(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
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 communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
Item 9.01 | Financial Statements and Exhibits. |
(d) | Exhibits. |
Exhibit No. | Description | |
99.1 |
SUNRUN INC. | ||
By: | /s/ Jeanna Steele | |
Jeanna Steele General Counsel |
June 30, 2019 | December 31, 2018 | |||||||
Assets | ||||||||
Current assets: | ||||||||
Cash | $ | 299,537 | $ | 226,625 | ||||
Restricted cash | 54,182 | 77,626 | ||||||
Accounts receivable, net | 77,846 | 66,435 | ||||||
State tax credits receivable | — | 2,697 | ||||||
Inventories | 89,829 | 79,467 | ||||||
Prepaid expenses and other current assets | 8,692 | 8,563 | ||||||
Total current assets | 530,086 | 461,413 | ||||||
Restricted cash | 148 | 148 | ||||||
Solar energy systems, net | 4,149,883 | 3,820,017 | ||||||
Property and equipment, net | 50,419 | 34,893 | ||||||
Intangible assets, net | 8,382 | 10,088 | ||||||
Goodwill | 87,543 | 87,543 | ||||||
Other assets | 380,919 | 335,685 | ||||||
Total assets | $ | 5,207,380 | $ | 4,749,787 | ||||
Liabilities and total equity | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 153,206 | $ | 131,278 | ||||
Distributions payable to noncontrolling interests and redeemable noncontrolling interests | 16,444 | 15,847 | ||||||
Accrued expenses and other liabilities | 104,328 | 98,636 | ||||||
Deferred revenue, current portion | 59,818 | 47,407 | ||||||
Deferred grants, current portion | 8,029 | 7,885 | ||||||
Finance lease obligations, current portion | 11,206 | 9,193 | ||||||
Recourse debt, current portion | 239,035 | — | ||||||
Non-recourse debt, current portion | 35,158 | 35,484 | ||||||
Pass-through financing obligation, current portion | 10,666 | 26,461 | ||||||
Total current liabilities | 637,890 | 372,191 | ||||||
Deferred revenue, net of current portion | 643,613 | 544,218 | ||||||
Deferred grants, net of current portion | 217,013 | 221,739 | ||||||
Finance lease obligations, net of current portion | 14,363 | 9,992 | ||||||
Recourse debt | — | 247,000 | ||||||
Non-recourse debt, net of current portion | 1,688,989 | 1,466,438 | ||||||
Pass-through financing obligation, net of current portion | 329,968 | 337,282 | ||||||
Other liabilities | 113,992 | 48,210 | ||||||
Deferred tax liabilities | 73,926 | 93,633 | ||||||
Total liabilities | 3,719,754 | 3,340,703 | ||||||
Redeemable noncontrolling interests | 278,539 | 126,302 | ||||||
Total stockholders’ equity | 915,545 | 948,707 | ||||||
Noncontrolling interests | 293,542 | 334,075 | ||||||
Total equity | 1,209,087 | 1,282,782 | ||||||
Total liabilities, redeemable noncontrolling interests and total equity | $ | 5,207,380 | $ | 4,749,787 |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Revenue: | ||||||||||||||||
Customer agreements and incentives | $ | 92,439 | $ | 91,605 | $ | 192,289 | $ | 158,595 | ||||||||
Solar energy systems and product sales | 112,156 | 78,933 | 206,810 | 156,306 | ||||||||||||
Total revenue | 204,595 | 170,538 | 399,099 | 314,901 | ||||||||||||
Operating expenses: | ||||||||||||||||
Cost of customer agreements and incentives | 70,594 | 57,769 | 140,087 | 112,345 | ||||||||||||
Cost of solar energy systems and product sales | 86,348 | 64,268 | 164,147 | 128,847 | ||||||||||||
Sales and marketing | 70,038 | 49,237 | 125,991 | 93,316 | ||||||||||||
Research and development | 6,555 | 5,052 | 12,029 | 8,948 | ||||||||||||
General and administrative | 33,044 | 28,130 | 62,107 | 61,023 | ||||||||||||
