SolarEdge Announces Second Quarter 2018 Financial Results
Second Quarter 2018 Highlights
-
Total revenues of
$227.1 million - GAAP gross margin of 36.1%
-
GAAP net diluted EPS of
$0.72 -
Non-GAAP net diluted EPS of
$0.82 - 985 Megawatts (AC) of inverters shipped
“We ended the second quarter of 2018 with record revenues, stable
operating income and continued strong cash generation while expanding
our activities on all fronts,” said
Second Quarter 2018 Summary
The Company reported record revenues of
GAAP gross margin was 36.1%, down from 37.9%, in the prior quarter and up from 34.6% year over year.
GAAP operating expenses was
GAAP operating income was
GAAP net income was
Non-GAAP net income was
GAAP net diluted earnings per share (“EPS”) was
Non-GAAP net diluted EPS was
Cash flow from operating activities was
As of
Outlook for the Third Quarter 2018
The Company also provides guidance for the third quarter ending
-
Revenues to be within the range of
$230 million to $240 million ; - Gross margins expected to remain flat within the range of 36% to 38%.
Conference Call
The Company will host a conference call to discuss these results at
A replay of the webcast will be available in the Investor Relations section of the Company’s web site approximately two hours after the conclusion of the call and will remain available for approximately 30 calendar days.
About
Use of Non-GAAP Financial Measures
The Company has presented certain non-GAAP financial measures in this
release. Generally, a non-GAAP financial measure is a numerical measure
of a company's performance, financial position, or cash flows that
either exclude or include amounts that are not normally excluded or
included in the most directly comparable measure calculated and
presented in accordance with generally accepted accounting principles in
The Company uses these non-GAAP financial measures to analyze its operating performance and future prospects, develop internal budgets and financial goals, and to facilitate period-to-period comparisons. The Company believes that these non-GAAP financial measures reflect an additional way of viewing aspects of its operations that, when viewed with its GAAP results, provide a more complete understanding of factors and trends affecting its business.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995
This release contains forward looking statements which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include information, among other things, concerning: our possible or assumed future results of operations; future demands for solar energy solutions; business strategies; technology developments; financing and investment plans; dividend policy; competitive position; industry and regulatory environment; general economic conditions; potential growth opportunities; and the effects of competition. These forward-looking statements are often characterized by the use of words such as “anticipate,” “believe,” “could,” “seek,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “will,” “would” or similar expressions and the negative or plural of those terms and other like terminology.
Forward-looking statements are only predictions based on our current
expectations and our projections about future events. These
forward-looking statements involve known and unknown risks,
uncertainties and other factors that may cause our actual results,
levels of activity, performance or achievements to be materially
different from those expressed or implied by the forward-looking
statements. Given these factors, you should not place undue reliance on
these forward-looking statements. These factors include, but are not
limited to, the matters discussed in the section entitled “Risk Factors”
of our Annual Report on Form 10-K for the year ended
SOLAREDGE TECHNOLOGIES, INC. |
||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||
(In thousands, except per share data) | ||||||||||||||||
Three months ended | Six months ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
Unaudited | Unaudited | |||||||||||||||
