when the customer obtains control of the product. Contracts of this nature typically include customer acceptance clauses, which results in revenue recognition occurring upon customer acceptance. The manufacturing process generally takes less than one week to complete production. The accounting for each contract involves a judgmental process of estimating total sales, costs, and profit for each performance obligation. Cost of revenue is recognized based on the unit of production. The amount reported as revenue is determined by adding a proportionate amount of the estimated profit to the amount reported as cost of revenue. The Company has elected to adopt certain practical expedients and exemptions as allowed under the new revenue recognition guidance such as (i) recording sales commissions as incurred because the |
Shipping and Handling | Shipping and Handling The Company accounts for shipping and handling related to contracts with customers as costs to fulfill its promise to transfer the associated products. Accordingly, payment by the Company’s customers for shipping and handling costs for delivery of the Company’s products are recorded as a component of revenue in the accompanying consolidated statements of operations. |
Concentrations | ConcentrationsThe Company has cash deposited at certain financial institutions which, at times, may exceed the limits provided by the Federal Deposit Insurance Corporation (“FDIC”). The Company has not experienced any losses on such amount and believes it is not subject to significant credit risk related to cash balances. |
Fair Value | Fair Value Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company follows a fair value hierarchy which requires the Company to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Three levels of inputs may be used to measure fair value, as follows: • Level 1 – Quoted prices in active markets for identical assets or liabilities. • Level 2 – Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. • Level 3 – Unobservable inputs that are supported by little or no market activity that are significant to the fair value of the assets or liabilities. The fair values of the Company’s cash and cash equivalents, accounts receivable, and accounts payable approximate their carrying values due to their short maturities. The carrying value of the Company’s long-term debt approximates fair value, as it is based on current market rates at which the Company could borrow funds with similar terms. The Company follows the provisions of Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 820-10 for nonfinancial assets and liabilities measured at fair value on a nonrecurring basis. As it relates to the Company, this applies to certain nonfinancial assets and liabilities acquired in business combinations. |
Income Taxes | Income Taxes Pre-IPO Income Taxes Shoals Parent was treated as a partnership and was not subject to federal income tax; rather, Shoals Parent’s taxable income was passed through to its members and subject to federal income tax at the member level. Shoals Parent is the sole member of the following subsidiary LLCs, which are treated as disregarded entities for federal income tax purposes: Intermediate, Holdings, and Shoals. The activities of Shoals Parent and its subsidiary LLCs are reported on the federal income tax return of Shoals Parent. Shoals Parent and its subsidiary LLCs are generally not subject to state income tax; however, Shoals Technologies Group, LLC and Shoals Technologies, LLC pay various state and franchise taxes. Post-IPO Income Taxes The Company is taxed as a corporation for U.S. federal and state income tax purposes. The Company’s sole material asset is Shoals Parent, which is a limited liability company that is taxed as a partnership for US federal and certain state and local income tax purposes. Shoals Parent’s net taxable income and related tax credits, if any, are passed through to its members and included in the member’s tax returns. The Company accounts for income taxes using the asset and liability method. Under this method, deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are calculated by applying existing tax laws and the rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in the year of the enacted rate change. In assessing the realizability of deferred tax assets, management considers whether it is more-likely-than-not that the deferred tax assets will be realized. In making such a determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, carryback potential if permitted under the tax law, and results of recent operations. The Company accounts for uncertainty in income taxes using a recognition and measurement threshold for tax positions taken or expected to be taken in a tax return, which are subject to examination by federal and state taxing authorities. The tax benefit from an uncertain tax position is recognized when it is more likely than not that the position will be sustained upon examination by taxing authorities based on the technical merits of the position. The amount of the tax benefit recognized is the largest amount of the benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. The effective tax rate and the tax basis of assets and liabilities reflect management’s estimates of the ultimate outcome of various tax uncertainties. The Company recognizes penalties and interest related to uncertain tax positions within the income tax expense financial statement caption in the accompanying consolidated statements of operations. The Company did not have any material interest and penalties during the years ended December 31, 2022, 2021 and 2020. The Company files U.S. federal and certain state income tax returns. The income tax returns of the Company are subject to examination by U.S. federal and state taxing authorities for various time periods, depending on each jurisdictions’ rules, beginning generally after the income tax returns are filed. |
Product Warranty | Product WarrantyThe Company offers an assurance type warranty for its products against manufacturer defects and does not contain a service element. For these assurance type warranties, a provision for estimated future costs related to warranty expense is recorded when they are probable and reasonably estimable. This provision is based on historical information on the nature, frequency and average cost of claims for each product line. When little or no experience exists for an immature product line, the estimate is based on comparable product lines. Specific reserves are established once an issue is identified with the amounts for such reserves based on the estimated cost of correction. These estimates are re-evaluated on an ongoing basis using best-available information and revisions to estimates are made as necessary. |
Acquisition Accounting | Acquisition Accounting The Company accounts for its business acquisitions under the acquisition method of accounting in ASC 805. The excess of the purchase price over the estimated fair values of the net assets acquired is recorded as goodwill. Determining the fair value of assets acquired and liabilities assumed requires management’s judgment and often involves the use of significant estimates and assumptions, including assumptions with respect to future cash inflows and outflows, discount rates, asset lives, and market multiples amongst other items. |
Equity-Based Compensation | Equity-Based Compensation The Company recognizes equity-based compensation expense based on the equity award’s grant date fair value. The determination of the fair value of equity awards issued to employees of the Company is based upon the closing market price of the Company’s common stock on the day prior to the grant date. Equity-based compensation expense related to performance stock units is recognized if it is probable that the performance condition will be satisfied. The Company accounts for forfeitures as they occur. The grant date fair value of each unit is amortized on a straight-line basis over the requisite service period, including those units with graded vesting. However, the amount of equity-based compensation at any date is at least equal to the portion of the grant date fair value of the award that is vested. |
Earnings per Share (“EPS”) | Earnings per Share (“EPS”) Basic EPS is computed by dividing net income available to common stockholders by the weighted average shares outstanding during the period. Diluted EPS takes into account the potential dilution that could occur if securities or other contracts to issue shares, such as unvested restricted stock units, were exercised and converted into shares. Diluted EPS is computed by dividing net income available to common stockholders by the weighted average shares outstanding during the period, increased by the number of additional shares that would have been outstanding if the potential shares had been issued and were dilutive. |
