SPI - Earnings call transcript Q2 2022

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Operator

Good afternoon, and welcome to SPI Energy's Second Quarter Fiscal 2022 Conference Call.

As a reminder, this call is being recorded and all participants are in a listen-only mode. The call will be open for questions-and-answers following the presentation. I will now pass the call over to Randy Conone, Senior Vice President of Investor Relations and Finance. Mr. begin. may you Conone,

Randy Conone

Laura. you, Thank

me on and COO, SPI Chairman today K. the Denton Peng, call CEO, our are as Cheong. Energy's Joining well H. as

that company's Please SPI’s CEO, any as various indicated, like Before constitute the Any prospects Private of for Harbor of Chairman remind company these Securities begin, on not ahead, Safe statements turn future would of today. or under to we everyone plans XXXX, cause made now I'd only Reform Tuesday, events including remarks. the to and forward-looking materially filings date to risks does and with that provisions XX, August forward-looking forward-looking remarks statements opening purposes conference the statements to statements are Act today’s subject differ the and in go of and speak update XXXX. described reflect Litigation SEC. to over that to risks SPI call their about for SPI expectations, this occur to after may call cautions from Denton. results that those Peng, circumstances these the Denton forward-looking like actual uncertainties intend

Denton Peng

Thank afternoon, you, everyone. Randy, and good

clean as in at on of top in solutions. Overall, for Nasdaq markets revenue strong SPI pilot we have IPO. started that its in team to first our foundation forward renewable has demand carving Motor Phoenix solar for the growth to our of Sacramento production continued and facility high-growth out and capitalize moving and expanding accelerating Our we deliver long delivered Meanwhile, line our energy delivering Made-in-California solar built the solid XXXX, module second divisions customers. position performance across quarter generate growth plan module goals our

solar multi-decade strong SolarJuice. effective brings Chief expand the HK William value the of as one team we units, as for foundation, over Officer ultimately was Our SolarJuice share of to the shareholders asset call continue enabling in us us strong another the track to a our than industry great I'm area world-class great that and unlock We our now providing our operations CEO more experience quarter details. and integrators this augment addition success already with of the impressive our increase is William across key turn position tailwinds in construction in management second Operating rapidly is is of and the our for Chen on residential U.S. over success. operations. value great He team to growing as to to our growth in already to further as in the of confident of record combined ahead. each largest cover place I market the new quarters with HK? of in a XX-years. building team business addition XX-years

Hoong Khoeng Cheong

Thank you, Denton, and good everyone. afternoon,

business across began insight SPI has Denton of acres XX solar on another the As accomplishments some in storage and solar into a achieved I'll noted, our business. our with quarter begin with facets milestones all of multiple further battery strong in our major X.X with in development California. land California of our initiation Southern We project the megawatt unit. X.XX project state solar community megawatt, DC for home had

of capacity to module starting production already and our a our delivery facility capacity flagship XXX We at of megawatts by expect also the of end year. solar year. Indeed, module capacity reach of McClellan quarter started continued three this customers, the from to expansion manufacturing we California in this solar have Park,

our solar machine-to-machine highly will module continuous connectivity further facilities, automation module of workers in high manufacturing improvement increase with that X.X plan to this state-of-the-art drive Our skilled of gigawatts. expanding which capacity is precision degree our production -- to California at a our state module features of manufacturing. solar capacity solar Also, combines

Texas. agreement also had key a leading an inverter meet a offerings with at XXXX face-to-face storage residential with charger opportunity and Energy including Storage Premium well energy quarter tradeshow events, event solar as for at With to at latest Smart second solution Solar product global storage and we gigawatt supplier and buyers and products, solar Texas continue as renewable Sungrow, San supply during EV COVID RE+ showcasing panels, the X Energy two SolarJuice our win, solar restrictions We our to in signed for the Australia energy Management, renewables. energy Antonio, system

within patents: intellectual and one solar processes company efficiency improve a of of testing note, of for application to machine regarding the innovative property patent module Lastly, IV we strengthened want the learning filing further module manufacturing to through apparatus the process. second division I an technologies improve accuracy solar and this provisional our two to

raised our obviously, of of on side which EV the the major the gross business, million. $XX more of the proceeds IPO On than NASDAQ, news Phoenix Motor was completion