Amortization of intangible assets | 814 | 1,051 | 1,707 | 2,102 | ||||||||||||
Total operating expenses | 267,393 | 205,507 | 506,068 | 406,581 | ||||||||||||
Loss from operations | (62,798 | ) | (34,969 | ) | (106,969 | ) | (91,680 | ) | ||||||||
Interest expense, net | 42,309 | 31,872 | 83,649 | 60,070 | ||||||||||||
Other expenses (income), net | 1,388 | 508 | 6,144 | (1,184 | ) | |||||||||||
Loss before income taxes | (106,495 | ) | (67,349 | ) | (196,762 | ) | (150,566 | ) | ||||||||
Income tax (benefit) expense | (1,910 | ) | 4,378 | (5,271 | ) | 12,581 | ||||||||||
Net loss | (104,585 | ) | (71,727 | ) | (191,491 | ) | (163,147 | ) | ||||||||
Net loss attributable to noncontrolling interests and redeemable noncontrolling interests | (103,292 | ) | (79,136 | ) | (176,336 | ) | (198,588 | ) | ||||||||
Net (loss) income attributable to common stockholders | $ | (1,293 | ) | $ | 7,409 | $ | (15,155 | ) | $ | 35,441 | ||||||
Net (loss) income per share attributable to common stockholders | ||||||||||||||||
Basic | $ | (0.01 | ) | $ | 0.07 | $ | (0.13 | ) | $ | 0.33 | ||||||
Diluted | $ | (0.01 | ) | $ | 0.06 | $ | (0.13 | ) | $ | 0.31 | ||||||
Weighted average shares used to compute net (loss) income per share attributable to common stockholders | ||||||||||||||||
Basic | 115,765 | 109,559 | 114,843 | 108,510 | ||||||||||||
Diluted | 115,765 | 117,067 | 114,843 | 113,930 |
Six Months Ended June 30, | Three Months Ended June 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Operating activities: | ||||||||||||||||
Net loss | $ | (191,491 | ) | $ | (163,147 | ) | $ | (104,585 | ) | $ | (71,727 | ) | ||||
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||||||||||||||||
Depreciation and amortization, net of amortization of deferred grants | 89,019 | 73,980 | 45,358 | 37,794 | ||||||||||||
Deferred income taxes | (5,271 | ) | 12,582 | (1,910 | ) | 4,379 | ||||||||||
Stock-based compensation expense | 12,566 | 16,242 | 6,783 | 5,548 | ||||||||||||
Interest on pass-through financing obligations | 12,378 | 7,002 | 5,906 | 3,903 | ||||||||||||
Reduction in pass-through financing obligations | (19,702 | ) | (10,142 | ) | (9,716 | ) | (5,114 | ) | ||||||||
Other noncash losses and expenses | 6,714 | 12,131 | 5,225 | 6,464 | ||||||||||||
Changes in operating assets and liabilities: | ||||||||||||||||
Accounts receivable | (12,848 | ) | 495 | (12,701 | ) | (5,722 | ) | |||||||||
Inventories | (10,362 | ) | 13,123 | (13,645 | ) | 6,598 | ||||||||||
Prepaid and other assets | (49,771 | ) | (34,013 | ) | (13,903 | ) | (20,690 | ) | ||||||||
Accounts payable | (1,567 | ) | (32,840 | ) | 21,010 | (19,858 | ) | |||||||||
Accrued expenses and other liabilities | 1,525 | 31,676 | (6,199 | ) | 38,724 | |||||||||||
Deferred revenue | 112,195 | 15,190 | 10,347 | 7,734 | ||||||||||||
Net cash provided by (used in) operating activities | (56,615 | ) | (57,721 | ) | (68,030 | ) | (11,967 | ) | ||||||||
Investing activities: | ||||||||||||||||
Payments for the costs of solar energy systems | (388,430 | ) | (346,962 | ) | (189,550 | ) | (183,772 | ) | ||||||||
Purchases of property and equipment | (13,950 | ) | (2,762 | ) | (11,433 | ) | (1,241 | ) | ||||||||
Net cash used in investing activities | (402,380 | ) | (349,724 | ) | (200,983 | ) | (185,013 | ) | ||||||||
Financing activities: | ||||||||||||||||
Proceeds from state tax credits, net of recapture | 2,329 | 10,434 | (275 | ) | 10,483 | |||||||||||
Proceeds from issuance of recourse debt | 55,000 | 2,000 | 15,000 | — | ||||||||||||
Repayment of recourse debt | (62,965 | ) | (2,000 | ) | (15,000 | ) | — | |||||||||
