8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of Earliest Event Reported): November 3, 2010

REAL GOODS SOLAR, INC.

(Exact Name of Registrant as Specified in its Charter)

Colorado	001-34044	26-1851813
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

833 W. South Boulder Road, Louisville, CO 80027-2452

(Address of Principal Executive Offices)

Registrant’s telephone number, including area code: (303) 222-8400

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communication pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Section 2 – Financial Information

Item 2.02 Results of Operations and Financial Condition

On November 3, 2010, Real Goods Solar, Inc. issued a press release announcing results for its third quarter ended September 30, 2010. A copy of the press release is attached as Exhibit 99.1.

This Current Report on Form 8-K and the earnings press release attached hereto are being furnished by Real Goods to Item 2.02 “Results of Operations and Financial Condition.” In accordance with General Instruction B.2 of Form 8-K, the information contained in this Current Report on Form 8-K, including Exhibit 99.1, shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section or Sections 11 and 12(a)(2) of the Securities Act of 1933, as amended. In addition, this information shall not be deemed incorporated by reference into any of the Registrant’s filings with the Securities and Exchange Commission, except as shall be expressly set forth by specific reference in any such filing.

Section 9 – Financial Statements and Exhibits

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

Exhibit No.	Description of Exhibit
99.1	Press Release issued by Real Goods Solar on November 3, 2010.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

REAL GOODS SOLAR, INC.
By:	/S/ ERIK ZECH
	Erik Zech
	Chief Financial and Accounting Officer

Date: November 3, 2010

Exhibit Index

Exhibit No.	Description of Exhibit
99.1	Press Release issued by Real Goods Solar on November 3, 2010.

EX-99.1

Exhibit 99.1

Real Goods Solar Reports Record Third Quarter Results

• Record Revenue of $24.6 Million

• Operating Income Increased Over Three Times to $1.2 Million

Boulder, CO, November 3, 2010 – Real Goods Solar, Inc. (NASDAQ: RSOL), a leading residential solar energy integrator, today announced results for its third quarter ended September 30, 2010.

Net revenue for the third quarter of 2010 increased 7.2% to $24.6 million from $23.0 million recorded in the same period last year. All of the year-over-year revenue growth was organic.

Gross profit increased to $6.2 million, or 25.3% of net revenue, for the third quarter of 2010 from $5.0 million, or 21.8% of net revenue, in the comparable period last year. The increase in gross profit percentage primarily reflects improved selling and installation practices as well as declines in module prices over the last year.

Operating expenses as a percent of net revenue decreased to 20.5% for the third quarter of 2010 from 20.7% in the comparable period last year. This decrease primarily reflects the leveraging of fixed costs and cost savings achieved by integrating all acquired businesses onto a single set of systems and a unified brand.

Operating income for the third quarter of 2010 improved significantly to $1.2 million, as compared to $258 thousand for the comparable period last year. EBITDA for the third quarter of 2010, prior to shared-based and bonus compensation, was $1.9 million, or 7.5% of net revenue. Refer to the Non-GAAP Financial Measures table below.

Net income for the third quarter of 2010 improved to $704 thousand, or $0.04 per share, as compared to $158 thousand, or $0.01 per share, for the comparable period last year.

For the nine months ended September 30, 2010, revenue grew to $57.2 million, a 26.4% increase from $45.2 million in the comparable period last year. Operating income for the nine month period was $1.6 million as compared to a loss of $2.9 million last year. Net income for the nine month period was $1.0 million as compared to a loss of $1.8 million last year.

For the twelve month period ended September 30, 2010, revenue increased to $76.3 million, representing 30.0% organic revenue growth from the previous twelve months. Operating income for the twelve month period was $2.0 million and EBITDA, prior to share-based and bonus compensation, was $3.6 million. Refer to the Non-GAAP Financial Measures table below.

“We are very pleased with our third quarter revenue performance, our improved gross profit margin and our expanding profitability,” commented John Schaeffer, President. “Internal revenue growth for the last twelve months has been 30% and we continue to see strong demand for both residential and commercial solar. We remain focused on building our backlog and on hiring installation crews where appropriate to expand our production capacity and keep up with demand.”

“Our financial metrics across the board were very strong in the third quarter,” said Erik Zech, Chief Financial Officer. “Our ability to show improved gross margins along with declines in operating expenses as a percentage of net revenue are both indicative of the progress we have made in optimizing our business. Our balance sheet remained strong with cash increasing by $3.0 million from the end of the year and by $3.4 million from the previous quarter to $15.2 million, and no debt.”

Real Goods Solar will host a conference call tomorrow, November 4, 2010, at 8:30 a.m. PDT (11:30 a.m. EDT) to review the third quarter results.

Dial-in No.:	877-941-1430 (domestic) or 480-629-9667 (international)
Passcode:	Real Goods

A replay of the call will begin approximately two hours after the end of the call and will continue until midnight EST on November 11, 2010.

Replay number:	877-870-5176 (domestic) or 858-384-5517 (international)
Pin:	4381108

About Real Goods Solar, Inc.

