TORONTO, April 29 /CNW/ - SonnenEnergy Corp. (TSX-V: PWR) ("SonnenEnergy"), an established photovoltaic solar power systems integrator and solar power producer, today announced its fiscal 2007 year end and fourth quarter results.
Highlights for the year ended December 31, 2007:
- First full year in operation for Solar Park Waldstetten, which is
expected to generate in excess of $0.8 million in recurring annual
revenues
- Completed capital pool company qualifying transaction
- Raised gross proceeds of $11.9 million through public offering
- Broke ground on Solar Park Hausen
- Named John Ross Chief Financial Officer
Highlights subsequent to December 31, 2007:
- Signed design, supply and installation agreement with The Home Depot
Canada
- Completed Phase 1 of Solar Park Hausen ahead of schedule. Once
operating at full capacity of 2,500 kWp, Solar Park Hausen is
expected to generate annual revenues of $1.4 million
- Signed $6.5 million agreement to build 1.1 MWp solar park for
customer in Germany
- Established Italian sales team
"2007 was a period of transition for SonnenEnergy as we closed our capital pool company qualifying transaction and successfully completed a concurrent public offering," said Sudhir Morar, SonnenEnergy's President and Chief Executive Officer. "We broke ground on Solar Park Hausen and strengthened our management team by adding John Ross as our Chief Financial Officer."
"Subsequent to the end of fiscal 2007, we signed an agreement to design, supply and install photovoltaic solar power systems for The Home Depot customers in Canada and announced that we had completed Phase 1 of Solar Park Hausen ahead of schedule," continued Mr. Morar. "Most recently, we finalized an agreement to build a 1.1 MWp solar power system for a customer in Germany. We had hoped to complete this agreement in 2007 but unforeseen delays pushed its closing into fiscal 2008. We believe this agreement demonstrates our ability to expand our business and generate revenues through the sale and construction of large-scale, utility grade solar power plants. The agreement is expected to generate $6.5 million in revenue in 2008, an amount that exceeds our total revenues for 2007."
"During the fourth quarter of 2007, we expended considerable capital for the construction of Solar Park Hausen. Now that the park is operational and selling power to the local utility, we expect to begin recovering that capital through a financing agreement with a German bank," added Mr. Morar.
"Our agreement with the Home Depot marked our entry into the Canadian market and we look forward to strengthening our presence in both Canada and United States. Also, in keeping with our expansion plan, we have recently established an Italian sales team in order to aggressively pursue opportunities in Italy, a country that offers strong long-term incentives for solar power production. We are encouraged with the progress we have made to date and look forward to continuing to build our business through the disciplined implementation of our growth strategy in 2008 and beyond."
Industry Outlook
The outlook for the solar industry is supported by solar power's emergence as the third major topic of energy policy, along with economic viability and climate protection, against the backdrop of dwindling oil, coal and gas as primary sources of energy.
The development of the photovoltaic sector in 2007 was supported by discussions about global climate change and the necessity of drastically reducing CO2 emissions. Governments are increasing their efforts to promote the use of alternative energy sources. Resolutions were passed by the European Union to support this effort, including the mandatory expansion of renewable energies to make up 20% of the supply of energy by the year 2020. The German government has also set itself more ambitious goals for the use of renewable energies which are expected to make up a minimum of 25% to 30% of the German energy supply by 2020.
The Company's financial results are presented in Canadian dollars based on Canadian generally accepted accounting principles ("GAAP").
3 Months 12 Months 3 Months 12 Months
Ended Ended Ended Ended
December December December December
31, 2007 31, 2007 31, 2006 31, 2006
Revenue 1,184,414 4,806,405 3,717,759 6,960,063
Gross Margin 984,971 2,450,363 2,578,943 3,809,770
Net Income (Loss) (1,940,401) (2,436,155) 1,387,847 1,633,859
Revenue
Revenue for the three months ending December 31, 2007, of $1.2 million was $2.5 million lower than the $3.7 million for the three months ending December 31, 2006. The decrease resulted from lower sales in our solar power integration business, caused by unforeseen delays, which led to a large sale expected to be recognized in 2007, being delayed until 2008.
Revenue for the 12 months ending December 31, 2007, of $4.8 million was $2.2 million lower than the $7.0 million for the twelve months ending December 31, 2006. Solar power production revenue was in line with projections.
Expenses
Operating expenses for the three-month period ended December 31, 2007 were $3.7 million, up $3.1 million from $0.6 million for the three-month period ended December 31, 2006. Significant components of this increase include: fees related to business combination of $0.7 million; stock-based compensation of $0.4 million; amortization of $0.6 million; and interest of $0.8 million.
Expenses for the twelve months ending December 31, 2007, were $5.6 million which was $4.1 million higher than the $1.5 million recorded for the twelve months ending December 31, 2006. Significant components of this increase include fees related to business combination of $0.7 million; stock-based compensation of $0.4 million; amortization of $0.7 million; and interest of $0.8 million.
Net Loss
The net loss for the three months ending December 31, 2007 was $1.2 million which was $2.6 million less than net income of $1.4 million for the three months ended December 31, 2006. One significant sale, expected to close in Q4 2007, was deferred to 2008 because of financing difficulties encountered.
The loss for the 12 months ending December 31, 2007 was $2.4 million which was $4.0 million more than the $1.6 million net income for the 12 months ended December 31, 2006. The loss of $2.4 million in 2007 reflects one-time costs related to the business combination of $0.7 million, non-cash expense of $0.5 million for stock options, and non-cash amortization costs of $0.7 million and interest of $0.8 million.
The Company's complete Fiscal 2007 Year End and Fourth Quarter Financial Statements and Management Discussion and Analysis are available at www.sedar.com or on the Company's website at www.sonnenenergy.com.
About SonnenEnergy
SonnenEnergy Corp. is a solar power systems integrator and solar power producer. The company markets, sells, designs, installs, operates, and maintains grid-connected solar power systems and has installed more than 100 photovoltaic ("PV") solar power commercial and residential systems since 2004. SonnenEnergy's corporate offices are located in Toronto, Ontario and its European operations are based in Polling, Germany. The company operates solar power plants in southern Germany which have total installed capacity of more than 5,000 kWp. For more information, please visit SonnenEnergy's website at www.sonnenenergy.com.
Forward-Looking Statements
Forward-looking statements in this news release are based on current expectations that are subject to significant risks and uncertainties. Actual results might differ materially due to various risks and uncertainties as described in the company's amended and restated preliminary prospectus available at www.sedar.com. Such risks and uncertainties include, but are not limited to, the retention of key personnel, its dependence on suppliers for components for the systems that it designs and installs, the availability of silicon, its ability to expand sales, technology changes, unexpected warranty expenses or service claims, and its ability to meet its clients' expectations. SonnenEnergy assumes no obligation to update any forward-looking statement or to update the reasons why actual results could differ from such statements.
The TSX Venture Exchange Inc. has not reviewed and does not accept
responsibility for the adequacy or accuracy of this release.
%SEDAR: 00024825E