Press Releases

SunPower Reports Third-Quarter 2010 Results

- Q3 2010 GAAP revenue of $551 million vs. $384 million in Q2 2010

- Q3 GAAP gross margin of 20.4% Q3 Non-GAAP gross margin of 22.3%

Q3 GAAP EPS of $0.21, Q3 non-GAAP EPS of $0.26

PRNewswire-FirstCall
SAN JOSE, Calif.

SunPower Reports Third-Quarter 2010 Results

- Q3 2010 GAAP revenue of $551 million vs. $384 million in Q2 2010

- Q3 GAAP gross margin of 20.4%, Q3 Non-GAAP gross margin of 22.3%

- Q3 GAAP EPS of $0.21, Q3 non-GAAP EPS of $0.26

SAN JOSE, Calif., Nov. 11, 2010 /PRNewswire-FirstCall/ -- SunPower Corp. (Nasdaq:SPWRA - News) today announced financial results for its 2010 third quarter which ended October 3, 2010.

 

   

($ Millions except per-share data)

3rd Quarter

2010

2nd Quarter

2010

3rd Quarter

2009

 

GAAP revenue

$550.6

$384.2

$465.4

 

GAAP gross margin

20.4%

22.9%

21.5%

 

GAAP net income (loss)

$20.1

($6.2)

$19.5

 

GAAP net income (loss) per share

$0.21

($0.07)

$0.20

 

Non-GAAP gross margin

22.3%

26.3%

23.1%

 

Non-GAAP net income per share

$0.26

$0.15

$0.46

 

*A reconciliation of Non-GAAP to GAAP results is included at the end of this press release

 
       

 

"Our third-quarter results reflect the continued success of our vertically integrated model and position us well to meet our 2010 financial goals," said Tom Werner, SunPower CEO. "Our strong execution, including our successful cost reduction efforts, and a stable ASP environment, enabled us to outperform our internal plan for the quarter. For 2011, we continue to see more demand than supply in our growing Utility and Power Plants (UPP) and Residential and Commercial (R&C) businesses. Operationally, our Fab 3 joint venture completed initial solar cell production tests, achieving conversion efficiencies of more than 22% and we remain on plan for our 2011 cost reduction programs across the value chain."

Major recent milestones include:

 

  • Completed sale of 28 megawatts (MW) of Italian power plants
  • Commenced marketing for approximately euro 200 million of project debt for final phases of the Montalto solar park
  • Awarded 10-MW contract from LS Power to build largest solar plant in Delaware
  • Announced the availability of the company's Oasis power plant block in Europe
  • Announced more than 20 MW of federal government projects in Q3
  • Awarded largest single roof top contract in the U.S. – 3.5 MW for Macy's in Arizona
  • Completed initial cell production at company's 1,400 MW Fab 3 joint venture with AU Optronics

 

"In our R&C business, we expanded our global dealer footprint in the U.S., France and Italy, and added substantial 2011 visibility thanks to growth in our commercial customer pipeline," continued Werner. "In our UPP business, we completed the euro 49 million sale of 28 MW of our Montalto solar projects in the third quarter, and we expect to finance and monetize the balance of our Italian projects by the end of the year. We recently initiated the marketing of approximately euro 200 million in the industry's first solar bond offering for our Montalto 44-MW project and expect the equity portion of the project to be sold in December.

"Operationally, we were pleased with our Fab 1 and Fab 2 manufacturing execution as we had record performance in cell production, overall equipment effectiveness, average solar cell conversion efficiency, and yields. Looking forward, with the further ramp of Fab 3 and continued cost improvements, we expect to reach our efficiency-adjusted panel cost goal of $1.08 per watt by the fourth quarter of 2011. This value reflects our world-leading, high-efficiency solar panels and resulting lower BOS and tracking costs," Werner concluded.

On a Generally Accepted Accounting Principles (GAAP) basis, third-quarter 2010 results include a $0.36 per share pre-tax gain related to our Fab 3 joint venture with AU Optronics. On a Non-GAAP basis, third-quarter 2010 results exclude this gain.

"In the third quarter, we repaid $143 million in convertible debentures and improved our liquidity position by executing a new $70 million revolving credit facility secured with our equity interests in Woongjin Energy," said Dennis Arriola, SunPower CFO. "The Woongjin facility, along with the $75 million IFC loan agreement that we executed earlier this year, provides us with access to $145 million of incremental liquidity. The financing of our Italian power plants remains on track, and we continue to meet our power plant assembly commitments as we installed more than 70 MW of power plants, a new quarterly record. We have also substantially mitigated the risk of our expected Q4 2010 net Euro exposure, as 100% of that exposure is hedged at a U.S. dollar rate of 1.37 to one Euro."

 

   

2010 Guidance

       
     

Q4 2010

FY 2010

 

Revenue ($MM)

   

$870-$970

$2,150-$2,250

 

Gross Margin (Non-GAAP)

 

20%-22%

22%-23%

 

Gross Margin (GAAP)

 

19%-21%

20%-21%

 

Net Income per diluted share (Non-GAAP)

$0.95-$1.15

$1.45-$1.65

 

Net Income per diluted share (GAAP)

$0.45-$0.60

$0.75-$0.90

 

*A reconciliation of Non-GAAP to GAAP guidance is included at the end of this press release

 
         

 

The company will provide guidance related to its 2011 fiscal year on November 18, 2010, SunPower's Analyst Day. Interested investors can listen to the event through the company's investor relations website beginning at 10:00 a.m. Eastern Time. All historical information included in the release reflects the company's change in segment reporting that was instituted in the second quarter of 2010.

This press release contains both GAAP and non-GAAP financial information. Non-GAAP historical figures are reconciled to the closest GAAP equivalent categories in the financial attachment of this press release. Please note that the company has posted supplemental information and slides related to its third quarter 2010 performance on the Events and Presentations section of the SunPower Investor Relations page at http://investors.sunpowercorp.com/events.cfm. The capacity of power plants in this release is described in approximate megawatts on an alternating current (ac) basis unless otherwise noted.

