US tracker manufacturer Array Technologies has published its financial results for 2023, reporting total revenue of US$1.58 billion in the year, and revenue of US$341.6 million in the fourth quarter, acknowledging benefits from the 45X production tax credit implemented by the Inflation Reduction Act (IRA).
Many of the company’s financial metrics have remained consistent between the third and fourth quarters of 2023, which saw revenue decline slightly from US$350.4 million to US$341.6 million, and adjusted earnings before inflation, taxation, depreciation and amortisation (EBITDA) fall from US$57.4 million to US$48.2 million.
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This consistency has helped the company meet or exceed a number of its financial forecasts for the year. In the third quarter of 2023, Array Technologies expected to post a year-end revenue of up to US$1.57 billion, and EBITDA of US$290 million, so the company’s results will make for encouraging reading for shareholders. The graph below shows the year’s trends in revenue and EBITDA, alongside operating expenses, which remained consistent across the year, fluctuating between US$47.1 million and US$54 million.
“Throughout the year we implemented many structural enhancements to our business which improved our margin profile and enabled us to more than double our adjusted EBITDA to US$288 million and generate US$215 million of free cash flow,” said Kevin Hostetler, Array CEO. “We enter 2024 with strong momentum and meaningful additions to our US pipeline which has tripled since the second quarter of 2023.”
Hostetler’s comments refer to the announced construction of a new manufacturing plant in Albuquerque, New Mexico, as the company looks to take advantage of legislation such as the 45X manufacturing tax credit, offering financial incentives for producing equipment and materials for the energy transition on US soil. Array noted that it earned an additional US$49.9 million through benefits delivered by the tax credit, and onshoring more operations in the US could be integral as the company looks to improve its financial performance further.
Array expects it adjusted EBITDA to increase in 2024, targeting a year-end figure between US$285-315 million, but notes that it expects revenue to fall slightly, to between US$1.25-1.4 billion by the end of 2024. The company explained that a fall in commodity input prices has encouraged the firm to make arrangements for future tracker production and deliveries for the second half of 2024, and into 2025, which would eat into the projected profits for 2024.
The news comes as there is increasing attention paid to the resilience and climate suitability of PV equipment, including trackers. Earlier this year, Colleen Mahoney, vice president of product management at Array, told PV Tech Power that there has been an increase in “instances of destructive wind events” at solar facilities, and discussed how the company plans to tackle this challenge.