FTCI - Earnings call transcript Q2 2024

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Operator

Thank you for standing by. At this time, I would like to welcome everyone to FTC Solar's Second Quarter 2024 Earnings Conference Call. [Operator Instructions] Thank you. I would now like to turn the conference over to Bill Michalek, Vice President of Investor Relations. Please go ahead.

Bill Michalek

everyone, Solar's welcome, Earnings Quarter and Call. Conference you, to Second FTC XXXX Thank

you reviewed today. may and call, today's Before have information, were supplemental our which posted earlier financial release earnings

they're If not section our at you website the reviewed documents, of have ftcsolar.com. Investor available these Relations on

of joined Ahmad Financial Cathy CEO; Head member Development. the Behnen, company's Chief Chatila, I'm and Business of Directors Patrick of company's incoming Board today the Markets company the company's by Officer; Cook, and founder; a & our Capital Yann Brandt, the

Before we of includes current our beliefs begin, I that as today's the current the remind assumptions forward-looking discussion everyone environment in only on statements speaks date. and based and

from these and on refer include as risks Please assume required by forward-looking and results to such uncertainties, our such, to press and risk except SEC specific statements no information current differ more our obligation filings for update release expectations. actual As We materially factors. other the and events law. could information,

you'd includes expect, the this applicable to measure. discuss issued nearest financial non-GAAP of release earnings note and morning today. the GAAP Please full non-GAAP measures financial that reconciliation GAAP each measure As a both we'll

our is press discuss our we'll addition, in this release. metric and In of also definition backlog, our included

turn call With that, I'll Ahmad. the over to

Ahmad Chatila

and Thanks, morning, Bill, everyone. good

FTC seen, and will announced you've been August that of recently new we CEO Solar As named start likely Yann Brandt the has XX. on

company profitability, of significantly helped to to experience of SEIA great Member he and of a with exceptional very in solar few. company, company is Yann just operations grow to leading-edge in leader a CFO racking being a name a running CEO depth for a storage CCO industry the an that downstream to solar solar Board from all

immediate industry. forward We're has He will an the make having a onboard and relationship hands-on of to know looking impact. him experience and throughout wealth he excellent

into to he fortunate officially he's While this group. a few traveling believe we're able he started hasn't say was overseas, call words this dive yet, that to to I and

So let me turn it over to Yann? Yann.

Yann Brandt

generous say and opportunity the Thanks, and Ahmad. the to drop everyone. appreciate in to I introduction hello

morning good with be first, I you capacity. you. excited to So I'm started all my even speaking to new before of

I'm on to I think move and find formalities. I always big that like quickly, not you'll

the I've mentioned, a industry I've to advocate, and been decades Ahmad industry been a foster while in As nearly supplier as had of perspective growth X or and developer, solar maintaining different industry. for mandates, the for helping in whether the solar but relationships now. building consistency varying and a always roles long-term

FTC progress. that developed and since with been had I strong tracked team the it great founding familiar its have outset, behind its would make knew technology Solar company I've At the the and to you you long-term market with and to something their players, take notice unique a market have when entrenched they When into with noticed. XP new to break value-added get you came offering. need

secured my has a relationship as the spot Even leading that would the the provider FTC in with segment. quickly the about anecdotes perch, a I technology, and company customers. hear its constructability market from

feedback from similar market ahead technology FTC. the the for hear XP this segment, the into leveraging about Now I strength opportunity

and product at the found market. has as and But exceeds Yes, the company itself the developed XP far the increasingly broadest offering point readers. the through thousands know various newsletter with filled financial position conversations, the my has that current of gaps run industry, I strong professionals across on one a leader nicely most the SEIA on date. brand the many roles, whether of Board or operating company XP in an that comprehensive has the my I've industry my company from its Based footprint. to in