Revenues | $ | 227,118 | $ | 136,099 | $ | 436,989 | $ | 251,153 | ||||||||
Cost of revenues | 145,172 | 89,033 | 275,446 | 165,411 | ||||||||||||
Gross profit | 81,946 | 47,066 | 161,543 | 85,742 | ||||||||||||
Operating expenses: | ||||||||||||||||
Research and development | 19,551 | 12,725 | 37,426 | 24,183 | ||||||||||||
Sales and marketing | 15,954 | 11,961 | 32,159 | 22,736 | ||||||||||||
General and administrative | 5,776 | 3,265 | 10,465 | 7,704 | ||||||||||||
Total operating expenses |
41,281 | 27,951 | 80,050 | 54,623 | ||||||||||||
Operating income | 40,665 | 19,115 | 81,493 | 31,119 | ||||||||||||
Financial income (expenses), net | (2,480 | ) | 3,595 | (1,896 | ) | 5,005 | ||||||||||
Other expenses | - | - | 64 | - | ||||||||||||
Income before taxes on income | 38,185 | 22,710 | 79,533 | 36,124 | ||||||||||||
Taxes on income (tax benefit) | 3,617 | 186 | 9,279 | (575 | ) | |||||||||||
Net income | $ | 34,568 | $ | 22,524 | $ | 70,254 | $ | 36,699 |
SOLAREDGE TECHNOLOGIES, INC. |
|||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | |||||||||
(In thousands) | |||||||||
June 30, |
December 31, |
||||||||
2018 | 2017 | ||||||||
Unaudited | |||||||||
ASSETS | |||||||||
CURRENT ASSETS: | |||||||||
Cash and cash equivalents | $ | 214,540 | $ | 163,163 | |||||
Restricted cash | 2,049 | 1,516 | |||||||
Marketable Securities | 134,821 | 77,264 | |||||||
Trade receivables, net | 118,103 | 109,528 | |||||||
Prepaid expenses and other accounts receivable | 44,520 | 42,223 | |||||||
Inventories | 102,014 | 82,992 | |||||||
Total current assets |
616,047 | 476,686 | |||||||
LONG-TERM ASSETS: | |||||||||
Marketable securities | 86,144 | 103,120 | |||||||
Property, equipment and intangible assets, net | 68,532 | 52,297 | |||||||
Prepaid expenses and lease deposits | 956 | 862 | |||||||
Deferred tax assets, net | 11,551 | 8,340 | |||||||
Total long term assets |
167,183 | 164,619 | |||||||
Total assets |
$ | 783,230 | $ | 641,305 | |||||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||
CURRENT LIABILITIES: | |||||||||
Trade payables, net | $ | 81,610 | $ | 69,488 | |||||
Employees and payroll accruals | 23,510 | 22,544 | |||||||
Warranty obligations | 18,964 | 14,785 | |||||||
Deferred revenues | 3,407 | 2,559 | |||||||
Accrued expenses and other accounts payable | 26,480 | 20,378 | |||||||
Total current liabilities |
153,971 | 129,754 | |||||||
LONG-TERM LIABILITIES: | |||||||||
Warranty obligations | 78,327 | 64,026 | |||||||
Deferred revenues | 47,595 | 31,453 | |||||||
Lease incentive obligation | 1,616 | 1,765 | |||||||
Non-current tax liabilities | 16,830 | 16,840 | |||||||
Total long-term liabilities |
144,368 | 114,084 | |||||||
COMMITMENTS AND CONTINGENT LIABILITIES | |||||||||
STOCKHOLDERS’ EQUITY: | |||||||||
Common stock | 5 | 4 | |||||||
Additional paid-in capital | 353,470 | 331,902 | |||||||
Accumulated other comprehensive loss | (1,138 | ) | (611 | ) | |||||
Retained earnings | 132,554 | 66,172 | |||||||
Total stockholders’ equity |
484,891 | 397,467 | |||||||
Total liabilities and stockholders’ equity |
$ | 783,230 | $ | 641,305 |
SOLAREDGE TECHNOLOGIES, INC. |
|||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||
(In thousands) | |||||||||
Six months ended | |||||||||
June 30, | |||||||||
2018 | 2017 | ||||||||
Unaudited | |||||||||
Cash flows provided by operating activities: |
|||||||||
Net income | $ | 70,254 | $ | 36,699 | |||||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||
Depreciation and amortization of property, equipment and intangible assets | 5,053 | 3,130 | |||||||
Amortization of premiums on available-for-sale marketable securities | 1,014 | 791 | |||||||
Stock-based compensation | 13,977 | 7,646 | |||||||
Deferred tax assets, net | (3,018 | ) | (2,105 | ) | |||||
Loss on disposals of fixed assets | 64 | - | |||||||
Changes in assets and liabilities: | |||||||||
Inventories | (18,952 | ) | 11,153 | ||||||
Prepaid expenses and other accounts receivable | (2,135 | ) | (12,675 | ) | |||||
Trade receivables, net | (9,203 | ) | (8,399 | ) | |||||