Segment Reporting | Segment Reporting ASC 280 (“Segment Reporting”) establishes standards for reporting information about operating segments. Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to |
Advertising Expenses | Advertising ExpensesAdvertising expenses are expensed as incurred. |
Research and Development Expenses | Research and Development ExpensesResearch and development expenses are expensed as incurred. |
New Accounting Standards | New Accounting Standards Adopted On January 1, 2022, the Company adopted Accounting Standards Update (“ASU”) No. 2016-02 (Topic 842) “Leases” which supersedes the lease recognition requirements in Accounting Standards Codification (“ASC”) Topic 840, “Leases” . Under ASU No. 2016-02, lessees are required to recognize assets and liabilities on the consolidated balance sheets for most leases and provide enhanced disclosures. For companies that are not emerging growth companies (“EGCs”), the ASU was effective for fiscal years beginning after December 15, 2018. For EGCs, the ASU is effective for fiscal years beginning after December 15, 2021. The Company adopted the new standard using the modified retrospective method by recording a right-of-use asset of $1.2 million, short-term portion of lease liabilities of $0.4 million and long-term portion of lease liabilities of $0.8 million as of the effective date. Prior periods will not be restated and will continue to be reported under Topic 840 guidance in effect during those periods. The Company applied the package of practical expedients to leases that commenced before the effective date whereby the Company elected to not reassess the following: (i) whether any expired or existing contracts contain leases; (ii) the lease classification for any expired or existing leases; and (iii) initial direct costs for any existing leases. The adoption did not have a material impact on its consolidated statements of operations or its consolidated statements of cash flows. See Note 14 - Leases for further information and disclosures related to the adoption of this standard. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses , which was subsequently amended by ASU No. 2018-19 and ASU No. 2019-10, and which requires the measurement of expected credit losses for financial instruments carried at amortized cost held at the reporting date based on historical experience, current conditions and reasonable forecasts. The updated guidance also amends the current other-than-temporary impairment model for available-for-sale debt securities by requiring the recognition of impairments relating to credit losses through an allowance account and limits the amount of credit loss to the difference between a security’s amortized cost basis and its fair value. In addition, the length of time a security has been in an unrealized loss position will no longer impact the determination of whether a credit loss exists. The main objective of this ASU is to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. The standard was adopted on December 31, 2022 as the Company lost its status as an Emerging Growth Company effective December 31, 2022 and therefore was required to adopt the standard for the year ending December 31, 2022. As the Company’s credit losses are typically minimal, the adoption of this standard did not have a significant impact on the consolidated financial statements. Not Yet Adopted In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805) Accounting for Contract Assets and Contract Liabilities from Contracts with Customers . This ASU requires that contract assets and contract liabilities acquired in a business combination be recognized and measured in accordance with Topic 606. At the acquisition date, an acquirer should account for the related revenue contracts in accordance with Topic 606 as if it had originated the contracts. This guidance is effective for fiscal years beginning after December 15, 2022, including interim periods within that fiscal year. Early adoption of the amendments is permitted, including adoption in an interim period. An entity that early adopts in an interim period should apply the amendments (1) retrospectively to all business combinations for which the acquisition date occurs on or after the beginning of the fiscal year that includes the interim period of early application and (2) prospectively to all business combinations that occur on or after the date of initial application. We are currently evaluating the impact of the new standard on our financial statements and related disclosures. Management does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Schedule of Cash and Cash Equivalents | A reconciliation of cash, cash equivalents and restricted cash to the consolidated statement of cash flows is as follows (in thousands): As of December 31, 2022 2021 2020 Cash and cash equivalents $ 8,766 $ 5,006 $ 10,073 Restricted cash included in other current asset — — — Restricted cash included in other assets — 4,551 — Total cash, cash equivalents and restricted cash $ 8,766 $ 9,557 $ 10,073 |
Schedule of Restricted Cash | A reconciliation of cash, cash equivalents and restricted cash to the consolidated statement of cash flows is as follows (in thousands): As of December 31, 2022 2021 2020 Cash and cash equivalents $ 8,766 $ 5,006 $ 10,073 Restricted cash included in other current asset — — — Restricted cash included in other assets — 4,551 — Total cash, cash equivalents and restricted cash $ 8,766 $ 9,557 $ 10,073 |
Schedule of Revenue and Accounts Receivable Concentration Risks | The Company had the following revenue concentrations representing 10% or more of revenue for any period in the years ended December 31, 2022, 2021 and 2020 and related accounts receivable concentrations as of December 31, 2022 and 2021: 2022 2021 2020 Revenue % Accounts Revenue % Accounts Revenue % Customer A 6.3 % 5.1 % 11.3 % 4.6 % 21.8 % Customer B 7.0 % 8.4 % 18.3 % 15.8 % 18.4 % Customer C 6.0 % 12.6 % 10.0 % 23.7 % 9.4 % |
Acquisition of ConnectPV (Table
Acquisition of ConnectPV (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The estimated fair value allocated to certain property, plant and equipment, identifiable intangible assets and goodwill was determined based on a combination of market, cost and income approaches with the assistance of a third-party valuation firm (in thousands): Purchase Price Allocation Cash and cash equivalents $ 849 Accounts receivable 5,382 Inventory 4,273 Other current assets 1,583 Total current assets 12,087 Property, plant and equipment 438 Goodwill 19,765 Other intangible assets 1,600 Total Assets 33,890 Accounts payable 9,440 Accrued expenses 2,655 Debt 1,537 Total Liabilities 13,632 Net assets acquired $ 20,258 |
Schedule of Pro Forma Financial Information | The pro forma information below gives effect to the ConnectPV acquisition as if it had been completed on the first day of each period presented. The pro forma results of operations are presented for informational purposes only. As such, they are not necessarily indicative of the Company’s results had the acquisition been completed on the first day of each period presented, nor do they intend to represent the Company’s future results. The pro forma information does not reflect any cost savings from operating efficiencies or synergies that could result from the acquisition and does not reflect additional revenue opportunities following the acquisition. The pro forma information includes adjustments to record the assets and liabilities associated with the acquisition at their respective fair values, based on available information and to give effect to the financing for the acquisition (in thousands): Year Ended 2021 2020 Revenue $ 229,709 $ 200,892 Net income $ 3,305 $ 29,861 |
Accounts Receivable (Tables)
Accounts Receivable (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Receivables [Abstract] | |
Schedule of Accounts Receivable, Net | Accounts receivable, net consists of the following (in thousands): December 31, 2022 2021 Accounts receivable $ 51,061 $ 32,015 Less: allowance for credit losses (486) (516) Accounts receivable, net $ 50,575 $ 31,499 |
Inventory (Tables)
