US residential solar specialist Sunrun has posted Q1 2020 installs largely in line with earlier quarters despite the COVID-19 crisis, pulling its 2020 guidance as reports emerge of sizeable layoffs.
Preliminary, unaudited figures out on Monday indicate the firm deployed 97.4MW over the year’s first quarter. While below its expectations of 102MW, the figure remains largely in line with quarterly roll-out records last year, including Q3 2019 (107MW) and Q4 2019 (117MW).
Sunrun – thought to be the top US residential installer after overtaking Tesla two years ago – had said in late February it was expecting to end 2020 with 15% more installs than in 2019. The firm is however now withdrawing the guidance, amid talk of “uncertainty” over COVID-19's impacts.
Sunrun admitted this week that the COVID-19 crisis has affected Q1 2020 installs but said it expects the appetite for solar to remain strong. Having enlarged its existing tax equity facilities, the firm claimed its current financing levels could fund some 216MW of leased projects at 90% of contracted value.
Sunrun’s statement came as Business Insider reported the firm has let go around 100 staff and acted to furlough “at least 65 more”. Contacted by PV Tech, Sunrun had not commented on the claims by the time this article was published.
The firm’s statement did mention “labor-related cost actions”, which it claims to have adopted to slash quarterly costs by US$30 million. These actions “strike an appropriate balance” between the welfare of staff and strengthening Sunrun versus “downside scenarios”, the firm argued.
ROTH sticks to ‘buy’ advice as Sunrun goes digital
A note from ROTH Capital Partners suggested it puts stock in Sunrun’s narrative. On Wednesday, the analysts said they were sticking to their ‘buy’ advice for the firm’s shares on Nasdaq, adding that the install figures of 97.4MW are “positive” given the current circumstances.
As ROTH noted, Sunrun claims to have ended Q1 2020 with US$366 million in cash balance, of which US$286 million is unrestricted; both figures are higher than in Q4 2019. “We believe the company has sufficient liquidity to manage through the downturn,” ROTH commented.
Separate analysis by the consultancy, out last week, showed residential players feel they may able to stick to full-year growth plans if COVID-19 impacts are contained within two to three months. Cost drops driven by the pandemic may help the segment rebound “faster than expected”, ROTH said.
Sunrun’s rivals in the space are too having to act to contain the fallout. Reports have emerged of jobs lost at Sungevity and Sunworks, while SunPower is trying to save US$50 million as it pulls its 2020 guidance and Tesla has been forced to shutter its solar factory in response to lockdowns.
This week’s update by Sunrun shed light on the firm’s moves to adapt to a reality of COVID-19 disruption. A push to make installation “contact-free” has involved using inspection drones, while the shift to a fully virtual sales workforce has seen “more leads” come through on online channels.
The widespread move to remote working will, Sunrun believes, reinforce the business case of solar and storage. Both technologies can offer “more certainty during uncertain times, greater financial value, and more protection for families when they need it most,” the firm said.
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