Sunnova Reports Fourth Quarter and Full-Year 2021 Financial Results
Sunnova Energy International Inc. (NYSE: NOVA) reported a significant increase in customer count, reaching 195,400 by the end of 2021. The company's revenue rose to $241.8 million, up by $80.9 million year-over-year. Adjusted EBITDA also increased by 44% to $85.9 million. Despite a net loss of $147.5 million for the year, Sunnova's efficient operational management allowed a reduction in adjusted operating expenses per customer by 15%. For 2022, Sunnova has raised its customer additions guidance to between 85,000 and 89,000 while reaffirming its EBITDA guidance for the year.
- Increased revenue to $241.8 million for 2021, up $80.9 million YoY.
- Adjusted EBITDA rose to $85.9 million, an increase of $26.3 million.
- Customer count reached 195,400, adding 87,900 customers in 2021.
- Reduced adjusted operating expense per customer by 15%.
- 2022 customer additions guidance increased by 2,000 customers.
- Net loss of $147.5 million for 2021, though improved from $307.8 million in 2020.
- Increased total operating expenses to $296.6 million for 2021, up $100 million YoY.
- Approximately 2,000 customers short of the 2021 guidance midpoint.
2021 Highlights
-
Added 87,900 customers in 2021, bringing total customer count to 195,400 as of
December 31, 2021 ; - Exceeded our full-year 2021 guidance range for Adjusted EBITDA despite public health and supply-chain challenges;
-
Reduced adjusted operating expense per customer by
15% in 2021; and -
Total liquidity of
as of$831 million December 31, 2021 .
"2021 was a landmark year for Sunnova, marked by significant improvement in the financial performance of the company despite numerous challenges that faced the economy as a whole," said
"In 2021, we saw the resiliency of our people, our dealers, our business model, and capitalization strategy help Sunnova navigate economic and regulatory uncertainties. As centralized utilities continue to rapidly increase their rates, Sunnova is able to provide its customers even greater savings through an energy service that is more reliable, more resilient, and more environmentally sustainable."
Fourth Quarter and Full-Year 2021 Results
Revenue increased to
Total operating expense, net increased to
Adjusted Operating Expense increased to
Sunnova incurred a net loss of
Sunnova incurred a net loss of
Adjusted EBITDA was
Customer principal (net of amounts recorded in revenue) and interest payments received from solar loans increased to
Liquidity & Capital Resources
As of
2022 Guidance
Sunnova management is increasing its 2022 customer additions guidance by 2,000 customers and reaffirming its 2022 financial guidance.
2022 full-year guidance is as follows:
- Customer additions of between 85,000 and 89,000, up from prior guidance of between 83,000 and 87,000;
-
Adjusted EBITDA of between
and$117 million , unchanged from prior guidance;$137 million -
Customer interest payments received from solar loans of between
and$45 million , unchanged from prior guidance; and$55 million -
Customer principal payments received from solar loans, net of amounts recorded in revenue, of between
and$134 million , unchanged from prior guidance.$154 million
Non-GAAP Financial Measures
We present our operating results in accordance with accounting principles generally accepted in the
Fourth Quarter and Full-Year 2021 Conference Call Information
Sunnova is hosting a conference call for analysts and investors to discuss its fourth quarter and full-year 2021 results at
A replay will be available two hours after the call and can be accessed by dialing 866-813-9403, or for international callers, +44 204-525-0658. The access code for the replay is 626962. The replay will be available until
Interested investors and other parties may also listen to a simultaneous webcast of the conference call by logging onto the Investor Relations section of Sunnova’s website.
