Sunrun Reports First Quarter 2017 Financial Results

Net Present Value created of $56 million in Q1 2017, an increase of 145% Year-Over-Year

Net Earning Assets exceeded $1 billion, 35% Year-Over-Year Growth

SAN FRANCISCO, May 10, 2017 (GLOBE NEWSWIRE) -- Sunrun (Nasdaq:RUN), the nation’s largest dedicated provider of residential solar, storage and energy services, today announced financial results for the first quarter ended March 31, 2017.

First Quarter 2017 Operating Highlights

  • Total deployments of 73 MW, an increase of 21% year-over-year 
  • Net Present Value created of $56 million, an increase of 145% year-over-year
  • Creation Cost per watt improved by $0.69 from Q1 2016
  • Cumulative MW deployed of 951 MW, an increase of 45% year-over-year
  • Net Earning Assets exceeded $1 billion, reflecting a 35% increase year-over-year

“The positive momentum continues in Q1, with a 21% growth in volumes and improvements in our unit economics, a testament to the resiliency of our multi-channel business model and alignment of our product offerings with customer demand,” said Lynn Jurich, Sunrun’s chief executive officer.  “As always, we’re most proud of our customer experience, having already saved our customers over $100 million, while continuing to grow and taking share.”

Key Operating Metrics

In the first quarter of 2017, MW deployed increased to 73 MW from 60 MW in the first quarter of 2016, a 21% year-over-year increase.

In the first quarter of 2017, MW booked were 74 MW, an increase of 19% from the first quarter of 2016.

Creation cost per watt was $3.38 in the first quarter of 2017 compared to $4.07 in the first quarter of 2016, an improvement of 17% year-over-year. NPV per watt in the first quarter of 2017 was $0.83 compared to $0.44 in the first quarter of 2016.

NPV created in the first quarter of 2017 was $56 million, a 145% increase from $23 million in the first quarter of 2016. Project Value per watt was $4.21, compared to $4.51 in the first quarter of 2016.

Gross earning assets as of March 31, 2017 were $1.9 billion, up $536 million, or 39%, since March 31, 2016. Net earning assets as of March 31, 2017 were $1.1 billion, up $279 million, or 35% from the prior year.

Financing Activities                                  

As of May 10, 2017, our project finance pipeline remains robust, with closed transactions and executed terms sheets that provide us expected runway into Q4 of 2017. 

First Quarter 2017 GAAP Results

Operating leases and incentives revenue grew 39% year-over-year to $48.1 million. Solar energy systems and product sales declined 13% year-over-year to $56.0 million. Total revenue grew to $104.1 million in the first quarter of 2017, up $5.4 million, or 5% from the first quarter of 2016.

Total cost of revenue was $93.8 million, a decrease of 2% year-over-year. Total operating expenses were $154.1 million, a decrease of 7% year-over-year.

Net income available to common stockholders was $12.7 million in the first quarter of 2017, compared to net income available to common stockholders of $29.0 million in the fourth quarter of 2016, and $13.1 million in the first quarter of 2016.

Diluted net earnings per share available to common shareholders was $0.12 per share.

Guidance for Q2 and Full Year 2017

The following statements are based on current expectations. These statements are forward-looking and actual results may differ materially.

In Q2, we expect to deploy approximately 72 MW, reflecting approximately 15% growth in the first half of 2017 compared to the prior year.

For the full year 2017, we continue to expect to deploy 325 MWs, reflecting 15% year-over-year growth.

Conference Call Information

Sunrun is hosting a conference call for analysts and investors to discuss its first quarter 2017 results and outlook for its second quarter 2017 at 2:00 p.m. Pacific Time today, May 10, 2017. A live audio webcast of the conference call along with supplemental financial information will be accessible via the “Investor Relations” section of the Company’s website at The conference call can also be accessed live over the phone by dialing (877) 470-1078 (domestic) or (615) 247-0087 (international) using ID #7201266. A replay will be available following the call via the Sunrun Investor Relations website or for one week at the following numbers (855) 859-2056 (domestic) or (404) 537-3406 (international) using ID #7201266.