About SunPower

Founded in 1985, SunPower Corp. (Nasdaq:SPWRA - News) designs, manufactures and delivers the planet's most powerful solar technology broadly available today. Residential, business, government and utility customers rely on the company's experience and proven results to maximize return on investment. With headquarters in San Jose, Calif., SunPower has offices in North America, Europe, Australia and Asia. For more information, visit www.sunpowercorp.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that do not represent historical facts and may be based on underlying assumptions. The company uses words and phrases such as "continue," "position," "expect," "on plan," "marketing," "visibility," "growth," "on track," "will," "looking forward," "guidance" and similar expressions to identify forward-looking statements in this press release, including forward-looking statements regarding: (a) the continued success of the company's business model; (b) the company's ability to meet its 2010 financial goals; © the company seeing more demand than supply in its UPP and R&C businesses for 2011; (d) the company meeting its cost reduction program for 2011 and further cost improvements; (e) the company's ability to execute, close and monetize (1) the 10 MW project with LS Power, and (2) the more than 20 MW of federal government projects; (f) the receipt of debt financing and sale of the equity portion of Montalto 44 in December 2010; (g) the company's visibility into its R&C pipeline and growth in its commercial customer pipeline; (h) the company's expectation that it will finance and monetize the balance of its Italian projects by the end of 2010; (i) the further ramp of production at Fab 3; (j) the company's expectation it will reach its efficiency adjusted panel cost goal of $1.08 per watt by the fourth quarter of 2011; (k) the company's ability to meet its power plant assembly commitments; and (l) revenue, GAAP and non-GAAP gross margin, and GAAP and non-GAAP net income per diluted share guidance for the fourth fiscal quarter of 2010 and for the full fiscal year 2010. Such forward-looking statements are based on information available to the company as of the date of this release and involve a number of risks and uncertainties, some beyond the company's control, that could cause actual results to differ materially from those anticipated by these forward-looking statements, including risks and uncertainties such as: (i) potential difficulties associated with operating the joint venture with AUO and integrating the SunRay business, and the company's ability to achieve the anticipated synergies and manufacturing benefits from these transactions, including ramping Fab 3 according to plan; (ii) the company's ability to obtain and maintain an adequate supply of raw materials, components, and solar panels, as well as the price it pays for such items; (iii) general business and economic conditions, including seasonality of the industry; (iv) growth trends in the solar power industry; (v) the continuation of governmental and related economic incentives promoting the use of solar power, particularly such incentives affecting the markets in which the company sells solar panels and constructs commercial systems and power plants; (vi) the significant investment required to construct power plants and the company's ability to sell or otherwise monetize power plants, including Montalto 44; (vii) the improved availability of financing arrangements for the company's utilities projects and the company's customers; (viii) construction difficulties or potential delays, including obtaining land use rights, permits, license, other governmental approvals, and transmission access and upgrades; (ix) increasing competition in the industry and lower average selling prices; (x) manufacturing difficulties that could arise; (xi) the success of the company's ongoing research and development efforts and the acceptance of the company's new products and services; (xii) the company's liquidity, substantial indebtedness, and its ability to obtain additional financing; (xiii) the company's ability to protect its intellectual property;(xiv) possible impairment of goodwill; (xv) possible consolidation of the joint venture AUO SunPower; and (xvi) other risks described in the company's Annual Report on Form 10-K for the year ended January 3, 2010 and Quarterly Report on Form 10-Q for the quarter ended July 4, 2010, and other filings with the Securities and Exchange Commission. These forward-looking statements should not be relied upon as representing the company's views as of any subsequent date, and the company is under no obligation to, and expressly disclaims any responsibility to, update or alter its forward-looking statements, whether as a result of new information, future events or otherwise.

Segment Reporting Information

The UPP Segment refers to both our large-scale solar products and systems business including power plant project development and project sales, turn-key power plant EPC and O&M services, as well as components sales which includes large volume sales of solar panels and mounting systems to third parties. The R&C Segment refers to our solar equipment sales into the residential and small commercial market through our third-party global dealer network, as well as direct sales and EPC and O&M services installing rooftop and ground-mounted solar systems for the commercial and public sectors.

Non-GAAP Measures

To supplement the consolidated financial results prepared under GAAP, SunPower uses non-GAAP measures which are adjusted from the most directly comparable GAAP results to exclude non-cash charges related to amortization of intangible assets and promissory notes, stock-based compensation and interest expense as well as exclude non-cash net gains (losses) on mark-to-market derivative instruments, a gain on the change in our equity investment in a joint venture, a gain on deconsolidation of consolidated subsidiary, and the related tax effects of these adjustments. In addition, the presentation of non-GAAP gross margin and non-GAAP operating income includes the results of discontinued operations. Management does not consider these non-cash items in evaluating the core operational activities of SunPower. Management uses these non-GAAP measures internally to make strategic decisions, forecast future results and evaluate SunPower's current performance. Most analysts covering SunPower use the non-GAAP measures as well. Given management's use of these non-GAAP measures, SunPower believes these measures are important to investors in understanding SunPower's current and future operating results as seen through the eyes of management. In addition, management believes these non-GAAP measures are useful to investors in enabling them to better assess changes in SunPower's core business across different time periods. These non-GAAP measures are not in accordance with or an alternative for GAAP financial data and may be different from non-GAAP measures used by other companies.

Fiscal Periods

The company reports on a fiscal-year basis and ends its quarters on the Sunday closest to the end of the applicable calendar quarter, except in a 53-week fiscal year, in which case the additional week falls into the fourth quarter of that fiscal year. Fiscal year 2010 consists of 52 weeks while fiscal year 2009 consists of 53 weeks. The third quarter of fiscal 2010 ended on October 3, 2010 and the third quarter of fiscal 2009 ended on September 27, 2009.

Montalto 44 Bond Offering

This press release is not an offer of securities for sale in the United States, and the securities referred to in this press release relating to Montalto 44 may not be offered or sold in the United States absent registration or an exemption from registration. The issuer of the securities does not intend to offer or sell these securities in the United States, and intends to conduct any offering of these securities outside the United States in reliance on Regulation S under the Securities Act of 1933.

SunPower and Oasis are trademarks or registered trademarks of SunPower Corp. All other trademarks are the property of their respective owners.

 

   

SUNPOWER CORPORATION

   

CONDENSED CONSOLIDATED BALANCE SHEETS

   

(In thousands)

   
               

(Unaudited)

   
               
   

Oct. 3,

   

Jan. 3,

   
   

2010

   

2010

   
         

(1)

   

ASSETS

   
                 

Cash and cash equivalents

 

$

281,212

   

$

615,879

   

Restricted cash and cash equivalents

   

156,532

     

310,658

   

Investments

   

172

     

172

   

Accounts receivable, net

   

265,832

     

248,833

   

Costs and estimated earnings in excess of billings

   

114,093

     

26,062

   

Inventories

   

285,805

     

202,301

   

Advances to suppliers

   

184,356

     

190,628

   

Prepaid expenses and other assets

   

426,705

     

181,264

   

Property, plant and equipment, net

   

589,690

     

682,344

   

Project assets - plants and land

   

182,263

     

15,617

   

Goodwill and other intangible assets, net

   

422,083

     

223,137

   
                   

Total assets

 

$

2,908,743

   

$

2,696,895

   
                   
                   

LIABILITIES AND STOCKHOLDERS' EQUITY

   
                   

Accounts payable

 

$

373,166

   

$

234,692

   

Accrued and other liabilities

   

422,002

     

190,830

   

Billings in excess of costs and estimated earnings

   

16,451

     

17,346

   

Bank loans

   

-

     

248,953

   

Convertible debt

   

585,343

     

536,574

   

Customer advances

   

83,283

     

92,120

   
                   

Total liabilities

   

1,480,245

     

1,320,515

   
                   

Stockholders' equity

   

1,428,498

     

1,376,380

   
                   

Total liabilities and stockholders' equity

 

$

2,908,743

   

$

2,696,895

   
                   

(1) As adjusted to reflect the adoption of new accounting guidance for share lending arrangements that were executed in connection with the Company's convertible debt offerings in fiscal 2007.