Forward Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements generally relate to future events or Sunnova’s future financial or operating performance. In some cases, you can identify forward-looking statements because they contain words such as "may," "will," "should," "expects," "plans," "anticipates," "going to," "could," "intends," "target," "projects," "contemplates," "believes," "estimates," "predicts," "potential" or "continue" or the negative of these words or other similar terms or expressions that concern Sunnova’s expectations, strategy, priorities, plans or intentions. Forward-looking statements in this release include, but are not limited to, statements regarding our level of growth, customer value propositions, technological developments, service levels, the ability to achieve our 2022 operational and financial targets, and references to Adjusted EBITDA and customer P&I payments from solar loans. Sunnova’s expectations and beliefs regarding these matters may not materialize, and actual results in future periods are subject to risks and uncertainties that could cause actual results to differ materially from those projected, including risks regarding our ability to forecast our business due to our limited operating history, the effects of the coronavirus pandemic on our business and operations, supply chain uncertainties, results of operations and financial position, our competition, changes in regulations applicable to our business, fluctuations in the solar and home-building markets, availability of capital, our ability to attract and retain dealers and customers and manage our dealer and strategic partner relationships, the ability to successfully integrate the SunStreet acquisition, the ability of Sunnova to implement its plans, forecasts and other expectations with respect to SunStreet's business and realize the expected benefits of the acquisition. The forward-looking statements contained in this release are also subject to other risks and uncertainties, including those more fully described in Sunnova’s filings with the
About Sunnova
CONSOLIDATED BALANCE SHEETS (in thousands, except share amounts and share par values) |
|||||||
|
As of |
||||||
|
2021 |
|
2020 |
||||
Assets |
|
|
|
||||
Current assets: |
|
|
|
||||
Cash |
$ |
243,101 |
|
|
$ |
209,859 |
|
Accounts receivable—trade, net |
|
18,584 |
|
|
|
10,243 |
|
Accounts receivable—other |
|
57,736 |
|
|
|
21,378 |
|
Other current assets, net of allowance of |
|
296,321 |
|
|
|
215,175 |
|
Total current assets |
|
615,742 |
|
|
|
456,655 |
|
|
|
|
|
||||
Property and equipment, net |
|
2,909,613 |
|
|
|
2,323,169 |
|
Customer notes receivable, net of allowance of |
|
1,204,073 |
|
|
|
513,386 |
|
Intangible assets, net |
|
190,520 |
|
|
|
49 |
|
|
|
13,150 |
|
|
|
— |
|
Other assets |
|
571,136 |
|
|
|
294,324 |
|
Total assets (1) |
$ |
5,504,234 |
|
|
$ |
3,587,583 |
|
|
|
|
|
||||
Liabilities, Redeemable Noncontrolling Interests and Equity |
|
|
|
||||
Current liabilities: |
|
|
|
||||
Accounts payable |
$ |
55,033 |
|
|
$ |
39,908 |
|
Accrued expenses |
|
81,721 |
|
|
|
34,049 |
|
Current portion of long-term debt |
|
129,793 |
|
|
|
110,883 |
|
Other current liabilities |
|
44,350 |
|
|
|
26,014 |
|
Total current liabilities |
|
310,897 |
|
|
|
210,854 |
|
|
|
|
|
||||
Long-term debt, net |
|
3,135,681 |
|
|
|
1,924,653 |
|
Other long-term liabilities |
|
436,043 |
|
|
|
171,395 |
|
Total liabilities (1) |
|
3,882,621 |
|
|
|