Inventory (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory, Net | Inventory, net consists of the following (in thousands): December 31, 2022 2021 Raw materials $ 75,778 $ 39,265 Allowance for obsolete or slow-moving inventory (2,924) (897) Inventory, net $ 72,854 $ 38,368 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Plant, and Equipment, Net | Property, plant, and equipment, net consists of the following (in thousands): Estimated Useful Lives (Years) December 31, 2022 2021 Land N/A $ 840 $ 840 Building and land improvements 5-40 9,031 7,801 Machinery and equipment 3-5 12,371 10,693 Furniture and fixtures 3-7 1,787 1,775 Vehicles 5 125 65 24,154 21,174 Less: accumulated depreciation (7,284) (5,600) Property, plant and equipment, net $ 16,870 $ 15,574 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Carrying Amount of Goodwill | Changes in the carrying amount of goodwill during the years ended December 31, 2022 and 2021 are shown below (in thousands): Goodwill Balance at December 31, 2020 $ 50,176 Acquisition of ConnectPV 19,260 Balance at December 31, 2021 69,436 Adjustments related to finalization of working capital in the acquisition of ConnectPV 505 Balance at December 31, 2022 $ 69,941 |
Schedule of Other Intangible Assets, Net | Other intangible assets, net consisted of the following (in thousands): Estimated Useful Lives (Years) December 31, 2022 2021 Amortizable: Costs: Customer relationships 13 $ 53,100 $ 53,100 Developed technology 13 34,600 34,600 Trade names 13 11,900 11,900 Backlog 1 600 600 Noncompete agreements 5 2,000 2,000 Total amortizable intangibles 102,200 102,200 Accumulated amortization: Customer relationships 22,925 18,629 Developed technology 14,860 12,199 Trade names 5,230 4,103 Backlog 600 200 Noncompete agreements 2,000 1,833 Total accumulated amortization 45,615 36,964 Total other intangible assets, net $ 56,585 $ 65,236 |
Schedule of Estimated Future Annual Amortization Expense of Intangible Assets | Estimated future annual amortization expense for other intangible assets, net are as follows (in thousands): For the Year Ended December 31, Amortization Expense 2023 $ 7,918 2024 7,585 2025 7,585 2026 7,585 2027 7,585 Thereafter 18,327 $ 56,585 |
Accrued Expenses and Other (Tab
Accrued Expenses and Other (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Expenses and Other Consists | Accrued expenses and other consists of the following (in thousands): December 31, 2022 2021 Accrued compensation $ 4,917 $ 2,882 Accrued interest 7,226 3,095 Other accrued expenses 5,739 1,751 Total accrued expenses and other $ 17,882 $ 7,728 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt | Long-term debt consists of the following (in thousands): December 31, 2022 2021 Term Loan Facility $ 195,250 $ 197,250 Revolving Credit Facility 48,000 55,140 Less: deferred financing costs (4,187) (5,337) Total debt, net of deferred financing costs 239,063 247,053 Less: current portion (2,000) (2,000) Long-term debt, net current portion $ 237,063 $ 245,053 |
Schedule of Maturities of Long-term Debt | The aggregate amounts of principal maturities on the Company’s long-term debt is as follows (in thousands): For the Year Ended December 31, 2023 $ 2,000 2024 2,000 2025 2,000 2026 237,250 $ 243,250 |
Earnings per Share ("EPS") (Tab
Earnings per Share ("EPS") (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Earnings Per Share | Basic and diluted EPS of Class A common stock have been computed as follows (in thousands, except per share amounts): Year Ended December 31, 2022 Period from January 27, 2021 to December 31, 2021 Numerator: Net income (loss) attributable to Shoals Technologies Group, Inc. - basic $ 127,611 $ (327) Reallocation of net income attributable to non-controlling interests from the assumed exchange of Class B common stock 15,402 — Net income (loss) attributable to Shoals Technologies Group, Inc. - diluted $ 143,013 $ (327) Denominator: Weighted average shares of Class A common stock outstanding - basic 114,495 99,269 Effect of dilutive securities: Restricted / performance stock units 308 — Class B common stock 52,828 — Weighted average shares of Class A common stock outstanding - diluted 167,631 99,269 Earnings (loss) per share of Class A common stock - basic $ 1.11 $ ( 0.00 ) Earnings (loss) per share of Class A common stock - diluted $ 0.85 $ ( 0.00 ) |
Equity-Based Compensation (Tabl
Equity-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Restricted Stock Unit Activity | Activity under the 2021 Incentive Plan for RSUs was as follows: Restricted Weighted Average Price Outstanding, December 31, 2020 — $ — Granted 1,701,306 $ 27.61 Forfeited (23,738) $ 29.46 Vested (44,724) $ 28.60 Outstanding, December 31, 2021 1,632,844 $ 27.55 Granted 727,001 $ 13.78 Forfeited (63,534) $ 25.56 Vested (559,336) $ 26.05 Outstanding, December 31, 2022 1,736,975 $ 22.34 |
Schedule of Performance Stock Unit Activity | Activity under the 2021 Incentive Plan for PSUs was as follows: Performance Weighted Average Price Outstanding, December 31, 2021 — $ — Granted 256,305 $ 11.89 Vested — $ — Forfeited — $ — Outstanding, December 31, 2022 256,305 $ 11.89 |
Non-Controlling Interests (Tabl
Non-Controlling Interests (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Noncontrolling Interest [Abstract] | |
Schedule of Effects of Changes in Ownership | The following table summarizes the effects of the changes in ownership in Shoals Parent on equity: Year Ended December 31, 2022 Period from January 27, 2021 to December 31, 2021 Net income attributable to non-controlling interest $ 15,402 $ 1,596 Transfers to non-controlling interests Decrease as a result of the Organizational Transactions — (88,644) Increase as a result of newly issued LLC Interests in IPO — 70,976 Increase as a result of activity under equity-based compensation plan 5,422 3,618 Decrease from tax distributions to non-controlling interest (7,762) (4,837) Reallocation of non-controlling interest 6,604 7,240 Change from net income attributable to/from non-controlling interest and transfers to non-controlling interest $ 19,666 $ (10,051) |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Schedule of Lease Assets and Liabilities | The following table summarizes the balances as it relates to leases at the end of the period (in thousands): (*) December 31, 2022 ROU asset Other assets $ 4,060 Lease liability, current portion Accrued expenses and other $ 1,162 Lease liability, long-term portion Other long-term liabilities 3,256 Total lease liability $ 4,418 (*) Location on the consolidated balance sheet |
Schedule of Lease Expense | The details of the Company’s operating leases are as follows (in thousands): Year Ended Operating lease expense $ 1,126 Variable lease expense 142 Short-term lease expense 177 Total lease expense $ 1,445 The Company’s weighted average remaining lease-term and weighted average discount rate are as follows: Year Ended Weighted average remaining lease-term 3.9 years Weighted average discount rate 4.5 % Supplemental cash flow and other information related to operating leases are as follows (in thousands): Year Ended Operating cash flows from operating leases $ 1,295 Non-cash investing activities: Lease liabilities arising from obtaining right-of-use assets as of January 1, 2022 $ 1,239 Lease liabilities arising from obtaining right-of-use assets during the year ended December 31, 2022 $ 3,990 |
Schedule of Future Minimum Rental Payments for Operating Leases | The following table presents the maturities of lease liabilities as of December 31, 2022 (in thousands): For the Year Ended December 31, Operating Leases 2023 $ 1,337 2024 1,261 2025 958 2026 950 2027 325 Total lease payments 4,831 Less: Imputed lease interest (413) Total lease liabilities $ 4,418 The following table represents future minimum lease obligations under non-cancelable operating leases accounted for in accordance with ASC 840, as of December 31, 2021 (in thousands): For the Year Ended December 31, Operating Leases 2022 $ 489 2023 499 2024 200 2025 58 2026 6 Total $ 1,252 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Before Income Taxes | The components of income before income taxes are as follows (in thousands): Year Ended December 31, 2022 2021 Domestic $ 152,000 $ 4,030 Foreign — — Income before income taxes $ 152,000 $ 4,030 |
Schedule of Components of Income Tax Expense | The components of income tax expense are as follows (in thousands): Year Ended December 31, 2022 2021 Current income taxes: Federal $ — $ — State 554 631 Foreign — — Total current income taxes 554 631 Deferred income taxes: Federal 13,639 397 State (5,233) (1,873) Foreign — — Total deferred income taxes 8,406 (1,476) Other tax expense 27 931 Income tax expense $ 8,987 $ 86 |
Schedule of U.S Federal Statutory Income Tax Rate and the Reported Income Tax (Benefit) Expense | The differences between income taxes expected at the U.S. federal statutory income tax rate and the reported income tax expense are summarized as follows (in thousands): Year Ended December 31, 2022 2021 U.S. federal income taxes at statutory rate $ 31,920 $ 846 State and local income tax net of federal benefit 4,786 (1,380) Permanent tax adjustments 268 342 Pre-IPO income — (562) Non-controlling interest (3,289) (342) Termination of TRA (15,905) 349 Remeasurement of deferred taxes (5,966) (1,939) Research and development credit — (77) Uncertain tax positions 27 789 Change in valuation allowance (1,983) 1,983 Other (871) 77 Income tax expense $ 8,987 $ 86 |