   
   
                 

 

 

SUNPOWER CORPORATION

 

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

 

(In thousands, except per share data)

 
                         

(Unaudited)

 
                         
     

THREE MONTHS ENDED

 

NINE MONTHS ENDED

 
     

Oct. 3,

 

Jul. 4,

 

Sep. 27,

 

Oct. 3,

 

Sep. 27,

 
     

2010

 

2010

 

2009

 

2010

 

2009

 
             

(1)

     

(1)

 

Revenue:

                       

Utility and power plants

   

$ 257,803

 

$ 119,999

 

$ 195,117

 

$ 521,896

 

$ 428,668

 

Residential and commercial

   

292,842

 

264,239

 

270,244

 

760,261

 

547,677

 

Total revenue

   

550,645

 

384,238

 

465,361

 

1,282,157

 

976,345

 
                         

Cost of revenue:

                       

Utility and power plants

   

212,526

 

97,224

 

142,999

 

421,178

 

353,611

 

Residential and commercial

   

225,534

 

199,163

 

222,532

 

588,800

 

449,991

 

Total cost of revenue

   

438,060

 

296,387

 

365,531

 

1,009,978

 

803,602

 
                         

Gross margin

   

112,585

 

87,851

 

99,830

 

272,179

 

172,743

 
                         

Operating expenses:

                       

Research and development

   

13,382

 

11,206

 

8,250

 

34,995

 

23,067

 

Selling, general and administrative

   

91,015

 

78,376

 

45,332

 

233,671

 

130,511

 
                         

Total operating expenses

   

104,397

 

89,582

 

53,582

 

268,666

 

153,578

 
                         

Operating income (loss)

   

8,188

 

(1,731)

 

46,248

 

3,513

 

19,165

 
                         

Other income (expense):

                       

Gain on deconsolidation of consolidated subsidiary

   

36,849

 

-

 

-

 

36,849

 

-

 

Gain on change in equity interest in unconsolidated investee

   

-

 

28,348

 

-

 

28,348

 

-

 

Gain (loss) on mark-to-market derivatives

   

(2,967)

 

34,070

 

-

 

28,885

 

21,193

 

Interest and other income (expense), net

   

(25,973)

 

(29,837)

 

(9,407)

 

(72,068)

 

(27,842)

 
                         

Other income (expense), net

   

7,909

 

32,581

 

(9,407)

 

22,014

 

(6,649)

 
                         

Income from continuing operations before income taxes and equity in earnings of unconsolidated investees

   

16,097

 

30,850

 

36,841

 

25,527

 

12,516

 
                         

Benefit from (provision for) income taxes

   

(3,376)

 

(46,992)

 

(19,962)

 

(19,493)

 

4,457

 

Equity in earnings of unconsolidated investees

   

5,825

 

2,030

 

2,627

 

10,973

 

7,005

 
                         

Income (loss) from continuing operations

   

18,546

 

(14,112)

 

19,506

 

17,007

 

23,978

 

Income from discontinued operations, net of taxes

   

1,570

 

7,896

 

-

 

9,466

 

-

 
                         

Net income (loss)

   

$ 20,116

 

$ (6,216)

 

$ 19,506

 

$ 26,473

 

$ 23,978

 
                         

Net income (loss) per share of class A and class B common stock:

                       

Net income (loss) per share – basic:

                       

Continuing operations

   

$ 0.19

 

$ (0.15)

 

$ 0.21

 

$ 0.18

 

$ 0.27

 

Discontinued operations

   

0.02

 

0.08

 

-

 

0.10

 

-

 

Net income (loss) per share – basic

   

$ 0.21

 

$ (0.07)

 

$ 0.21

 

$ 0.28

 

$ 0.27

 

Net income (loss) per share – diluted:

                       

Continuing operations

   

$ 0.19

 

$ (0.15)

 

$ 0.20

 

$ 0.18

 

$ 0.26

 

Discontinued operations

   

0.02

 

0.08

 

-

 

0.09

 

-

 

Net income (loss) per share – diluted

   

$ 0.21

 

$ (0.07)

 

$ 0.20

 

$ 0.27

 

$ 0.26

 
                         

Weighted-average shares:

                       

- Basic

   

95,840

 

95,564

 

94,668

 

95,519

 

89,764

 

- Diluted

   

105,648

 

95,564

 

105,031

 

96,741

 

91,513

 
                         

(1) As adjusted to reflect the adoption of new accounting guidance for share lending arrangements that were executed in connection with the Company's convertible debt offerings in fiscal 2007.

 
                       

 

 

   

SUNPOWER CORPORATION

   

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

   

(In thousands)

   
                                 

(Unaudited)

   
                                 
   

THREE MONTHS ENDED

   

NINE MONTHS ENDED

   
   

Oct. 3,

   

Jul. 4,

   

Sep. 27,

   

Oct. 3,

   

Sep. 27,

   
   

2010

   

2010

   

2009

   

2010

   

2009

   
               

(1)

         

(1)

   

Cash flows from operating activities:

                               

Net income (loss)

 

$

20,116

   

$

(6,216)

   

$

19,506

   

$

26,473

   

$

23,978

   

Less: Income from discontinued operations, net of taxes

   

1,570

     

7,896

     

-

     

9,466

     

-

   

Income (loss) from continuing operations

   

18,546

     

(14,112)

     

19,506

     

17,007

     

23,978

   

Adjustments to reconcile income (loss) from continuing operations to net cash provided by (used in) operating activities of continuing operations:

                                         

Stock-based compensation

   

15,665

     

11,591

     

13,074

     

38,064

     

34,204

   

Depreciation

   

26,407

     

24,558

     

21,414

     

75,680

     

60,348

   

Amortization of other intangible assets

   

11,578

     

11,702

     

4,146

     

28,039

     

12,296

   

Impairment (gain on sale) of investments

   

-

     

-

     

190

     

(1,572)

     

1,997

   

Loss (gain) on mark-to-market derivatives

   

2,967

     

(34,070)

     

-

     

(28,885)

     

(21,193)

   

Non-cash interest expense

   

6,407

     

9,378

     

5,388

     

22,175

     

16,709

   

Amortization of debt issuance costs

   

831

     

1,091

     

733

     

2,621

     

2,454

   

Amortization of promissory notes

   

6,022

     

2,919

     

-

     

8,941

     

-

   

Gain on change in equity interest in unconsolidated investee

   

-

     

(28,348)

     

-

     

(28,348)

     

-

   

Gain on deconsolidation of consolidated subsidiary

   

(36,849)

     

-

     

-

     

(36,849)

     

-

   

Equity in earnings of unconsolidated investees

   

(5,825)

     

(2,030)

     

(2,627)

     

(10,973)

     

(7,005)

   

Excess tax benefits from stock-based award activity

   

3,067

     

(3,828)

     

(7,127)

     

(761)

     

(7,127)

   

Deferred income taxes and other tax liabilities

   

6,489

     

47,939

     

15,025

     

18,708

     

(14,760)

   

Changes in operating assets and liabilities, net of effect of acquisition and divestiture:

                                         

Accounts receivable

   

(45,541)

     

11,151

     

(18,794)

     

(3,879)

     

(43,285)

   

Costs and estimated earnings in excess of billings

   

(48,155)

     

(27,657)

     

(60,071)

     

(80,719)

     

(41,992)

   

Inventories

   

(11,962)

     

(21,163)