2,306,902 |
|
|
|
|
|
||||
Redeemable noncontrolling interests |
|
145,336 |
|
|
|
136,124 |
|
|
|
|
|
||||
Stockholders' equity: |
|
|
|
||||
Common stock, 113,386,600 and 100,412,036 shares issued as of |
|
11 |
|
|
|
10 |
|
Additional paid-in capital—common stock |
|
1,649,199 |
|
|
|
1,482,716 |
|
Accumulated deficit |
|
(459,715 |
) |
|
|
(530,995 |
) |
Total stockholders' equity |
|
1,189,495 |
|
|
|
951,731 |
|
Noncontrolling interests |
|
286,782 |
|
|
|
192,826 |
|
Total equity |
|
1,476,277 |
|
|
|
1,144,557 |
|
Total liabilities, redeemable noncontrolling interests and equity |
$ |
5,504,234 |
|
|
$ |
3,587,583 |
|
(1) The consolidated assets as of
CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except share and per share amounts) |
|||||||||||||||
|
Three Months Ended
|
|
Year Ended
|
||||||||||||
|
2021 |
|
2020 |
|
2021 |
|
2020 |
||||||||
Revenue |
$ |
65,019 |
|
|
$ |
38,024 |
|
|
$ |
241,752 |
|
|
$ |
160,820 |
|
|
|
|
|
|
|
|
|
||||||||
Operating expense: |
|
|
|
|
|
|
|
||||||||
Cost of revenue—depreciation |
|
20,853 |
|
|
|
16,311 |
|
|
|
76,474 |
|
|
|
58,431 |
|
Cost of revenue—other |
|
8,262 |
|
|
|
1,432 |
|
|
|
21,834 |
|
|
|
6,747 |
|
Operations and maintenance |
|
4,943 |
|
|
|
7,699 |
|
|
|
19,583 |
|
|
|
16,313 |
|
General and administrative |
|
60,208 |
|
|
|
30,573 |
|
|
|
204,236 |
|
|
|
115,148 |
|
Other operating income |
|
(20,182 |
) |
|
|
(13 |
) |
|
|
(25,485 |
) |
|
|
(41 |
) |
Total operating expense, net |
|
74,084 |
|
|
|
56,002 |
|
|
|
296,642 |
|
|
|
196,598 |
|
|
|
|
|
|
|
|
|
||||||||
Operating loss |
|
(9,065 |
) |
|
|
(17,978 |
) |
|
|
(54,890 |
) |
|
|
(35,778 |
) |
|
|
|
|
|
|
|
|
||||||||
Interest expense, net |
|
31,500 |
|
|
|
26,776 |
|
|
|
116,248 |
|
|
|
154,580 |
|
Interest income |
|
(9,962 |
) |
|
|
(6,442 |
) |
|
|
(34,228 |
) |
|
|
(23,741 |
) |
Loss on extinguishment of long-term debt, net |
|
— |
|
|
|
92,051 |
|
|
|
9,824 |
|
|
|
142,772 |
|
Other (income) expense |
|
456 |
|
|
|
(1,577 |
) |
|
|
516 |
|
|
|
(1,752 |
) |
Loss before income tax |
|
(31,059 |
) |
|
|
(128,786 |
) |
|
|
(147,250 |
) |
|
|
(307,637 |
) |
|
|
|
|
|
|
|
|
||||||||
Income tax expense |
|
196 |
|
|
|
5 |
|
|
|
260 |
|
|
|
181 |
|
Net loss |
|
(31,255 |
) |
|
|
(128,791 |
) |
|
|
(147,510 |
) |
|
|
(307,818 |
) |
Net loss attributable to redeemable noncontrolling interests and noncontrolling interests |
|
(17,047 |
) |
|
|
(37,021 |
) |
|
|
(9,382 |
) |
|
|
(55,534 |
) |
Net loss attributable to stockholders |
$ |
(14,208 |
) |
|
$ |
(91,770 |
) |
|
$ |
(138,128 |
) |
|
$ |
(252,284 |
) |
|
|
|
|
|
|
|
|
||||||||
Net loss per share attributable to common stockholders—basic and diluted |
$ |
(0.13 |
) |
|
$ |
(0.96 |
) |
|
$ |
(1.25 |
) |
|
$ |
(2.87 |
) |
Weighted average common shares outstanding—basic and diluted |
|
112,947,816 |
|
|
|
95,598,897 |
|
|
|
110,881,630 |
|
|
|
87,871,457 |
|
CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) |
|||||||
|
Year Ended
|
||||||
|
2021 |
|
2020 |
||||
CASH FLOWS FROM OPERATING ACTIVITIES |
|
|
|
||||
Net loss |
$ |
(147,510 |
) |
|
$ |
(307,818 |
) |
Adjustments to reconcile net loss to net cash used in operating activities: |
|
|
|
||||
Depreciation |
|
85,600 |
|
|
|
66,066 |
|
Impairment and loss on disposals, net |
|
3,655 |
|
|
|
5,824 |
|
Amortization of intangible assets |
|
21,354 |
|
|
|
29 |
|
Amortization of deferred financing costs |
|
14,050 |
|
|
|
9,031 |
|
Amortization of debt discount |
|
9,949 |
|
|
