Second Quarter Revenue Reaches $9.9 Million,
Highest Level in Six Quarters
Company to Operate Under Name Westinghouse Solar
and Trade Under Ticker WEST
Akeena Solar, Inc. (Nasdaq:AKNS), a leading installer of solar
power systems and manufacturer of AC solar panels, today reported
revenue for the second quarter ended June 30, 2010 of $9.9 million,
its highest level in six quarters, and $3.5 million, or 54%, higher
than the first quarter of 2010.
For the second quarter, residential installation revenue reached
$7.5 million, compared with $4.7 million for the second quarter
last year, and $5.7 million for the first quarter of 2010.
Distribution revenue for the second quarter of 2010 was $2.2
million, compared with $202,000 for the second quarter last year,
and $729,000 for the first quarter of 2010.
"Our revenue performance during the quarter reflects the growing
consumer interest in our revolutionary AC solar panels, our
progress in developing new distribution channels and our improving
operational efficiency," said Gary Effren, president. "Residential
installation revenue grew each month during the second quarter
reaching $7.5 million, our highest result since the fourth quarter
of 2008 and our best quarter ever for California residential
installation revenue. Distribution revenue also had a record
quarter and contributed 22% of total revenue. Additionally,
since entering the distribution business one year ago, we have
increased our dealer network of solar installers, HVAC contractors,
electricians and roofers to 100 dealers located in 30 states and
Canada.
"This revenue momentum, along with ongoing cost control, support
our plan to reach cash flow breakeven on approximately $18 million
in revenue in the fourth quarter of this year," concluded
Effren.
Company to Operate Under Name Westinghouse Solar and
Trade Under Ticker WEST
Management also announced that the company will operate under
the name Westinghouse Solar and, effective July 23 at the opening
of the market, the company's stock will begin trading as Akeena
Solar, Inc. dba Westinghouse Solar under the stock symbol WEST.
Subject to shareholder approval, the company plans to complete the
required steps to change the name of the corporation to
Westinghouse Solar. Until then, the company will make filings with
the Securities and Exchange Commission under the name Akeena Solar,
Inc. dba Westinghouse Solar. The company's installation business in
California will continue to operate under the name Akeena
Solar.
"Solar is going mainstream, and well-known brand names are key
to widespread consumer adoption. In May, we announced a
partnership with Westinghouse, which unites their trusted brand
name with our safe and reliable solar panels," said Barry Cinnamon,
CEO. "As Westinghouse Solar, we will continue to drive the adoption
of solar power through our own installation services, through our
retail channel via Lowe's Home Improvement stores and through our
expanding dealer channel network in the United States and
Canada."
Second Quarter Financial Results
Net revenue for the second quarter of 2010 was $9.9 million, an
increase of 68.0%, compared to $5.9 million in net revenue for the
second quarter of 2009, and an increase of 53.7% from first quarter
net revenue of $6.5 million.
Residential installation revenue for the second quarter of 2010
was $7.5 million, compared to $4.7 million for the second quarter
last year and $5.7 million for the first quarter of 2010. The
year-over-year and sequential increase in residential installations
is due to the increase in kilowatts installed, partially offset by
lower residential average selling prices. Distribution revenue was
$2.2 million for the second quarter of 2010, compared to $202,000
for the second quarter last year and $729,000 for the first quarter
of 2010. The increase in distribution revenue is due to the growth
of our distribution network. Commercial revenue was $205,000 for
the second quarter of 2010, compared to $665,000 for the second
quarter last year and $36,000 for the first quarter of 2010 due to
the continued tight credit market.
Gross profit for the second quarter of 2010 was $2.1 million, or
21.0% of revenue, compared to $1.2 million, or 19.7% of revenue,
for the second quarter of 2009, and $1.5 million, or 23.0% of
revenue, for the first quarter of 2010. The year-over-year increase
in gross margin primarily reflects lower margins in the prior year
related to higher subcontractor labor costs associated with our
exit from the Colorado direct installation business. On a
sequential basis, second quarter 2010 gross margin decreased as a
result of the higher mix of distribution revenue. The average
selling price for installations in the quarter was $6.36 per watt
compared to $7.51 per watt a year ago and $6.52 per watt in the
first quarter. The year-over-year and sequential decreases in
average selling price for installations reflect lower system prices
associated with the market decline of panel costs.
Total operating expenses for the second quarter of 2010 were
$5.4 million, compared to $4.3 million for the same period last
year, and $4.8 million for the first quarter of 2010. The
year-over-year increase of $1.1 million is due to higher general
and administrative costs of $597,000 and higher sales and marketing
expense of $521,000. The general and administrative cost increase
was driven by higher payroll, research and development costs, and
the higher sales and marketing expense reflects volume-related
increases in advertising, payroll and commission costs supporting
the higher revenue. As compared to the first quarter of 2010, total
operating expenses were $632,000 higher due to the favorable bad
debt adjustment of $675,000 recorded in the first
quarter. Stock-based compensation expense was $414,000 for the
second quarter of 2010, compared to $458,000 for the same period
last year and $553,000 in the first quarter. Cash operating
expenses (adjusted for stock-based compensation expense and
depreciation and amortization expense) were $4.9 million for the
second quarter of 2010, compared to $3.7 million for the same
period last year and $4.1 million for the first quarter of 2010.