About Sunrun                    

Sunrun (Nasdaq:RUN) is the nation’s largest dedicated residential solar, storage and energy services company with a mission to create a planet run by the sun. Since establishing the solar as a service model in 2007, Sunrun leads the industry in providing clean energy to homeowners with little to no upfront cost and at a savings to traditional electricity. The company designs, installs, finances, insures, monitors and maintains the systems, while families receive predictable pricing for 20 years or more. The company also offers Sunrun BrightBoxTM solar power generation with smart inverter technology and home battery storage. For more information, please visit:

Forward Looking Statements

This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995, including statements regarding our future financial and operating guidance, operational and financial results such as growth, value creation, MW bookings and deployments, gross and net earning assets, project value, estimated creation costs and NPV, and the assumptions related to the calculation of the foregoing metrics, as well as our expectations regarding our growth and financing capacity. The risks and uncertainties that could cause our results to differ materially from those expressed or implied by such forward-looking statements include, but are not limited to: the availability of additional financing on acceptable terms; changes in the retail prices of traditional utility generated electricity; changes in policies and regulations including net metering and interconnection limits or caps; the availability of rebates, tax credits and other incentives; the availability of solar panels and other raw materials; our limited operating history, particularly as a new public company; our ability to attract and retain our relationships with third parties, including our solar partners; our ability to meet the covenants in our investment funds and debt facilities; and such other risks identified in the reports that we file with the U.S. Securities and Exchange Commission, or SEC, from time to time. All forward-looking statements in this press release are based on information available to us as of the date hereof, and we assume no obligation to update these forward-looking statements.

Consolidated Balance Sheets
(In Thousands)
  March 31, 2017  December 31, 2016 
Current assets:        
Cash $203,791  $206,364 
Restricted cash  12,030   11,882 
Accounts receivable, net  54,065   60,258 
State tax credits receivable     13,713 
Inventories  59,603   67,326 
Prepaid expenses and other current assets  11,585   9,802 
Total current assets  341,074   369,345 
Restricted cash  6,117   6,117 
Solar energy systems, net  2,790,424   2,629,366 
Property and equipment, net  44,925   48,471 
Intangible assets, net  17,448   18,499 
Goodwill  87,543   87,543 
Prepaid tax asset     378,541 
Other assets  31,497   34,936 
Total assets $3,319,028  $3,572,818 
Liabilities and total equity        
Current liabilities:        
Accounts payable $65,520  $66,018 
Distributions payable to noncontrolling interests and redeemable noncontrolling interests  11,157   10,654 
Accrued expenses and other liabilities  48,675   59,261 
Deferred revenue, current portion  74,284   70,849 
Deferred grants, current portion  8,394   8,011 
Capital lease obligations, current portion  9,198   10,015 
Long-term non-recourse debt, current portion  15,797   14,153 
Lease pass-through financing obligation, current portion  5,872   5,823 
Total current liabilities  238,897   244,784 
Deferred revenue, net of current portion  578,425   583,401 
Deferred grants, net of current portion  224,217   226,893 
Capital lease obligations, net of current portion  10,701   12,965 
Recourse debt  247,400   244,000 
Long-term non-recourse debt, net of current portion  686,078   639,870 
Lease pass-through financing obligation, net of current portion  138,050   137,958 
Other liabilities  5,646   5,457 
Deferred tax liabilities  41,068   415,397 
Total liabilities  2,170,482   2,510,725 
Redeemable noncontrolling interests  142,012   137,907 
Total stockholders equity  693,303   672,961 
Noncontrolling interests  313,231   251,225 
Total equity  1,006,534   924,186 
Total liabilities, redeemable noncontrolling interests and total equity $3,319,028  $3,572,818 

Consolidated Statements of Operations
(In Thousands, Except Per Share Amounts)
  Three Months Ended March 31, 
  2017  2016 
Operating leases and incentives $48,098  $34,540 
Solar energy systems and product sales  56,019   64,203 
Total revenue  104,117   98,743 
Operating expenses:        
Cost of operating leases and incentives  44,336   38,100 
Cost of solar energy systems and product sales  49,431   57,512 
Sales and marketing  31,676   43,188 
Research and development  2,996   2,463 
General and administrative  24,621   23,248 
Amortization of intangible assets  1,051   1,052 
Total operating expenses  154,111   165,563 
Loss from operations  (49,994)  (66,820)
Interest expense, net  15,277   11,515 
Other expenses (income), net  475   (532)
Loss before income taxes  (65,746)  (77,803)
Income tax expense  7,338    
Net loss  (73,084)  (77,803)
Net loss attributable to noncontrolling interests and redeemable noncontrolling interests  (85,811)  (90,937)
Net income available to common stockholders $12,727  $13,134 
Net income per share available to common stockholders        
Basic $0.12  $0.13 
Diluted $0.12  $0.13 
Weighted average shares used to compute net income per share available to common stockholders        
Basic  104,038   101,273 
Diluted  106,469   104,219 

