Earnings call transcript Q4 2022

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Operator

Greetings. And welcome to Sunworks, Inc. Fourth Quarter and Full Year 2022 Results Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. It is now pleasure to introduce your host , Jason Bonfigt, Chief Financial Officer. you. Thank

begin. may You

Jason Bonfigt

XXXX I'm CEO, of Chief like our our is full you Operator. call Leading Sunworks. me Morris. with to Officer On to today year and quarter behalf entire President fourth conference Jason you, call. Financial the and Bonfigt, our of welcome results Gaylon Thank team, I'd

due and those and we update our results to may Actual including discussion forward-looking forward-looking projected today's described periodic Today's in expectations. in contains risks by Exchange obligation statements the reports financial about Except to forward-looking risks the filed law, statements. statements significantly as no required uncertainties, Securities future from various Commission. business our undertake differ and with

line for questions. Following prepared the the remarks, we open will

turn over call I'd With to to that, like Gaylon. the

Gaylon Morris

and Thank those to today. joining welcome you, Jason, us

we platform solutions retention velocity to Last originations During installations. an to integrated build while across and between our drive our to year, business XXXX, leading continuing improved regional customer transformation installation, strategy. ensuring markets, continued advance a solar project continued we of core improved

toward materials. reweight further a thereby emphasis individual We positions further relationships quickly centralized support increased requirements. model, move an in reducing domestically expanded our our expense. of moved customer origination direct procurement with sales continued on to one that access customer And to we acquisition sourced channel, We operating towards us to

residential one segments. that given than across strong In summary, and our in XX% transformation, period, prior it was significant culminated the share sustained year and a year quarter commercial gains change of versus revenue of both fourth market growth more organizational

direct share fourth sales fourth XXXX, channel and sales growth. Within year-over-year Since force in segment, us Residential, period. direct drive recent positioning originations X% in backlog which revenue, contributed market our up XXX represented than acquisition new we've the the our gains. direct for in quarter delivered revenue, Solcius strong originations Solar XX% more a growth have record ongoing our from revenue, Our as investments representatives, sales prior increased significant represented to installations, quarter force XX% of market of Residential in year above to total

By annual half we XXXX, direct represent our of of the sales expect approximately sales. will channel end our

growth originations pace the and fourth solar in for the period. revenue a of rising rates economic robust evidenced combination quarter the in uncertainty While our reflects of new muted general solutions, interest demand

of targeted with the costs lower the the growth solar power customer key base. on loan in rebound the pace remained total see These ownership origination adoption solar weather quarter impact XXXX, providers new into improving recently response, of have for together which While options, will challenged markets. include agreement across of purchase higher first begun our the of our financing curb of action with consumers. materially to have taken In cost we addition actions we to

While a including many bills. Americans rising rising cost of living, continue to face utility monthly

represented Rising drive We pursue their more continue to adoption, expect than which in particularly bills eliminate or to XXXX. reduce prices while power of homeowners continue in solar solar independent. becoming energy increased will sales California, XX% total to electricity utility

the industry the turn tailwind the Before secular for to beginning for important for provide entering XXXX. this business outlook an his call domestic I over year. passage a We provide allow remarks, general Jason recent me our of the will Reduction solar to believe Act Inflation

to positioning accelerate the the rate significant competitors, share a as larger decade, over same environment could impact the during afforded to and as higher rates the incentives the competitive access period churn. and next solar credits legislation, IRA. Solcius financial in have the solar the across incentives consumers. by the severely investment solar of significant will market supply domestic manufacturing interest anticipate visibility smaller industry a adoption market believe is At both chain time, detailed tax providing take for unprecedented for platforms on As fully production will such educated We we

As Over recalibrate partners. the slightly we a normal, expand ownership, higher customers more aggressively value providing the more currently capabilities, pursue we financing total residential cost enhance is our happening of project become in to sales think we to makes housing robust This with begun as that proposition for that to time, customers higher solution rates offering consumers the and will potential adoption Sunworks strategies new market. see its to year, accessible. further much a channel solar with have

the this customers For as adoption these over adjacencies on I'm rates grow for XXXX. mind, attractive example, related appeal well With next profile. and and businesses are will entering rapidly believe we our their years. product their balance, pursuing as given positive On vehicle in margin charging we to outlook our the few both electric battery actively

position gains, market and particularly price of IRA, A demand share recent actions with us EBITDA breakeven. closer combination move benefit to of sustained towards The favorable the added long-term fundamentals,

that, over results. hand will With Jason quarter of fourth review I our call for to a the

