SolarEdge Announces Fourth Quarter And Full Year 2020 Financial Results

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SolarEdge Technologies, Inc. (Nasdaq: SEDG), a global leader in smart energy technology, today announced its financial results for the fourth quarter and year ended December 31, 2020.

Fourth Quarter 2020 Highlights

  • Revenues of $358.1 million
  • Revenues from solar products of $327.1 million
  • GAAP gross margin of 30.8%
  • Non-GAAP gross margin of 32.5%
  • GAAP gross margin from sale of solar products of 35.3%
  • Non-GAAP gross margin from sale of solar products of 36.2%
  • GAAP net income of $17.7 million
  • Non-GAAP net income of $55.7 million
  • GAAP net diluted earnings per share (“EPS”) of $0.33
  • Non-GAAP net diluted EPS of $0.98
  • 1.36 Gigawatts (AC) of inverters shipped

Full Year 2020 Highlights

  • Record revenues of $1.46 billion
  • Record revenues from solar products of $1.36 billion
  • GAAP gross margin of 31.6%
  • GAAP gross margin from sale of solar products of 34.3%
  • Non-GAAP gross margin from sale of solar products of 35.0%
  • GAAP net income of $140.3 million
  • Non-GAAP net income of $224.4 million
  • GAAP net diluted earnings per share (“EPS”) of $2.66
  • Non-GAAP net diluted EPS of $4.11
  • 6.1 Gigawatts (AC) of inverters shipped

“Our fourth quarter results are reflective of strength in the U.S. residential market and record revenues from outside of Europe and the U.S., led by Australia,” said Zvi Lando, CEO of SolarEdge. “The return to growth in installations in the U.S. residential market drove our sequential growth and return to the anticipated solar margins. Despite the global pandemic, we concluded the year with slight growth in revenues, healthy cash generation and are well positioned for 2021 and beyond, having invested significantly in development of new products to be released this year as well as development of our non-solar businesses, with readiness to supply full powertrain kits for the e-Mobility sector in Europe.”

Fourth Quarter 2020 Summary 

The Company reported revenues of $358.1 million, up 6% from $338.1 million in the prior quarter and down 14% from $418.2 million in the same quarter last year.

Revenues related to the solar business were $327.1 million, up 5% from $312.5 million in the prior quarter and down 16% from $389.0 million in the same quarter last year.

GAAP gross margin was 30.8%, down from 32.0% in the prior quarter and down from 34.3% year over year.

Non-GAAP gross margin was 32.5%, down from 33.5% in the prior quarter and down from 35.5% year over year.

GAAP gross margin for the solar business was 35.3%, up from 34.1% in the prior quarter and down from 37.3% year over year.

Non-GAAP gross margin for the solar business was 36.2%, up from 34.8% in the prior quarter and down from 37.8% year over year.

GAAP operating expenses were $95.9 million, up 23% from $77.7 million in the prior quarter and up 3% from $92.7 million in the same quarter last year.

Non-GAAP operating expenses were $72.9 million, up 15% from $63.2 million in the prior quarter and up 15% from $63.1 million in the same quarter last year.

GAAP operating income was $14.4 million, down 53% from $30.4 million in the prior quarter and down 71% from $50.5 million in the same quarter last year.

Non-GAAP operating income was $43.5 million, down 13% from $50.0 million in the prior quarter and down 49% from $85.3 million in the same quarter last year.

GAAP net income was $17.7 million, down 60% from $43.8 million in the prior quarter and down 67% from $52.8 million in the same quarter last year.

Non-GAAP net income was $55.7 million, down 15% from $65.9 million in the prior quarter and down 36% from $87.4 million in the same quarter last year.

GAAP net diluted earnings per share (“EPS”) was $0.33, down from $0.83 in the prior quarter and down from $1.03 in the same quarter last year.

Non-GAAP net diluted EPS was $0.98, down from $1.21 in the prior quarter and down from $1.65 in the same quarter last year.

Cash flow from operating activities was $27.0 million, down from $28.4 million in the prior quarter and down from $83.1 million in the same quarter last year.

As of December 31, 2020, cash, cash equivalents, bank deposits, restricted bank deposit and marketable securities totaled $530.2 million, net of debt, compared to $553.8 million on September 30, 2020. 

Full Year 2020 Summary

Total revenues of $1.46 billion, up 2% from $1.43 billion in the prior year.

GAAP gross margin was 31.6%, down from 33.6% in the prior year.

Non-GAAP gross margin was 33.0%, down from 34.9% in the prior year.

GAAP operating income was $142.6 million, down 25% from $189.9 million in the prior year.

Non-GAAP operating income was $218.8 million, down 21% from $276.8 million in the prior year.

GAAP net income was $140.3 million, down 4% from $146.5 million in the prior year.

Non-GAAP net income was $224.4 million, down 4% from $233.2 million in the prior year.

GAAP net diluted EPS was $2.66, down from $2.90 in the prior year.

Non-GAAP net diluted EPS was $4.11, down from $4.44 in the prior year.

Cash flow from operating activities of $222.7 million, down from $259.0 million in the prior year.

Outlook for the First Quarter 2021

  • Revenues to be within the range of $385 million to $405 million
  • Non GAAP gross margin expected to be within the range of 34% to 36%
  • Revenues from solar products to be within the range of $360 million to $375 million
  • Non GAAP gross margin from sale of solar products expected to be within the range of 36% to 38% 

Conference Call

The Company will host a conference call to discuss these results at 4:30 P.M. ET on Tuesday, February 16, 2021. The call will be available, live, to interested parties by dialing 800-347-6311. For international callers, please dial +1 646-828-8143. The Conference ID number is 3276360. A live webcast will also be available in the Investors Relations section of the Company’s website at: http://investors.solaredge.com

A replay of the webcast will be available in the Investor Relations section of the Company’s web site approximately two hours after the conclusion of the call and will remain available for approximately 30 calendar days.

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