|
15,685 |
|
Non-cash effect of equity-based compensation plans |
|
17,236 |
|
|
|
10,873 |
|
Unrealized gain on derivatives |
|
(4,874 |
) |
|
|
(13,768 |
) |
Unrealized gain on fair value instruments |
|
(21,988 |
) |
|
|
(907 |
) |
Loss on extinguishment of long-term debt, net |
|
9,824 |
|
|
|
142,772 |
|
Other non-cash items |
|
30,117 |
|
|
|
14,933 |
|
Changes in components of operating assets and liabilities: |
|
|
|
||||
Accounts receivable |
|
(53,261 |
) |
|
|
(4,297 |
) |
Other current assets |
|
(129,810 |
) |
|
|
(24,256 |
) |
Other assets |
|
(70,758 |
) |
|
|
(42,411 |
) |
Accounts payable |
|
(6,392 |
) |
|
|
(1,141 |
) |
Accrued expenses |
|
27,908 |
|
|
|
(4,504 |
) |
Other current liabilities |
|
5,963 |
|
|
|
5,397 |
|
Other long-term liabilities |
|
(293 |
) |
|
|
(2,974 |
) |
Net cash used in operating activities |
|
(209,230 |
) |
|
|
(131,466 |
) |
|
|
|
|
||||
CASH FLOWS FROM INVESTING ACTIVITIES |
|
|
|
||||
Purchases of property and equipment |
|
(554,541 |
) |
|
|
(578,369 |
) |
Payments for investments and customer notes receivable |
|
(728,926 |
) |
|
|
(285,238 |
) |
Proceeds from customer notes receivable |
|
66,879 |
|
|
|
35,479 |
|
Payments for investments in solar receivables |
|
(32,212 |
) |
|
|
— |
|
Proceeds from investments in solar receivables |
|
3,231 |
|
|
|
— |
|
State utility rebates and tax credits |
|
486 |
|
|
|
641 |
|
Other, net |
|
3,867 |
|
|
|
(2,032 |
) |
Net cash used in investing activities |
|
(1,241,216 |
) |
|
|
(829,519 |
) |
|
|
|
|
||||
CASH FLOWS FROM FINANCING ACTIVITIES |
|
|
|
||||
Proceeds from long-term debt |
|
2,235,939 |
|
|
|
1,651,765 |
|
Payments of long-term debt |
|
(947,130 |
) |
|
|
(963,872 |
) |
Payments on notes payable |
|
(34,555 |
) |
|
|
(4,981 |
) |
Payments of deferred financing costs |
|
(31,324 |
) |
|
|
(24,084 |
) |
Payments of debt discounts |
|
(2,324 |
) |
|
|
(3,374 |
) |
Purchase of capped call transactions |
|
(91,655 |
) |
|
|
— |
|
Proceeds from issuance of common stock, net |
|
10,513 |
|
|
|
152,277 |
|
Proceeds from equity component of debt instrument, net |
|
— |
|
|
|
73,657 |
|
Contributions from redeemable noncontrolling interests and noncontrolling interests |
|
350,121 |
|
|
|
320,245 |
|
Distributions to redeemable noncontrolling interests and noncontrolling interests |
|
(15,854 |
) |
|
|
(6,527 |
) |
Payments of costs related to redeemable noncontrolling interests and noncontrolling interests |
|
(8,805 |
) |
|
|
(6,517 |
) |
Other, net |
|
(476 |
) |
|
|
(2 |
) |
Net cash provided by financing activities |
|
1,464,450 |
|
|
|
1,188,587 |
|
Net increase in cash and restricted cash |
|
14,004 |
|
|
|
227,602 |
|
Cash and restricted cash at beginning of period |
|
377,893 |
|
|
|
150,291 |
|
Cash and restricted cash at end of period |
|
391,897 |
|
|
|
377,893 |
|
Restricted cash included in other current assets |
|
(80,213 |
) |
|
|
(73,020 |
) |
Restricted cash included in other assets |
|
(68,583 |
) |
|
|
(95,014 |
) |
Cash at end of period |
$ |
243,101 |
|
|
$ |
209,859 |
|
Key Financial and Operational Metrics |
|||||||||||||||
|
Three Months Ended
|
|
Year Ended
|
||||||||||||
|
2021 |
|
2020 |
|
2021 |
|
2020 |
||||||||
|
(in thousands) |
||||||||||||||
Reconciliation of Net Loss to Adjusted EBITDA: |
|
|
|
|
|
|
|
||||||||
Net loss |
$ |
(31,255 |
) |
|
$ |
(128,791 |
) |
|
$ |
(147,510 |
) |
|
$ |
(307,818 |
) |
Interest expense, net |
|
31,500 |
|
|
|
26,776 |
|
|
|
116,248 |
|
|
|
154,580 |