Jason Bonfigt

period, and decreased project by in gross received revenue Total compared the to by partially growth XX% $X.X current the which Thank driven $XX.X year primarily of you, associated inflation. of labor of generated year of Solar of an million. the versus full April and and $XXX.X Gaylon. XXXX, revenue performance, the timing dates year Sunworks to Energy start financial increase offset year a Residential benefit orders profit Solar increased in million segment versus materials a the increased full XX% prior summary Commercial closed year. Solcius from the prior driven Beginning XXXX. year Supported with in our by period, contributions the prior with acquisition, of total a year by of the full revenue million

we compared reported fourth together periods prior segment of XX% in XXXX, with In $XX.X per of $XX.X XXXX, million in versus commercial due year within share. million, a $X.XX we quarter basic XXXX, or a of $XX.X revenue was Adjusted backlog mainly full higher $XX.X loss installation volumes order share, million, segment. loss of within total $X.XX increase to higher year an basic the the in net from prior and our period intake of loss For prior a to $XX.X the a or residential the prior year loss million million EBITDA net of our period, year. versus elevated generated the per

During quarter, of approximately the fourth residential revenues respectively. commercial XX% XX% and represented and revenue, total

primarily year year $XX We year $X.XX revenue increase and gross due the loss per the prior primarily increased variance net million The prior offset the the $XX.X quarter in to variance period, attributable loss to share, of margin million $XX.X in degradation was resulting basic to a $X.X and versus in XXXX year-over-year impairment from million in prior or share. million both attributable the $X.XX delays. gross the by $X.X quarter, and of fourth increased quarter. segments, reported weather compared of increases to Total Adjusted The profit loss fourth in million quarter the to per a was quarter a in in quarter revenue of period. was basic a in year-over-year loss net in the partially of together with EBITDA XXXX. profit current the fourth $X.X million or goodwill jurisdictional million permitting in versus a labor fourth in costs $X

of across segment quarter. Solcius Turning business, installed quarter loss approximately to our fourth to period. XX, represented in all quarter, direct Solar of channels. our XXXX, in December $XX.X increased year-over-year to XX% the a XX% year XX% installed as year-over-year sales total which X% fourth review versus residential and of backlog residential $XX.X million the increased sales the basis increased revenue is approximately XX% revenue in by prior by year-over-year fourth Residential million, Total segment, Direct in growth a driven driven growth Total on originations.

increased on commercial year-over-year a segment, Within and increased XX% Commercial $X.X revenue million, by year-over-year our to XX% basis. the backlog

our of of the no end quarter, balance issues debt are the margin in we the increased sheet; into the progressed, related business. wrestled the Sunworks. supply and ongoing leading in year, positive to Increased to to Turning million improved Earlier and of for sourcing moderating we conditions at fourth with inflation labor modules. particularly growth had chain cash support coupled availability both $X.X solar of as year availability materially tailwinds to module modules with the XXXX. availability These

into chain several three growth. to quarters hand. Exiting modules, four had year, heavily and modules modules challenges of months to commercial the we inventory of support specifically the with our Given we on invested supply building residential

our of increased $XX result the a inventory this, during by As year. million

capital was improvements However, and/or operating in we DPO working deposits growth lenders. customers received approximately million as realized $X.X as well as from in

more scale questions to throughout our our improve, back to in levels result as levels that session. inventory capital remarks. conditions question-and- lines Please begin tailwind operating we open which answer prepared normalized concludes the our working XXXX. should will Operator, module for we As continue

Operator

Instructions] [Operator

with Schafer Donovan the Our first Markets. of comes question from Capital line Northland

