SunPower sees quarterly results fuel late-year surge, as annual revenues push past $2.2 billion

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Fueled by fourth-quarter sales of $937 million, SunPower saw its fiscal 2010 revenues exceed $2.2 billion and net income come in at more than $178 million—a better-than-fivefold improvement over its FY2009 income result.  The solar company said it exceeded its 2010 plan in both its residential/commercial and utility and power plant business units, recognizing 546MW in installed capacity.

CEO Tom Werner credited the solid quarterly and annual results to “strong execution of our strategy as we achieved annual revenue growth of 46% and materially exceeded the high end of our non-GAAP annual earnings per share guidance given at our analyst conference in November.”

“Operationally, we successfully integrated our acquisition of SunRay Renewable Ventures, which significantly contributed to recognizing revenue on more than 100MW of power plants in Europe in 2010,” he said. “We also increased our global dealer network to 1,500 partners and are on our way to 2,000 partners this year.”  

“In addition, we commenced operations of our Fab 3 Malaysian joint venture, and we are on track to produce more than a third of our solar cells at Fab 3 this year,” he noted. “Due to the success of our accelerated cost reduction roadmap, we are on plan to achieve our efficiency-adjusted panel cost goal of $1.08 per watt in the fourth quarter of 2011.”

“Given our strong 2010 performance, robust downstream demand and strong visibility, we are confident in our ability to deliver on our improved 2011 plan,” he concluded.

The company cited several key milestones achieved since the third quarter, including an agreement to sell 250MW California Valley Solar Ranch power plant to NRG Solar; the industry's first publicly-rated solar project bonds, approximately Euro 195 million, and sale of the 72MW Montalto Solar Park in Italy; the dedication of 1.4GW Fab 3 joint venture in Malaysia with AU Optronics; the signing of three power purchase agreements with Southern California Edison totaling 711MW; the expansion of the global utility and power plant pipeline to more than 5GW in 2010; and a record North American commercial backlog, with 90% booked for 2011.

CFO Dennis Arriola said that the company’s “strong operating performance in the fourth quarter, coupled with our successful financing and sale of power plants globally, resulted in ending cash of more than $900 million in 2010. We enter 2011 with a strong balance sheet, ample liquidity, and a continued focus on improving our cash flow from operations and working capital management.  

“Given the strong visibility of our 2011 revenue plan and our confidence in achieving our goals, we have hedged more than 65% of our expected European business at a rate of 1 euro to $1.34 U.S. dollars. As a result of the continued growth in our backlog of business, we have increased our revenue and earnings per share guidance for the first quarter and for full-year 2011 from the forecast we provided at our Analyst Conference in November.”

The updated guidance calls for Q1 2011 revenues in the $475 million to $525 million range, with annual fiscal revenues between $2.8 billion and $2.95 billion, based on 825 to 920 of total recognized megawatts.

The company’s production capacity stood at 595MW at year end, and will nearly double to 1005MW by the end of 2011, nearly doubling again to 2005MW by late 2013.

In terms of its near-term manufacturing cost roadmap, SunPower said it will trim 23 cents from Q4 2010’s $1.71/W to $1.48/W by Q4 2011, through a combination of reductions in the poly, ingot, wafering, cell, and module processes.

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