     

21,695

     

(84,210)

     

27,776

   

Project assets

   

(98,362)

     

(44,480)

     

-

     

(146,268)

     

-

   

Prepaid expenses and other assets

   

30,541

     

(92,623)

     

15,465

     

(76,774)

     

(6,615)

   

Advances to suppliers

   

(2,085)

     

579

     

3,435

     

1,672

     

25,174

   

Accounts payable and other accrued liabilities

   

98,351

     

93,909

     

93,380

     

219,133

     

(13,142)

   

Billings in excess of costs and estimated earnings

   

6,557

     

(16,903)

     

(33,479)

     

1,269

     

1,049

   

Customer advances

   

(8,912)

     

1,869

     

(5,553)

     

(7,961)

     

(13,639)

   

Net cash provided by (used in) operating activities of continuing operations

   

(24,263)

     

(68,528)

     

85,800

     

(73,890)

     

37,227

   

Net cash provided by (used in) operating activities of discontinued operations

   

(4,618)

     

649

     

-

     

(3,969)

     

-

   

Net cash provided by (used in) operating activities

   

(28,881)

     

(67,879)

     

85,800

     

(77,859)

     

37,227

   
                                           

Cash flows from investing activities:

                                         

Decrease (increase) in restricted cash and cash equivalents

   

72,927

     

11,464

     

(103,247)

     

64,674

     

(145,583)

   

Purchases of property, plant and equipment

   

(4,331)

     

(56,634)

     

(37,957)

     

(104,623)

     

(149,624)

   

Proceeds from sale of equipment to third-party

   

2,409

     

-

     

1,976

     

5,284

     

9,878

   

Cash decrease due to deconsolidation of consolidated subsidiary

   

(12,879)

     

-

     

-

     

(12,879)

     

-

   

Proceeds from sales or maturities of available-for-sale securities

   

-

     

-

     

9,867

     

1,572

     

29,545

   

Cash paid for acquisitions, net of cash acquired

   

-

     

-

     

-

     

(272,699)

     

-

   

Cash paid for investments in joint ventures and other non-public companies

   

(2,180)

     

-

     

(1,500)

     

(3,798)

     

(1,500)

   

Net cash provided by (used in) investing activities of continuing operations

   

55,946

     

(45,170)

     

(130,861)

     

(322,469)

     

(257,284)

   

Net cash provided by (used in) investing activities of discontinued operations

   

51,658

     

(17,708)

     

-

     

33,950

     

-

   

Net cash provided by (used in) investing activities

   

107,604

     

(62,878)

     

(130,861)

     

(288,519)

     

(257,284)

   
                                           

Cash flows from financing activities:

                                         

Proceeds from issuance of long-term debt, net of issuance costs

   

(5,134)

     

3,595

     

54,701

     

-

     

137,735

   

Proceeds from issuance of convertible debt, net of issuance costs

   

-

     

29,320

     

-

     

244,241

     

225,018

   

Proceeds from offering of class A common stock, net of offering expenses

   

-

     

-

     

(114)

     

-

     

218,781

   

Repayment of bank loans

   

(33,646)

     

(30,000)

     

-

     

(63,646)

     

-

   

Cash paid for repurchased convertible debt

   

(143,804)

     

-

     

(7,687)

     

(143,804)

     

(75,636)

   

Cash paid for bond hedge

   

-

     

(9,024)

     

-

     

(75,200)

     

-

   

Cash paid for purchased options

   

-

     

-

     

-

     

-

     

(97,336)

   

Proceeds from warrant transactions

   

-

     

7,374

     

-

     

61,450

     

71,001

   

Proceeds from exercise of stock options

   

324

     

346

     

570

     

670

     

1,408

   

Excess tax benefits from stock-based award activity

   

(3,067)

     

3,828

     

7,127

     

761

     

7,127

   

Purchases of stock for tax withholding obligations on vested restricted stock

   

(562)

     

(797)

     

(586)

     

(2,539)

     

(3,708)

   

Net cash provided by (used in) financing activities of continuing operations

   

(185,889)

     

4,642

     

54,011

     

21,933

     

484,390

   

Net cash provided by financing activities of discontinued operations

   

-

     

17,059

     

-

     

17,059

     

-

   

Net cash provided by (used in) financing activities

   

(185,889)

     

21,701

     

54,011

     

38,992

     

484,390

   
                                           

Effect of exchange rate changes on cash and cash equivalents

   

5,410

     

(7,130)

     

6,341

     

(7,281)

     

5,462

   

Net increase (decrease) in cash and cash equivalents

   

(101,756)

     

(116,186)

     

15,291

     

(334,667)

     

269,795

   

Cash and cash equivalents at beginning of period

   

382,968

     

499,154

     

456,835

     

615,879

     

202,331

   

Cash and cash equivalents at end of period

   

281,212

     

382,968

     

472,126

     

281,212

     

472,126

   

Less: Cash and cash equivalents of discontinued operations

   

-

     

-

     

-

     

-

     

-

   

Cash and cash equivalents of continuing operations, end of period

 

$

281,212

   

$

382,968

   

$

472,126

   

$

281,212

   

$

472,126

   
                                           

Non-cash transactions:

                                         

Property, plant and equipment acquisitions funded by liabilities

 

$

4,382

   

$

113,008

   

$

21,594

   

$

4,382

   

$

21,594

   

Non-cash interest expense capitalized and added to the cost of qualified assets

   

1,856

     

560

     

873

     

2,951

     

4,456

   

Issuance of common stock for purchase acquisition

   

-

     

-

     

-

     

-

     

1,471

   
   

(1) As adjusted to reflect the adoption of new accounting guidance for share lending arrangements that were executed in connection with the Company's convertible debt offerings in fiscal 2007.

 
   
                                           

 

 

   

(In thousands, except per share data)

                                       
   

THREE MONTHS ENDED

 

NINE MONTHS ENDED

 

THREE MONTHS ENDED

 

NINE MONTHS ENDED

   
   

Oct. 3,

 

Jul. 4,

 

Sep. 27,

 

Oct. 3,

 

Sep. 27,

 

Oct. 3,

 

Jul. 4,

 

Sep. 27,

 

Oct. 3,

 

Sep. 27,

   
   

2010

 

2010

 

2009

 

2010

 

2009

 

2010

 

2010

 

2009

 

2010

 

2009

   
   

(Presented on a GAAP Basis)

 

(Presented on a non-GAAP Basis)

   

Gross margin

 

$

112,585

 

$

87,851

 

$

99,830

 

$

272,179

 

$

172,743

 

$

123,398

 

$

103,282

 

$

107,299

 

$

304,821

 

$

192,993

   

Operating income (loss)

 

$

8,188

 

$

(1,731)

 

$

46,248

 

$

3,513

 

$

19,165

 

$

45,192

 

$

33,032

 

$

63,833

 

$

91,750

 

$

67,770

   

Net income (loss) per share of class A and class B common stock:

                                             

-Basic

 

$

0.21

 

$

(0.07)

 

$

0.21

 

$

0.28

 

$

0.27

 

$

0.27

 

$

0.15

 

$

0.50

 

$

0.48

 

$

0.53

   

-Diluted

 

$

0.21

 