Proceeds from issuance of non-recourse debt | 541,249 | 250,232 | 359,597 | 154,332 | ||||||||||||
Repayment of non-recourse debt | (313,474 | ) | (48,677 | ) | (214,226 | ) | (41,555 | ) | ||||||||
Payment of debt fees | (7,462 | ) | (9,133 | ) | (4,808 | ) | (5,253 | ) | ||||||||
Proceeds from pass-through financing and other obligations | 5,282 | 98,172 | 3,497 | 96,670 | ||||||||||||
Early repayment of pass-through financing obligation | (7,597 | ) | — | — | ||||||||||||
Payment of finance lease obligations | (6,445 | ) | (4,081 | ) | (3,444 | ) | (1,968 | ) | ||||||||
Contributions received from noncontrolling interests and redeemable noncontrolling interests | 330,311 | 167,468 | 178,162 | 23,864 | ||||||||||||
Distributions paid to noncontrolling interests and redeemable noncontrolling interests | (35,607 | ) | (33,301 | ) | (17,160 | ) | (18,038 | ) | ||||||||
Acquisition of noncontrolling interests | (4,600 | ) | — | — | — | |||||||||||
Proceeds from exercises of stock options, net of withholding taxes paid on restricted stock units | 12,442 | 4,944 | 11,603 | 5,520 | ||||||||||||
Net cash provided by financing activities | 508,463 | 436,058 | 312,946 | 224,055 | ||||||||||||
Net change in cash and restricted cash | 49,468 | 28,613 | 43,933 | 27,075 | ||||||||||||
Cash and restricted cash, beginning of period | 304,399 | 241,790 | 309,934 | 243,328 | ||||||||||||
Cash and restricted cash, end of period | $ | 353,867 | $ | 270,403 | $ | 353,867 | $ | 270,403 |
Three Months Ended June 30, | ||||||||
2019 | 2018 | |||||||
MW Deployed (during the period) | 103 | 91 | ||||||
Cumulative MW Deployed (end of period) | 1,763 | 1,360 | ||||||
Gross Earning Assets under Energy Contract (end of period)(in millions) | $ | 2,252 | $ | 1,715 | ||||
Gross Earning Assets Value of Purchase or Renewal (end of period)(in millions) | $ | 1,060 | $ | 863 | ||||
Gross Earning Assets (end of period)(in millions) (1) | $ | 3,312 | $ | 2,578 | ||||
Net Earning Assets (end of period)(in millions)(1)(2) | $ | 1,429 | $ | 1,290 |
Three Months Ended June 30, | ||||||||
2019 | 2018 | |||||||
Project Value, Contracted Portion (per watt) | $ | 4.04 | $ | 3.51 | ||||
Project Value, Renewal Portion (per watt) | $ | 0.40 | $ | 0.59 | ||||
Total Project Value (per watt) | $ | 4.44 | $ | 4.10 | ||||
Creation Cost (per watt) | $ | 3.33 | $ | 3.12 | ||||
Unlevered NPV (per watt)(1) | $ | 1.11 | $ | 0.98 | ||||
NPV (in millions) | $ | 95 | $ | 77 |
(1) | Numbers may not sum due to rounding. |
(2) | Sunrun records income when it delivers tax benefits to its tax equity investors. Under partnership flip transactions this income is recognized beginning at the time of deployment. In pass-through financing transactions, income is recognized later, upon utility interconnection permission (PTO). Income recognition therefore lags in periods when the company is increasing its use of pass-through financing funds. Until PTO is received for a solar system in a pass-through financing obligation structure, the company records the expected value of tax benefits as a short term pass-through financing obligation, similar to deferred revenue accounting. The amount reflected within short-term pass-through financing obligation was $36.2 million in the second quarter of 2018. As such, the pass-through financing obligation used to calculate Net Earning Assets is reduced by $36.2 million. There was no amount reflected within short-term pass through financing in the second quarter of 2019. |
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