Schedule of Deferred Tax Assets and Liabilities | The components of the deferred tax assets and liabilities are as follows (in thousands): Year Ended December 31, 2022 2021 Investment in Shoals Parent $ 286,759 $ 161,078 Tax receivable agreement — 13,014 Net operating loss 4,626 3,772 Other 249 1,077 Total deferred income taxes 291,634 178,941 Valuation allowance — (1,983) Net deferred tax asset $ 291,634 $ 176,958 |
Schedule of Unrecognized Tax Benefits Reconciliation | The following table presents a reconciliation of the total amounts of unrecognized tax benefits, excluding interest and penalties as follows (in thousands): Year Ended December 31, 2022 2021 Beginning Balance $ 604 $ — Gross increases - tax positions in prior period — 604 Gross decreases - tax positions in prior period — — Gross increases - tax positions in current period — — Settlement — — Lapse of statute of limitations — — Ending balance $ 604 $ 604 |
Payable Pursuant to the Tax R_2
Payable Pursuant to the Tax Receivable Agreement - (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Tax Receivable Agreement [Abstract] | |
Schedule of Tax Receivable Agreement | The following table reflects the changes to the Company’s payable pursuant to the TRA (in thousands): Year ended 2022 2021 Beginning balance $ 156,374 $ — Additions to TRA: Exchange of LLC Interests for Class A common stock 7,761 140,293 Merger of Shoals investment CTB — 14,418 Adjustment for change in estimated effective income tax rate 6,675 1,663 Adjustment related to TRA termination (112,810) — Early termination payment of TRA (58,000) — Payable pursuant to TRA $ — $ 156,374 |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Revenue Disaggregated by Product Type and Timing of Revenue Recognition | The following table presents the Company’s revenue disaggregated by product type (in thousands): Year Ended December 31, 2022 2021 2020 System solutions $ 254,415 $ 155,818 $ 116,720 Components 72,525 57,394 58,798 Total revenue $ 326,940 $ 213,212 $ 175,518 |
Schedule of Contract Balances | The Company’s contract balances consist of the following (in thousands): December 31, (*) 2022 2021 Billed accounts receivable Accounts receivable, net $ 48,571 $ 26,669 Retainage Accounts receivable, net $ 2,004 $ 4,830 Unbilled receivables Unbilled receivables $ 16,713 $ 13,533 Deferred revenue Accrued expenses and other $ 23,259 $ 1,841 (*) Location on the consolidated balance sheet |
Organization and Business (Deta
Organization and Business (Details) $ / shares in Units, $ in Thousands | 12 Months Ended | |||||||
Dec. 06, 2022 USD ($) shares | Jul. 16, 2021 shares | Jan. 29, 2021 USD ($) $ / shares shares | Jan. 26, 2021 shares | Dec. 31, 2022 USD ($) subsidiary shares | Dec. 31, 2021 USD ($) shares | Dec. 31, 2020 USD ($) | Aug. 26, 2021 | |
Class of Stock [Line Items] | ||||||||
Number of subsidiaries | subsidiary | 4 | |||||||
Underwriting discounts and commission payments | $ | $ 1,463 | $ 9,704 | $ 3,738 | |||||
Early termination payment of tax receivable agreement | $ | $ 58,000 | $ 58,000 | $ 0 | $ 0 | ||||
ConnectPV | ||||||||
Class of Stock [Line Items] | ||||||||
Voting interests acquired (as a percent) | 100% | |||||||
Shoals Parent | ||||||||
Class of Stock [Line Items] | ||||||||
Interests purchased in subsidiaries (in shares) | 6,315,790 | 480,116 | 40,665 | |||||
Founder and Class B Unit Holder in Shoals Parent | ||||||||
Class of Stock [Line Items] | ||||||||
Interests purchased in subsidiaries (in shares) | 5,234,210 | |||||||
IPO | ||||||||
Class of Stock [Line Items] | ||||||||
Consideration received from stock issued in IPO | $ | $ 278,800 | |||||||
Underwriting discounts and commission payments | $ | $ 9,900 | |||||||
Class A Common Stock | ||||||||
Class of Stock [Line Items] | ||||||||
Stock issued in conversion per share (in shares) | 1 | |||||||
Effect of organizational transactions (in shares) | 81,977,751 | 81,977,751 | ||||||
Class A Common Stock | IPO | ||||||||
Class of Stock [Line Items] | ||||||||
Stock issued in IPO (in shares) | 11,550,000 | |||||||
Price per share of stock issued in IPO (in USD per share) | $ / shares | $ 25 | |||||||
Class A Common Stock | Stock Offering By Selling Shareholders | ||||||||
Class of Stock [Line Items] | ||||||||
Stock issued in IPO (in shares) | 27,900,000 | 4,989,692 | ||||||
Class A Common Stock | Stock Offering | ||||||||
Class of Stock [Line Items] | ||||||||
Stock issued in IPO (in shares) | 2,000,000 | 10,402,086 | ||||||
Class B Common Stock | ||||||||
Class of Stock [Line Items] | ||||||||
Stock issued in conversion (in shares) | 78,300,817 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Narrative (Details) | 12 Months Ended | ||||
Dec. 31, 2022 USD ($) segment | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | Jan. 01, 2022 USD ($) | Jan. 01, 2021 USD ($) | |
Condensed Income Statements, Captions [Line Items] | |||||
Restricted cash and cash equivalents | $ 4,600,000 | ||||
Impairment of long-lived assets | $ 0 | 0 | $ 0 | ||
Goodwill impairment | 0 | 0 | 0 | ||
Cost of revenue | 195,629,000 | 130,567,000 | 108,972,000 | ||
Bank balances in excess of FDIC insurance limits | 8,300,000 | ||||
Standard product warranty accrual | $ 600,000 | 100,000 | |||
Number of operating segments | segment | 1 | ||||
Number of reportable segments | segment | 1 | ||||
ROU asset | $ 4,060,000 | ||||
Operating lease, liability, current | 1,162,000 | ||||
Lease liability, long-term portion | 3,256,000 | ||||
Accounting Standards Update 2016-02 | |||||
Condensed Income Statements, Captions [Line Items] | |||||
ROU asset | $ 1,200,000 | $ 1,200,000 | |||
Operating lease, liability, current | 400,000 | ||||
Lease liability, long-term portion | $ 800,000 | ||||
Shipping and Handling | |||||
Condensed Income Statements, Captions [Line Items] | |||||
Cost of revenue | $ 7,000,000 | $ 5,200,000 | $ 4,900,000 | ||
Shoals Parent | |||||
Condensed Income Statements, Captions [Line Items] | |||||
Non-controlling ownership interest (as a percent) | 18.56% |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies Cash Cash Equivalents And Restricted Cash (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Accounting Policies [Abstract] | ||||
Cash and cash equivalents | $ 8,766 | $ 5,006 | $ 10,073 | |
Restricted cash included in other current asset | 0 | 0 | 0 | |
Restricted cash included in other assets | 0 | 4,551 | 0 | |
Total cash, cash equivalents and restricted cash | $ 8,766 | $ 9,557 | $ 10,073 | $ 7,082 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Revenue and Accounts Receivable Concentrations (Details) - Customer Concentration Risk | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Revenue % | Customer A | |||
Concentration Risk [Line Items] | |||
Concentration risk (as a percent) | 6.30% | 11.30% | 21.80% |
Revenue % | Customer B | |||
Concentration Risk [Line Items] | |||
Concentration risk (as a percent) | 7% | 18.30% | 18.40% |
Revenue % | Customer C | |||
Concentration Risk [Line Items] | |||
Concentration risk (as a percent) | 6% | 10% | 9.40% |
Accounts Receivable % | Customer A | |||
Concentration Risk [Line Items] | |||
Concentration risk (as a percent) | 5.10% | 4.60% | |
Accounts Receivable % | Customer B | |||
Concentration Risk [Line Items] | |||
Concentration risk (as a percent) | 8.40% | 15.80% | |
Accounts Receivable % | Customer C | |||
Concentration Risk [Line Items] | |||
Concentration risk (as a percent) | 12.60% | 23.70% |
Acquisition of ConnectPV - Narr
Acquisition of ConnectPV - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Aug. 26, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Business Acquisition, Equity Interests Issued or Issuable [Line Items] | ||||
Aggregate purchase price, net of cash acquired | $ 0 | $ 12,909 | $ 0 | |
Goodwill acquired during period | $ 19,260 | |||
ConnectPV | ||||
Business Acquisition, Equity Interests Issued or Issuable [Line Items] | ||||
Voting interests acquired (as a percent) | 100% | |||
Aggregate purchase price, net of cash acquired | $ 13,800 | |||
Cash acquired from acquisition | $ 800 | |||
Equity interest issued or issuable (in shares) | 209,437 | |||
Value of equity interest issued or issuable | $ 6,500 | |||
Goodwill acquired during period | 19,800 | |||
Acquisition-related costs | $ 2,300 |
Acquisition of ConnectPV - Prel
Acquisition of ConnectPV - Preliminary Purchase Price Allocation (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Aug. 26, 2021 | Dec. 31, 2020 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 69,941 | $ 69,436 | $ 50,176 | |
ConnectPV | ||||
Business Acquisition [Line Items] | ||||