May, of alongside showcase sales growth our product charging we this continue in anticipate line new approximately retain We post-IPO. electric during our bus, successful very second EV and customer and Motor next-generation forward. forklifts solar began quarter at ACT solution of pickup been have with we With respond. to the pleased delivery truck ownership And initial these the from continued Phoenix importantly, Expo forklifts a power lithium-ion moving XX% Phoenix in the strong

We into during manufacturing also corporate our relocate headquarters module bringing to the to solar second close our proximity facility. management our senior County quarter, Sacramento

and across review from efforts. development of positive capacity, this Randy. our second our sales to our quarter, financial hand value call discussion continue well of will believe as solar grow as Randy to improve we provide for for business back to performance a will increased as I energy XXXX. this the creating our in As strategic will Over guidance the renewable production synergies the now you, tremendous

Randy Conone

translates of This and transparency U.S. reporting report requirements more our form company's filing This XX-K XX-Q to the performance the filing. Thank to metrics, compared on Form is annual of H.K. increased first as follows timely quarter previous our a Form as second on you, our filing in March. a company and

X% XX, EV XXXX. June our increasing business net forward. moving million, XXXX, continue ended million our quarter from the $XX.X revenues of to QX sales lines up by although we Revenues driven represent to sales expect from increased revenues mainly overall For to increasing solar of be in $XX.X an share

of our in net significant were $X.X convertible in and expenses the of other of million quarter QX Our second the XX% loss $X.X and in cost Gross second resulted second million of materials primarily significant net borrowings. XXXX. of million, XX.X% quarter the was net bonds from improvement second in the were $XX.X the quarter, of to of $XX.X revenues, net and these loss or million gross of during compared a operating a quarter, quarter in or of of Interest General QX $X.X net second in raw no XX.X% $X.X costs, factors million or which consist was of $X.X labor of or of million in XXXX, net the changes $X.X million with XXXX. in in second million us to a the the profit from $X.X XXXX. sales other Together, Total giving increased the and million X%. in quarter up expenses second expense $X.X administrative sales of XX.X% million sales, from sales margin up in XXXX. moderately quarter quarter,

of in cash. we equivalents As cash XXXX, cash, and had June XX, $XX.X million restricted

turning to year the Now ahead.

with revenue XXXX. and business, range module open questions. solar We As and into manufacturing sales this supply between We future the EV business million installation business, We'll our American look chain revenue mentioned challenges solar the ongoing to XXXX solar believe our earlier, in EV new with logistics as residential successes $XXX be consideration will our primary to $XXX year coupled with ultimately are and wholesale drive million the our roofing the updates. for call in overall accelerating and for now forward drivers sharing takes progresses. to you ongoing This to expected globally.

Operator

be this of question-and-answer conducting with we'll a comes Sullivan line Instructions] question Maxim session. At [Operator Tate Group. from the time First

your question. with proceed may You

Tate Sullivan

you. thank Yes,

by manufacturing to module to of that started needs XXX Sacramento, the What end any you On additional capacity, do or please? more there year? you in equipment? need believe to of delivering that testing I Are do to current How get or solar this certification processes install quarter. megawatts to capacity you XXX-megawatt facility the you for customers get this you said happen to

Randy Conone

Thanks, Tate. Sure.

that's staging start So the it's process of the to from XXXX middle basically going XXXX. a to occur of

XXX million, $XXX year. of and We by million expect the sorry, to by to $XXX this year, about end XXX I'm next the middle of gigawatts then megawatts megawatts X.X get -- to

equipment that have we equipment the comes here, it is and cases. quality we and several then process it So ship control and over that to install in acquire and

equipment equipment are equipment are of got pieces route we've producing controlled panels the pieces other the still So quality being then and in some of still of here. other over in

So staging next it's be around the of Sacramento process, a at QX full year. but end capacity the should

Tate Sullivan

then do in portion, -- stage capacity? providing production then mean, that terms Or as when with initially what of you you you getting -- do capacity mean, with okay. to And I can -- that a match then of there I at capacity you And up? within expect and target share, match a operating percent

Denton Peng

color we for side. [Technical the Difficulty] Yes, operations H.K.