$

(0.07)

 

$

0.20

 

$

0.27

 

$

0.26

 

$

0.26

 

$

0.15

 

$

0.46

 

$

0.47

 

$

0.52

   
   
                                                               

 

About SunPower's Non-GAAP Financial Measures

To supplement its consolidated financial results presented in accordance with GAAP, SunPower uses non-GAAP measures which are adjusted from the most directly comparable GAAP results to exclude non-cash charges related to amortization of intangible assets and promissory notes, stock-based compensation and interest expense as well as exclude non-cash net gains (losses) on mark-to-market derivative instruments, a gain on the change in our equity investment in a joint venture, a gain on deconsolidation of consolidated subsidiary, and the related tax effects of these adjustments. In addition, the presentation of non-GAAP gross margin and non-GAAP operating income includes the results of discontinued operations. The specific non-GAAP measures listed below are gross margin, operating income and net income per share. Management believes that each of these non-GAAP measures (gross margin, operating income and net income per share) are useful to investors by enabling them to better assess changes in each of these key elements of SunPower's results of operations across different reporting periods on a consistent basis, independent of these non-cash items. Thus, each of these non-GAAP financial measures provides investors with another method for assessing SunPower's operating results in a manner that is focused on its ongoing core operating performance, absent the effects of amortization of intangible assets and promissory notes, stock-based compensation, interest expense, net gains (losses) on mark-to-market derivative instruments, a gain on the change in our equity investment in a joint venture, a gain on deconsolidation of consolidated subsidiary, and the presentation of the results of discontinued operations. Management also uses these non-GAAP measures internally to assess the business and financial performance of current and historical results, for strategic decision making, forecasting future results and evaluating the company's current performance. Many of the analysts covering SunPower also use these non-GAAP measures in their analyses. These non-GAAP measures are not in accordance with or an alternative for GAAP financial data, the non-GAAP results should be reviewed together with the GAAP results and are not intended to serve as a substitute for results under GAAP, and may be different from non-GAAP measures used by other companies.

o Non-GAAP gross margin. The use of this non-GAAP financial measure allows management to evaluate the gross margin of the company's core businesses and trends across different reporting periods on a consistent basis, independent of non-cash charges including amortization of intangible assets, stock-based compensation and interest expense. In addition, the presentation of non-GAAP gross margin includes the results of discontinued operations. This non-GAAP financial measure is an important component of management's internal performance measurement process as it is used to assess the current and historical financial results of the business, for strategic decision making, preparing budgets and forecasting future results. Management presents this non-GAAP financial measure to enable investors and analysts to evaluate SunPower's revenue generation performance relative to the direct costs of revenue of its core businesses.

o Non-GAAP operating income. The use of this non-GAAP financial measure allows management to evaluate the operating results of the company's core businesses and trends across different reporting periods on a consistent basis, independent of non-cash charges including amortization of intangible assets and promissory notes, stock-based compensation and interest expense. In addition, the presentation of non-GAAP operating income includes the results of discontinued operations. Non-GAAP operating income is an important component of management's internal performance measurement process as it is used to assess the current and historical financial results of the business, for strategic decision making, preparing budgets and forecasting future results. Management presents this non-GAAP financial measure to enable investors and analysts to understand the results of operations of the company's core businesses and to compare results of operations on a more consistent basis against that of other companies in the industry.

o Non-GAAP net income per share. Management presents this non-GAAP financial measure to enable investors and analysts to assess the company's operating results and trends across different reporting periods on a consistent basis, independent of non-cash items including amortization of intangible assets and promissory notes, stock-based compensation, interest expense, net gains (losses) on mark-to-market derivative instruments, a gain on the change in our equity investment in a joint venture, a gain on deconsolidation of consolidated subsidiary, and the tax effects of these non-GAAP adjustments. In addition, investors and analysts can compare SunPower's operating results on a more consistent basis against that of other companies in the industry. It should be noted that diluted weighted-average shares are determined on a GAAP basis and the resulting share count is used for computing both GAAP and Non-GAAP diluted net income per share.

Non-Cash Items

o Amortization of intangible assets. SunPower incurs amortization of intangible assets as a result of acquisitions, which includes in-process research and development, patents, project assets, purchased technology and trade names. SunPower excludes these items because these expenses are not reflective of ongoing operating results in the period incurred. These amounts arise from prior acquisitions and have no direct correlation to the operation of SunPower's core businesses.

o Stock-based compensation. Stock-based compensation relates primarily to SunPower stock awards such as stock options and restricted stock. Stock-based compensation is a non-cash expense that varies in amount from period to period and is dependent on market forces that are difficult to predict. As a result of this unpredictability, management excludes this item from its internal operating forecasts and models. Management believes that non-GAAP measures adjusted for stock-based compensation provide investors with a basis to measure the company's core performance against the performance of other companies without the variability created by stock-based compensation.

o Amortization of promissory notes. Included in the total consideration for the acquisition of SunRay completed on March 26, 2010 is $14 million in promissory notes to SunRay's management shareholders issued by SunPower. Since the vesting and payment of the promissory notes are contingent on future employment, the promissory notes are considered deferred compensation and therefore are not included in the purchase price allocated to the net assets acquired. SunPower excludes this non-cash charge over the service period required under the terms of the promissory notes because these expenses are not reflective of ongoing operating results in the period incurred. These amounts arise from prior acquisitions and have no direct correlation to the operation of SunPower's core businesses.

o Non-cash interest expense. SunPower separately accounted for the liability and equity components of its convertible debt issued in 2007 in a manner that reflected interest expense equal to its non-convertible debt borrowing rate. Under new accounting guidance effective in the first quarter of 2010, SunPower measured the two existing share lending arrangements entered into in connection with its convertible debt issued in 2007 at fair value and amortized the imputed share lending costs in current and prior periods. As a result, SunPower incurs interest expense that is substantially higher than interest payable on its 1.25% senior convertible debentures and 0.75% senior convertible debentures.

In addition, SunPower separately accounted for the fair value liabilities of the embedded cash conversion option and the over-allotment option on its 4.5% senior cash convertible debentures issued in April 2010 as an original issue discount and a corresponding derivative conversion liability. As a result, SunPower incurs interest expense that is substantially higher than interest payable on its 4.5% senior cash convertible debentures. SunPower excludes non-cash interest expense because the expense is not reflective of its ongoing financial results in the period incurred. Excluding this data provides investors with a basis to compare the company's performance against the performance of other companies without non-cash interest expense.

o Gain on deconsolidation of consolidated subsidiary. SunPower's joint venture transaction with AU Optronics Singapore Pte. Ltd. closed on July 5, 2010, the first day of the third quarter of 2010. Under the joint venture agreement SunPower's equity interest in SunPower Malaysia Manufacturing Sdn. Bhd., formerly a wholly-owned subsidiary, was reduced to 50% and the entity was renamed AUO SunPower Sdn. Bhd. ("AUOSP"). Each investor has a 50% equity ownership in the joint venture. As a result of the shared power arrangement SunPower deconsolidated AUOSP. SunPower recognized a $36.8 million non-cash gain from the deconsolidation of the consolidated subsidiary in the third quarter of 2010. SunPower excluded the non-cash gain from its non-GAAP results because it was not realized in cash and it is not reflective of the Company's ongoing financial results. Excluding this data provides investors with a basis to compare the Company's performance against the performance of other companies without non-cash income from a gain on deconsolidation and fair value recognition of the equity interest in AUOSP.