Cash operating expenses were $4.8 million in the first quarter of
2010 excluding the favorable bad debt adjustment of $675,000.
Net loss for the second quarter of 2010 was $2.5 million, or
$0.06 per share, compared to a net loss of $4.7 million, or $0.14
per share, for the second quarter of 2009, and a net loss of $2.4
million or $0.07 per share, for the first quarter of 2010. Net loss
for the first and second quarters of 2010 included a favorable
non-cash adjustment to the fair value of common stock warrants of
$884,000 and $911,000, respectively. Net loss for the second
quarter of 2009 included a non-cash charge of $1.5 million to
reflect the fair value of common stock warrants. Excluding the
adjustments to reflect the fair value of warrants in all periods,
net loss for the second quarter of 2010 would have been $3.4
million or $0.09 per share, compared to $3.1 million, or $0.10 per
share, for the same period last year and $3.3 million, or $0.09 per
share, for the first quarter of 2010.
Installations for the quarter amounted to 1,211 kilowatts,
compared to 716 kilowatts in the same quarter last year and 878
kilowatts in the first quarter of 2010. Backlog as of June
30, 2010 was $8.9 million, compared to $7.5 million as of June 30,
2009 and $11.4 million at March 31, 2010. Cash and cash
equivalents at June 30, 2010 were $4.9 million. There was no
balance drawn on the $1.0 million cash-backed line at the end of
the quarter. Common shares outstanding as of June 30, 2010 were
40.7 million compared to 37.2 million at March 31, 2010.
The number of employees at the end of the second quarter of 2010
was 176 full time equivalents, compared to 125 at June 30, 2009 and
164 at March 31, 2010.
Outlook
Management continues to project EBITDAS (excluding non-cash
stock-based compensation) breakeven for the fourth quarter of 2010
at a revenue level of approximately $18 million with approximately
25% of the revenue from distribution.
Conference Call Information
Akeena Solar will host an earnings conference call at 11:00 a.m.
PT (2:00 p.m. ET) today to discuss its second quarter 2010 earnings
results. To access the live call, please dial 877-225-1676 and for
international callers dial 706-643-9669 approximately 10 minutes
prior to the start of the conference call. The pass code is
83712596. The call is also being webcast and can be accessed from
the "Investor Relations" section of the company's website at
www.akeena.com or www.westinghousesolar.com. A replay of the call
will be available via telephone for one week, beginning two hours
after the call. To listen to the telephone replay in the U.S.,
please dial 800-642-1687 and for international callers, dial
706-645-9291. The pass code is the same as above. The
webcast will be archived on the company's website for 90 days at
www.akeena.com or www.westinghousesolar.com.
About Akeena Solar, Inc. (Nasdaq:AKNS)
dba Westinghouse Solar (Nasdaq:WEST)
Westinghouse Solar is one of the nation's leading installers and
manufacturers of solar power systems. Award winning Westinghouse
Solar panels provide the best combination of safety, efficiency and
reliability, while backed by the proven quality of the Westinghouse
name. For more information on Westinghouse Solar, visit
www.westinghousesolar.com.
The Akeena Solar, Inc. logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=5143
The Westinghouse Solar logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=7708
AKNS-E
Safe Harbor
Statements made in this release that are not historical in
nature, including those related to revenue and profitability and
product offerings in future periods, constitute forward-looking
statements within the meaning of the Safe Harbor Provisions of the
Private Securities Litigation Reform Act of 1995. Forward-looking
statements can be identified by the use of words such as "expects,"
"projects," "plans," "will," "may," "anticipates," believes,"
"should," "intends," "estimates," and other words of similar
meaning. These statements are subject to risks and uncertainties
that cannot be predicted or quantified, and our actual results may
differ materially from those expressed or implied by such
forward-looking statements. Such risks and uncertainties include,
without limitation, risks associated with the uncertainty of future
financial results, additional financing requirements, development
of new products, the effectiveness, profitability, and
marketability of such products, the ability to protect proprietary
information, the impact of current, pending, or future legislation
and regulation on the industry, the impact of competitive products
or pricing, technological changes, the ability to identify and
successfully acquire, integrate and manage client accounts and
locations and deliver our services to customers of businesses and
accounts acquired from third parties, and the effect of general
economic and business conditions. All forward-looking statements
included in this release are made as of the date of this press
release, and Akeena Solar assumes no obligation to update any such
forward-looking statements.