Hoong Khoeng Cheong

Yes.

solar far bit and think to this add H.K.speaking, I California. a this module in I as like Park manufacturing would of McClellan color as

[Phase and X (ph). Phase X, now XXX product in X] started and this line. from we Phase megawatt delivering we at Phase are we production already production have So have capacity, X

of the phase, we production in MXX process So kind megawatt the is which installing new of second line. are the XXX

by the completed of be early will four. that So the part quarter

November, So year. from the we next the all starting until ramp-up frame the toward the time the expect way -- was December

of capacity on next Phase we capacity. to the of probably expect coming expansion line of will Phase by we production production X, start So And the another X XXX middle megawatts the this full board. year

will end next of X.X It's gigawatts that process. bring ramp-up a So of a total the year. by us

Tate Sullivan

make you some guidance I kind to X,XXX later capacity sure millions about revenue I solar know but give equipment per Absolutely. to of provide that a and provide can with dollars mean for prices range talk that you the date? of mean, out I megawatt of try I we to do a megawatts, of your And of will imply companies type other companies just -- at or do facility? XXX X,XXX to discount with hundreds does type understand, megawatt to of here it -- there? for that

Hoong Khoeng Cheong

the so in of the certainly are that still Phase mean I Yes. X production. we

So the scale. achieve when we we ramp up, will economy of

we productivity the adjustment on volume. expect as as well our So efficiency,

they throughout the will that would reduce costs year. So our progressively

Tate Sullivan

very Okay. Thank you much.

Hoong Khoeng Cheong

you. Thank you. Thank

Operator

with of Our you EF question. the your comes Hutton, next with line question proceed Tim from Moore may

Tim Moore

saw I be see sales nice supply Because you the about your It if PDI contribution. on delays to better despite for just was same? last congestion organic appeared the reiterated for over in the that Thank the if wondering chain continued what guidance of how you. it's you excluding believe growth I'm the guidance. it's disruptions. that year wondering logistic improved supply to was any that revenue about the quarter, I the acquisition X% port disruptions with couple range a for months? reason I'm gotten and the the chain

Randy Conone

guys let Yes. over other I'd the say top. definitely the improved, but I'll come

Denton Peng

Yes, we items, depends logistics, but which here see still in improvement shortage. items some some the on it

logistic So we -- issues. we of challenge are this think I managing

Tim Moore

the customer? any and it's Great. That's on it's and are from more Or follow-up that solar you one stages, facility. of home willing seeing just interest? very up the early type specific batches? underway module a municipalities you Sacramento question Are of showing you manufacturing those Phase pilot or given I'm update mentioned check more any curious it traction is types in to parties months. of X, Are Are out seeing helpful. have quality last the I corporate demand to more with builders? the

Denton Peng

different to currently for distribution channels. Difficulty] [Technical are we Yes, market residential

require and dialogued have distribution contract customers market. and modules. now We to with Made-in-U.S. we -- with more residential several nation leading company in made coming also utility also large commercial And the solar for more in already see

end this more the Made-in-U.S. to You the to still probably buy [indiscernible] products. -- past the incentive buyer customers waiting have additional see that deals to for

think I we be our will buy factory. the lot a think good from customers in the Made-in-U.S. will be interested And very I Sacramento spot of Made-in-U.S. to this products given are more to products. supplying

ramping are are we is importantly, ready more more capacity our up, So now. increasing and and we and

Tim Moore

it’s actually to helpful on for question. hear. Thanks is, My the color sharing that. two-part That's question next a

Denton Peng

Yes.

yes. Sorry,

Tim Moore

Well go ahead.