|
Interest income |
|
(9,962 |
) |
|
|
(6,442 |
) |
|
|
(34,228 |
) |
|
|
(23,741 |
) |
Income tax expense |
|
196 |
|
|
|
5 |
|
|
|
260 |
|
|
|
181 |
|
Depreciation expense |
|
23,314 |
|
|
|
18,255 |
|
|
|
85,600 |
|
|
|
66,066 |
|
Amortization expense |
|
7,409 |
|
|
|
8 |
|
|
|
21,771 |
|
|
|
32 |
|
EBITDA |
|
21,202 |
|
|
|
(90,189 |
) |
|
|
42,141 |
|
|
|
(110,700 |
) |
Non-cash compensation expense |
|
3,299 |
|
|
|
2,484 |
|
|
|
17,236 |
|
|
|
10,873 |
|
ARO accretion expense |
|
803 |
|
|
|
609 |
|
|
|
2,897 |
|
|
|
2,186 |
|
Financing deal costs |
|
574 |
|
|
|
948 |
|
|
|
1,411 |
|
|
|
4,454 |
|
Natural disaster losses and related charges, net |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
31 |
|
Acquisition costs |
|
(344 |
) |
|
|
— |
|
|
|
6,709 |
|
|
|
— |
|
Loss on extinguishment of long-term debt, net |
|
— |
|
|
|
92,051 |
|
|
|
9,824 |
|
|
|
142,772 |
|
Unrealized gain on fair value instruments |
|
(17,323 |
) |
|
|
(742 |
) |
|
|
(21,988 |
) |
|
|
(907 |
) |
Realized gain on fair value instruments |
|
— |
|
|
|
(835 |
) |
|
|
— |
|
|
|
(835 |
) |
Amortization of payments to dealers for exclusivity and other bonus arrangements |
|
879 |
|
|
|
585 |
|
|
|
2,968 |
|
|
|
1,820 |
|
Provision for current expected credit losses |
|
8,647 |
|
|
|
3,145 |
|
|
|
23,679 |
|
|
|
7,969 |
|
Non-cash inventory impairments |
|
— |
|
|
|
1,934 |
|
|
|
982 |
|
|
|
1,934 |
|
Adjusted EBITDA |
$ |
17,737 |
|
|
$ |
9,990 |
|
|
$ |
85,859 |
|
|
$ |
59,597 |
|
|
Three Months Ended
|
|
Year Ended
|
||||||||
|
2021 |
|
2020 |
|
2021 |
|
2020 |
||||
|
(in thousands) |
||||||||||
Interest income from customer notes receivable |
$ |
9,833 |
|
$ |
6,360 |
|
$ |
33,696 |
|
$ |
23,239 |
Principal proceeds from customer notes receivable, net of related revenue |
$ |
16,866 |
|
$ |
9,476 |
|
$ |
59,274 |
|
$ |
32,580 |
|
Three Months Ended
|
|
Year Ended
|
||||||||||||
|
2021 |
|
2020 |
|
2021 |
|
2020 |
||||||||
|
(in thousands, except per system data) |
||||||||||||||
Reconciliation of Total Operating Expense, Net to Adjusted Operating Expense: |
|
|
|
|
|
|
|
||||||||
Total operating expense, net |
$ |
74,084 |
|
|
$ |
56,002 |
|
|
$ |
296,642 |
|
|
$ |
196,598 |
|
Depreciation expense |
|
(23,314 |
) |
|
|
(18,255 |
) |
|
|
(85,600 |
) |
|
|
(66,066 |
) |
Amortization expense |
|
(7,409 |
) |
|
|
(8 |
) |
|
|
(21,771 |
) |
|
|
(32 |
) |
Non-cash compensation expense |
|
(3,299 |
) |
|
|
(2,484 |
) |
|
|
(17,236 |
) |
|
|
(10,873 |
) |
ARO accretion expense |
|
(803 |
) |
|
|
(609 |
) |
|
|
(2,897 |
) |
|
|
(2,186 |
) |
Financing deal costs |
|
(574 |
) |
|
|
(948 |
) |
|
|
(1,411 |
) |
|
|
(4,454 |
) |
Natural disaster losses and related charges, net |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(31 |
) |
Acquisition costs |
|
344 |
|
|
|
— |
|
|
|
(6,709 |
) |
|
|
— |
|
Amortization of payments to dealers for exclusivity and other bonus arrangements |
|
(879 |
) |
|
|
(585 |
) |
|
|
(2,968 |
) |
|
|
(1,820 |
) |
Provision for current expected credit losses |
|
(8,647 |
) |
|
|
(3,145 |
) |
|
|
(23,679 |
) |
|
|
(7,969 |
) |
Non-cash inventory impairments |
|
— |
|
|
|
(1,934 |
) |
|
|
(982 |
) |
|
|
(1,934 |
) |
Direct sales costs |
|
(375 |
) |
|
|
— |
|
|
|
(733 |
) |
|
|
— |
|
Cost of revenue related to cash sales |
|
(6,112 |
) |
|
|
— |
|
|
|
(14,525 |
) |
|
|
— |
|
Unrealized gain on fair value instruments |
|
17,779 |
|
|
|
— |
|
|
|
22,504 |
|
|
|
— |
|
Adjusted Operating Expense |
$ |
