updated 5/9/2011 4:16:25 PM ET 2011-05-09T20:16:25

  • Gross Margin Increases 200 Basis Points to 28.9%
  • Seventh Consecutive Quarter of Profitability

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

Net revenue for the first quarter of 2011 increased 16.1% to $17.4 million from $15.0 million recorded in the same period last year. All of the year-over-year revenue growth was organic.

Gross profit increased to $5.0 million, or 28.9% of net revenue, for the first quarter of 2011 from $4.0 million, or 26.9% of net revenue, in the comparable period last year. The increase in gross profit percentage primarily reflects a shift in revenue mix towards higher margin residential installations and improved selling and installation practices.

Operating expenses as a percent of net revenue increased to 28.5% for the first quarter of 2011 from 26.7% in the comparable period last year. This primarily reflects a significant investment in commercial operations, partially offset by the leveraging of fixed costs.

Operating income for the first quarter of 2011 improved to $66 thousand, as compared to $27 thousand for the comparable period last year. EBITDA for the first quarter of 2011 was $288 thousand, or 1.7% of net revenue. Refer to the Non-GAAP Financial Measures table below.

Net income for the first quarter of 2011 improved to $37 thousand, or $0.00 per share, as compared to $17 thousand, or $0.00 per share, for the comparable period last year.

"We are pleased with our revenue performance, improved gross profit margin and profitability in our seasonally slowest quarter of the year," commented John Schaeffer, President. "We continue to see strong demand for both residential and commercial solar, and remain optimistic about seeing strong growth for the remainder of 2011. We continue to focus on building our backlog and on hiring installation crews where appropriate to expand our production capacity to keep up with demand."

"Our discipline and planning allowed us to show strong financial metrics across the board in what is usually our slowest quarter of the year," said Erik Zech, Chief Financial Officer. "This performance is particularly impressive given the production challenges experienced as a result of this being one of the rainiest winters in California history. 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. Our balance sheet remained strong at the end of the quarter with cash of $13.4 million and no debt."

Real Goods Solar will host a conference call tomorrow, May 10, 2011, at 8:30 a.m. PDT (11:30 a.m. EDT) to review the first quarter results.

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 March 31, 2011. 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 March 31, 2011 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

March 31, 2011
For the Twelve

Months Ended

March 31, 2011
     
Income from operations $66 $2,060
Exclusion of depreciation 140 355
Exclusion of share-based compensation 82 547
     
Non-GAAP EBITDA $288 $2,962
CONTACT: Erik Zech
         Chief Financial Officer
         415-295-4952
         erik.zech@realgoods.com

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