U.S. solar powerhouse SunEdison saw year-on-year losses grow dramatically as sales climbed 11% to $681.2 million.
The company also added 561 MW to its pipeline and completed nearly 300 MW of projects in the quarter.
SunEdisons loss grew from $108 million a year ago to $283.4 million between July and September. The Missouri-based group attributed the higher loss to "one-time asset impairment charges, higher operating expenses related to growth initiatives and costs associated with holding rather than selling completed projects."
SunEdison CEO Ahmad Chatila said the company continued its strong track record by completing construction of 297 MW during the quarter while converting approximately 1 GW of future potential projects into backlog and adding 561 MW of gross pipeline.
Chatila added that the group also launched the TerraForm Power initial public offering in July. "By taking advantage of the lower cost of capital of yieldcos, we believe we are able to create significant additional value for our shareholders."
The company said its Solar Energy segment revenue was higher year-over-year, driven by higher solar project sales volume and higher energy sales. Solar Energys third-quarter revenue included $4 million of previously deferred solar project revenue. The units revenue also increased sequentially from the second quarter, likewise driven by higher solar project sales volume and higher energy sales. The division recognized revenue from 95 MW of solar projects in the quarter, up from 90 MW in the second quarter of 2014 and 42 MW in the third quarter of last year. The company constructed an additional 251 MW of projects in the period.
Solar project pipeline, backlog and construction
The Solar Energy segment ended the 2014 third quarter with a project pipeline of 4.5 GW, up 264 MW compared to the prior quarter and up 1.4 GW from a year ago. The company added 561 MW to its pipeline additions in third quarter while the backlog at the end of September was at 1.8 GW, up 750 MW from the prior quarter with 1 GW of gross additions.
SunEdison classifies a solar project as "pipeline" when it has a signed or awarded power purchase agreement (PPA) or other energy off-take agreement or has achieved each of the following three items: site control, an identified interconnection point with an estimate of the interconnection costs and an executed energy off-take agreement or the determination that there is a reasonable likelihood that an energy off-take agreement will be signed. The company classifies solar projects as "backlog" if there is an associated executed PPA or other energy off-take deal, such as a feed-in-tariff. There can be no assurance that all pipeline or backlog projects will convert to revenue because in the ordinary course of our development business some fall-out is typical and certain projects will not be built, SunEdison underscored.
At the end of the third quarter, SunEdison had 610 MW of its pipeline under construction compared to 475 MW at the end of the second quarter and 558 MW at the end of Q3 2013.
For the fourth quarter, SunEdison predicts non-GAAP sales from solar energy systems to range between 84 MW to 124 MW.
SunEdison said the use of non-GAAP measures accounting measures that do not follow generally accepted accounting principles (GAAP) offered investors a better understanding of the ultimate income and near-term cash flows generated by the groups solar energy segment. Non-GAAP measures include deferrals required under GAAP real estate and lease accounting for some of SunEdison's direct sales and or its sale-leaseback transactions as well as related tax impacts, it added.
In addition, the company expects to have between 335 MW and 485 MW of solar systems completed in the fourth quarter and average project pricing of between $2.50/watt and $2.75/watt for fully developed solar energy systems.
For the full year, SunEdison reckons with a total non-GAAP sales volume in the range of 260 MW to 300 MW; between 1 GW and 1.15 GW of completed solar systems; average project pricing between $2.50/watt and $3.00/watt for fully developed solar energy systems and between 740 MW and 850 MW of solar energy systems retained on its balance sheet.
This content is protected by copyright and may not be reused. If you want to cooperate with us and would like to reuse some of our content, please contact: firstname.lastname@example.org.