Donovan Schafer

fantastic. Hey, Those for revenue guys, on the taking congratulations really thanks the numbers. And questions. are

think improvement. kind see gross wants of everyone I to margin

margins look, know way my So and include gave and But can the for first gross that. you a also on year-over-year, I were expense, customer originations. reasons sales of cost pretty marketing I and gross you which is do some be kind you the don't down question actually margins, when quarter-over-quarter variable

doing like year-over-year year when there improvement. I It's of gross profit And it adjusted XX% a a sales do approach, When it consolidated margin so kind gross this sort cost in fourth this call, a adjusted but gross when gross get I actually was and on or I an marketing, the margin, an quarter ago. that, do like to take XX% a and basis. after I'm I versus of get subtract crude a year sales of like a margin looks that

cost corresponds you talk what I'm there at so inflation that to seeing. what you're to and that you're other things, if all just course, was Of like curious could seeing

more you actually talk that's shift improving include margins. If direct the the once about to you sales improving you, shift,

about this actually direct that more improvement just there kinks math front? have are where customer through and increasing of Or costs is work percent or Can some seen just is thinking actually you're that? on acquisition there misleading even you that quarter my wrong out sales you or talk to something. maybe If an

Jason Bonfigt

Donovan. It's morning, Good Jason.

at thinking the a you're different segments segment it, have important think consolidate because rather to right. profiles. basis It's I about look varying on that than margin it

I a to at and get that residential think trying you're dig bit little into more.

basis basis, point, we did accounting on a a in was of quarter. adjustment a That first the prior sequential XXX onetime have the difference. XXX or points On

bringing accretive there right. just marketing look do you that of markets sequentially at about reflection onetime then California led profile costs margin when less challenges did We thinking So solutions? in lot and and inefficiencies. that, residential you're in just of with weather, to QX of have other We in on specifically I significant couple of think we our think a sales I as look a delays and at benefit, without a gross it the that business margin wasn't So a the change. are and

like So we'd to is course be increase we'd QX to country. throughout the that going year. given little over to weather events certainly to across the continue a of But see the challenge the expect

think we we're as quite your are onboarding we about overall investments in then take of a and sales expecting as And our our to percentage expense platform, it's minus more percent you direct to And leverage, making gradually we've sales gross onboard the a marketing that. after improve margin as few that Because we sales higher force population. direct and been well.

Donovan Schafer

helpful the deck the think, kind theme, in same and Okay, of the release. as that's on I or

was target of it channel. yearend believe I coming your it's of you XX% by direct have to from a sales ‘XX. in year ’XX said, end You maybe getting

get me done if believe in channels. like kind this what's two mean. are I from could model you to I'm for modeling of for With in would on we'd that customer implication out can in I terms is, if statements But the kind metric in said at least terms of a about of out it you I correct into third I of of the and another mean can financial area where figure see past said translating the the channel. You that what something the could in is XX% past or me what of direct that, party direct channel thirds the correct you that. have where kind anything you or acquisition but sales costs you of are wrong, they question

another you've what direction me thirds, So out from implication XX% I'm worked if numbers wrong steer kind on or right or the to two it, that or if just be sales you trying on get direct can channel? that, of some either already one of kind based if of would

Jason Bonfigt

you company. if the let's So call our at, marketing minus gross look sales just margin expenses and of

points. in around margin nine QX, Let's just call percentage example, we for were net right that

that's so sales of and dealer blend the And direct the sales. channel, tele

financials acquisition, direct back can especially business historical to Solcius grow see, number upper channel. as you look to That we're mid-teens. sales in As if where we prior the to, to targeting the is this was that the of get you at our

I not come third we that on that challenge to to that think organization. the parties dealer number, cost into I we competitive of and these much generate is sales than direct thirds that other the from And we standpoint still organization to even other is, channels. be Ultimately, of need be have cost direct our two to a competitive organization so that can we're would the homeowners. bring cost sales the competitive less

wouldn't modeling you think it, it So as as be think you're modeling I I might I aggressive that. be, as

Donovan Schafer

rates other and were the were installations, you fourth just you in part promotion in originations that one quarter installations so and a great, But drives get mean, are in, lower originations? another weather that drivers lower like, would you originations? just and there mentioned Were part I Okay. there then third terms given are just the pull the down. other kind rate and instance, quarter? quarter the being then fantastic, would perhaps fourth down first The originations. And of originations then goes And the curious seasonality. of bit, like dynamics certainly you beyond get but I the the like doing, I are sales quarter fourth for for interest if originations a I'm quarter one or interest sense and big like the if I'm of third quarter forward be then part higher could fourth curious are any from seasonality away, higher promotions be, any ‘XX, that that. QX first of seasonality potential makes That's doing question guess was

have always exploration me have I fourth an lot really but But guess You down. of step was seasonality do to wouldn't well an that actually can because on the originations or installations, a maybe ITC in you think and also it originations the quarter. I times for have with of known big past, in impact occurred a really could ITC

