Complete Solar Preliminary Fourth Quarter Report

OREM, Utah, Jan. 21, 2025 (GLOBE NEWSWIRE) -- Complete Solaria, Inc. d/b/a Complete Solar ("Complete Solar" or the "Company") (Nasdaq: CSLR), a solar technology, services, and installation company, today will present its preliminary unaudited Q4'24 results via webcast at 2:00pm ET. Interested parties may access the webcast by registering here or by visiting the Events page within the IR section of the company website: investors.completesolar.com/news-events/events.

Complete Solar Chairman and CEO, T.J. Rodgers commented, "Our Q4'24 results are subject to a full-year audit, which is currently in progress and involves historical SunPower financials, a complication that is forecasted to delay our audited Q4'24 results into mid-March. By that time, I want to be talking to investors about Q2'25, only two weeks away, not analyzing 2024 history. That's why we are providing this preliminary, unaudited report which focuses on just Q4'24 and our forecast for Q1'25. The risk of this decision is that the audit process may change some of the results, but probably not revenue, and certainly not the Q1'25 forecast. We have a 57-person finance group comprised of people from two public companies that I trust to report one quarter properly. The Q1'25 forecast is mine.

Rodgers added, "We will give GAAP and non-GAAP results for those quarters with commentary focusing on the non-GAAP results, unless otherwise stated. My philosophy is that "non-GAAP" results should be as close to GAAP results as possible, but without 1) stock earnings charges added onto the dilution impact of share count we already report, 2) amortization of intangible assets, and 3) charges for special one-time events, both negative and positive."

Summary of CSLR's Q4'24 Accomplishments

In our November 13 Third Quarter Report, we presented an operating plan for Complete Solar predicated on our successful $45 million acquisition of business unit assets from SunPower to form a Complete Solar "NewCo" (herein called CSLR). This plan called for two big accomplishments that have now been achieved: 1) that the old-CSLR, a small solar company with little cash and only $5.5 million of prior-quarter revenue, would acquire and integrate assets of the SunPower corporation, which was founded in 1985 and about 10 times bigger than old-CSLR, and 2) that, as we wrote in our Third Quarter Report, "our revenue would be $80 million in Q4'24," the quarter after the asset purchase. This report presents Q4'24 combined company results on a GAAP-compliant basis and certain non-GAAP results and our Q1'25 forecast. The narrative is based on the non-GAAP financial results, unless otherwise noted:

   -- The SunPower Integration is substantially complete. On the last day of 
      Q3'24, September 30, we closed the acquisition, six days after a Delaware 
      bankruptcy court approved our asset purchase of three SunPower business 
      units, which have now been substantially integrated (including their MRP 
      systems) into CSLR as its two sole operating divisions, New Homes and 
      Blue Raven Solar. That asset integration raised our headcount from 109 to 
      1,341 on September 30. Our original target of 1,225 was achieved in 
      December, as shown on the included headcount chart. We raised $80 million 
      on September 24 to fund the $45 million SunPower asset purchase price 
      plus the expected added operating capital required to get to 
      profitability. 
 
   -- Our $81.1 million Q4 revenue beat expectations. CSLR's consolidated 
      revenue for Q4'24 jumped to $81.1 million, up 14.7 times vs. old-CSLR's 
      $5.5 million third quarter revenue on a standalone basis, and beat the 
      $80 million revenue forecasted in our Third Quarter Report. 
 
   -- New Divisional EVP/GMs are in place. We announced the promotion of Blue 
      Raven's Dan Myers as the EVP and GM of the New Homes Division on October 
      15, 2024 (here). And one month ago, we hired veteran operations manager 
      Steve Erickson, who was promoted six times at three Salt Lake "Solar 
      Valley" companies since 2011, to be the EVP and GM of the Blue Raven 
      Solar Division. 
 
   -- We are forecasting revenue growth next quarter. Despite the typical 
      industry seasonality that reduces solar industry revenue by 5%-14% in the 
      Q1 winter quarter, we are forecasting modest quarter-on-quarter revenue 
      growth to $82.0 million in Q1'25. 
 
   -- The Company is almost at its "fighting weight." The combined headcount of 
      the two companies started at 3,499 on October 1 and was reduced by 67% to 
      1,140 by the end of Q4'24, as shown in the embedded org chart. Our final 
      headcount target for the combined company is 980. 
 