Denton Peng

solar for also from module manufacturing also Made-in-U.S. have see incentive So also the to for solar module the for from for the the about manufacturing $X.XX an for additional bill have Made-in-U.S., for bill incentive they that we

So products these Made-in-U.S. are additional incentive for the

to this So our to buy -- and a -- Sacramento. capacity to also facility I increase especially products California, the who think from or in also like more we Made customers another in thing get is be

Tim Moore

you are U.S. I my that's hear. next a ones the commercial to know Is start be pretty And do good and I your the see agreement No, imported to from in initial supply lot to kicking you on the in going that you nice tend Sungrow it's helpful was XXX, the with watt think seeing summer? tariffs, question, this will wondering for traction when made modules? shipments? And XXX happen to the

Hoong Khoeng Cheong

tend we Denton, sorry, think to see yes, go I -- ahead.

Denton Peng

please. Yes, go, H.K. you

Hoong Khoeng Cheong

Yes.

a space, are the XXX actually particular product has main in for Phase our in bit of or watt, which the to space. watt products watt these quite geared quite we Phase the XXX in these are a I of fact, produce do watts. -- on come bit of the see rooftop Certainly, the up our residential for panel see And watt XXX traction. the focus will line space, C&I therefore, quite that and residential residential for XXX for the are see to XXX kick -- been XXX start module a watts, the rooftop modules our for think the we for bigger space the will traction we But XXX lot in application. in C&I two two X, And -- the the X application.

Tim Moore

Sungrow to start does Or know going I that is phase how was summer if one that big a this And in? wondering two shipments? I with was that --

Hoong Khoeng Cheong

Yes. growing I Sungrow -- have mean we in some Australia. fact, Sungrow with in

been contract signed gigawatt Australia. -- have lot we X Sungrow, a we in with a new of So product

has focus. product the focus, an for mainly Australia been So the Australia for Sungrow

Tim Moore

just be update provide more and just for They're projects. Thank there an there you large for was if update projects that. I the on on can wondering estimate solar I'm And they'll sharing there. an is Maryland any of kind timing underway? Illinois you and when wondering,

Hoong Khoeng Cheong

Yes, I in think development the the it's phase. -- still

will it before while little MTP. we probably So take the hit a

planned Maryland, these So projects two are we as progressing utility-scale Illinois. in for

Tim Moore

questions. more Two Good.

that one How a $X.XX do product. first the that a electric The read do in is capacity it's come to saw were to a revenues for And production few almost around you order orders a generate big have million, about I if can out I you some great them? enough of revenues lot and think you major ago, I forklifts. if fill believe. look year? big much decide corporates months in fleet and a you that

Denton Peng

the the is logistics see the probably for electric for products, customers demand We increasing. especially the

more to California try service the market. we think we service So can markets only

So we service also other to try markets. increase to

us to try to these So more keep definitely, or be customers. for more elect and we'll products check do inventory more service

it it But be with one building China, the takes you're always will in because will relationship not months, a shipment time. two or increasing. So happen some

Tim Moore

PDI, one-off goes you will the and a the more forward? year. quarter. makes and total question that as was Do know rate integration year you year. go should in year for is, down there It Or on last And expense sense. costs quarterly going on? number cost it last do about the indicative recent administrative That I think the how some this I think up of general other think had second My run came is Understood. last

Denton Peng

Yes.

also, most for profitable, for Made-in-U.S. module, because is this And operation just module moving is building in solar especially now the business business the [indiscernible] starting development definitely, [indiscernible] distribution from and CapEx our to also our to we'll now installation business increasing are Our to business solar our for the we solid profitable. -- moving our of factory and be Sacramento. cell cost our profitable. this electricity And try into -- [indiscernible] move be -- project solar so always

lot we put still manufacturing quarters. So have our think a still profitable. EV I in of profitable business very we some very solar of be And strong, still will challenge for time few business R&D to a module the course, be a

good company is terms. the think profitabilities a in in short to I totally moving So the very shape to

Randy Conone

like I the up solar as we little, should be going but count head may to scale a module quite operating think manufacturing, go -- leverage a the grows, especially forward. things going bit in it's get of

Tim Moore

Good. you. Thank I questions you my and appreciate questions for today. answering that's my it

Randy Conone

Thank you.