smoothest in and a product a relationships and top in continue improvements transition me who with brand, the see I'm weeks help to nearly possible developers looking a Staff ensure some ago, efficiency. getting has the path top-tier and help here FTC. X started. doing a forward be and EPCs been cost company to Chief with I on overall I industry as And day legwork installed possible So to at excellent of X impactful technology, clear as

the I'm and take I company on about technology of genuinely And will the be all asset industry. much closely a leader has in the opportunity to and more believe great capability. very to the transparent this couldn't this team, in success demonstrate company to and be owners. role. of way and look very I'm the forward position company's for can enable the in excited looking the market I to EPCs with you pleased CEO working a the

you. Ahmad, I'll to back turn again. it Thanks

Ahmad Chatila

I Thanks, joining much the and road. looking onboard. having very early you to forward We're from Yann. appreciate you us

Turning then review I'll to financials. Cathy it to the a make results, the overarching comments few to and over turn

we will financial targets At and the the across a it project well make Two, future. in to takeaways is degree by delays. our currently still and, is, business results to three, therefore, well our for in high quarter positioned as level, continue the that pay positioned in subscale me impacted with further greater there customer three One, growth line dividends a this continue as and And to enhancements remain revenue business, second are for we provided. were profitability quarter. main

expect be half second a our the to our better expectations. relative than half, still lower While first will we results prior half second unfortunately

last with start So let me point. that

customers relating to We primarily delays financing. project seen have interconnection and from

we scale, are compensating types you of that When layers have recent construction projects has at you're projects now common, to the in more quarters. large three and construction overlapping and Specifically, moved of start dates. throughout industry start in for these issues are expecting seen QX the to delays have opportunities we business Project adjustments.

of and again will and there achieving the the sequentially, more our not a an just quarter than delays goal more our start fourth third to it to impact. of relatively recovery quarter flat be of XXXX. delay cause revenue we're Unfortunately, breakeven a like push quarter, to In case, have yet, looks the of which our the

growth strong delays including particularly certainly recovery, disappointing, we strong are ramps. are for the well positioned do as margin a While revenue believe I quite

X For I've just the business and will bookings This the you told points, comments. won't brief for our improving our I set we've but product key cost a lowering and our included the up to accelerating our initiatives about improving break-even processes rate, profitability. few with quarters, growth progress rehash add those level. made revenue business we roadmap, past

begin today, product, the than to year, continue million specifically, sales of as the second half and recovery revenue it orders, groundwork a quarter. to I signed On we the as fourth for purchase have $XXX we the in which that lays more mentioned, stands in expect

projects have While orders we our new were not in new as since products and additions pipeline. to robust call, to purchase add continue last our

well remains market Our to And as growth internationally there are U.S. capture particularly in engagement customer strategically we adding high. opportunities, the resources the more sales capture as to

last We're to that CEO Alberto our focused he's Since an our who we presence international former working Alberto lead we growing excited been international very and of has veteran Norland, our sales that leader, announced our call, on industry efforts. Echeverria, have STI hired pipeline. enhancing tracker and is on. exceptional

Board Board And have we his her America pleased new relationships, and our incredible another capabilities. Member, Solar a to announced talent, on about role. Tamara is Mullings, and great we're would efforts. addition North take this from sales to to Tamara talked lead also great that We've stepped be Yann FTC customer down the very our which

and with Our software [indiscernible] product portfolio products customers. additional is in and way, can each across optimize ever size the as it configurations. XP project been high-wind has now we for solutions truly With broad individual technology-agnostic as XP be and the on

through. year, costs, further to direct today reductions. place on our to leading the long-term competitors. our from We're rate, with to perspective, Even gross drive started product Regarding line we margin in Last in costs run entering margin. a believe quarterly much we at we enable opportunities that million and And were higher continue margins this range. execute double-digit are $XX show can good

key million margins has overhead on been to regional while as And the in driven focus break-even have direct million and and OpEx finally, improved, or our invest over a higher $XX well on brought down mix bonus. level costs our $XXX to down We break-even depending quarter costs from reduction as $XX less, greatly pay [indiscernible]. and strategically by potentially we range revenue what whether million per to historically been continuing

to summary. Turning

we to a While point for see well at are a project we positioned delays, healthy remain recovery.

