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LOUISVILLE, Colo., Aug. 10, 2015 (GLOBE NEWSWIRE) -- RGS Energy (NASDAQ:RGSE), one of the nation's leading rooftop installers of solar equipment, has reported results for its second quarter ended June 30, 2015. The company also filed today its quarterly report on Form 10-Q.
"During the second quarter, we made great strides towards turning around our business that resulted in several accomplishments, including our return to positive stockholders' equity and positive working capital," stated RGS Energy CEO, Dennis Lacey. "Since the end of the quarter, we have further reduced our accounts payable, the aging of which was hindering our business. We are now pivoting our efforts toward revenue growth by expanding our sales and construction capabilities."
Summary Business Update
The company previously reported completing a series of financial transactions that have strengthened its financial position, as well as actions taken to restructure its business operations for improved operating results. These results during the quarter include reporting positive stockholders' equity and positive working capital, as well as cutting the operating loss in half compared to the first quarter of 2015. See further highlights regarding the company's financial performance in the table, below.
|(in thousands, unaudited)|
|30, 2015||31, 2015|
|Cash and cash equivalents||$ 5,338||$ 992|
|Cash and available borrowings:|
|Under Current Borrowing Base (see update below)||6,058||2,765|
|Under Maximum allowed Borrowing Base||6,310||4,032|
|Related Party Debt||0||3,150|
|Total Debt Outstanding||4,028||5,110|
|Working Capital (Deficit) - Current Assets less Current Liabilities||2,743||(7,568)|
|Stockholders' Equity (Deficit)||7,328||(11,614)|
|Statement of Operations|
|Business Unit Contribution||(509)||(2,469)|
|Business Unit Contribution||162||(313)|
|Selling, Operating and G&A Ratio to Revenue||29%||53%|
|Net Income (Loss)||$ 1,575||$ (3,552)|
|Update on Cash and Available Borrowings:|
|Under current borrowing base||$ 1,325|
|Under maximum borrowing base||3,012|
|A roll forward of cash and available borrowing from June 30, 2015 through August 6, 2015 is:|
|Cash and available at June 30, 2015||$ 6,058|
|Collections of stock subscriptions receivable||900|
|Pay-down of prior accounts payable and accrued expenses||(2,466)|
|Decline in size of borrowing base||(1,232)|
|Used in operations||(709)|
|Cash and available at August 6, 2015||$ 1,325|
Q2 2015 Financial Summary
Six Months Ended June 30, 2015
Backlog and Net Sales Orders
Backlog is increased for transactions from acquired companies at the date of acquisition and thereafter for net sales orders (representing newly signed contracts with customers, net of contract cancellations or holds), and decreased for installations, which are reflected in revenue.
Q2 2015 Financing Capacity Highlights
"During the quarter, we cut our operating loss, which included approximately $800,000 of litigation and restructuring charges during the quarter, nearly in half compared to the first quarter of 2015," said Dennis Lacey, RGS Energy's CEO. "We also reported positive net income. Since this was primarily the result of a derivative gain, a non-cash item that we do not expect to recur at this level, we will continue striving to improve results at the operating income line. We intend to achieve this by expanding our sales and construction capabilities, all with the goal of 2016 being a growth year for the company.
"During the remainder of 2015, we will incur costs to expand our sales and construction capabilities as we position the company for revenue growth in 2016. Those costs, along with our current rate of installations after past cancellations and not being subject to the same level of derivative warrant income going forward, are such that we do not expect to report net income for the remaining quarters of 2015.
"We already have a national footprint — we are in all the key solar states and operate with a blend of both company field sales and our e-sales call center along with in-house construction crews and alliance partners for construction. The recently completed series of financial transactions have strengthened our financial position and provided us with working capital to further reduce our accounts payable and support our current operations. We also plan to apply this working capital to expand our sales and construction capabilities, as well as our presence in new states. These expansions represent the next step in our turnaround plan."
RGS Energy National Footprint
RGS Energy is one of the nation's leading rooftop installers of solar equipment, serving residential and small business customers in eight mainland U.S. states and Hawaii. The company markets its solar power systems through a mix of field sales teams and e-sales call center approach, as well as installs its systems using in-house and third-party integrators. For East Coast operations, the company primarily utilizes field sales through solarize programs and in-house construction crews. In California and Colorado, the company markets solely through its e-sales, call center-based approach and installs only through its authorized third-party integrators.
