Spruce Power (US:SPRU)2024-08-14 20:33Financial Performance - Total revenues for Q2 2024 were $22,481,000, a slight decrease of 1.5% compared to $22,813,000 in Q2 2023[16] - The net loss attributable to stockholders for Q2 2024 was $8,578,000, compared to a net income of $3,065,000 in Q2 2023[16] - The company reported a loss from operations of $3,360,000 in Q2 2024, compared to a loss of $972,000 in Q2 2023[16] - The net loss for the six months ended June 30, 2024, was $11,023,000, compared to a net loss of $17,240,000 for the same period in 2023, indicating an improvement of approximately 36%[22] - For the six months ended June 30, 2024, total revenues were $40.8 million, compared to $40.9 million for the same period in 2023[50] - Revenues decreased by $0.3 million, or 1.5%, to $22.5 million for the three months ended June 30, 2024, compared to $22.8 million for the same period in 2023[145] - For the six months ended June 30, 2024, revenues decreased by $0.1 million, or 0.3%, to $40.8 million compared to $40.9 million for the same period in 2023[154] Operating Expenses - Operating expenses increased to $25,841,000 in Q2 2024, up 8.6% from $23,785,000 in Q2 2023[16] - Cost of revenues increased by $1.5 million, or 18.0%, to $10.1 million for the three months ended June 30, 2024, primarily due to higher operating and maintenance costs[145] - Selling, general and administrative expenses rose by $0.7 million, or 4.5%, to $16.7 million for the three months ended June 30, 2024, driven by higher compensation expenses including one-time severance costs[146] Cash and Liquidity - Cash and cash equivalents decreased to $116,588,000 as of June 30, 2024, down from $141,354,000 at December 31, 2023[13] - The cash and cash equivalents at the end of the period were $150,209,000, down from $192,110,000 at the beginning of the period[23] - Total cash, cash equivalents, and restricted cash amounted to $150.2 million as of June 30, 2024, down from $192.1 million as of June 30, 2023[38] - Net cash used in continuing operating activities was $27,402,000 for the six months ended June 30, 2024, compared to $16,113,000 for the same period in 2023, reflecting an increase in cash outflow[22] - The net change in cash and cash equivalents for the six months ended June 30, 2024, was $(22,732) thousand, an improvement from $(48,034) thousand in the prior year[164] Assets and Liabilities - Total assets decreased to $858,434,000 as of June 30, 2024, from $895,021,000 at December 31, 2023[14] - Total liabilities decreased to $653,871,000 as of June 30, 2024, down from $680,352,000 at December 31, 2023[14] - The accumulated deficit increased to $(268,920,000) as of June 30, 2024, compared to $(257,888,000) at December 31, 2023[14] - The company reported a total stockholders' equity of $265,966,000 as of June 30, 2023, compared to $288,891,000 at the end of the previous quarter[20] Investments and Acquisitions - The acquisition of Legacy Spruce Power was completed for a total purchase price of $32.6 million, which included cash payments of $61.8 million less cash and restricted cash acquired of $29.2 million[65] - The acquisition of SEMTH was completed for approximately $23.0 million in cash, with the assumption of $125.0 million in outstanding senior indebtedness[73] - The estimated fair value of the investment in the SEMTH Master Lease was approximately $146.9 million on the transaction date[74] Stock and Equity - The weighted-average shares outstanding, basic, increased to 19,271,954 in Q2 2024 from 18,611,757 in Q2 2023[16] - The company performed a one-for-eight reverse stock split effective October 6, 2023, impacting all share amounts retrospectively[31] - Stock-based compensation expense for the three months ended June 30, 2024, was $0.5 million, a decrease from $0.8 million for the same period in 2023[90] - The Company granted 295,229 stock options during the six months ended June 30, 2024, with an average exercise price of $3.74[91] Legal and Regulatory Matters - The Company reached a settlement of $19.5 million related to a securities class action, with a net payment of $15.0 million after insurance recoveries[106] - The Company is involved in ongoing legal proceedings but believes the outcomes will not significantly impact its financial position[105] - The Company is cooperating with state attorney generals' investigations regarding its sales and marketing protocols[111] Future Outlook and Strategy - The corporate strategy focuses on subscription-based solutions for distributed energy resources, aiming to enhance customer service and operational efficiency[137] - Future growth is dependent on acquiring operating home solar energy systems in bulk from other companies, leveraging existing market opportunities[140] - The ability to raise capital from third parties is critical for supporting ownership of existing assets and enabling future growth[141]