CEO internationally, to U.S. a drive not additional bookings the in new week. product starting well-regarded a great is just Customer portfolios. of sales the talent We the an over positions number in a and least in capabilities have top customers' we're strategically product engagement portfolio can a optimize investing that is priority, strong our and and industry our is of in which with exceptional

that XX% place enable long-term cost and in been we a structure is the cost product gross And enable margins. in structure reduced quarterly has have range. $XX profitability million Our to good can company

revenue the levels of flow through. and can business the the cash improve, As potential profitability show

With that, I'll to Cathy. Cathy? over turn it

Cathy Behnen

I'll and morning, outlook. provide quarter color additional second on Thanks, our some everyone. good Ahmad, and performance our

the both volumes. Revenue revenue although decrease midpoint. our million, target the X.X% and XX.X% quarter compared which on the a within with of below Beginning year-earlier a range, was to in second discussion level logistics product compared to a This quarter. represents quarter of the prior came of decrease $XX.X and at lower

to compared of gross gross was a compares in million of quarter. basis, $X.X of loss XX.X% to a loss or prior gross or in $X.X $X.X XX.X% of million midpoint the the range. revenue non-GAAP loss prior better or of XX.X% XX.X% revenue revenue, This a GAAP was of gross than million the guidance our million quarter. On loss or $X.X

in our absorb the our the remain are indirect enough to project costs. the much improved, and was costs quarter margins revenue healthy While second not high level

to significant our recover. believe have upside that We revenue continue margin when levels we

to level non-GAAP million quarter. $X.X stock-based the years expenses a other were $X.X result expenses operating were million. million in million. have to On non-GAAP expenses and $X.X compensation invest compares company represents in This prior costs, $X.X lowest the operating growth. certain the than X GAAP and as operating continuing excluding the efficiencies across found we more quarter support This year-ago to in while of basis,

or expense GAAP year-ago $X.X items, was $X.XX $XX.X in an This in prior or of and the $XX.X $X.XX losses than of better year-ago million midpoint quarter of to of approximate from loss, $X.XX per which loss a loss net net EBITDA noncash million $X.X compares million quarter. loss million a other also million, in million range. the our share guidance stock-based the net per $X.X the $XX.X compared prior compensation quarter. $XX.X and and per quarter to loss excludes the or Adjusted share was share in million

Based sheet. We our in cash by on balance liquidity. to regarding restricted Finally, with of of cash through ended we on million $XX.X end cash grow combination and quarter the the the deposits current forecast, quarter and a the collections. expect

debt and We ATM on the the the sheet million to quarter. $XX no under have about remaining continue end balance hold of program the at

the With all We have deposits utilized quarters payments. have and don't of ATM supplier managing are those the plans it. not and actively past customer currently utilize we in to few factors,

As Ahmad the increased mentioned, to of by backlog our $XX portion contracted million $XXX million.

our to us turn outlook. that, focus With the let

vary third might you million. Our be the we or more adjusted quarter; as targets million; and flat million operating between and $XX revenue $XX between revenue non-GAAP XX.X% expenses and $XX.X second between negative between this and $X.X million and following: to the expect, quarter calls $X.X ranges $XX revenue down million, greatly million million level, gross loss slightly for along the would $X at revenue, between with EBITDA these XX.X% finally, the and non-GAAP expect loss lower $X.X for from percentage levels; which of million

more relative For the expect to third revenue we quarter. than fourth to the quarter, double

over With remarks, questions. to will our prepared I operator for that, and Operator? it we turn conclude the

Operator

[Operator Instructions] with line from of comes question Philip the ROTH first Shen Markets. Capital Your

Matthew Ingraham

Matt This for on Phil. is Ingraham

follow-up. release of do expect more the And that recognized the how to the what you the sooner? much need months? in of few catalysts bookings $XXX the then I could that next to of a For are And then secondly, see quarters? the contracted backlog over And XX backlog of you be next have portion trend to million, how

Ahmad Chatila

Cathy?