Cash and cash equivalents | $ 849 | |||
Accounts receivable | 5,382 | |||
Inventory | 4,273 | |||
Other current assets | 1,583 | |||
Total current assets | 12,087 | |||
Property, plant and equipment | 438 | |||
Goodwill | 19,765 | |||
Other intangible assets | 1,600 | |||
Total Assets | 33,890 | |||
Accounts payable | 9,440 | |||
Accrued expenses | 2,655 | |||
Debt | 1,537 | |||
Total Liabilities | 13,632 | |||
Net assets acquired | $ 20,258 |
Acquisition of ConnectPV - Pro
Acquisition of ConnectPV - Pro Forma Financial Information (Details) - ConnectPV - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Business Acquisition [Line Items] | |||
Revenue | $ 229,709 | $ 200,892 | |
Net income | $ 3,305 | $ 29,861 |
Accounts Receivable (Details)
Accounts Receivable (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Receivables [Abstract] | ||
Accounts receivable | $ 51,061 | $ 32,015 |
Less: allowance for credit losses | (486) | (516) |
Accounts receivable, net | $ 50,575 | $ 31,499 |
Inventory (Details)
Inventory (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 75,778 | $ 39,265 |
Allowance for obsolete or slow-moving inventory | (2,924) | (897) |
Inventory, net | $ 72,854 | $ 38,368 |
Property, Plant and Equipment -
Property, Plant and Equipment - Schedule of Property, Plant, and Equipment, Net (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 24,154 | $ 21,174 |
Less: accumulated depreciation | (7,284) | (5,600) |
Property, plant and equipment, net | 16,870 | 15,574 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 840 | 840 |
Building and land improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 9,031 | 7,801 |
Building and land improvements | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives (Years) | 5 years | |
Building and land improvements | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives (Years) | 40 years | |
Machinery and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 12,371 | 10,693 |
Machinery and equipment | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives (Years) | 3 years | |
Machinery and equipment | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives (Years) | 5 years | |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 1,787 | 1,775 |
Furniture and fixtures | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives (Years) | 3 years | |
Furniture and fixtures | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives (Years) | 7 years | |
Vehicles | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives (Years) | 5 years | |
Property, plant and equipment, gross | $ 125 | $ 65 |
Property, Plant and Equipment_2
Property, Plant and Equipment - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation expense | $ 1.9 | $ 1.7 | $ 1.4 |
Depreciation expense allocated to cost of revenue | 1.5 | 1.5 | 1.1 |
Depreciation expense allocated to operating expenses | $ 0.4 | $ 0.2 | $ 0.3 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Goodwill | $ 69,941 | $ 69,436 | $ 50,176 |
Amortization expense of intangible assets | $ 8,700 | $ 8,400 | $ 8,000 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets - Carrying Amount of Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Goodwill [Roll Forward] | ||
Goodwill, beginning balance | $ 69,436 | $ 50,176 |
Acquisition of ConnectPV | 19,260 | |
Adjustments related to finalization of working capital in the acquisition of ConnectPV | 505 | |
Goodwill, ending balance | $ 69,941 | $ 69,436 |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets - Other Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Finite-Lived Intangible Assets [Line Items] | ||
Total amortizable intangibles | $ 102,200 | $ 102,200 |
Total accumulated amortization | 45,615 | 36,964 |
Total other intangible assets, net | $ 56,585 | 65,236 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated Useful Lives (Years) | 13 years | |
Total amortizable intangibles | $ 53,100 | 53,100 |
Total accumulated amortization | $ 22,925 | 18,629 |
Developed technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated Useful Lives (Years) | 13 years | |
Total amortizable intangibles | $ 34,600 | 34,600 |
Total accumulated amortization | $ 14,860 | 12,199 |
Trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated Useful Lives (Years) | 13 years | |
Total amortizable intangibles | $ 11,900 | 11,900 |
Total accumulated amortization | $ 5,230 | 4,103 |
Backlog | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated Useful Lives (Years) | 1 year | |
Total amortizable intangibles | $ 600 | 600 |
Total accumulated amortization | $ 600 | 200 |
Noncompete agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated Useful Lives (Years) | 5 years | |
Total amortizable intangibles | $ 2,000 | 2,000 |
Total accumulated amortization | $ 2,000 | $ 1,833 |
Goodwill and Other Intangible_6
Goodwill and Other Intangible Assets - Estimated Future Annual Amortization Expense (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2023 | $ 7,918 | |
2024 | 7,585 | |
2025 | 7,585 | |
2026 | 7,585 | |
2027 | 7,585 | |
Thereafter | 18,327 | |
Total other intangible assets, net | $ 56,585 | $ 65,236 |
Accrued Expenses and Other (Det
Accrued Expenses and Other (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Payables and Accruals [Abstract] | ||
Accrued compensation | $ 4,917 | $ 2,882 |
Accrued interest | 7,226 | 3,095 |
Other accrued expenses | 5,739 | 1,751 |
Accrued expenses and other | $ 17,882 | $ 7,728 |
Long-Term Debt - Schedule of Lo
Long-Term Debt - Schedule of Long-term Debt (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 243,250 | |
Less: deferred financing costs | (4,187) | $ (5,337) |
Total debt, net of deferred financing costs | 239,063 | 247,053 |
Less: current portion | (2,000) | (2,000) |
Long-term debt, net current portion | 237,063 | 245,053 |
Senior Secured Credit Agreement | Line of Credit | Secured Debt | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | 195,250 | 197,250 |
Senior Secured Credit Agreement | Line of Credit | Revolving Credit Facility | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 48,000 | $ 55,140 |
Long-Term Debt - Schedule of Ma
Long-Term Debt - Schedule of Maturities of Long-term Debt (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Debt Disclosure [Abstract] | |
2023 | $ 2,000 |
2024 | 2,000 |
2025 | 2,000 |
2026 | 237,250 |
Total debt, net of deferred financing costs | $ 243,250 |
Long-Term Debt - Narrative (Det
Long-Term Debt - Narrative (Details) | 1 Months Ended | 12 Months Ended | ||||||||
Feb. 28, 2021 USD ($) | Feb. 27, 2021 USD ($) | Jan. 29, 2021 USD ($) | Nov. 25, 2020 USD ($) | Dec. 31, 2020 USD ($) amendment | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | May 02, 2022 USD ($) | May 01, 2022 USD ($) | |
Debt Instrument [Line Items] | ||||||||||
Loss on debt repayment | $ 0 | $ 15,990,000 | $ 0 | |||||||
Revolving Credit Facility | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Repayments of lines of credit | $ 53,140,000 | 14,000,000 | $ 0 | |||||||
Senior Secured Credit Agreement | Line of Credit | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Number of amendments to debt agreement | amendment | 2 | |||||||||
Senior Secured Credit Agreement | Line of Credit | Base Rate | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Effective interest rate of debt instrument (as a percent) | 5% | |||||||||
Maximum aggregate outstanding principal amount | $ 200,000,000 | |||||||||
Basis spread on variable rate (as a percent) | 2.25% | |||||||||
Minimum principal repayment | $ 70,000,000 | |||||||||
Basis spread on variable rate after minimum principal repayment (as a percent) | 4.75% | |||||||||
Senior Secured Credit Agreement | Line of Credit | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Effective interest rate of debt instrument (as a percent) | 6% | |||||||||
Maximum aggregate outstanding principal amount | $ 200,000,000 | |||||||||
Basis spread on variable rate (as a percent) | 3.25% | |||||||||
Minimum principal repayment | $ 70,000,000 | |||||||||
Basis spread on variable rate after minimum principal repayment (as a percent) | 5.75% | |||||||||
Senior Secured Credit Agreement | Secured Debt | Line of Credit | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Face amount of debt instrument | $ 350,000,000 | |||||||||
Term of debt instrument | 6 years | |||||||||
Repayments of lines of credit | $ 150,000,000 | |||||||||
Loss on debt repayment | 16,000,000 | |||||||||
Prepayment premium | 11,300,000 | |||||||||
Write-off of deferred financing costs | $ 4,700,000 | |||||||||
Stated interest rate (as a percent) | 7.51% | |||||||||
Maximum principal prepayment amount for premium payment | $ 175,000,000 | $ 150,000,000 | ||||||||
Multiplier rate of principal amount prepaid (as a percent) | 1% | 7.50% | ||||||||
