Vivint Solar claims progress in post-SunEdison turnaround

Vivint Solar, among the largest installers of US rooftop PV systems, shrank its losses and its installation costs in the third quarter, making progress as it tries to move beyond its failed merger with SunEdison earlier this year.

Since SunEdison’s planned $2.2bn acquisition of Vivint Solar collapsed this March, Vivint has struggled on multiple fronts, including securing enough finance to fuel its capital-intensive growth model of installing PV panels at no upfront cost for consumers.

The Utah-based company is still dogged by uncertainty and a depressed share price, and has yet to name a permanent chief executive since the sudden and unexpected departure in May of Greg Butterfield, who took Vivint Solar public in late 2014.

But in a conference call Wednesday, interim chief executive David Bywater said efforts to rein in costs and deliver “smart and sustainable growth” are gaining traction.

US rooftop PV – big growth, big uncertainty

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Hampered by a lack of finance, Vivint installed 59MW in the third quarter of 2016 – down from 61MW in the same quarter last year. But the company reduced its operating loss to $33.3m, compared to $54.4m in the year-ago period, and grew its revenues 84% to $41.3m.

Earlier this week Vivint announced a $200m pot of tax-equity financing, enough to finance 123MW of new PV systems, in a deal that “demonstrates Vivint Solar’s ability to raise financing to enable our continued growth”, according to chief commercial officer Thomas Plagemann.

Critically, Vivint is getting a handle on its operating expenses, shelling out $74.6m in the quarter compared to $76.9m last year – despite having a much larger portfolio of distributed solar assets on its books. Sales and marketing costs fell by 28%.

Having struggled to consistently bring down its installation costs over the last few years, Vivint’s all-in costs hit an all-time low of $2.85/W in the third quarter, down from $2.95/W in the second quarter – and $3.12/W a year ago.  

Cumulative installations now stand at 634MW, leaving Vivint’s assets with an estimated retained value of $1.23bn – the figure it expects to haul in over the lifetime of the PV systems it has leased to homeowners.