Consolidated Statements of Cash Flows
(In Thousands)
  Three Months Ended March 31, 
  2017  2016 
Operating activities:        
Net loss $(73,084) $(77,803)
Adjustments to reconcile net loss to net cash used in operating activities:        
Depreciation and amortization, net of amortization of deferred grants  31,710   21,596 
Deferred income taxes  7,337    
Stock-based compensation expense  5,874   3,809 
Noncash interest expense  5,931   3,502 
Interest on lease pass-through financing obligations  2,961   3,002 
Reduction in lease pass-through financing obligations  (4,546)  (4,236)
Other noncash losses and expenses  2,898   1,657 
Changes in operating assets and liabilities:        
Accounts receivable  6,362   3,595 
Inventories  7,723   (23,314)
Prepaid and other assets  (1,441)  (4,355)
Accounts payable  (4,357)  (10,103)
Accrued expenses and other liabilities  (15,445)  (317)
Deferred revenue  (1,030)  5,572 
Net cash used in operating activities  (29,107)  (77,395)
Investing activities:        
Payments for the costs of solar energy systems, leased and to be leased  (168,149)  (164,629)
Purchases of property and equipment  (2,610)  (5,023)
Net cash used in investing activities  (170,759)  (169,652)
Financing activities:        
Proceeds from state tax credits, net of recapture  13,388   9,202 
Proceeds from issuance of recourse debt  57,400   141,000 
Repayment of recourse debt  (54,000)  (147,000)
Proceeds from issuance of non-recourse debt  38,225   106,400 
Repayment of non-recourse debt  (4,904)  (2,160)
Payment of debt fees     (9,369)
Proceeds from lease pass-through financing obligations  1,448   9,746 
Contributions received from noncontrolling interests and redeemable noncontrolling interests  162,565   154,944 
Distributions paid to noncontrolling interests and redeemable noncontrolling interests  (12,887)  (9,986)
(Payments) proceeds from exercises of stock options, net of withholding taxes on restricted stock units  (1,067)  452 
Offering costs paid related to initial public offering     (437)
Payment of capital lease obligations  (2,749)  (3,115)
Change in restricted cash  (126)  1,819 
Net cash provided by financing activities  197,293   251,496 
Net change in cash  (2,573)  4,449 
Cash, beginning of period  206,364   203,864 
Cash, end of period $203,791  $208,313 

Key Operating Metrics and Financial Metrics
  Three Months Ended March 31,  
  2017  2016  
MW Booked (during the period)(1)(2)  74   62  
MW Deployed (during the period)  73   60  
Cumulative MW Deployed (end of period)  951   656  
Gross Earning Assets under Energy Contract (end of period)(in millions)(3) $1,269  $913  
Gross Earning Assets Value of Purchase or Renewal (end of period)(in millions) $647  $467  
Gross Earning Assets (end of period)(in millions) $1,916  $1,380  
Net Earning Assets (end of period)(in millions)(3) $1,070  $791 



Three Months Ended
March 31,
  2017  2016 
Project Value, Contracted Portion (per watt) $3.58  $3.99 
Project Value, Renewal Portion (per watt) $0.63  $0.52 
Total Project Value (per watt) $4.21  $4.51 
Creation Cost (per watt)(4)(5) $3.38  $4.07 
Unlevered NPV (per watt)(3) $0.83  $0.44 
NPV (in millions)(3) $56  $23 

(1)  First quarter 2016 total excludes 6.5 MW of cancellations due to Nevada exit.

(2)  The presentation of MW Booked for periods prior to December 31, 2016 reflects changes made to the calculation methodology as further described in our 2016 Annual Report on Form 10-K filed with the SEC on March 8, 2017.

(3)  Numbers may not sum due to rounding.

