updated 3/9/2011 4:18:26 PM ET 2011-03-09T21:18:26

  • Gross Margin Increases 280 Basis Points to 30.9%
  • Sixth Consecutive Quarter of Profitability

    BOULDER, Colo., March 9, 2011 (GLOBE NEWSWIRE) -- Real Goods Solar, Inc. (Nasdaq:RSOL), a leading residential solar energy integrator, today announced results for its fourth quarter ended December 31, 2010.

    Net revenue for the fourth quarter of 2010 increased 5.5% to $20.2 million from $19.1 million recorded in the same period last year. This growth included the replacement of a significant $5 million commercial project that was installed in the fourth quarter of 2009. All of the year-over-year revenue growth was organic.

    Gross profit increased to $6.2 million, or 30.9% of net revenue, for the fourth quarter of 2010 from $5.4 million, or 28.1% of net revenue, in the comparable period last year. The increase in gross profit percentage primarily reflects improved selling and installation practices as well as declines in PV module prices over the last year.

    Operating expenses as a percent of net revenue increased to 28.9% for the fourth quarter of 2010 from 26.3% in the comparable period last year. This primarily reflects increased share-based and bonus compensation as a direct result of our improved performance, partially offset by the leveraging of fixed costs and cost savings achieved by integrating all acquired businesses onto a single set of systems and a unified brand.

    Operating income for the fourth quarter of 2010 improved to $396 thousand, as compared to $337 thousand for the comparable period last year. EBITDA for the fourth quarter of 2010 was $618 thousand, or 3.1% of net revenue. Refer to the Non-GAAP Financial Measures table below.

    Net income for the fourth quarter of 2010 improved to $250 thousand, or $0.01 per share, as compared to $217 thousand, or $0.01 per share, for the comparable period last year.

    For the year ended December 31, 2010, revenue grew to $77.3 million, a 20.2% increase from $64.3 million for last year. Operating income for the year was $2.0 million as compared to a loss of $2.6 million last year. Net income for the year was $1.2 million as compared to a loss of $1.6 million last year. EBITDA for the year was $2.9 million, or 3.7% of net revenue. Refer to the Non-GAAP Financial Measures table below.

    "We are very pleased with our fourth quarter revenue performance, our improved gross profit margin and our sixth consecutive quarter of profitability," commented John Schaeffer, President. "Internal revenue growth for the year was over 20% and we continue to see strong demand for both residential and commercial solar. We remain focused on building our backlog and on hiring installation crews where appropriate to expand our production capacity to keep up with demand."

    "Our financial metrics across the board were very strong in the fourth quarter," said Erik Zech, Chief Financial Officer. "Our ability to show both higher revenues and improved gross margins are indicative of the progress we have made in growing and optimizing our business. While our cash balance was down from the end of the third quarter largely due to a delayed payment of more than $3 million on a large commercial project, which has subsequently been collected, our balance sheet has remained strong with cash of $11.1 million and no debt."

    Real Goods Solar will host a conference call tomorrow, March 10, 2011, at 8:30 a.m. PST (11:30 a.m. EST) to review the fourth quarter results.

    Dial-in No.: 877-941-2069 (domestic) or 480-629-9713 (international)
    Passcode: Real Goods

    A replay of the call will begin approximately two hours after the end of the call and will continue until midnight EDT on March 17, 2011. 

    Replay number: 877-870-5176 (domestic) or 858-384-5517 (international)
    Pin: 4407642

    About Real Goods Solar, Inc.

    Real Goods Solar, Inc. is a leading residential and commercial solar energy integrator, having installed over 6,500 solar systems. Real Goods Solar offers turnkey solar energy services, and has 33 years of experience in solar energy, beginning with the sale in 1978 of the first solar photovoltaic, or PV, panels in the United States. For more information about Real Goods Solar, please visit www.realgoodssolar.com, or call (888) 507-2561.

    The Real Goods Solar, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=6455

    This press release includes forward-looking statements relating to matters that are not historical facts. Forward-looking statements may be identified by the use of words such as "expect," "intend," "believe," "will," "should" or comparable terminology or by discussions of strategy. While Real Goods Solar believes its assumptions and expectations underlying forward-looking statements are reasonable, there can be no assurance that actual results will not be materially different. Risks and uncertainties that could cause materially different results include, among others, introduction of new products and services, completion and integration of acquisitions, the possibility of negative economic conditions, and other risks and uncertainties included in Real Goods Solar's filings with the Securities and Exchange Commission. Real Goods Solar assumes no duty to update any forward-looking statements.