|RGS Energy National Footprint|
|Pacific||MidAtlantic||New England||West Coast||Total||States|
|States of Operation||HI||NY||NJ||CT||MA||VT||RI||CA||CO(HQ)||9||TBD|
|Company Field Sales Teams||*||*||*||*||*||*||*||7||TBD|
|Company Construction Teams||*||*||*||*||*||5||TBD|
|Call Center Sales||*||*||*||*||*||*||*||*||1||*|
|Authorized 3rd Party Integrators||*||*||*||*||*||*||*||*||8||*|
|Number of Offices/Warehouses||1||1||--||2||3||2||1||--||1||11||TBD|
RGS Energy will hold a conference call to discuss its second quarter 2015 financial results later today. Management will host the presentation, followed by a question and answer period.
|Date: Monday, August 10, 2015|
|Time: 4:30 p.m. Eastern time (2:30 p.m. Mountain time)|
|Toll-free dial-in number: 1-888-215-6917|
|International dial-in number: 1-913-312-0401|
|Conference ID: 8726019|
The conference call will be webcast live and available for replay via the investor relations section of the company's website at RGSEnergy.com.
Please call the conference telephone number five minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact Liolios Group at 1-949-574-3860.
A replay of the call will be available after 7:30 p.m. Eastern time on the same day through August 17, 2015.
|Toll-free replay number: 1-877-870-5176|
|International replay number: 1-858-384-5517|
|Replay ID: 8726019|
About RGS Energy
RGS Energy (NASDAQ:RGSE) is one of the nation's leading rooftop installers of solar equipment, serving residential and small business customers in the mainland U.S. and Hawaii. Beginning with one of the very first photovoltaic panels sold in 1978, the company has installed tens of thousands solar power systems. RGS Energy makes it possible for customers to save on their energy bill by providing a comprehensive solar solution, from design, financing, permitting and installation to ongoing monitoring, maintenance and support.
For more information, visit RGSEnergy.com, on Facebook at www.facebook.com/rgsenergy and on Twitter at www.twitter.com/rgsenergy. RGS Energy is a trade name and RGS Energy makes filings with the Securities and Exchange Commission under its official name "Real Goods Solar, Inc." For more information about the company, visit www.rgsenergy.com.
Forward-Looking Statements and Cautionary Statements
This press release may contain forward-looking statements that involve risks and uncertainties. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they provide our current beliefs, expectations, assumptions and forecasts about future events, and include statements regarding our future results of operations and financial position, business strategy, budgets, projected costs, plans and objectives of management for future operations. The words "anticipate," "believe," "plan," "estimate," "expect," "strive," "future," "intend," "may," "will" and similar expressions as they relate to us are intended to identify such forward-looking statements. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, without limitation, the following: the continuation and level of government subsidies and incentives for solar energy, the impacts of worsening economic conditions on homeowners and small commercial operation that may limit their ability and desire to invest in solar systems, changing and updating technologies and the issues presented by these new technologies related to customer demand and our product offering, the rates charged by electric utilities that may impact the desirability of our product to customers, our success in implementing our plans to increase future sales and revenue by expanding our sales and construction organization and expanding into new states of operations, the impact of a drop in the price of conventional energy on demand for solar energy systems, new regulations impacting solar installations including electric codes, access to electric grids, the willingness of electric utilities to allow interconnections and other regulations effecting energy consumption by consumers, factors impacting the timely installations of solar systems, seasonality and adverse weather conditions inhibiting our ability to install solar systems, our inability to maintain effective disclosure controls and procedures and internal control over financial reporting, our ability to operate with our existing financial resources and capital available under our debt facility, the impact of our current indebtedness on our financial health, our ability to continue to obtain access to financing and financial concessions when needed from financiers, loss of key personnel and ability to attract necessary personnel, our history of operating losses, our failure to realize cost savings from restructuring and optimization, geographic concentration of revenue from the sale of solar energy systems in east coast states, Hawaii and California, our failure to timely or accurately complete financing paperwork behalf of customers, adverse outcomes arising from litigation and contract disputes, disruption of our supply chain from equipment manufacturers, construction risks and costs, competition, continued access to competitive third party financiers to finance customer solar installations, failure by manufacturers of third party installers to perform under their warranties to us, failure of customers to pay per contractual terms, potential shortages of supplies for solar energy systems, conditions affecting international trade having an adverse effect on the supply of solar photovoltaic modules, delays or cancellations for system installations done on a percentage-of-completion, non-compliance with NASDAQ continued listing standards, changing reporting requirements which require significant compliance efforts and resources, volatile market price of our Class A common stock, lack of coverage of our Class A common stock by securities analysts, the low likelihood that we will pay any cash dividends on our Class A common stock for the foreseeable future, possibility of future dilutive issuances of securities, anti-takeover provisions in out organizational documents, the significant ownership and voting power of our Class A commons stock held by Riverside Renewable Energy Investments, LLC, the potential impact of the U.S. Security and Exchange Commission's investigation, and such other factors as discussed throughout Part I, Item 1A, Risk Factors and Part II, Item 7, Management's Discussion and Analysis of Financial Conditions and Results of Operations of our Annual Report on Form 10-K for the year ended December 31, 2014 and Part I, Item 2, Management's Discussion and Analysis of Financial Condition and Results of Operations and Part II, Item 1A, Risk Factors included of our Quarterly Reports on Form 10-Q for the quarter ended June 30, 2015.