Trade payables, net | 12,143 | 2,007 | |||||||
Employees and payroll accruals | 1,028 | 1,206 | |||||||
Warranty obligations | 18,479 | 6,965 | |||||||
Deferred revenues | 13,120 | 6,935 | |||||||
Accrued expenses and other accounts payable | 6,194 | 3,958 | |||||||
Lease incentive obligation | (148 | ) | (148 | ) | |||||
Net cash provided by operating activities | 107,870 | 57,163 | |||||||
Cash flows used in investing activities: |
|||||||||
Purchase of property and equipment | (21,385 | ) | (7,611 | ) | |||||
Investment in available-for-sale marketable securities | (89,389 | ) | (74,106 | ) | |||||
Maturities of available-for-sale marketable securities | 46,825 | 31,674 | |||||||
Net cash used in investing activities | (63,949 | ) | (50,043 | ) | |||||
Cash flows from financing activities: |
|||||||||
Proceeds from issuance of shares under stock purchase plan and upon exercise of stock-based awards | 7,591 | 2,123 | |||||||
Net cash provided by financing activities | 7,591 | 2,123 | |||||||
Net increase in cash, cash equivalents and restricted cash | 51,512 | 9,243 | |||||||
Cash, cash equivalents and restricted cash at the beginning of the period | 164,679 | 105,580 | |||||||
Effect of exchange rate differences on cash, cash equivalents and restricted cash | 398 | (274 | ) | ||||||
Cash, cash equivalents and restricted cash at the end of the period | $ | 216,589 | $ | 114,549 |
SOLAREDGE TECHNOLOGIES, INC. |
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RECONCILIATION OF NON-GAAP FINANCIAL MEASURES | |||||||||||
(In thousands, except gross profit and per share data) | |||||||||||
(Unaudited) | |||||||||||
Reconciliation of Non-GAAP Financial Measures | |||||||||||
Reconciliation of GAAP to Non-GAAP Gross Profit | |||||||||||
Three months ended | Six months ended | ||||||||||
June 30, 2018 | March 31, 2018 | June 30, 2017 | June 30, 2018 | June 30, 2017 | |||||||
Gross profit (GAAP) | 81,946 | 79,597 | 47,066 | 161,543 | 85,742 | ||||||
Stock-based compensation | 968 | 924 | 517 | 1,892 | 1,010 | ||||||
Gross profit (Non-GAAP) | 82,914 | 80,521 | 47,583 | 163,435 | 86,752 | ||||||
Reconciliation of GAAP to Non-GAAP Gross Margin | |||||||||||
Three months ended | Six months ended | ||||||||||
June 30, 2018 | March 31, 2018 | June 30, 2017 | June 30, 2018 | June 30, 2017 | |||||||
Gross margin (GAAP) | 36.1% | 37.9% | 34.6% | 37.0% | 34.1% | ||||||
Stock-based compensation | 0.4% | 0.5% | 0.4% | 0.4% | 0.4% | ||||||
Gross margin (Non-GAAP) | 36.5% | 38.4% | 35.0% | 37.4% | 34.5% | ||||||
Reconciliation of GAAP to Non-GAAP Operating expenses | |||||||||||
Three months ended | Six months ended | ||||||||||
June 30, 2018 | March 31, 2018 | June 30, 2017 | June 30, 2018 | June 30, 2017 | |||||||
Operating expenses (GAAP) | 41,281 | 38,769 | 27,951 | 80,050 | 54,623 | ||||||
Stock-based compensation R&D | 2,605 | 2,382 | 1,280 | 4,987 | 2,485 | ||||||
Stock-based compensation S&M | 2,094 | 2,204 | 1,204 | 4,298 | 2,234 | ||||||
Stock-based compensation G&A | 1,461 | 1,339 | 1,033 | 2,800 | 1,917 | ||||||
Operating expenses (Non-GAAP) | 35,121 | 32,844 | 24,434 | 67,965 | 47,987 | ||||||
Reconciliation of GAAP to Non-GAAP Operating income | |||||||||||
Three months ended | Six months ended | ||||||||||
June 30, 2018 | March 31, 2018 | June 30, 2017 | June 30, 2018 | June 30, 2017 | |||||||
Operating income (GAAP) | 40,665 | 40,828 | 19,115 | 81,493 | 31,119 | ||||||
Stock-based compensation | 7,128 | 6,849 | 4,034 | 13,977 | 7,646 | ||||||
Operating income (Non-GAAP) | 47,793 | 47,677 | 23,149 | 95,470 | 38,765 | ||||||
Reconciliation of GAAP to Non-GAAP Financial income, net | |||||||||||
Three months ended | Six months ended | ||||||||||
June 30, 2018 | March 31, 2018 | June 30, 2017 | June 30, 2018 | June 30, 2017 | |||||||
Financial income (expenses), net (GAAP) | (2,480) | 584 | 3,595 | (1,896) | 5,005 | ||||||
Non cash interest | 568 | 512 | ---- | 1,080 | ---- | ||||||
Financial income (expenses), net (Non-GAAP) | (1,912) | 1,096 | 3,595 | (816) | 5,005 | ||||||