o Gain on change in equity interest in unconsolidated investee. On June 30, 2010, Woongjin Energy Co., Ltd completed its initial public offering and the sale of 15.9 million new shares of common stock. SunPower did not participate in this common stock issuance by Woongjin Energy. As a result of the new common stock issuance by Woongjin Energy in the IPO, SunPower's percentage equity interest in Woongjin Energy decreased from 42.1% to 31.3% of Woongjin Energy's issued and outstanding shares of common stock. In connection with the IPO, SunPower recognized a non-cash gain of $28.3 million representing the excess of the IPO price over SunPower's per share carrying value of its shares. SunPower excluded the $28.3 million gain in the second quarter 2010 from its non-GAAP results because it was not realized in cash and it is not reflective of the company's ongoing financial results. Excluding this data provides investors with a basis to compare the company's performance against the performance of other companies without non-cash income from a gain on change in the company's equity interest in Woongjin Energy.

o Gain (loss) on mark-to-market derivative instruments. In connection with the issuance of its 4.5% senior cash convertible debentures in April 2010, SunPower entered into certain convertible debenture hedge and warrant transactions with respect to its class A common stock intended to reduce the potential cash payments that would occur upon conversion of the debentures. The convertible debenture hedge and warrant transactions consisting of call option instruments are deemed to be mark-to-market derivatives during the period in which the cash convertible debt remains outstanding. In addition, the embedded cash conversion option of the debt is deemed to be a mark-to-market derivative instrument during the period in which the cash convertible debt remains outstanding. Finally, the over-allotment option in favor of the debenture underwriters is deemed a mark-to-market derivative instrument during the period the over-allotment option remained unexercised. SunPower excluded the $3.0 million net loss in the third quarter 2010, $34.1 million net gain in the second quarter 2010, and $2.2 million net loss in the first quarter 2010 relating to the above mentioned derivative instruments from its non-GAAP results because it was not realized in cash and it is not reflective of the company's ongoing financial results. Excluding this data provides investors with a basis to compare the company's performance against the performance of other companies without a net non-cash gain or loss on mark-to-market derivative instruments.

In connection with the issuance of its 4.75% senior convertible debentures in May 2009, SunPower entered into certain convertible debenture hedge transactions with respect to its class A common stock intended to reduce the potential dilution that would occur upon conversion of the debentures. The convertible debenture hedge transactions consisting of call option instruments are deemed to be a mark-to-market derivative during the period in which the over-allotment option in favor of the debenture underwriters was unexercised. During the one-day period that the underwriters' over-allotment option was outstanding, SunPower's class A common stock price increased substantially. SunPower excluded the $21.2 million gain in the second quarter 2009 relating to the purchased options from its non-GAAP results because it was not realized in cash and it is not reflective of the company's ongoing financial results. Excluding this data provides investors with a basis to compare the company's performance against the performance of other companies without non-cash income from a gain on purchased options.

o Tax effect. This amount is used to present each of the amounts described above on an after-tax basis with the presentation of non-GAAP net income per share.

o Income from discontinued operations, net of taxes. In connection with SunPower's acquisition of SunRay on March 26, 2010, it acquired an already completed and operating solar power plant owned by SunRay. In the period in which an asset of SunPower is classified as held-for-sale, it is required to present the related assets, liabilities and results of operations associated with that asset as discontinued operations in its financial statements in accordance with GAAP. During the second and third quarter 2010, SunPower generated electricity revenue and incurred costs and expenses associated with this owned asset. In the third quarter of 2010, SunPower recognized a pre-tax gain of $7.9 million for the sale of the asset on August 5, 2010. The presentation of SunPower's Condensed Consolidated Statements of Operations discloses the results of operations of the solar power plant as a one line item classification as discontinued operations in accordance with GAAP. As such, the presentation of GAAP gross margin and GAAP operating income in the second and third quarter 2010 excludes the results of these discontinued operations. SunPower reclassified the results of the solar power plant operations from the one line discontinued operations classification for GAAP purposes to the natural account classifications (revenue, etc.) within non-GAAP gross margin and non-GAAP operating income. SunPower believes this reclassification of the solar power plants results of operations provides an appropriate representation of the results of SunPower's operations during the quarter in operating a solar power plant.

For more information on these non-GAAP financial measures, please see the tables captioned "Reconciliations of GAAP Measures to Non-GAAP Measures" set forth at the end of this release and which should be read together with the preceding financial statements prepared in accordance with GAAP.

 

   

SUNPOWER CORPORATION

   

RECONCILIATIONS OF GAAP MEASURES TO NON-GAAP MEASURES

   

(Unaudited)

   

(In thousands, except per share data)

   
                                                     
                                                     

STATEMENT OF OPERATIONS DATA:

   
   

THREE MONTHS ENDED

   

NINE MONTHS ENDED

   
   

Oct. 3,

   

Jul. 4,

   

Sep. 27,

   

Oct. 3,

   

Sep. 27,

   
   

2010

   

2010

   

2009

   

2010

   

2009

   
                                                     

GAAP utility and power plants gross margin

 

$

45,277

   

18%

   

$

22,775

   

19%

   

$

52,118

   

27%

   

$

100,718

   

19%

   

$

75,057

   

18%

   

Amortization of intangible assets

   

946

           

774

           

683

           

2,409

           

2,049

         

Stock-based compensation expense

   

2,442

           

1,632

           

1,530

           

5,265

           

4,090

         

Non-cash interest expense

   

293

           

275

           

130

           

969

           

974

         

Discontinued operations

   

3,176

           

7,905

           

-

           

11,081

           

-

         

Non-GAAP utility and power plants gross margin

 

$

52,134

   

20%

   

$

33,361

   

26%

   

$

54,461

   

28%

   

$

120,442

   

23%

   

$

82,170

   

19%

   
                                                                         

GAAP residential and commercial gross margin

 

$

67,308

   

23%

   

$

65,076

   

25%

   

$

47,712

   

18%

   

$

171,461

   

23%

   

$

97,686

   

18%

   

Amortization of intangible assets

   

1,745

           

2,125

           

2,119

           

5,994

           

6,341

         

Stock-based compensation expense

   

1,941

           

2,327

           

2,772

           

5,759

           

5,665

         

Non-cash interest expense

   

270

           

393

           

235

           

1,165

           

1,131

         

Non-GAAP residential and commercial gross margin

 

$

71,264

   

24%

   

$

69,921

   

26%

   

$

52,838

   

20%

   

$

184,379

   

24%

   

$

110,823

   

20%

   
                                                                         

GAAP total gross margin

 

$

112,585

   

20%

   

$

87,851

   

23%

   

$

99,830

   

21%

   

$

272,179

   

21%

   

$

172,743

   

18%

   

Amortization of intangible assets

   

2,691

           

2,899

           

2,802

           

8,403

           

8,390

         

Stock-based compensation expense

   

4,383

           

3,959

           

4,302

           