Cathy Behnen

Thanks, the for Ahmad. This Cathy. question. is Thanks

giving customer guidance million in numbers. if of growing our about and the revenue the move projects terms XXXX. into really up is -- ready just is projects those those and go. right? And are the orders, QX. Those projects, contracted talked not the QX So we're execution, to it they But those given for as we've $XXX purchase And through through, those customer lined move yet in for guidance catalysts then all will execution, of

Matthew Ingraham

trend do forward? to then you And how bookings going expect

Ahmad Chatila

ahead. Cathy. Yes, go ahead, Go

Cathy Behnen

a -- market in an U.S. added really us Tamara expect about to And for relationships great want the addition bookings. Yann sales Alberto of we've we've fact really continued Well, joining added really and the the the that I market. for the addition having just with in then as industry, really team. see we've of talked strong CEO had to Ahmad say that the of acceleration international we the the

Matthew Ingraham

that out And constraints Okay, have top of on module we like permitting been are projects adding you impact new then rest from now? adversely have right the additional But availability great. that industry to AD/CVD any causing and interconnection seen of headwinds challenges Southeast know there headwind impacting the these and an Asia the pushing and the right.

Ahmad Chatila

We not lot Ahmad. industry-wide is projects, to we yet. our issue not hear on about specifically this on it have our about lot seen we a issues. it, the this current seen projects, but surface we a have hear although But Yes,

Operator

Next question comes Pavel from the with Molchanov James. Raymond line of

Pavel Molchanov

So be should -- appreciate giving turn for positive but you're guidance fact 'XX, not 'XX. EBITDA you the that said should in that

predicated gross So margin run rate on? revenue is that what and

Ahmad Chatila

We Pavel. range as $XX well to the and between around and million million $XX is $XX as quarter, million, million overhead $XX per be bonuses $XX in operating our bonuses. between need expenses current revenue without with million range expense And

million, even bonuses, without So at million, we'd we bonuses. $XX even but break $XX with break

Pavel Molchanov

be to you In helpful. that's expect margin of year, gross positive? Okay, do this QX

Ahmad Chatila

Cathy?

Cathy Behnen

that if increases gross we've providing been see at have, margin. we've margins you project as revenue talking progressing about grows, that in how aren't look the of guidance. and we Yes, But strong you our kind the definitely been we

improvements see quarter-to-quarter. you'll grows as So that revenue

Pavel Molchanov

Okay. it, potentially? $XX.X look a wouldn't capital plans mentioned negative to -- the talking were we quarter no And at need you ATM then and that you cash, program. you when balance bring fresh XX%, have pull Cathy, sheet, call if on the as about But some million, is to in EBITDA you this negative

Cathy Behnen

look at the and cash the balance projects was way up on our down we forth, to deposits vendors, we collections through our have the we we and forecast get are timing payments projects When receipts so and on our don't to the sheet. and of set the payments timing fund projects our how of need

we that's looking discussions the it at on opportunities how that's we're mean, that. So yet, the not replaced see how forecasted. we based we we have playing out now. on I forecast that revolver -- we have But do, always not this we're but in are like

Pavel Molchanov

anticipate in So inflows cash -- to was capital the working other capital Do benefit working you in second a year? the you words, from QX, -- of from nice in which more working see. inflows had half working from the

Cathy Behnen

Yes, do. we

Operator

And Capital from with Instructions] of [Operator last have comes Northland we Donovan Schafer question, Markets. our the line

Bill Michalek

Operator, is there another question?

Operator

conference further are time. There no This at today's concludes questions this call.

disconnect. may now You

FTC Solar (FTCI) 8 Aug 242024 Q2 Earnings call transcript