Akeena Solar,
Inc. |
Condensed Consolidated
Statements of Operations |
(Unaudited) |
|
|
|
|
|
|
Three Months Ended June
30, |
Six Months Ended June
30, |
|
2010 |
2009 |
2010 |
2009 |
|
|
|
|
|
Net revenue |
$ 9,923,299 |
$ 5,905,360 |
$ 16,378,804 |
$ 13,499,950 |
Cost of goods sold |
7,838,513 |
4,742,944 |
12,808,342 |
10,082,926 |
Gross profit |
2,084,786 |
1,162,416 |
3,570,462 |
3,417,024 |
Operating Expenses |
|
|
|
|
Sales and marketing |
2,003,035 |
1,481,788 |
3,692,341 |
3,135,909 |
General and administrative |
3,442,565 |
2,845,813 |
6,567,016 |
6,907,219 |
Total operating expenses |
5,445,600 |
4,327,601 |
10,259,357 |
10,043,128 |
Loss from operations |
(3,360,814) |
(3,165,185) |
(6,688,895) |
(6,626,104) |
Other income (expense) |
|
|
|
|
Interest income (expense), net |
(3,987) |
16,239 |
5,135 |
(60,302) |
Adjustment to the Fair Value of Common Stock
Warrants |
911,379 |
(1,536,755) |
1,794,902 |
(3,078,519) |
Total other income (expense) |
907,392 |
(1,520,516) |
1,800,037 |
(3,138,821) |
Loss before provision for income
taxes |
(2,453,422) |
(4,685,701) |
(4,888,858) |
(9,764,925) |
Provision for income taxes |
-- |
-- |
-- |
-- |
Net loss |
(2,453,422) |
(4,685,701) |
(4,888,858) |
(9,764,925) |
|
|
|
|
|
Net loss per share attributable to
common shareholders: |
|
|
|
|
Basic and diluted |
$ (0.06) |
$ (0.14) |
$ (0.13) |
$ (0.31) |
|
|
|
|
|
Weighted average shares used in
computing loss |
|
|
|
|
per common share: |
|
|
|
|
Basic and diluted |
38,199,845 |
31,800,509 |
37,160,726 |
30,495,063 |
|
|
|
|
|
Akeena Solar,
Inc. |
|
|
Condensed Consolidated
Balance Sheets |
|
|
|
|
|
|
(Unaudited) |
|
|
June 30, |
December 31, |
|
2010 |
2009 |
Assets |
|
|
Current assets |
|
|
Cash and cash equivalents |
$ 4,925,389 |
$ 5,804,458 |
Accounts receivable, net |
2,950,746 |
4,118,358 |
Other receivables |
30,822 |
274,169 |
Inventory, net |
6,150,290 |
5,491,074 |
Prepaid expenses and other current
assets, net |
1,781,153 |
1,197,430 |
Total current assets |
15,838,400 |
16,885,489 |
Property and equipment, net |
1,038,901 |
1,248,994 |
Goodwill |
298,500 |
298,500 |
Other assets |
409,920 |
151,338 |
Total assets |
$ 17,585,721 |
$ 18,584,321 |
Liabilities and Stockholders'
Equity |
|
|
Current liabilities |
|
|
Accounts payable |
$ 4,531,082 |
$ 4,277,599 |
Customer rebate payable |
2,374 |
60,106 |
Accrued liabilities |
1,623,507 |
1,174,979 |
Accrued warranty |
1,244,010 |
1,187,999 |
Common stock warrant liability |
529,905 |
2,536,402 |
Deferred revenue |
892,007 |
619,242 |
Current portion of capital lease
obligations |
10,959 |
18,086 |
Current portion of long-term debt |
210,813 |
222,583 |
Total current liabilities |
9,044,657 |
10,096,996 |
|
|
|
Capital lease obligations, less current
portion |
4,208 |
2,728 |
Long-term debt, less current portion |
234,540 |
352,847 |
Other long-term liabilities |
6,480 |
19,440 |
Total liabilities |
9,289,885 |
10,472,011 |
|
|
|
Commitments, contingencies and subsequent
events |
|
|
|
|
|
Stockholders' equity: |
|
|
Common stock $0.001 par value;
100,000,000 shares authorized; 40,657,825 and |
|
|
36,406,944 shares issued and outstanding
at June 30, 2010 and December 31, 2009 |
40,658 |
36,407 |
Additional paid-in capital |
64,965,686 |
59,897,553 |
Accumulated deficit |
(56,710,508) |
(51,821,650) |
Total stockholders' equity |
8,295,836 |
8,112,310 |
Total liabilities and stockholders'
equity |
$ 17,585,721 |
$ 18,584,321 |
|
|
|
CONTACT: Lippert / Heilshorn & Associates
Investor Relations Contact:
Jody Burfening
(212) 838-3777
jburfening@lhai.com
Akeena Solar, Inc.
Barry Cinnamon, CEO
(408) 402-9400
bcinnamon@westinghousesolar.com
Akeena Solar (MM) (NASDAQ:AKNS)
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