11,024

           

9,755

         

Non-cash interest expense

   

563

           

668

           

365

           

2,134

           

2,105

         

Discontinued operations

   

3,176

           

7,905

           

-

           

11,081

           

-

         

Non-GAAP total gross margin

 

$

123,398

   

22%

   

$

103,282

   

26%

   

$

107,299

   

23%

   

$

304,821

   

24%

   

$

192,993

   

20%

   
                                                                         

GAAP operating income (loss)

 

$

8,188

         

$

(1,731)

         

$

46,248

         

$

3,513

         

$

19,165

         

Amortization of intangible assets

   

11,578

           

11,702

           

4,146

           

28,039

           

12,296

         

Stock-based compensation expense

   

15,665

           

11,591

           

13,074

           

38,064

           

34,204

         

Amortization of promissory notes

   

6,022

           

2,919

           

-

           

8,941

           

-

         

Non-cash interest expense

   

563

           

668

           

365

           

2,134

           

2,105

         

Discontinued operations

   

3,176

           

7,883

           

-

           

11,059

           

-

         

Non-GAAP operating income

 

$

45,192

         

$

33,032

         

$

63,833

         

$

91,750

         

$

67,770

         
                                                                         
                                                                       

 

 

NET INCOME (LOSS) PER SHARE:

                                                                 
   

THREE MONTHS ENDED

   

NINE MONTHS ENDED

   
   

Oct. 3,

         

Jul. 4,

         

Sep. 27,

         

Oct. 3,

         

Sep. 27,

   
   

2010

         

2010

         

2009

         

2010

         

2009

   
                                                                   

Basic:

                                                                 

GAAP net income (loss) per share

 

$

0.21

         

$

(0.07)

         

$

0.21

         

$

0.28

         

$

0.27

   

Reconciling items:

                                                                 

Amortization of intangible assets

   

0.12

           

0.12

           

0.04

           

0.29

           

0.14

   

Stock-based compensation expense

   

0.16

           

0.12

           

0.14

           

0.40

           

0.38

   

Amortization of promissory notes

   

0.06

           

0.03

           

-

           

0.09

           

-

   

Non-cash interest expense

   

0.07

           

0.10

           

0.06

           

0.23

           

0.19

   

Mark-to-market derivatives

   

0.03

           

(0.35)

           

-

           

(0.30)

           

(0.25)

   

Gain on deconsolidation of consolidated subsidiary

   

(0.38)

           

-

           

-

           

(0.38)

           

-

   

Gain on change in equity interest in unconsolidated investee

   

-

           

(0.30)

           

-

           

(0.30)

           

-

   

Tax effect

   

-

           

0.50

           

0.05

           

0.17

           

(0.20)

   
                                                                   

Non-GAAP net income per share

 

$

0.27

         

$

0.15

         

$

0.50

         

$

0.48

         

$

0.53

   
                                                                   

Diluted:

                                                                 

GAAP net income (loss) per share

 

$

0.21

         

$

(0.07)

         

$

0.20

         

$

0.27

         

$

0.26

   

Reconciling items:

                                                                 

Amortization of intangible assets

   

0.11

           

0.12

           

0.04

           

0.29

           

0.14

   

Stock-based compensation expense

   

0.15

           

0.12

           

0.12

           

0.39

           

0.37

   

Amortization of promissory notes

   

0.06

           

0.03

           

-

           

0.09

           

-

   

Non-cash interest expense

   

0.06

           

0.10

           

0.05

           

0.23

           

0.18

   

Mark-to-market derivatives

   

0.03

           

(0.35)

           

-

           

(0.30)

           

(0.23)

   

Gain on deconsolidation of consolidated subsidiary

   

(0.36)

           

-

           

-

           

(0.38)

           

-

   

Gain on change in equity interest in unconsolidated investee

   

-

           

(0.30)

           

-

           

(0.29)

           

-

   

Tax effect

   

-

           

0.50

           

0.05

           

0.17

           

(0.20)

   
                                                                   

Non-GAAP net income per share

 

$

0.26

         

$

0.15

         

$

0.46

         

$

0.47

         

$

0.52

   
                                                                   

Weighted-average shares:

                                                                 
                                                                   

GAAP net income (loss) per share:

                                                                 

- Basic

   

95,840

           

95,564

           

94,668

           

95,519

           

89,764

   

- Diluted

   

105,648

           

95,564

           

105,031

           

96,741

           

91,513

   
                                                                   

Non-GAAP net income per share:

                                                                 

- Basic

   

95,840

           

95,564

           

94,668

           

95,519

           

89,764

   

- Diluted

   

105,648

           

96,816

           

105,031

           

96,741

           

91,513

   
                                                                   
                                                                 

 

 

2010 GUIDANCE:

   

Q4 2010 (a)

           

FY2010 (b)

 

Revenue

   

$870,000-$970,000

           

$2,150,000-$2,250,000

 

Gross margin (Non-GAAP)

   

20%-22%

           

22%-23%

 

Gross margin (GAAP)

   

19%-21%

           

20%-21%

 

Net income per diluted share (Non-GAAP)

   

$0.95-$1.15

           

$1.45-$1.65

 

Net income per diluted share (GAAP)

   

$0.45-$0.60

           

$0.75-$0.90

 
                     

 

 

(a) Estimated non-GAAP amounts above for Q4 2010 reflect adjustments that exclude the estimated amortization of intangible assets of approximately $10-$11 million, estimated stock-based compensation expense of approximately $16-$17 million, estimated non-cash interest expense of approximately $5-$8 million and amortization of promissory notes of approximately $2 million.

 

(b) Estimated non-GAAP amounts above for FY 2010 reflect adjustments that exclude the estimated amortization of intangible assets of approximately $38-$39 million, estimated stock-based compensation expense of approximately $54-$55 million, estimated non-cash interest expense of approximately $28-$31 million, amortization of promissory notes of approximately $11 million, mark-to-market derivatives of approximately $29 million, gain related to our Fab 3 joint venture of approximately $37 million and gain related to our investment in Woongjin Energy of approximately $28 million.

 
 

 

 

The following supplemental data represents the individual charges and credits that are excluded from SunPower's non-GAAP financial measures for each period presented in the Condensed Consolidated Statements of Operations contained herein.