Amortization rate of original principal amount per annum (as a percent) | 1% | |||||||||
Senior Secured Credit Agreement | Secured Debt | Line of Credit | After First Anniversary, Prior to Second Anniversary | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Prepayment premium as a proportion of principal amount (as a percent) | 2% | |||||||||
Senior Secured Credit Agreement | Secured Debt | Line of Credit | After First Anniversary, Prior to Second Anniversary | IPO | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Prepayment premium as a proportion of principal amount (as a percent) | 2% | |||||||||
Senior Secured Credit Agreement | Secured Debt | Line of Credit | After Second Anniversary, Prior to Third Anniversary | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Prepayment premium as a proportion of principal amount (as a percent) | 1% | |||||||||
Senior Secured Credit Agreement | Secured Debt | Line of Credit | After Second Anniversary, Prior to Third Anniversary | IPO | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Prepayment premium as a proportion of principal amount (as a percent) | 1% | |||||||||
Senior Secured Credit Agreement | Secured Debt | Line of Credit | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Basis spread on variable rate (as a percent) | 3.25% | |||||||||
Senior Secured Credit Agreement | Delayed Draw Secured Debt | Line of Credit | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Term of debt instrument | 6 years | |||||||||
Maximum borrowing capacity of credit facility | $ 30,000,000 | |||||||||
Senior Secured Credit Agreement | Revolving Credit Facility | Line of Credit | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Maximum borrowing capacity of credit facility | $ 150,000,000 | $ 100,000,000 | ||||||||
Increase in maximum borrowing capacity of credit facility | $ 100,000,000 | |||||||||
Maximum net leverage ratio | 0.000650 | 6.50 | ||||||||
Draw on credit facility | $ 48,000,000 | |||||||||
Remaining borrowing capacity under credit facility | $ 102,000,000 | |||||||||
Senior Secured Credit Agreement | Revolving Credit Facility | Line of Credit | Minimum | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Stated interest rate (as a percent) | 7% | |||||||||
Senior Secured Credit Agreement | Revolving Credit Facility | Line of Credit | Maximum | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Stated interest rate (as a percent) | 7.92% | |||||||||
Senior Secured Credit Agreement | Revolving Credit Facility | Line of Credit | Base Rate | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Basis spread on variable rate (as a percent) | 2.25% | |||||||||
Senior Secured Credit Agreement | Revolving Credit Facility | Line of Credit | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Basis spread on variable rate (as a percent) | 3.25% | |||||||||
Senior Secured Credit Agreement | Term Loan | Line of Credit | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Draw on credit facility | $ 195,300,000 | |||||||||
Unamortized deferred financing fees | $ (4,200,000) | $ (5,300,000) | ||||||||
Effective interest rate of debt instrument (as a percent) | 7.06% | 6.42% |
Earnings per Share ("EPS") (Det
Earnings per Share ("EPS") (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 11 Months Ended | 12 Months Ended |
Dec. 31, 2021 | Dec. 31, 2022 | |
Numerator: | ||
Net income (loss) attributable to Shoals Technologies Group, Inc. - basic | $ (327) | $ 127,611 |
Reallocation of net income attributable to non-controlling interests from the assumed exchange of Class B common stock | 0 | 15,402 |
Net income (loss) attributable to Shoals Technologies Group, Inc. - diluted | $ (327) | $ 143,013 |
Denominator: | ||
Weighted average shares of Class A common stock outstanding - basic (in shares) | 99,269 | 114,495 |
Weighted average shares of Class A common stock outstanding - diluted (in shares) | 99,269 | 167,631 |
Earnings (loss) per share of Class A common stock - basic (in USD per share) | $ 0 | $ 1.11 |
Earnings (loss) per share of Class A common stock - diluted (in USD per share) | $ 0 | $ 0.85 |
Restricted / performance stock units | ||
Denominator: | ||
Effect of dilutive securities (in shares) | 0 | 308 |
Class B Common Stock | ||
Denominator: | ||
Effect of dilutive securities (in shares) | 0 | 52,828 |
Equity-Based Compensation - Nar
Equity-Based Compensation - Narrative (Details) - USD ($) | 1 Months Ended | 11 Months Ended | 12 Months Ended | |||
Jan. 26, 2021 | May 31, 2020 | Dec. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Equity-based compensation | $ 16,100,000 | $ 11,300,000 | ||||
Unrecognized compensation costs | $ 31,900,000 | |||||
Period for recognition of unrecognized compensation costs | 2 years 1 month 6 days | |||||
Class C Units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Awards granted (in shares) | 11,150,000 | |||||
Equity-based compensation | $ 8,300,000 | |||||
Unrecognized compensation costs | $ 0 | |||||
Proportion of stock vested on grant date (as a percent) | 77% | |||||
Granted (in USD per share) | $ 0.74 | |||||
Corporate conversion of shares (in shares) | 11,150,000 | |||||
Member Units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock issued for organizational transaction (in shares) | 9,986,025 | |||||
Restricted Stock Units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Awards granted (in shares) | 1,701,306 | 727,001 | 1,701,306 | |||
Award vesting period | 3 years | |||||
Granted (in USD per share) | $ 13.78 | $ 27.61 | ||||
Restricted Stock Units | Director | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Award vesting period | 1 year | |||||
Restricted Stock Units | Minimum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share price (in USD per share) | $ 21.50 | 10.42 | 21.50 | |||
Award vesting period | 3 years | |||||
Restricted Stock Units | Maximum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share price (in USD per share) | $ 34.60 | $ 25.82 | $ 34.60 | |||
Award vesting period | 4 years | |||||
Performance Shares | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Awards granted (in shares) | 256,305 | |||||
Award vesting period | 3 years | |||||
Granted (in USD per share) | $ 11.89 | |||||
Performance Shares | Minimum | Class A Common Stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share price (in USD per share) | 10.42 | |||||
Performance Shares | Maximum | Class A Common Stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share price (in USD per share) | $ 20.58 | |||||
2021 Incentive Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of shares authorized (in shares) | 8,768,124 |
Equity-Based Compensation - Res
Equity-Based Compensation - Restricted Stock Unit Activity (Details) - $ / shares | 11 Months Ended | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Restricted Stock Units | |||
Restricted Stock Units | |||
Outstanding at beginning of period (in shares) | 1,632,844 | 0 | |
Granted (in shares) | 1,701,306 | 727,001 | 1,701,306 |
Forfeited (in shares) | (63,534) | (23,738) | |
Vested (in shares) | (559,336) | (44,724) | |
Outstanding at end of period (in shares) | 1,632,844 | 1,736,975 | 1,632,844 |
Weighted Average Price | |||
Balance at beginning of period (in USD per share) | $ 27.55 | $ 0 | |
Granted (in USD per share) | 13.78 | 27.61 | |
Forfeited (in USD per share) | 25.56 | 29.46 | |
Vested (in USD per share) | 26.05 | 28.60 | |
Balance at end of period (in USD per share) | $ 27.55 | $ 22.34 | $ 27.55 |
Performance Shares | |||
Restricted Stock Units | |||
Outstanding at beginning of period (in shares) | 0 | ||
Granted (in shares) | 256,305 | ||
Forfeited (in shares) | 0 | ||
Vested (in shares) | 0 | ||
Outstanding at end of period (in shares) | 0 | 256,305 | 0 |
Weighted Average Price | |||
Balance at beginning of period (in USD per share) | $ 0 | ||
Granted (in USD per share) | 11.89 | ||
Forfeited (in USD per share) | 0 | ||
Vested (in USD per share) | 0 | ||
Balance at end of period (in USD per share) | $ 0 | $ 11.89 | $ 0 |
Stockholders_ Equity (Deficit)
Stockholders’ Equity (Deficit) (Details) $ / shares in Units, $ in Millions | Jan. 29, 2021 USD ($) $ / shares shares | Jan. 26, 2021 class vote $ / shares shares | Dec. 31, 2022 $ / shares shares | Dec. 31, 2021 $ / shares shares |
Class of Stock [Line Items] | ||||
Preferred stock authorized (in shares) | 5,000,000 | 5,000,000 | 5,000,000 | |
Number of classes of directors | class | 3 | |||
Maximum ratio of class B common stock held to LLC interests held | 1 | |||
Ratio for cancellation of class B common stock when LLC interests are redeemed or exchanged | 1 | |||
Required ratio of class A common stock issued to LLC interests owned | 1 | |||
Required ratio of class B common stock owned by continuing equity owners to number of LLC interests owned by continuing equity owners | 1 | |||