And so sense was now urgency the convince customers, or this do going there could you of it where are away. credits

terms make originations course of a correct normalized seasonality me raining, It's the kind of door would just raining that impacts be just knocking. I origination? you you on in on weather people, an if what can so to how So Does for and sense? be that it's basis don't want

Jason Bonfigt

start I'll I of part the it off to second can then question. the and hand Gaylon for

QX, lot QX. benchmark certainly typically In seasonality way to we a at what's marketing different of play. year by and is changing sort of seasonality homeowners increases, rate the that impact, all you pressures third we with throughout effects in was a We the other consumer, think at the a with and think, reduction saw in. showed is fees, I look permits. dealer And So interest that in that products, of drop a And on and all rate loan weren't growth in any the party as data providers inflationary QX. then came happening really there driven

felt into early QX So certainly and some QX. we pressure in

well. same and existing our are one are has that in in originations a we're those And So there. new that think late to seeing tweaks we'll looking starting what be February PPA have time and changes onboarded we're at several making I options lower that materially recovery that? March, the seeing also rates as We're business are those and base, about growth. and help doing loan we we then than onboarding new provider We at and the

Donovan Schafer

originations, that lower Like yes. weather or seasonality, lot Okay, But that's do harder that to more guess, the Gaylon different can door doing it's talk different lead just to impacts does is it thing, roof favorable. what originations understand Because, straightforward. again, or it's be it's helpful. that not a And to about weather on or holidays easy climbing that you're the originations. It's a the you if installation. seasonal and telemarketing weather I is up basis? and to if then a way a an is the seasonality on fourth in so seasonality, also, a channels that whether is it it normalized quarter knocking? of it Is kind or causes pretty

Gaylon Morris

different Hey, ways. seasonality a Donovan, The us in Sure. number this of is Gaylon. hits

a all, for in November of Thanksgiving. almost week First you lose

weeks two for December holidays. the roughly lose You in

release, and with the them California So a after you're press alluded to plus some hard. place effects lot very for that. serious we we origination they took event comments percent there's attention QX, door in right on in weather that in the weather I saw then that door. it's that originations for on think business knock get of and somebody's of simultaneous. as of to when muted is in XX also these based the And a when going our on If knock the

being Wisconsin, see the just run winter United those our that and tail you in central appointments both so weather is in the So part them off electricity is don't business, of installations business being of have to of of and originations in will. because and then, for course, the to And able Minnesota set frightful, when if lot a our really part heat. able appointments them don't you up and States,

thing. get year It's So And going same things doors other for on for to electrical then and people's people attention on. just it's time of difficult a costs. the on lower knock

Donovan Schafer

admit readily in that it a hunker Okay. everyone I all that sounded rains, confused, resident, when California Well, we down. I also just panics I’ll, will and I even Los bit though Angeles as a know

It that like least sense get will make think yes, raining just down. at shut part. it I we traffic that I does rain and And it's today. don't

Gaylon Morris

much We to modules are much bit in still haven't out the have There's a been Jason than haven't year are group for and seen seen that it the cheaper change the there and if is ago. would though a reality is cheaper. with they and ago, making great origination regards a sentiment holding of a it's inflation. than anything, lot other to this our we but the sales adjusting to what not it people tele I again a and really talking sales, of half about there And that better, not what be leases just so some, going a were expensive down Even a come still while. to used a are have more be, year new loans bought

on still bring there's challenge seem some consumer the in in before, workforce. additional what's read in listen which storm. industry. able partner that in to amount They're like some were commissions of think a there's amount my creates to some It's not I So adjustment, an were going this able kind sales isolated challenge that It channel then. perfect of of is I they adjustment. quite I doesn't back

Operator

question with Shen of ROTH Philip Capital Partners. Our comes next the line from

Philip Shen

thanks for questions. the taking the Hey, guys, follow-up originations I had theme. a on

guys a You some recovery PPA I of thus about I as the provider new loan new wondering reason. And the were quantify just far. year. and this far talked thus recovery could options Jason, talking you you was about if the think, onboarding

as you you growth writing And of want you the were it if deck or then in a to is recovery magnitude and January of up this recovery QX. from split drop well and slide the versus here, Thanks. kind in we off that about what California between and could February get So sense your on see non-California. recovery