(4)  Pro forma creation cost excluding one-time items related to Nevada exit in Q1 2016.

(5)  The presentation of Creation Cost for periods prior to December 31, 2016 reflects changes made to the calculation methodology as further described in our Fourth Quarter 2016 earnings presentation available on our investor relations website.


Creation Cost includes (i) certain installation and general and administrative costs after subtracting the gross margin on solar energy systems and product sales divided by watts deployed during the measurement period and (ii) certain sales and marketing expenses under new Customer Agreements, net of cancellations during the period divided by the related watts deployed.

Customers refers to all residential homeowners (i) who have executed a Customer Agreement or cash sales agreement with us and (ii) for whom we have internal confirmation that the applicable solar energy system has reached notice to proceed or “NTP”, net of cancellations.

Customer Agreements refers to, collectively, solar power purchase agreements and solar leases.

Gross Earning Assets represents the net cash flows (discounted at 6%) we expect to receive during the initial 20-year term of our Customer Agreements for systems that have been deployed as of the measurement date, plus a discounted estimate of the value of the Customer Agreement renewal term or solar energy system purchase at the end of the initial term. Gross Earning Assets excludes estimated cash distributions to investors in consolidated joint ventures and estimated operating, maintenance and administrative expenses for systems deployed as of the measurement date. In calculating Gross Earning Assets, we deduct estimated cash distributions to our cash equity financing providers. In calculating Gross Earning Assets, we do not deduct customer payments we are obligated to pass through to investors in lease pass-throughs as these amounts are reflected on our balance sheet as long-term and short-term lease pass-through obligations, similar to the way that debt obligations are presented. In determining our finance strategy, we use lease pass-throughs and long-term debt in an equivalent fashion as the schedule of payments of distributions to lease pass-through investors is more similar to the payment of interest to lenders than the internal rates of return (IRRs) paid to investors in other tax equity structures.

Gross Earning Assets Under Energy Contract represents the net cash flows during the initial (typically 20 year) term of our Customer Agreements (less substantially all value from SRECs prior to July 1, 2015), for systems deployed as of the measurement date.

Gross Earning Assets Value of Purchase or Renewal is the forecasted net present value we would receive upon or following the expiration of the initial Customer Agreement term (either in the form of cash payments during any applicable renewal period or a system purchase at the end of the initial term), for systems deployed as of the measurement date.

MW Booked represents the aggregate megawatt production capacity of our solar energy systems, whether sold directly to customers or subject to an executed Customer Agreement, for which we have confirmation that the systems have reached NTP, net of cancellations.

MW Deployed represents the aggregate megawatt production capacity of our solar energy systems, whether sold directly to customers or subject to executed Customer Agreements, for which we have (i) confirmation that the systems are installed on the roof, subject to final inspection or (ii) in the case of certain system installations by our partners, accrued at least 80% of the expected project cost.

Net Earning Assets represents Gross Earning Assets less both project level debt and Lease Pass-Through Financing Obligation, as of the same measurement date. Because estimated cash distributions to our cash equity financing partners are deducted from Gross Earning Assets, a proportional share of the corresponding project level debt is deducted from Net Earning Assets. 

NPV equals Unlevered NPV multiplied by leased megawatts deployed in period.

NTP or Notice to Proceed refers to our internal confirmation that a solar energy system has met our installation requirements for size, equipment and design.

Project Value represents the value of upfront and future payments by customers, the benefits received from utility and state incentives, as well as the present value of net proceeds derived through investment funds. Specifically, Project Value is calculated as the sum of the following items (all measured on a per-watt basis with respect to megawatts deployed under Customer Agreements during the period): (i) estimated gross earning assets, (ii) utility or upfront state incentives, (iii) upfront payments from customers for deposits and partial or full prepayments of amounts otherwise due under Customer Agreements and which are not already included in Gross Earning Assets and (iv) finance proceeds from tax equity investors, excluding cash true-up payments or the value of asset contributions in lieu of cash true-up payments made to investors. Project Value includes contracted SRECs for all periods after July 1, 2015.

Unlevered NPV equals the difference between Project Value and estimated Creation Cost on a per watt basis.

CONTACT: Investor Relations Contacts:

Patrick Jobin
(415) 638-4007

Charlotte Coultrap-Bagg
(415) 510-4833

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