Any forward-looking statement made by us in this press release is based only on information currently available to us and speaks only as of the date on which it is made. We undertake no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise. These documents are available on both the EDGAR section of the SEC's website at www.sec.gov and the Investor Relations section of the company's website at www.rgsenergy.com
|Condensed Consolidated Balance Sheets|
|(in thousands, except per share amounts - unaudited)|
|30, 2015||31, 2014|
|Cash & cash equivalents||$ 5,338||$ 1,947|
|Other Current Assets||6,886||5,847|
|Assets of Discontinued Operations||3,346||8,427|
|Total Current Assets||28,042||29,153|
|Goodwill and Intangibles||1,338||1,338|
|Assets of Discontinued Operations||937||1,082|
|Total Assets||$ 33,929||$ 35,106|
|Line of Credit and Term Loan||$ 4,028||$ 4,350|
|Related Party Debt||--||3,150|
|Other Current Liabilities||6,247||8,575|
|Liabilities of Discontinued Operations||5,312||7,984|
|Total Current Liabilities||25,299||37,457|
|Common stock warrant liability||1,002||2,491|
|Liabilities of Discontinued Operations||227||327|
|Stockholder's Equity (deficit)||7,328||(5,301)|
|Liabilities and Stockholders' Equity||$ 33,929||$ 35,106|
|Consolidated Summary Statements of Operations|
|(in thousands, except per share amounts - unaudited)|
|Three Months Ended June 30,||Six Months Ended June 30,|
|Net Revenue||$ 14,727||$ 19,636||$ 25,337||$ 33,403|
|Cost of Goods Sold||12,278||15,133||21,991||26,089|
|Gross Margin (%)||16.63%||22.93%||13.21%||21.90%|
|Selling and Operating||2,916||6,914||6,987||12,850|
|General and Administrative||1,313||2,300||2,870||4,372|
|Stock option compensation||155||417||400||620|
|Depreciation and amortization||124||554||274||--|
|Operating Loss from Continuing Operations||(2,896)||(5,378)||(8,043)||(12,519)|
|Derivative Gain, Net||4,509||6,082||6,264||1,415|
|Income Tax (Expense)/Benefit||(41)||1,214||24||1,208|
|Income/(Loss) from Continuing Operations, net of tax||1,575||1,684||(1,977)||(10,352)|
|(Loss) From Discontinued Operations, net of tax||(133)||(23,039)||(315)||(25,831)|
|Net Income/(Loss)||$1,442||$ (21,355)||$ (2,292)||$ (36,183)|
|Earnings per share||$ 0.28||$ (9.27)||$ (0.58)||$ (16.32)|
|Weighted average shares outstanding||5,011||2,304||3,947||2,217|
|(in thousands - unaudited)|
|Second quarter Results||YTD Results|
|Revenue||$ 11,110||$ 15,943||$ 17,967||$ 29,217|
|Business Unit Contribution||$ (509)||$ (1,771)||$ (2,978)||$ (3,952)|
|Business Unit Contribution||$162||$ (149)||$ (151)||$ (149)|
|Second quarter Results||YTD Results|
|Net Orders (dollars in thousands):|
|Residential||$ (636)||$ 5,717||$ (4,447)||$ 7,324|
|Sunetric||$ (190)||$ 2,263||$ (1,772)||$ 2,263|
|Total||$ (826)||$ 7,980||$ (6,219)||$ 9,587|
|Net Orders (kW):|
|As of June 30 2015|
|Backlog Information||Backlog Rooftops||Backlog Value ($'000's)|
|RGS Energy Stock Capitalization Table|
Total shares issued and
outstanding as of:
|Beginning Shares outstanding prior to June transactions||5,935,735||5,935,735|
|Shares issued in June transactions:|
|Subordinated Debt Conversion to Equity||1,288,156|
|Class A & C Warrant Exchanges||1,328,004|
|Total shares outstanding||5,935,735||12,573,779|
|Additional possible future shares issuable from:|
|Options to purchase common stock||148,040||148,040|
|Warrants to purchase common stock||2,252,956||1,330,247|
|Other contracts and agreements||22,631||22,631|
|Total shares issued or issuable in the future||8,359,362||14,074,697|
CONTACT: Investor Relations Contact Ron Both, Senior Managing Director Liolios Group, Inc. Tel 1-949-574-3860 RGSE@liolios.comNEXT ARTICLE
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