Jason Bonfigt

second I'd break that that quarter still and was, first a had And X.X weeks of we'll some a And until we portions talking the half of into like six start how to quarter the the in was it it frankly, homeowners. December. the be we of the really marketing here. economics where the Let's changes for playing quarter. that say November out, lift. lot break two been aggressively across quarter didn't in challenges pretty there it were the many markets. it's felt play into but the and out We've expecting NEM to And California about

The closer second half general in of we're are much we what what just to the quarter, seeing, QX. saw originations, in terms, the

in but we we of the originations. we're the a weeks Now, and some go, have business few changes have felt on more to encouraged that seeing

into in of come to say At a time, of to think a sales the without to one that direct California we're that's actually see I we strategies California year what and us our well an XX% QX of their feeling level of I really last on we are promoting Solcius broader from is that the on And we're are, very as And dealers to as is the towards the also in very, better same XX% XXX organization. for well. seeing force end was state about are connected continuing business really, giving residential lift California. catapulting specifics, people have excellent some healthy would of our lot they and over originations. to industry be well originations

Philip Shen

California Jason. possibly And to Thanks, QX we a a writing and weeks, think in QX before potential result was But huge strength we that X of so cause first pull six a X. transition in you of get even a we likely it's QX, step the about strength less for as have NEM probably one that in down Great. the were with weaker in NEM the things QX. much as

kind due you the strength, QX, some QX Do actually there's applications in to volume with mesh drop now, the is you have that don't so that originations see by into there's rush Thanks. that be of QX? going because given QX you rather installation serve but does the drop and think, we you then April see so more QX. in of California Do XX, in in an could you you now? my think see do so expect a applications, Do sense, And that carries be see? that that but what to

Jason Bonfigt

tell. a to I think it's early little

to been install slots or California out We're book production QX. slots into starting strong. So has

strength several QX. wouldn't drop I dealers we significant the we direct see if to bring we're on time, I continue So new to same and expand a over have focus these seen on continuing the sales. the want weeks, expect At that just last off to in

the So we're markets after mindset solar is California economical. the going our aggressively in year, other still that of if half is weakens back very

Philip Shen

Right.

And accessing. in so of even seeing we're thread, megawatts, But year-over-year, if little having California. basis, the seen your that same just expect states? brings curious in on up seeing, the if next in you've that in you you down Have we're a the strength type that and be some conversations Resi so, maybe a We're example, we're bit would which seen year-over-year thing, similar guys seeing or recovery are you is, slightly a non-California to and up? the for data flat

Jason Bonfigt

applications. well. which permits bit seeing for other published, markets Utah going am research but has stay in us, saw little were Texas, right that thing in same down and on Arizona New was Mexico, you the as additional a as bringing the I seeing probably been We're And pretty guidance to support We're from think I for sales forces recovery So now, there. are Texas quarter we're question strong other in and and new of that strong. a markets a

there. strength some So there is

So until we'll see giving more a out plays we the little guidance. can get comfortable how year with

Philip Shen

Great.

and and you PPA expectations even PPA you your what providers? new some overall it or mix And that can on bring QX what then so for XXXX in share in are loan ’XX lease of maybe especially versus was terms

Jason Bonfigt

Sure.

And with less even to So and the in XXXX past. Solcius, XX% past, about than was of adapted we've I the acquisition, prior think the this sort PPA. in in moved talked the market

to they QX one we're is far XX% predominantly that's we And expect to. point, seeing bringing move shifting PPA, into to were So more loans do products. I'd up And closer to it we're XXX% even us nearly of on And be it's as loans. so again, probably eventually shifted What that the PPA in that, at acquisition and at was products. PPAs.

to the think end the in by I XX% XX% being we're targeting the year. of range

battery money which So, like can with option homeowner is the PK selling day a California, point. on one, it save looks the options, to key

that's given It business, I XX%-XX% by of the being quicker XX% of just have of might might than myself talked happen So out end the at our year. that.