40,795 |
|
|
$ |
28,034 |
|
|
$ |
140,635 |
|
|
$ |
101,233 |
|
Adjusted Operating Expense per weighted average system |
$ |
219 |
|
|
$ |
272 |
|
|
$ |
906 |
|
|
$ |
1,099 |
|
|
As of |
||
|
2021 |
|
2020 |
Number of customers |
195,400 |
|
107,500 |
|
Three Months Ended
|
|
Year Ended
|
||||
|
2021 |
|
2020 |
|
2021 |
|
2020 |
Weighted average number of systems (excluding loan agreements and cash sales) |
149,600 |
|
85,900 |
|
127,200 |
|
77,900 |
Weighted average number of systems with loan agreements |
35,300 |
|
17,000 |
|
27,500 |
|
14,200 |
Weighted average number of systems with cash sales |
1,500 |
|
— |
|
600 |
|
— |
Weighted average number of systems |
186,400 |
|
102,900 |
|
155,300 |
|
92,100 |
|
As of |
||||
|
2021 |
|
2020 |
||
|
(in millions, except per customer data) |
||||
Estimated gross contracted customer value |
$ |
4,337 |
|
$ |
2,997 |
Key Terms for Our Key Metrics and Non-GAAP Financial Measures
Estimated Gross Contracted Customer Value. Estimated gross contracted customer value as of a specific measurement date represents the sum of the present value of the remaining estimated future net cash flows we expect to receive from existing customers during the initial contract term of our leases and power purchase agreements ("PPAs"), which are typically 25 years in length, plus the present value of future net cash flows we expect to receive from the sale of related solar renewable energy certificates ("SRECs"), either under existing contracts or in future sales, plus the cash flows we expect to receive from energy services programs such as grid services, plus the carrying value of outstanding customer loans on our balance sheet. From these aggregate estimated initial cash flows, we subtract the present value of estimated net cash distributions to redeemable noncontrolling interests and noncontrolling interests and estimated operating, maintenance and administrative expenses associated with the solar service agreements. These estimated future cash flows reflect the projected monthly customer payments over the life of our solar service agreements and depend on various factors including but not limited to solar service agreement type, contracted rates, expected sun hours and the projected production capacity of the solar equipment installed. For the purpose of calculating this metric, we discount all future cash flows at
Number of Customers. We define number of customers to include every unique individual possessing an in-service product that is subject to a Sunnova lease, PPA or loan agreement, or with respect to which Sunnova is obligated to perform a service under an active agreement between Sunnova and the individual or between Sunnova and a third party. For all solar energy systems or energy storage systems installed by us, in-service means the related solar energy system or energy storage system, as applicable, must have met all the requirements to begin operation and be interconnected to the electrical grid. For all products other than solar energy systems or energy storage systems, which are subject to a loan agreement between Sunnova and a customer, in-service means the customer is obligated to begin making payments to Sunnova under the loan agreement. We do not include in our number of customers any customer possessing a solar energy system or energy storage system under a lease, PPA or loan agreement that has reached mechanical completion but has not received permission to operate from the local utility or for whom we have terminated the contract and removed the solar energy system. We also do not include in our number of customers any customer that has been in default under his or her lease, PPA or loan agreement in excess of six months. We track the total number of customers as an indicator of our historical growth and our rate of growth from period to period.