Shoals Parent | ||||
Class of Stock [Line Items] | ||||
Interests purchased in subsidiaries (in shares) | 6,315,790 | 480,116 | 40,665 | |
Founder and Class B Unit Holder in Shoals Parent | ||||
Class of Stock [Line Items] | ||||
Interests purchased in subsidiaries (in shares) | 5,234,210 | |||
IPO | ||||
Class of Stock [Line Items] | ||||
Consideration received from stock issued in IPO | $ | $ 278.8 | |||
Class A Common Stock | ||||
Class of Stock [Line Items] | ||||
Common stock authorized (in shares) | 1,000,000,000 | 1,000,000,000 | 1,000,000,000 | |
Common stock, par value (in USD per share) | $ / shares | $ 0.00001 | $ 0.00001 | $ 0.00001 | |
Number of votes per share of common stock | vote | 1 | |||
Stock issued for organizational transactions (in shares) | 81,977,751 | 81,977,751 | ||
Class A Common Stock | IPO | ||||
Class of Stock [Line Items] | ||||
Stock issued in IPO (in shares) | 11,550,000 | |||
Price per share of stock issued in IPO (in USD per share) | $ / shares | $ 25 | |||
Class B Common Stock | ||||
Class of Stock [Line Items] | ||||
Common stock authorized (in shares) | 195,000,000 | 195,000,000 | 195,000,000 | |
Common stock, par value (in USD per share) | $ / shares | $ 0.00001 | $ 0.00001 | $ 0.00001 | |
Number of votes per share of common stock | vote | 1 |
Non-Controlling Interests - Nar
Non-Controlling Interests - Narrative (Details) - USD ($) $ in Thousands | 11 Months Ended | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Jan. 29, 2021 | |
Noncontrolling Interest [Line Items] | ||||
Tax distributions to non-controlling LLC interest holders | $ 4,837 | $ 7,762 | $ 4,800 | |
Shoals Parent | ||||
Noncontrolling Interest [Line Items] | ||||
Ownership interest (as a percent) | 81.44% | |||
Shoals Parent | ||||
Noncontrolling Interest [Line Items] | ||||
Interests purchased in subsidiaries (in shares) | 40,665 | 480,116 | 40,665 | 6,315,790 |
Non-Controlling Interests - Eff
Non-Controlling Interests - Effects of Changes in Ownership (Details) - USD ($) $ in Thousands | 11 Months Ended | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Noncontrolling Interest [Abstract] | ||||
Net income attributable to non-controlling interest | $ 1,596 | $ 15,402 | $ 1,596 | $ 0 |
Decrease as a result of the Organizational Transactions | (88,644) | 0 | ||
Increase as a result of newly issued LLC Interests in IPO | 70,976 | 0 | ||
Increase as a result of activity under equity-based compensation plan | 3,618 | 5,422 | ||
Decrease from tax distributions to non-controlling interest | (4,837) | (7,762) | ||
Reallocation of non-controlling interest | 7,240 | 6,604 | ||
Change from net income attributable to/from non-controlling interest and transfers to non-controlling interest | $ (10,051) | $ 19,666 |
Leases - Narrative (Details)
Leases - Narrative (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Jan. 01, 2022 | Jan. 01, 2021 |
Lessee, Lease, Description [Line Items] | |||
ROU asset | $ 4,060 | ||
Operating lease, liability | $ 4,418 | ||
Accounting Standards Update 2016-02 | |||
Lessee, Lease, Description [Line Items] | |||
ROU asset | $ 1,200 | $ 1,200 | |
Operating lease, liability | $ 1,200 |
Leases - Assets and Liabilities
Leases - Assets and Liabilities (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Leases [Abstract] | |
ROU asset | $ 4,060 |
Lease liability, current portion | 1,162 |
Lease liability, long-term portion | 3,256 |
Total lease liabilities | $ 4,418 |
Operating lease, right-of-use asset, statement of financial position | Other current assets |
Operating lease, liability, current, statement of financial position | Accrued expenses and other |
Operating lease, liability, noncurrent, statement of financial position | Other long-term liabilities |
Leases - Lease Expenses (Detail
Leases - Lease Expenses (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Leases [Abstract] | |
Operating lease expense | $ 1,126 |
Variable lease expense | 142 |
Short-term lease expense | 177 |
Total lease expense | $ 1,445 |
Leases - Maturities of Lease Li
Leases - Maturities of Lease Liabilities (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Leases [Abstract] | |
2023 | $ 1,337 |
2024 | 1,261 |
2025 | 958 |
2026 | 950 |
2027 | 325 |
Total lease payments | 4,831 |
Less: Imputed lease interest | (413) |
Total lease liabilities | $ 4,418 |
Leases - Weighted-Average Remai
Leases - Weighted-Average Remaining Lease-Term and Discount Rate (Details) | Dec. 31, 2022 |
Leases [Abstract] | |
Weighted average remaining lease-term | 3 years 10 months 24 days |
Weighted average discount rate | 4.50% |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 01, 2022 | Dec. 31, 2022 | |
Leases [Abstract] | ||
Operating cash flows from operating leases | $ 1,295 | |
Non-cash investing activities: | ||
Lease liabilities arising from obtaining right-of-use assets during 2022 | $ 1,239 | $ 3,990 |
Leases - Future Minimum Lease O
Leases - Future Minimum Lease Obligation (Details) $ in Thousands | Dec. 31, 2021 USD ($) |
Leases [Abstract] | |
2022 | $ 489 |
2023 | 499 |
2024 | 200 |
2025 | 58 |
2026 | 6 |
Total | $ 1,252 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Loss Contingencies [Line Items] | ||
Employer discretionary contributions | $ 0 | |
Employer matching contributions | 300,000 | $ 200,000 |
Surety Bond | ||
Loss Contingencies [Line Items] | ||
Maximum potential payment obligation with regard to surety bonds | $ 8,700,000 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Jan. 29, 2021 | |
Tax Credit Carryforward [Line Items] | |||
Effective income tax rate (as a percent) | 6% | 2% | |
Deferred tax asset related to the tax receivable agreement | $ 286,800 | ||
Tax receivable agreement, proportion of tax benefits to be paid to TRA Owners (as a percent) | 85% | 85% | |
Valuation allowance | $ 0 | $ 1,983 | |
Penalties and interest on uncertain tax positions | 1,000 | $ 900 | |
Federal | |||
Tax Credit Carryforward [Line Items] | |||
Net operating loss carryforwards | 20,200 | ||
Net operating loss carryforwards not subject to expiration | 20,200 | ||
State | |||
Tax Credit Carryforward [Line Items] | |||
Net operating loss carryforwards | 6,400 | ||
Net operating loss carryforwards not subject to expiration | 400 | ||
Operating loss carryforward, subject to expiration | $ 6,000 |
Income Taxes - Components of In
Income Taxes - Components of Income Before Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | ||
Domestic | $ 152,000 | $ 4,030 |
Foreign | 0 | 0 |
Income before income taxes | $ 152,000 | $ 4,030 |
Income Taxes - Components of _2
Income Taxes - Components of Income Tax Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Current income taxes: | |||
Federal | $ 0 | $ 0 | |
State | 554 | 631 | |
Foreign | 0 | 0 | |
Total current income taxes | 554 | 631 | |
Deferred income taxes: | |||
Federal | 13,639 | 397 | |
State | (5,233) | (1,873) | |
Foreign | 0 | 0 | |
Total deferred income taxes | 8,406 | (1,476) | $ 0 |
Other tax expense | 27 | 931 | |
Income tax expense | $ 8,987 | $ 86 | $ 0 |
Income Taxes - U.S Federal Stat
Income Taxes - U.S Federal Statutory Income Tax Rate and the Reported Income Tax (Benefit) Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |||
U.S. federal income taxes at statutory rate | $ 31,920 | $ 846 | |
State and local income tax net of federal benefit | 4,786 | (1,380) | |
Permanent tax adjustments | 268 | 342 | |
Pre-IPO income | 0 | (562) | |
Non-controlling interest | (3,289) | (342) | |
Termination of TRA | (15,905) | 349 | |
Remeasurement of deferred taxes | (5,966) | (1,939) | |
Research and development credit | 0 | (77) | |
Uncertain tax positions | 27 | 789 | |
Change in valuation allowance | (1,983) | 1,983 | |
Other | (871) | 77 | |
Income tax expense | $ 8,987 | $ 86 | $ 0 |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Income Tax Disclosure [Abstract] | ||
Investment in Shoals Parent | $ 286,759 | $ 161,078 |
Tax receivable agreement | 0 | 13,014 |
Net operating loss | 4,626 | 3,772 |
Other | 249 | 1,077 |
Total deferred income taxes | 291,634 | 178,941 |
Valuation allowance | 0 | (1,983) |
Net deferred tax asset | $ 291,634 | $ 176,958 |
Income Taxes - Unrecognized Tax
Income Taxes - Unrecognized Tax Benefits Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | ||
Beginning Balance | $ 604 | $ 0 |
Gross increases - tax positions in prior period | 0 | 604 |
Gross decreases - tax positions in prior period | 0 | 0 |
Gross increases - tax positions in current period | 0 | 0 |
Settlement | 0 | 0 |
Lapse of statute of limitations | 0 | 0 |
Ending balance | $ 604 | $ 604 |
Payable Pursuant to the Tax R_3
Payable Pursuant to the Tax Receivable Agreement - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | |||||
Dec. 06, 2022 | Nov. 29, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Jan. 29, 2021 | |