Reconciliation of GAAP to Non-GAAP Other expenses | |||||||||||
Three months ended | Six months ended | ||||||||||
June 30, 2018 | March 31, 2018 | June 30, 2017 | June 30, 2018 | June 30, 2017 | |||||||
Other expenses (GAAP) | ---- | 64 | ---- | 64 | ---- | ||||||
Fixed Assets disposal | ---- | 64 | ---- | 64 | ---- | ||||||
Other expenses (Non-GAAP) | ---- | ---- | ---- | ---- | ---- | ||||||
Reconciliation of GAAP to Non-GAAP Tax on income (Tax benefit) | |||||||||||
Three months ended | Six months ended | ||||||||||
June 30, 2018 | March 31, 2018 | June 30, 2017 | June 30, 2018 | June 30, 2017 | |||||||
Tax on income (Tax benefit) (GAAP) | 3,617 | 5,662 | 186 | 9,279 | (575) | ||||||
Deferred tax realized (asset) | (1,697) | (1,321) | (773) | (3,018) | (2,105) | ||||||
Transition tax of foreign earnings | ---- | 820 | ---- | 820 | ---- | ||||||
Tax on income (Tax benefit) (Non-GAAP) | 5,314 | 6,163 | 959 | 11,477 | 1,530 | ||||||
Reconciliation of GAAP to Non-GAAP Net income | |||||||||||
Three months ended | Six months ended | ||||||||||
June 30, 2018 | March 31, 2018 | June 30, 2017 | June 30, 2018 | June 30, 2017 | |||||||
Net income (GAAP) | 34,568 | 35,686 | 22,524 | 70,254 | 36,699 | ||||||
Stock-based compensation | 7,128 | 6,849 | 4,034 | 13,977 | 7,646 | ||||||
Non cash interest | 568 | 512 | ---- | 1,080 | ---- | ||||||
Fixed Assets disposal | ---- | 64 | ---- | 64 | ---- | ||||||
Deferred tax realized (asset) | (1,697) | (1,321) | (773) | (3,018) | (2,105) | ||||||
Transition tax of foreign earnings | ---- | 820 | ---- | 820 | ---- | ||||||
Net income (Non-GAAP) | 40,567 | 42,610 | 25,785 | 83,177 | 42,240 | ||||||
Reconciliation of GAAP to Non-GAAP Net basic EPS | |||||||||||
Three months ended | Six months ended | ||||||||||
June 30, 2018 | March 31, 2018 | June 30, 2017 | June 30, 2018 | June 30, 2017 | |||||||
Net basic earnings per share (GAAP) | 0.76 | 0.81 | 0.54 | 1.57 | 0.88 | ||||||
Stock-based compensation | 0.16 | 0.15 | 0.10 | 0.31 | 0.19 | ||||||
Non cash interest | 0.01 | 0.01 | ---- | 0.03 | ---- | ||||||
FA disposal | ---- | ---- | ---- | ---- | ---- | ||||||
Deferred tax realized (asset) | (0.03) | (0.03) | (0.02) | (0.07) | (0.05) | ||||||
Transition tax of foreign earnings | ---- | 0.02 | ---- | 0.02 | ---- | ||||||
Net basic earnings per share (Non-GAAP) | 0.90 | 0.96 | 0.62 | 1.86 | 1.02 | ||||||
Reconciliation of GAAP to Non-GAAP Net diluted EPS | |||||||||||
Three months ended | Six months ended | ||||||||||
June 30, 2018 | March 31, 2018 | June 30, 2017 | June 30, 2018 | June 30, 2017 | |||||||
Net diluted earnings per share (GAAP) | 0.72 | 0.75 | 0.50 | 1.46 | 0.83 | ||||||
Stock-based compensation | 0.12 | 0.12 | 0.06 | 0.24 | 0.12 | ||||||
Non cash interest | 0.01 | 0.01 | ---- | 0.03 | ---- | ||||||
FA disposal | ---- | ---- | ---- | ---- | ---- | ||||||
Deferred tax realized (asset) | (0.03) | (0.03) | (0.01) | (0.06) | (0.05) | ||||||
Transition tax of foreign earnings | ---- | 0.02 | ---- | 0.01 | ---- | ||||||
Net diluted earnings per share (Non-GAAP) | 0.82 | 0.87 | 0.55 | 1.68 | 0.90 | ||||||
Reconciliation of GAAP to Non-GAAP No. of shares used in Net diluted EPS | |||||||||||
Three months ended | Six months ended | ||||||||||
June 30, 2018 | March 31, 2018 | June 30, 2017 | June 30, 2018 | June 30, 2017 | |||||||
Number of shares used in computing net diluted earnings per share (GAAP) | 48,291,280 | 47,673,522 | 44,831,590 | 47,984,817 | 44,335,521 | ||||||
Stock-based compensation | 1,341,286 | 1,535,408 | 2,228,246 | 1,438,347 | 2,359,454 | ||||||
Number of shares used in computing net diluted earnings per share (Non-GAAP) | 49,632,566 | 49,208,930 | 47,059,836 | 49,423,164 | 46,694,975 |
View source version on businesswire.com: https://www.businesswire.com/news/home/20180802005618/en/
Source:
Investor Contacts
SolarEdge Technologies, Inc.
Ronen
Faier, +1 510-498-3263
Chief Financial Officer
investors@solaredge.com
or
Sapphire
Investor Relations, LLC
Erica Mannion or Michael Funari, +1
617-542-6180
investors@solaredge.com