Philip Shen

Good. it. Got

seeing of And revenue then or you I QX se, wondering if what a sorry the if to of steady or just shift, So but look will. I of originations originations the guidance you provided mix you think relative to haven't what bit And color QX? way per I maybe about a mix with QX there, of know best kind it, but be kind you're on if missed shape was give little there. QX might like the could

but course, quarter. commercial Of could contribute, typically seasonally weaker it's

through sales some, the as were about So do into profit QX margins. for expansion the get even like gross you talking see just it that year and marketing. see But curious if plus margins we sorry, you some do revenue the can give a little or on bit you of you either sounds revenue color less

provide the what you we Thanks. saying can lot I'm a to color, to it. would appreciate here, anyway, but So degree degree,

Jason Bonfigt

cover it I'll at high Look, Sure. level. a

timeline the by originations, with XX you to that can from takes get and think slope saw you that for it So for the about permits, anywhere that when with to time days recognize revenue. apply XX be you work the jurisdictions, that the installed, work customers

past, talk install in we traditionally the slots by and slope higher I out We think it events. impacted than further January and and percent that we about be in in originations of QX weather that So certainly we the will a in the downward lost have plays saw install slots February.

That was was us. well. as really Texas. in certainly California That that So impacted Colorado, in in

we So severe had impacts. pretty

at point off we that. year, the look the QX low be to and build I as like we see would of So

then to margin well. likely volume And direct as sales direct QX. So with throughout we expand lead we'd year revenue, as pressures revenue the for have look the more that to will levels revenue some lower in as improves and

million $XX I our backlog commercial then We'd based business, in the QX recent conversations in today. activity And pipeline and to our with on expect is customers. said backlog our order about the have in we grow backlog

growth light revenue again, commercial QX a anticipating the we're in were by our little be because is So going But weather to revenue throughout year impacted business. in impacted the California. and again, delivery dates was

Operator

comes question with Moore EF next the Hutton. from of Tim Our line

Tim Moore

growth the the see than Congratulations commercial nice to some the one weather is lower was in commercial on margin quarter? beat the It step labor It mix Did was difference and Besides of Historically, in effect. gross my of the is sales Thanks. impressive explain the a questions. for a margin growth. help the actually lot gross side. up that on residential.

Jason Bonfigt

point. Gross segment quarter. excellent that. the XX% margin in significantly commercial In than it's business, the during residential less Yes, is

So that see will really the quarters each our margin. in of revenue the drive between segments consolidated in you variations

Tim Moore

gotten do That strong first And big the were door to is questions, originations bit given of that that that there you the the little January? quarter thought ask you were to which at gave orders beat, orders I maybe soft a sense. you and trying any was because this going a was of door have didn't the I commercial backlog want or sure sales knocking. of the I from in were but probably kind makes residential quarter and might Donovan just wondering, pretty set came that of pull and down end quarter down the March just some the to part color but forward make his to know as on lot of just weather,

Jason Bonfigt

forward financials. a in the nothing is business short $X.X no. answer, revenue completed significant had for commercial we're $X The but to of earlier, million We talking pull our some forward, but being million quick some answer pull

Tim Moore

hear. I to to to hear, comment sales run getting residential earlier remarks, know your gave which half the the of And on that eventually nice opening rate, this was Okay, in that's maybe sales. direct the in team helpful you a

clarify, the XXXX of run a exit was more was maybe December that or that Or for to this year? an XX%? Just goal end the of goal, rate to

Jason Bonfigt

the channels. We again, see want make want when at thinking us. happen this for sure sales finish all and there the deals build be economics it to and is perspective sense but we of goal we Our from but than the of earlier for value growth, sales makes may channel in to that, both to various we XX% a we're QX, about

negotiate part we the sales and some benefits So all continue But that over sales process and organization more to do paths. down the we control and like we go both the will of direct have again, with that. come the

it's So to important why we Sunworks. talking about so that's why keep

Tim Moore

the team Good. contribution the upgrades as months? cost it's and are acquisition ramped to Obviously, customer from they've type more Because of couple that. triggering products your the But any to direct a up higher productivity? over side. they or I direct seeing ancillary other you last question system Are sales had products of margin on or lower relate insurance

Jason Bonfigt

a we So we and EV battery see being them product same and mentioned. process it's that a could rate have adders those think the specific be they're time. do different just we it be, which we will best at provide added call homeowner see the we like sales you the optimize because sale just a those every that or with adders, could and adders do through service higher and or on working insurance do And how attachment I

Tim Moore

this you and then see earlier systems was And your the know to type residential, on I the power customers EV those stations, to it inroads charging cross-selling comments starting one like alluded commercial for products already? are you sounds starting for of with Yes. storage of and

