8point3 Energy (CAFD) Q1 Earnings Miss, Sales Improve Y/Y

8point3 Energy Partners LP (NASDAQ:CAFD) reported adjusted earnings of 5 cents per share in first-quarter fiscal 2018 (ended Feb 28), missing the Zacks Consensus Estimate of 8 cents by 37.5%.

Including the one-time tax benefit from the recent Tax Cuts and Jobs Act, the company reported earnings of 35 cents, compared with 3 cents in the year-ago period.

Revenues

8point3 Energy, a limited partnership formed by two major solar companies — First Solar Inc. (NASDAQ:FSLR) and SunPower Corp. (NASDAQ:SPWR) — generated revenues of $10.9 million in the quarter, up 9.8% year over year. The Zacks Consensus Estimate for revenues was pegged at $11 million.

Cash Distribution & Cash Available for Distribution

The partnership declared a distribution of 28.02 cents per unit in the fiscal first quarter. This marks an increase of 3% from the previous quarter level.

8point3 Energy also had $18.1 million of cash available for distribution in the reported quarter.

It projects cash available for distribution of 28.02 cents per unit for second-quarter fiscal 2018.

Operational Highlights

In the quarter under review, 8point3 Energy’s total operating costs and expenses increased 26.6% to $13.8 million from $10.9 million in the year-ago quarter.

Higher cost of operations, depreciation and accretion expenses along with selling, general and administrative costs as well as acquisition-related transaction costs led to an increase in expenditure.

Evidently, cost of operations was $2.4 million, up from $2.2 million a year ago. Depreciation and accretion expenses were $7.1 million, up from $6.8 million in the previous year. Selling, general and administrative expenses were $4.3 million, up from $1.9 million in the year ago period. Acquisition-related transaction costs were $20 million, up from $13 million in the year ago period.

Financial Update

8point3 Energy’s cash and cash equivalents as of Feb 28, 2018 were $13.9 million compared with $7 million as of Feb 28, 2017.

As of Feb 28, 2018, long-term debt and financing obligations was $694.3 million compared with $689.8 million as of Feb 28, 2017.

Other Highlights

8point3 Energy’s portfolio consisted of 946 MW of the U.S. solar generating assets as of Feb 2018 end.

Guidance

For the fiscal second quarter, the partnership projects revenues in the range of $16-$18 million, net income in the band of $5 million to $7.5 million, adjusted earnings before interest, tax, depreciation and amortization of $25.5−$28 million and cash of $13−$15.5 million available for distribution.

Zacks Rank

8point3 Energy currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Recent Peer Release

JinkoSolar Holding (NYSE:JKS) reported fourth-quarter 2017 earnings per American Depositary Share of 12 cents which missed the Zacks Consensus Estimate of 23 cents by 47.8%.

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