   
         
   

SUPPLEMENTAL DATA

   
   

(In thousands)

   
         
   

THREE MONTHS ENDED

   
         
   

October 3, 2010

   
   

Revenue

   

Cost of revenue

   

Operating expenses

                     
   

Utility

and

power

plants

   

Residential

and

commercial

   

Utility

and

power

plants

   

Residential

and

commercial

   

Research

and

development

   

Selling,

general

and

administrative

   

Other

income

(expense),

net

   

Benefit

from

(provision

for)

income

taxes

   

Income

from

discontinued

operations,

net of taxes

   

Amortization of intangible assets

 

$

-

   

$

-

   

$

946

   

$

1,745

   

$

-

   

$

8,887

   

$

-

   

$

-

   

$

-

   

Stock-based compensation expense

   

-

     

-

     

2,442

     

1,941

     

1,886

     

9,396

     

-

     

-

     

-

   

Amortization of promissory notes

   

-

     

-

     

-

     

-

     

-

     

6,022

     

-

     

-

     

-

   

Non-cash interest expense

   

-

     

-

     

293

     

270

     

-

     

-

     

5,844

     

-

     

-

   

Mark-to-market derivatives

   

-

     

-

     

-

     

-

     

-

     

-

     

2,967

     

-

     

-

   

Gain on deconsolidation of consolidated subsidiary

   

-

     

-

     

-

     

-

     

-

     

-

     

(36,849)

     

-

     

-

   

Tax effect

   

-

     

-

     

-

     

-

     

-

     

-

     

-

     

377

     

-

   

Discontinued operations

   

3,176

     

-

     

-

     

-

     

-

     

-

     

(887)

     

(719)

     

(1,570)

   
   

$

3,176

   

$

-

   

$

3,681

   

$

3,956

   

$

1,886

   

$

24,305

   

$

(28,925)

   

$

(342)

   

$

(1,570)

   
                                                                           
   

July 4, 2010

   
   

Revenue

   

Cost of revenue

   

Operating expenses

                     
   

Utility

and

power

plants

   

Residential

and

commercial

   

Utility

and

power

plants

   

Residential

and

commercial

   

Research

and

development

   

Selling,

general

and

administrative

   

Other

income

(expense),

net

   

Benefit

from

(provision

for)

income

taxes

   

Income

from

discontinued

operations,

net of taxes

   

Amortization of intangible assets

 

$

-

   

$

-

   

$

774

   

$

2,125

   

$

-

   

$

8,803

   

$

-

   

$

-

   

$

-

   

Stock-based compensation expense

   

-

     

-

     

1,632

     

2,327

     

2,253

     

5,379

     

-

     

-

     

-

   

Amortization of promissory notes

   

-

     

-

     

-

     

-

     

-

     

2,919

     

-

     

-

     

-

   

Non-cash interest expense

   

-

     

-

     

275

     

393

     

-

     

-

     

8,710

     

-

     

-

   

Mark-to-market derivatives

   

-

     

-

     

-

     

-

     

-

     

-

     

(34,070)

     

-

     

-

   

Gain on change in equity interest in unconsolidated investee

   

-

     

-

     

-

     

-

     

-

     

-

     

(28,348)

     

-

     

-

   

Tax effect

   

-

     

-

     

-

     

-

     

-

     

-

     

-

     

47,457

     

-

   

Discontinued operations

   

7,905

     

-

     

-

     

-

     

-

     

(22)

     

3,627

     

(3,614)

     

(7,896)

   
   

$

7,905

   

$

-

   

$

2,681

   

$

4,845

   

$

2,253

   

$

17,079

   

$

(50,081)

   

$

43,843

   

$

(7,896)

   
                                                                           
   

September 27, 2009

   
   

Revenue

   

Cost of revenue

   

Operating expenses

                     
   

Utility

and

power plants

   

Residential

and

commercial

   

Utility

and

power

plants

   

Residential

and

commercial

   

Research

and

development

   

Selling,

general

and administrative

   

Other

income

(expense),

net

   

Benefit

from

(provision

for)

income

taxes

   

Income

from

discontinued

operations,

net of taxes

   

Amortization of intangible assets

 

$

-

   

$

-

   

$

683

   

$

2,119

   

$

-

   

$

1,344

   

$

-

   

$

-

   

$

-

   

Stock-based compensation expense

   

-

     

-

     

1,530

     

2,772

     

1,736

     

7,036

     

-

     

-

     

-

   

Non-cash interest expense

   

-

     

-

     

130

     

235

     

-

     

-

     

5,023

     

-

     

-

   

Tax effect

   

-

     

-

     

-

     

-

     

-

     

-

     

-

     

4,928

     

-

   
   

$

-

   

$

-

   

$

2,343

   

$

5,126

   

$

1,736

   

$

8,380

   

$

5,023

   

$

4,928

   

$

-

   
                                                                           
                                                                           
   

NINE MONTHS ENDED

   
                                                                           
   

October 3, 2010

   
   

Revenue

   

Cost of revenue

   

Operating expenses

                     
   

Utility

and

power

plants

   

Residential

and

commercial

   

Utility

and

power

plants

   

Residential

and

commercial

   

Research

and

development

   

Selling,

general

and

administrative

   

Other

income

(expense),

net

   

Benefit

from

(provision

for)

income

taxes

   

Income

from

discontinued

operations,

net of taxes

   

Amortization of intangible assets

 

$

-

   

$

-

   

$

2,409

   

$

5,994

   

$

-

   

$

19,636

   

$

-

   

$

-

   

$

-

   

Stock-based compensation expense

   

-

     

-

     

5,265

     

5,759

     

5,822

     

21,218

     

-

     

-

     

-

   

Amortization of promissory notes

   

-

     

-

     

-

     

-

     

-

     

8,941

     

-

     

-

     

-

   

Non-cash interest expense

   

-

     

-

     

969

     

1,165

     

-

     

-

     

20,041

     

-

     

-

   

Mark-to-market derivatives

   

-

     

-

     

-

     

-

     

-

     

-

     

(28,885)

     

-

     

-

   

Gain on deconsolidation of consolidated subsidiary

   

-

     

-

     

-

     

-

     

-

     

-

     

(36,849)

     

-

     

-

   

Gain on change in equity interest in unconsolidated investee

   

-

     

-

     

-

     

-

     

-

     

-

     

(28,348)

     

-

     

-

   

Tax effect

   

-

     

-

     

-

     

-

     

-

     

-

     

-

     

16,245

     

-

   

Discontinued operations

   

11,081

     

-

     

-

     

-

     

-

     

(22)

     

2,740

     

(4,333)

     

(9,466)

   
   

$

11,081

   

$

-

   

$

8,643

   

$

12,918

   

$

5,822

   

$

49,773

   

$

(71,301)

   

$

11,912

   

$

(9,466)

   
                                                                           
   

September 27, 2009

   
   

Revenue

   

Cost of revenue

   

Operating expenses

                     
   

Utility

and

power

plants

   

Residential

and

commercial

   

Utility

and

power

plants

   

Residential

and

commercial

   

Research

and

development

   

Selling,

general

and

administrative

   

Other

income

(expense),

net

   

Benefit

from

(provision

for)

income

taxes

   

Income

from

discontinued

operations,

net of taxes

   

Amortization of intangible assets

 

$

-

   

$

-

   

$

2,049

   

$

6,341

   

$

-

   

$

3,906

   

$

-

   

$

-

   

$

-

   

Stock-based compensation expense

   

-

     

-

     

4,090

     

5,665

     

4,649

     

19,800

     

-

     

-

     

-

   

Non-cash interest expense

   

-

     

-

     

974

     

1,131

     

-

     

-

     

14,604

     

-

     

-

   

Mark-to-market derivatives

   

-

     

-

     

-

     

-

     

-

     

-

     

(21,193)

     

-

     

-

   

Tax effect

   

-

     

-

     

-

     

-

     

-

     

-

     

-

     

(18,242)

     

-

   
   

$

-

   

$

-

   

$

7,113

   

$

13,137

   

$

4,649

   

$

23,706

   

$

(6,589)

   

$

(18,242)

   

$

-