Gaylon Morris

every middle year last on to adding we're fleet business And focused we virtually director to We commercial storage appending on hired install and number of the for and absolutely the side. business of solutions where it a charging offer sense EV Yes, energy EV we out, option are. director, the solely commercial for charging. do send customer, development and a at the makes now we proposal

Tim Moore

That's talking do panning oversight. to you're some these about, New and And don't give remember, seeing I officer And an Arizona speed you last where you for internal other more opportunities? local year, were expansion that in think that permitting chief great question, growth other good if Mexico and hear. I last you that'll you legal out? sometime added recall, markets my How's

Gaylon Morris

say the I've that at made is made of hire this that will best the we company. I one hires CLO

improved his timeliness increased tireless and professionalism that and touch. and and our has He's they we So that do everything team

leader journey a customer to the to must only not continue, customer customer and they involved licensing instances where sense. there in those want decides make that he or to they can I continue are for she may to many and get they installation, addressing things and endorsement ringing just convince but like where and this permitting challenges just And really So not group. say also that, that in times

value they're job. had of than more I and a doing the So great they're areas expected touching stream

Operator

Next Donovan question question from follow-up is a Schafer.

Donovan Schafer

follow-up get a know for thanks asking I on greedy if opportunity but is taking my questions, there, it. bit I'll guys, questions. take the I Hey, can

ask C&I to margins. So I want gross for

in that You fourth C&I impact the there and was on quarter margins mentioned quarter. gross a mixed

And had ones? it it disproportionately divide, EV versus in a types Or size, there like quarter? of whether How charging it mix so maybe the versus projects larger it solar curious, disproportionately higher just different versus what you where is storage? a standpoint? is from it the mix I'm certain fourth you of is smaller Is projects buckets do

Gaylon Morris

Yes.

with So a are the to been is the public tend wrong in most the One, they bigger there. correlation lower to, things construction couple larger tend has percentage. be competitive but projects the they of they projects, the word, and get, margin works

is what revenue. public comes Jason also So slightly contribution, the But is lower timing. the a contribution group significant a works as margin. had that And the to mentioned, at QX important

just mentioned as project. revenue where every flow end your have last pretty the in was really of necessarily through we and in entire your at margin project, five I don't typical the recognition, recognize really discrete on to the milestones usually commercial the very be commercial between we two It's revenue and costs couple profitability So construction take miles. to the along a at we the Unlike take milestones, the end, way. and of nine margin only as milestone closely to the of full most related construction

Donovan Schafer

And did, C&I $XX had you $XX XXXX. then so helpful. the then revenue in in you I million million for C&I really backlog. in C&I that's think, Okay, backlog at year And end XXXX,

year. have this backlog now $XX at of So in the end you million

north wondering, would to that that revenue XXXX, become that all C&I be of in to expect backlog since fall, revenue somewhere I'm for might of that because so maybe C&I that best or in the of year just you do XXXX. And you even end all up guys you

came Gaylon, back were it rework and because to think it with gets that a revenue sure was levels. those make to us higher But I trying that bit before the down profitable. process you

get it'd actually sort a $XX good million So to that great XXXX. on be or XXXX a handle whether just is floor maybe there is for a if chunk for

can't of of So type it inference. doesn’t, that kind really make so we

Jason Bonfigt

Yes, a we finalizing that we're in our backlog of be XXXX same that contracts $XX over at have negotiating numbers QX through also And some we XX/XX. when mention early will we're increase see there going of did the backlog additional be supportive into at I could revenue report most May. to working time, that of But million XXXX. bleed revenue. and

to the be there organization do we throughout year. we that the executing But some So and sales see we're, execute cautious, could upside again, executing. we're need while contracts on

basis, EBITDA on a segment. at starting million in basis to about to think $XX that of So $XX we revenue $XX least we're being of or a that's this we're million excess really million as to once range, on rate be annual business run an pushing are into positive

Operator

like to questions hand for remarks. the closing There to call I'd in are management further no back queue. the

Gaylon Morris

call. So thank us our again, our once you questions, today. And A to may at contact disconnect. everybody, any have now member with ir@sunworksusa.com. follow please for of you call joining free up feel our you you. concludes team Should will again, thank This you. And for

Operator

your for does today's conclude gentlemen, this and Ladies teleconference. Thank participation. you

time. lines have a this your wonderful And at disconnect may You day.

Sunworks (SUNWQ) 10 Mar 232022 Q4 Earnings call transcript