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| Statement |
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| The growth and strong execution in C&I last quarter offset the pressures we are experiencing in the residential segment, which demonstrates how our diversification is a true advantage |
| Meanwhile, we are seeing continued opportunities in the EV infrastructure segment and our origination team is helping to ensure that we continue to build backlog to sustain that growth |
| Once again, we are very pleased with the strong performance our team has generated this quarter |
| In the third quarter of 2023, we have produced another beat on the top line with revenues up 47% year-over-year, nicely above the Street's consensus |
| Margin is expected to remain strong in 2023 as we continue to scale operations and drive efficiencies across segments |
| Our commercial and industrial group is driving excellent results, and our residential group, SunCommon continues to see high customer satisfaction and referrals despite a short-term slowdown in residential demand, as I'll discuss shortly |
| We expect these positive trends to be sustained throughout the rest of 2023 |
| Our success in winning significant new contracts in solar and EV infrastructure as well as more residential business despite some of the headwinds in that segment provides us with heightened confidence in our ability to meet the annual financial targets that we shared earlier and are affirming today for annual revenue growth and improving profitability |
| Revenue growth in the quarter and year-to-date was driven by effective execution of our commercial and industrial backlog as well as fulfillment of our residential consumer demand |
| Our strong operating performance so far this year enabled us to refinance our debt facility |
| I also want to share some thoughts on some trends we are seeing and why we believe we are well positioned for continued growth as we continue to scale our business |
| We maintain that this approach is a competitive differentiating advantage that positions us for long-term sustainable growth |
| We see the proof of the success of the strategy and execution in the meaningful year-over-year revenue growth we have generated this year and on a year-to-date basis |
| We are pleased with the sustained robust revenue growth we produced yet again in the third quarter as we continue to execute on our backlog |
| And as you'll hear us point out repeatedly, we generated this robust growth while reducing our operating expenses over the same period by $5.6 million or 21% |
| We're very proud of the success we're having from the efficiency measures that we've implemented |
| Thus, we are affirming our expectations for total revenue in fiscal year 2023 of between $95 million and $100 million, reflecting a 24% to 31% increase over the total revenue in 2022, along with gross margin expansion on an annual basis |
| We remain confident that as we scale and drive synergies and efficiency throughout the organization, our margins will expand even though there will be some variability in any given quarter depending on the revenue mix |
| In 2023, considering all the evolving macroeconomic factors, we have continued to demonstrate strong revenue growth and reduce operating expenses, both of which will help us attain operating profitability in the years ahead and sustain our margin expansion |
| Our success also reflects a high level of customer satisfaction, specifically in the residential segment, which generates strong referrals, creating a lower customer acquisition cost |
| So likely some small impacts, but really in a positive way to better smooth revenue throughout the year |
| The residential division did well despite the backdrop of a more sluggish residential segment across the industry, reflecting the impact of higher interest rates on home improvement loans |
| We remain convinced that both the heightened interest in alternative energy as well as the IRA legislation passed inflation past last year will afford Iceland and the industry genuine benefits |
| The commercial and industrial division, which we combined as of the beginning of 2023 has continued to generate very strong results this year and accounted for 67% of our revenue in the third quarter |
| The size of the backlog and pipeline underscore the healthy customer demand we're experiencing as well as the effectiveness of our efforts to originate more projects and expand to more states, all part of our ongoing strategic initiatives |
| In the face of challenging macroeconomic factors, which have enabled us to continue to exceed the Street's consensus |
| And the good news is that we have ample backlog to execute in this segment and operate in markets insulated by some of the larger headwinds |
| Margin improvement reflected efficiencies generated through the consolidation of our teams leading to more efficient utilization of our labor despite the headwind from revenue mix |
| Our continuing ability to win new contract awards, both through our efforts and through our collaborations and partnerships ensures that we remain well positioned for success as we finish up 2023 |
| This creates a strong customer relationship, leading to contract awards across our business |
| Statement |
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| Our utility and development division continue to face delays, once again something we see across the industry |
| As we noted last quarter, we recognized the downward pressure on our valuation from our outstanding convertible note |
| In the third quarter 30% of our revenues came from the residential segment where gross margins tend to be higher, which added pressure to margin expansion |
| Year-to-date operating income was a loss of 6.2 million, a 10 million or 62% reduction compared to a loss of 16.2 million during the same period in 2022 |
| Adjusted EBITDA for the third quarter of 2023 was a loss of $0.5 million or $0.02 per share compared to a loss of $2.5 million or $0.18 per share in 2022's third quarter |
| Year-to-date adjusted EBITDA was a loss of $2.3 million or $0.10 per share compared to a loss of $5.9 million or $0.43 per share in the same period in 2022 |
| The third silver lining here I would note is that the sticker shock consumers had initially experienced when looking at home improvement loans has abated somewhat |
| Justin Clare And then I guess is do you have a sense for is there a risk that some of the projects may fall out of the backlog if the economics may have been challenged somewhat by the higher interest rates or do they still seem to Pencil and still, you expect them to move to all move forward here? Jeffrey Peck I mean, I would imagine going forward that is a possibility |
| As Jeff mentioned, in the third quarter of 2023, 30% of our total revenues were in the residential segment, which impacted our margin expectations as historically, 50% of our total revenues were in the residential segment |
| Although we continue to increase the backlog the group is addressing, and we saw small revenue growth in this past quarter compared to prior quarters in 2023 |
| As our efficiency efforts enabled more of the top line to drop to the bottom line |
| That will probably moderate some to a 40%, 60%, just based on some of that lack of rushing for the tax equity at year-end |
| Some of that timing is a little bit difficult to predict, which is why we're giving the guidance that we are |
| Year-to-date net loss was $7.8 million or $0.35 per share compared to a net loss of $13.5 million or $0.98 per share in the same period in 2022 |
| Such statements are subject to risks and uncertainties that could cause actual results to differ from management's expectations |
| Despite some of the macroeconomic challenges in our sector, we continue to do precisely what we said we would do |
| iSun reported a net loss $2.2 million or $0.07 per share in the third quarter of 2023 compared to a net loss of $4.9 million or $0.36 per share in the same period in 2022 |
| Non-cash depreciation and amortization expenses were 0.8 million in the third quarter of 2023, $1 million lower than $1.8 million in prior year period |
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