Operator

Our next question line from Sullivan the comes Maxim Group. Tate of with

You proceed your with question. may

Tate Sullivan

capital get to it there I actually speed the you're you Should of times, couple a in may? you, and or I of on based what mention production installing increase ’XX XQ couple a Hi, just equipment? $X from started? the heard at thank follow-ups, looking decline about pilot expenditures will million if

Denton Peng

In of see equipment this some CapEx installation prepayments will view QX. in module QX, increasing the of and because the the early this in in is most QX of definitely be much too so cash a QX done, be the but spent and for you of impact CapEx little QX, in is so new some solar But will equipment maybe already -- not flow, the already bit manufacturing.

Randy Conone

Yes, time, is up time, months, our tate, I of capacity up to get plan to Sacramento full and would periods and over of quarters over CapEx weeks longer replicate go we the is once time to but going kind not it.

over growing the So CapEx time. keep should

Tate Sullivan

-- Is for type And Great. the look a in you to wanted Denton, acts about I that some the funding and domestically modules. future? previous funding possibility Act that may indicates of secure some Reduction to Inflation that? the manufactured that I the well, mean, -- for you then financing of there replicating facility ask on sources think I and also Is solar

Denton Peng

through we our to of this increase seems try planning we And And already current already other we just possibility when our at -- Yes, probably stage, the as business are ways, very open have to money some do But goes. And this we secured. to course, continue due will most we to increase it's -- funds CapEx. to currently, module some ease solar are capacity, will, the of looking we also. is kind profitable. for

Randy Conone

Yes.

think we're the time the I in down to stack grow. over capital going public probably markets we then and and on money up pursue as both funds

Tate Sullivan

was statement on that -- Or other just -- And is maybe other question to mean it me. some take after, last $X mean, about foreign financial million Great. I that income offline income quarter. If other for we could think a one before? it it in I possibly? the income $X.X businesses you've related about Is of in had was the your the quarter. currency, I million but

Randy Conone

Tate. I that, get on Can to back you

Tate Sullivan

Yes.

Randy Conone

Yes.

Okay, thanks.

Tate Sullivan

Okay. answering all thank my Well, question. you for

Denton Peng

you. Thank

Operator

you. reached Conone Thank we would closing over Ladies gentlemen, call today's have I for session. of Mr. to and turn end back to question-and-answer Randy remarks. this the like

Randy Conone

solar Thanks even next and and very forward. from in growth want industries to decade. growth small a much, Laura. we able capture are TAMs the EV of EV opportunities the has SPI percentage going highlight the tremendous revenue and over if extraordinary Energy I projected earnings solar to the potential

generate consider transactions and value capital. has in deep in several in making has companies, flow this Energy, and we acquisitions raise and Our solar SPI the are and through Energy generate a proven revenue those owns under ability and additional assets exploit will between currently SPI $XX cash million. company as of growth more going the and of to targeted we such continue synergies challenging economy, of distressed a XX% implementing and packages affiliate of division, cap loops. a markets. history we EV to energy EV also approximately to strategies sell markets, green green EV Energy and has and customers solar SPI including of integrated traded EdisonFuture, approximately storage is its publicly divisions market solar, ticker its seeking battery which Phoenix EV PEV Motor also equipment Cars, significant the to our forward, foresee energy opportunities wholly-owned to

to today. solar a forward will consequently interest That new tailwind our very We're at EV join will financing the Energy remarks believe green also to able were Energy. SPI Green private operations, sector SBI concludes We us you energy and glad increase and to look Energy the legislation and complementary continued be that to your in Federal sector.

Operator

conference. today's concludes This

You rest disconnect your for Thank at Enjoy may your the your of lines participation. you day. this time.

SPI Energy (SPIEF) 16 Aug 222022 Q2 Earnings call transcript