Tax Receivable Agreement [Abstract] | ||||||
Tax receivable agreement, proportion of tax benefits to be paid to TRA Owners (as a percent) | 85% | 85% | ||||
Early termination payment of tax receivable agreement | $ (58,000) | $ (58,000) | $ 0 | $ 0 | ||
Payable pursuant to the tax receivable agreement adjustment | $ 58,000 | 6,675 | 1,663 | 0 | ||
Gain on termination of tax receivable agreement | $ 110,883 | $ 0 | $ 0 |
Payable Pursuant to the Tax R_4
Payable Pursuant to the Tax Receivable Agreement - Summary (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Liability on Tax Receivable Agreement [Roll Forward] | ||
Beginning balance | $ 156,374 | $ 0 |
Exchange of LLC Interests for Class A common stock | 7,761 | 140,293 |
Merger of Shoals investment CTB | 0 | 14,418 |
Adjustment for change in estimated effective income tax rate | 6,675 | 1,663 |
Adjustment related to TRA termination | (112,810) | 0 |
Early termination payment of TRA | (58,000) | 0 |
Payable pursuant to TRA | $ 0 | $ 156,374 |
Revenue Recognition - Schedule
Revenue Recognition - Schedule of Revenue Disaggregated by Product (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 326,940 | $ 213,212 | $ 175,518 |
System solutions | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 254,415 | 155,818 | 116,720 |
Components | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 72,525 | $ 57,394 | $ 58,798 |
Revenue Recognition - Contract
Revenue Recognition - Contract Balances (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Revenue from Contract with Customer [Abstract] | |||
Billed accounts receivable | $ 48,571 | $ 26,669 | $ 24,200 |
Retainage | 2,004 | 4,830 | 2,800 |
Unbilled receivables | 16,713 | 13,533 | $ 3,800 |
Deferred revenue | $ 23,259 | $ 1,841 |
Revenue Recognition - Narrative
Revenue Recognition - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |||
Billed accounts receivable | $ 48,571 | $ 26,669 | $ 24,200 |
Unbilled receivables | 16,713 | 13,533 | 3,800 |
Retainage | 2,004 | 4,830 | $ 2,800 |
Deferred revenue | $ 1,800 | $ 200 | |
Contract with customer, liability, revenue recognized, percentage | 100% | 100% |
Related Party Transaction (Deta
Related Party Transaction (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Related Party Transactions [Abstract] | |
Related party transaction, tax receivable agreement, termination payment, percentage | 45% |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Feb. 24, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Subsequent Event [Line Items] | ||||
Period for recognition of unrecognized compensation costs | 2 years 1 month 6 days | |||
Equity-based compensation | $ 16.1 | $ 11.3 | ||
Chief Executive Officer | Subsequent Event | ||||
Subsequent Event [Line Items] | ||||
Period for recognition of unrecognized compensation costs | 3 years | |||
Forecast | Chief Executive Officer | ||||
Subsequent Event [Line Items] | ||||
Equity-based compensation | $ 4 |
Uncategorized Items - shls-2022
Label | Element | Value |
Stock Issued During Period, Value, New Issues | us-gaap_StockIssuedDuringPeriodValueNewIssues | $ 140,915,000 |
Stock Issued During Period, Value, New Issues | us-gaap_StockIssuedDuringPeriodValueNewIssues | 281,064,000 |
Shares Issued, Value, Share-Based Payment Arrangement, after Forfeiture | us-gaap_StockIssuedDuringPeriodValueShareBasedCompensation | (137,000) |
Stock Issued During Period, Value, Organizational Transactions | shls_StockIssuedDuringPeriodValueOrganizationalTransactions | 0 |
Stock Repurchased During Period, Value | us-gaap_StockRepurchasedDuringPeriodValue | 281,064,000 |
APIC, Share-Based Payment Arrangement, Increase for Cost Recognition | us-gaap_AdjustmentsToAdditionalPaidInCapitalSharebasedCompensationRequisiteServicePeriodRecognitionValue | 9,481,000 |
Stock Issued During Period, Value, Conversion of Units | us-gaap_StockIssuedDuringPeriodValueConversionOfUnits | 0 |
Noncontrolling Interest, Increase (Decrease) from Equity Reallocation | shls_NoncontrollingInterestIncreaseDecreaseFromEquityReallocation | 0 |
Adjustments To Additional Paid In Capital, Deferred Tax Adjustment, Acquisition | shls_AdjustmentsToAdditionalPaidInCapitalDeferredTaxAdjustmentAcquisition | 238,000 |
Stock Issued During Period, Value, Acquisitions | us-gaap_StockIssuedDuringPeriodValueAcquisitions | 6,500,000 |
Adjustments to Additional Paid in Capital, Deferred Tax Adjustment | shls_AdjustmentsToAdditionalPaidInCapitalDeferredTaxAdjustment | (20,997,000) |
Noncontrolling Interest [Member] | ||
Stock Issued During Period, Value, New Issues | us-gaap_StockIssuedDuringPeriodValueNewIssues | 70,976,000 |
Shares Issued, Value, Share-Based Payment Arrangement, after Forfeiture | us-gaap_StockIssuedDuringPeriodValueShareBasedCompensation | 3,618,000 |
Stock Issued During Period, Value, Organizational Transactions | shls_StockIssuedDuringPeriodValueOrganizationalTransactions | (88,644,000) |
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest | us-gaap_ProfitLoss | 1,596,000 |
Noncontrolling Interest, Increase (Decrease) from Equity Reallocation | shls_NoncontrollingInterestIncreaseDecreaseFromEquityReallocation | 7,240,000 |
Noncontrolling Interest, Decrease from Distributions to Noncontrolling Interest Holders | us-gaap_MinorityInterestDecreaseFromDistributionsToNoncontrollingInterestHolders | 4,837,000 |
Retained Earnings [Member] | ||
Stock Issued During Period, Value, Organizational Transactions | shls_StockIssuedDuringPeriodValueOrganizationalTransactions | (92,806,000) |
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest | us-gaap_ProfitLoss | (327,000) |
Member Units [Member] | ||
Stock Issued During Period, Value, Organizational Transactions | shls_StockIssuedDuringPeriodValueOrganizationalTransactions | 181,448,000 |
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest | us-gaap_ProfitLoss | 2,675,000 |
Additional Paid-in Capital [Member] | ||
Stock Issued During Period, Value, New Issues | us-gaap_StockIssuedDuringPeriodValueNewIssues | 281,064,000 |
Stock Issued During Period, Value, New Issues | us-gaap_StockIssuedDuringPeriodValueNewIssues | 69,939,000 |
Shares Issued, Value, Share-Based Payment Arrangement, after Forfeiture | us-gaap_StockIssuedDuringPeriodValueShareBasedCompensation | (3,755,000) |
Stock Repurchased During Period, Value | us-gaap_StockRepurchasedDuringPeriodValue | 281,064,000 |
APIC, Share-Based Payment Arrangement, Increase for Cost Recognition | us-gaap_AdjustmentsToAdditionalPaidInCapitalSharebasedCompensationRequisiteServicePeriodRecognitionValue | 9,481,000 |
Noncontrolling Interest, Increase (Decrease) from Equity Reallocation | shls_NoncontrollingInterestIncreaseDecreaseFromEquityReallocation | (7,240,000) |
Adjustments To Additional Paid In Capital, Deferred Tax Adjustment, Acquisition | shls_AdjustmentsToAdditionalPaidInCapitalDeferredTaxAdjustmentAcquisition | 238,000 |
Stock Issued During Period, Value, Acquisitions | us-gaap_StockIssuedDuringPeriodValueAcquisitions | 6,500,000 |
Adjustments to Additional Paid in Capital, Deferred Tax Adjustment | shls_AdjustmentsToAdditionalPaidInCapitalDeferredTaxAdjustment | $ (20,997,000) |
Common Class B [Member] | Common Stock [Member] | ||
Stock Issued During Period, Shares, New Issues | us-gaap_StockIssuedDuringPeriodSharesNewIssues | (5,234,210) |
Stock Issued During Period, Value, Organizational Transactions | shls_StockIssuedDuringPeriodValueOrganizationalTransactions | $ 1,000 |
Stock Issued During Period, Shares, Conversion of Units | us-gaap_StockIssuedDuringPeriodSharesConversionOfUnits | (7,870,042) |
Stock Issued During Period, Shares, Organizational Transactions | shls_StockIssuedDuringPeriodSharesOrganizationalTransactions | 78,300,817 |
Stock Repurchased During Period, Shares | us-gaap_StockRepurchasedDuringPeriodShares | 10,402,086 |
Common Class A [Member] | Common Stock [Member] | ||
Stock Issued During Period, Shares, New Issues | us-gaap_StockIssuedDuringPeriodSharesNewIssues | 11,550,000 |
Stock Issued During Period, Shares, New Issues | us-gaap_StockIssuedDuringPeriodSharesNewIssues | 10,402,086 |
Stock Issued During Period, Value, Organizational Transactions | shls_StockIssuedDuringPeriodValueOrganizationalTransactions | $ 1,000 |
Stock Issued During Period, Shares, Conversion of Units | us-gaap_StockIssuedDuringPeriodSharesConversionOfUnits | 7,870,042 |
Stock Issued During Period, Shares, Organizational Transactions | shls_StockIssuedDuringPeriodSharesOrganizationalTransactions | 81,977,751 |
Stock Issued During Period, Shares, Acquisitions | us-gaap_StockIssuedDuringPeriodSharesAcquisitions | 209,437 |
Stock Issued During Period, Shares, Restricted Stock Award, Net of Forfeitures | us-gaap_StockIssuedDuringPeriodSharesRestrictedStockAwardNetOfForfeitures | 40,665 |