Weighted Average Number of Systems. We calculate the weighted average number of systems based on the number of months a customer and any additional service obligation related to a solar energy system is in-service during a given measurement period. The weighted average number of systems reflects the number of systems at the beginning of a period, plus the total number of new systems added in the period adjusted by a factor that accounts for the partial period nature of those new systems. For purposes of this calculation, we assume all new systems added during a month were added in the middle of that month. The number of systems for any end of period will exceed the number of customers, as defined above, for that same end of period as we are also including any additional services and/or contracts a customer or third party executed for the additional work for the same residence. We track the weighted average system count in order to accurately reflect the contribution of the appropriate number of systems to key financial metrics over the measurement period.
Definitions of Non-GAAP Measures
Adjusted EBITDA. We define Adjusted EBITDA as net income (loss) plus net interest expense, depreciation and amortization expense, income tax expense, financing deal costs, natural disaster losses and related charges, net, losses on extinguishment of long-term debt, realized and unrealized gains and losses on fair value instruments, amortization of payments to dealers for exclusivity and other bonus arrangements, legal settlements and excluding the effect of certain non-recurring items we do not consider to be indicative of our ongoing operating performance such as, but not limited to, costs of our initial public offering ("IPO"), acquisition costs, losses on unenforceable contracts and other non-cash items such as non-cash compensation expense, asset retirement obligation ("ARO") accretion expense, provision for current expected credit losses and non-cash inventory impairments.
Adjusted Operating Expense. We define Adjusted Operating Expense as total operating expense less depreciation and amortization expense, financing deal costs, natural disaster losses and related charges, net, amortization of payments to dealers for exclusivity and other bonus arrangements, legal settlements, direct sales costs, cost of revenue related to cash sales, unrealized losses on fair value instruments and excluding the effect of certain non-recurring items we do not consider to be indicative of our ongoing operating performance such as, but not limited to, costs of our IPO, acquisition costs, losses on unenforceable contracts and other non-cash items such as non-cash compensation expense, ARO accretion expense, provision for current expected credit losses and non-cash inventory impairments.
View source version on businesswire.com: https://www.businesswire.com/news/home/20220223005897/en/
Investor Relations:
IR@sunnova.com
877-770-5211
Media:
Alina Eprimian, Media Relations Manager
Alina.Eprimian@sunnova.com
Source:
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