    REAL GOODS SOLAR, INC. 
    CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS 
    (Unaudited) 
    (In thousands, except per share data) 
             
             
      Three Months Ended Three Months Ended
      December 31, 2010 December 31, 2009
         
    Net revenue  $  20,162   100.0% $  19,118   100.0%
    Cost of goods sold  13,940   69.1% 13,755   71.9%
    Gross profit  6,222   30.9% 5,363   28.1%
    Operating expenses  5,826   28.9% 5,026   26.3%
    Income from operations  396   2.0% 337   1.8%
    Interest income (expense)  10   0.0% (3) 0.0%
    Income before income taxes  406   2.0% 334   1.8%
    Income tax expense  156   0.8% 117   0.7%
    Net income attributable to Real Goods Solar, Inc.  $ 250   1.2% $  217   1.1%
    Weighted-average shares outstanding:        
    Basic  18,308    18,286  
    Diluted  18,308   18,364  
    Net income per share attributable to Real Goods Solar, Inc. common shareholders:        
    Basic  $ 0.01   $0.01  
    Diluted  $ 0.01   $0.01  
    REAL GOODS SOLAR, INC. 
    CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS 
    (Unaudited) 
    (In thousands, except per share data) 
             
             
      Twelve Months Ended Twelve Months Ended
      December 31, 2010 December 31, 2009
         
    Net revenue  $77,324 100.0% $64,328 100.0%
    Cost of goods sold  55,814 72.2% 48,371 75.2%
    Gross profit  21,510 27.8% 15,957 24.8%
    Operating expenses  19,489 25.2% 18,553 28.8%
    Income (loss) from operations  2,021 2.6% (2,596) -4.0%
    Interest income (expense)  15 0.0% (2) 0.0%
    Income (loss) before income taxes  2,036 2.6% (2,598) -4.0%
    Income tax expense (benefit)  797 1.0% (1,021) -1.5%
    Net income (loss) attributable to Real Goods Solar, Inc.  $1,239 1.6% $(1,577) -2.5%
             
    Weighted-average shares outstanding:        
    Basic  18,301   18,181  
    Diluted  18,367   18,181  
             
    Net income (loss) per share attributable to Real Goods Solar, Inc. common shareholders:        
    Basic  $0.07   $(0.09)  
    Diluted  $0.07   $(0.09)  
    REAL GOODS SOLAR, INC. 
    CONDENSED CONSOLIDATED BALANCE SHEETS 
    (Unaudited) 
    (In thousands) 
         
         
      December 31, December 31,
      2010 2009
         
    Assets    
    Current assets:    
    Cash and cash equivalents  $11,123 $12,206
    Accounts receivable, net  19,259 13,996
    Inventory, net  6,394 4,769
    Deferred costs on uncompleted contracts  215 1,024
    Deferred advertising costs  49 114
    Receivable and deferred tax assets  1,861 833
    Other current assets  687 598
         
    Total current assets  39,588 33,540
         
    Property and equipment, net  5,401 5,145
    Goodwill  732 732
    Deferred tax assets  1,744 3,064
    Other assets  498 813
         
    Total assets  $47,963 $43,294
         
         
    Liabilities and shareholders' equity    
    Current liabilities:    
    Accounts payable  $10,000 $8,821
    Accrued liabilities  2,630 2,500
    Deferred revenue on uncompleted contracts  534 -- 
    Payable to Gaiam  2,865 1,636
         
    Total current liabilities  16,029 12,957
    Total shareholders' equity  31,934 30,337
         
    Total liabilities and shareholders' equity  $47,963 $43,294

    Non-GAAP Financial Measures

    We have utilized the non-GAAP information set forth below as an additional device to aid in understanding and analyzing our financial results for the three and twelve months ended December 31, 2010. We believe that these non-GAAP measures will allow for a better evaluation of the operating performance of our business and facilitate meaningful comparison of the results in the current period to those in prior periods and future periods. Reference to these non-GAAP measures should not be considered a substitute for results that are presented in a manner consistent with GAAP.

    Reconciliations of our three and twelve months ended December 31, 2010 GAAP income from operations to our non-GAAP earnings before interest, taxes, depreciation and share-based compensation are set forth below (unaudited, in thousands):

      For the Three

    Months Ended

    December 31, 2010
    For the Twelve

    Months Ended

    December 31, 2010
         
    Income from operations $396 $2,021
         
    Exclusion of depreciation  147 529
    Exclusion of share-based compensation  75 348
         
    Non-GAAP EBITDA $618 $2,898
    CONTACT:  Erik Zech
              Chief Financial Officer
              415-295-4952
              erik.zech@realgoods.com

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