US-based solar tracker manufacturer FTC Solar has again downgraded financial forecasts, reducing its Q4 revenue expectations amidst PV project pushbacks in the US.
Reporting its Q3 results yesterday (10 November), FTC said the downwards revenue projection, adjusted down by roughly US$5 million to between US$70 – 80 million, was due to an “abrupt delay of customer purchase order decisions from the fourth quarter into 2022”, mainly due to higher module prices and supply uncertainty coupled with elevated material and logistic costs.
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This comes on top of a difficult year for FTC Solar, which in August confirmed that it had made a non-GAAP loss of US$16.97 million in the three months ended 30 June 2021. This was on top of an announcement in June that said the company was expecting to record a loss of up to US$17.3 million in Q2 2021.
“Expanding a bit more on the current environment since our last update in mid-August, steel pricing has continued to remain elevated. The global logistics environment has continued to deteriorate with freight near record highs, and perhaps the biggest change has been in the module space, where pricing has increased significantly,” its newly appointed CEO Sean Hunkler said in a call with analysts.
Hunkler said that module price rises had caused “an increasing number of developers to re-evaluate their construction timelines for certain projects” and that 50% of “uncontracted project timelines were being pushed out by a quarter or two”.
The company announced that it had a 1.7GW agreement to supply trackers to multiple projects in development by “a leading project developer”, which represents a “meaningful portion of pipeline under development by them,” said Hunkler. “As part of the transaction, FTC intends to make a limited amount of development capital available to some of the projects,” he added.
It has also been awarded new supply agreements for three projects in Australia and two in Africa. The company’s contracted and awarded order growth was up US$267 million since its update in August, representing a growth of 580% on a year-to-date basis, it said in a media release.
FTC Solar had said it was turning to alternative shipping methods and cost-cutting initiatives in a bid to return the business to profitability in Q4, and yesterday’s results show the company recorded a GAAP net loss of $US22.9 million or US$0.24 per share, compared to a loss of US$52.4 million, or $0.61 per share, in the Q2.
FTC’s total third quarter revenue was US$53 million, an increase of 5.8% compared to the prior quarter, but this was not enough to offset the higher costs associated with delayed contracts due to supply uncertainty and higher costs.
Shares in FTC Solar fell by more than 15% after the results disclosure, falling to US$7.98 per share.
Analyst call transcript from SeekingAlpha.
