Spruce Power (SPRU) - 2023 Q2 - Quarterly Report

Financial Performance - Total revenues for the three months ended June 30, 2023, were $22.813 million, compared to $0 in the same period of 2022[19] - The net income attributable to stockholders for the three months ended June 30, 2023, was $3.065 million, compared to a net loss of $12.698 million in the same period of 2022[19] - For the six months ended June 30, 2023, the company reported a net loss of $17,240,000, compared to a net loss of $28,775,000 for the same period in 2022, indicating a 40% improvement in losses year-over-year[25] - The company reported a net income from continuing operations of $3.37 million for the three months ended June 30, 2022, and $14.02 million for the six months ended June 30, 2022[115] - The company reported a net loss of $17.2 million for the six months ended June 30, 2023, a 40% improvement from a loss of $28.8 million in the prior year[198] Expenses and Costs - Operating expenses for the three months ended June 30, 2023, were $24.579 million, an increase from $9.782 million in the same period of 2022[19] - Selling, general, and administrative expenses rose by $6.2 million to $16.0 million for the three months ended June 30, 2023, driven by ongoing operations of the residential solar business and integration costs[196] - Selling, general, and administrative expenses rose by $14.2 million to $31.7 million, reflecting an 81% increase compared to $17.5 million in the prior year[200] - Cost of revenues increased by $0.7 million, or 9%, to $8.6 million for the three months ended June 30, 2023, primarily due to increased operation and maintenance costs[192] Assets and Liabilities - Total assets as of June 30, 2023, were $917.195 million, an increase from $826.552 million as of December 31, 2022[17] - Current liabilities decreased to $49.575 million as of June 30, 2023, from $59.697 million as of December 31, 2022[17] - Long-term debt, net of current portion, increased to $587.393 million as of June 30, 2023, from $474.441 million as of December 31, 2022[17] - Cash and cash equivalents decreased to $162.749 million as of June 30, 2023, from $220.321 million as of December 31, 2022[17] - The accumulated deficit increased to $208.387 million as of June 30, 2023, from $193.342 million as of December 31, 2022[17] Acquisitions and Strategic Initiatives - The company completed the acquisition of Legacy Spruce Power, which had approximately 51,000 customer subscribers as of December 31, 2022, enhancing its market position in residential solar energy[35] - The company has initiated a strategic review leading to the exit from its Drivetrain business and the sale of its XL Grid operations, focusing on core solar energy assets[33][38] - The Company completed the acquisition of Legacy Spruce Power in September 2022, which had over 52,000 customer subscribers at the time, allowing for low customer acquisition costs[178] - The acquisition of SEMTH was completed on March 23, 2023, for approximately $23.0 million in cash and the assumption of $125.0 million in senior indebtedness[116] Cash Flow and Financing - Cash used in continuing operating activities was $(13.0) million for the six months ended June 30, 2023, compared to $(22.3) million in the same period last year[205] - The net change in cash and cash equivalents and restricted cash was $(48.0) million for the six months ended June 30, 2023, compared to $(29.3) million in the prior year[206] - The company believes no additional capital will be needed to execute its current business plan over the next 12 months[204] Shareholder Information - The company had 150,143,890 shares issued and outstanding as of June 30, 2023, compared to 144,375,226 shares as of December 31, 2022[17] - The Company repurchased 1.9 million shares of common stock at a weighted-average price of $0.87 per share for a total of $1.6 million during the three and six months ended June 30, 2023[169] - As of June 30, 2023, $48.4 million remained available for future share repurchases under the authorized program[169] Revenue Streams - The company generated $3,631,000 from the sale of solar energy systems during the six months ended June 30, 2023[25] - Total revenue for the three months ended June 30, 2023, was $22.8 million, with PPA revenues at $12.2 million and SLA revenues at $7.0 million[77] - For the six months ended June 30, 2023, total revenue was $40.9 million, with solar renewable energy credit revenues contributing $3.2 million[77] Legal and Regulatory Matters - The Company believes that ongoing lawsuits, including those from BMZ USA Inc. and Plastic Omnium, lack substantial merit and is vigorously defending against them[156][157] - A settlement agreement was reached with Firstar Development LLC for $2.3 million regarding reimbursement obligations under a tax recapture guaranty agreement[155] Other Financial Metrics - The effective interest rate on the Deutsche Bank Credit Agreement was 7.16% as of June 30, 2023[124] - The company has long-term debt of $613.4 million as of June 30, 2023, which includes debt assumed from acquisitions[203] - The company reported a net cash used in continuing operating activities of $13,030,000 for the six months ended June 30, 2023, compared to $22,332,000 in the prior year[25]