Real Goods Solar, Inc. is a leading residential solar energy integrator, having installed over 6,500 solar systems. Real Goods Solar offers turnkey solar energy services, and has 32 years of experience in residential solar energy, beginning with the sale in 1978 of the first solar photovoltaic, or PV, panels in the United States. For more information about Real Goods Solar, please visit www.realgoodssolar.com, or call (888) 507-2561.

This press release includes forward-looking statements relating to matters that are not historical facts. Forward-looking statements may be identified by the use of words such as “expect,” “intend,” “believe,” “will,” “should” or comparable terminology or by discussions of strategy. While Real Goods Solar believes its assumptions and expectations underlying forward-looking statements are reasonable, there can be no assurance that actual results will not be materially different. Risks and uncertainties that could cause materially different results include, among others, introduction of new products and services, completion and integration of acquisitions, the possibility of negative economic conditions, and other risks and uncertainties included in Real Goods Solar’s filings with the Securities and Exchange Commission. Real Goods Solar assumes no duty to update any forward-looking statements.

Contact:	Erik Zech
	Chief Financial Officer
	415-295-4952
	erik.zech@realgoods.com

REAL GOODS SOLAR, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(In thousands, except per share data)

	Three Months  Ended September 30, 2010				Three Months  Ended September 30, 2009
Net revenue	$	24,626	100.0	%	$	22,966	100.0	%
Cost of goods sold		18,407	74.7	%		17,952	78.2	%
Gross profit		6,219	25.3	%		5,014	21.8	%
Operating expenses		5,044	20.5	%		4,756	20.7	%
Income from operations		1,175	4.8	%		258	1.1	%
Interest income		2	0.0	%		1	0.0	%
Income before income taxes		1,177	4.8	%		259	1.1	%
Income tax expense		473	1.9	%		101	0.4	%
Net income attributable to Real Goods Solar, Inc.	$	704	2.9	%	$	158	0.7	%
Weighted-average shares outstanding:
Basic		18,305				18,271
Diluted		18,305				18,273
Net income per share attributable to Real Goods Solar, Inc. common shareholders:
Basic	$	0.04			$	0.01
Diluted	$	0.04			$	0.01

REAL GOODS SOLAR, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(In thousands, except per share data)

	Nine Months  Ended September 30, 2010				Nine Months  Ended September 30, 2009
Net revenue	$	57,162	100.0	%	$	45,210		100.0	%
Cost of goods sold		41,874	73.3	%		34,616		76.6	%
Gross profit		15,288	26.7	%		10,594		23.4	%
Operating expenses		13,663	23.9	%		13,527		29.9	%
Income (loss) from operations		1,625	2.8	%		(2,933	)	-6.5	%
Interest income		5	0.0	%		1		0.0	%
Income (loss) before income taxes		1,630	2.8	%		(2,932	)	-6.5	%
Income tax expense (benefit)		641	1.1	%		(1,138	)	-2.5	%
Net income (loss) attributable to Real Goods Solar, Inc.	$	989	1.7	%	$	(1,794	)	-4.0	%
Weighted-average shares outstanding:
Basic		18,298				18,145
Diluted		18,373				18,145
Net income (loss) per share attributable to Real Goods Solar, Inc. common shareholders:
Basic	$	0.05			$	(0.10	)
Diluted	$	0.05			$	(0.10	)

REAL GOODS SOLAR, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands)

	September 30, 2010		December 31, 2009
Assets
Current assets:
Cash and cash equivalents	$	15,227	$	12,206
Accounts receivable, net		16,022		13,996
Inventory, net		7,311		4,769
Deferred costs on uncompleted contracts		313		1,024
Deferred advertising costs		254		114
Receivable and deferred tax assets		1,007		833
Other current assets		714		598
Total current assets		40,848		33,540
Property and equipment, net		5,217		5,145
Goodwill		732		732
Deferred tax assets		2,942		3,064
Other assets		527		813
Total assets	$	50,266	$	43,294
Liabilities and shareholders’ equity
Current liabilities:
Accounts payable	$	14,452	$	8,821
Accrued liabilities		2,460		2,500
Payable to Gaiam		1,743		1,636
Total current liabilities		18,655		12,957
Total shareholders’ equity		31,611		30,337
Total liabilities and shareholders’ equity	$	50,266	$	43,294

Non-GAAP Financial Measures

We have utilized the non-GAAP information set forth below as an additional device to aid in understanding and analyzing our financial results for the three and nine months ended September 30, 2010. We believe that these non-GAAP measures will allow for a better evaluation of the operating performance of our business and facilitate meaningful comparison of the results in the current period to those in prior periods and future periods. Reference to these non-GAAP measures should not be considered a substitute for results that are presented in a manner consistent with GAAP.

Reconciliations of our three and twelve months ended September 30, 2010 GAAP income from operations to our non-GAAP earnings before interest, taxes, depreciation, and share-based and bonus compensation are set forth below (unaudited, in thousands):

	For the Three Months  Ended September 30, 2010		For the Twelve Months Ended September 30, 2010
Income from operations	$	1,175	$	1,962
Exclusion of depreciation		133		505
Exclusion of share-based and bonus compensation		542		1,113
Non-GAAP EBITDA	$	1,850	$	3,580