   -- Our operating expense has been cut by a factor of two. The headcount 
      reduction led to a total non-GAAP operating expense reduction from $94.0 
      in Q3'24 million for the added expenses of the two companies to $35.7 
      million in Q4'24 for the combined and cost-reduced company. The operating 
      expenses less sales commissions were $84.0 million in Q3'24, down to 
      $19.8 million in Q4'24, a 4x reduction. Our forecast is to drop operating 
      expense less commissions by another 30% in Q1'25. 
 
   -- We are forecasting operating income breakeven in Q1'25. Given our current 
      backlog and cost-cutting plan, we are forecasting non-GAAP operating 
      income at breakeven in Q1'25. 
 
   -- Our cash balance will grow. We finished Q4'24 with $13.3 million in cash, 
      our lowest quarter since raising the $80 million in funding. We plan to 
      grow cash from operations during 2025. 

Fellow Shareholders:

Our revenue, earnings and cashflow for the stand-alone old-CSLR (Q1-Q3) and the post-merger CSLR (Q4), preliminary and unaudited, are given below showing identical Q4'24 GAAP and non-GAAP results, except for GAAP operating income, which still contains charges from merger write-offs:

The Noah's Ark Model

Our primary cost reductions in Q4'24 were achieved by reducing headcount in both companies:

CSLR Total Headcount By Work Week

So far, we have reduced our headcount from 3,499 to 1,140 employees, using the Noah's Ark model in which the 65-employee old-CSLR made employment offers to only 1,219 SunPower and Blue Raven Solar employees to get them "on the Ark" that, we believe, will shelter them from the flood of high interest rates that has already has put over 70 solar companies out of business.

When we were raising the $80 million in Q4'24 for the merger, the first five-quarter plan presented to investors called for $100 million in revenue in Q4'24, and an operating loss of $1.0 million, followed by breakeven operating income in Q2'25. After the backlog uncertainty caused by order cancellations due to the SPWR bankruptcy, we revised our post-integration Q4'24 revenue estimate to $80 million from $100 million in our November 13 Third Quarter Report -- and also gave an improved breakeven revenue forecast of $80 million to our shareholders, which, in turn, reduced the allowable number of employees CSLR would support from 1,225 to 980.

Actual 510-foot Oak Noah's Ark Model -- Williamsburg, KY

The Ark merger theory is actually nothing but a typical Silicon Valley startup plan in disguise. Instead of a big company in trouble asking for and getting too much money (SunPower asked for $750 million) -- and then being burdened for years with losses and layoffs from debt, the Ark Theory asserts, "Your old company has great assets. Get venture funding for those assets (in our case, $80 million) and build a new organization that can make a profit with what you've got."

Since this org chart was shown last quarter, we have merged the Dealer business unit into the Blue Raven business unit and the O&M (Operations and Maintenance to support our customers) into our Quality Group, with a new Senior VP of quality, Surinder Bedi, who headed Advanced Product Quality at Lucid Motors. Other new executives include Chaise Sweat, our General Counsel from ADT Solar, and Venki Sundaresan, our VP of IT, who ran IT groups at Cypress Semiconductor and Enphase.

This Friday, January 24, 2025, at our Orem, Utah HQ, we will present this report to over 1,000 employees and our board. We will also cover the details of our 2025 Rev. 6 Annual Operating Plan which currently shows operating income profitability in 2025.

Complete Solar CEO, T.J. Rodgers said, "The board honored our fourth quarter performance with a modest $1.14 million bonus (1.4% of revenue) -- even in a loss quarter, which is rare. Management chose to give the bonus money to all hands equally to recognize that the rank-and-file employees made the quarter for us. The management team holds significant restricted stock and will get rewarded by the market when they 'meet and beat the street,' by producing a series of quarters that impresses Wall Street.

Rodgers continued, "Our $81.1 million revenue last quarter re-defined our Company with an annualized revenue of $324 million and a $5.94 million quarterly loss that will not survive in 2025, as Muhammad Ali might have said.

Rodgers concluded, "We would like to thank our shareholders for funding our company and giving us the opportunity to re-build an iconic solar company."

The NASA Helios airplane had 14 electric motors that used SunPower all-black high-efficiency cells to take off and land on its own power. In 2001, it set an all-time altitude record of 96,863 feet, which still stands. The F-15 Eagle, a mach 2.5 fighter, capable of accelerating while climbing vertically, has a service ceiling of 72,000 feet.

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January 21, 2025 08:00 ET (13:00 GMT)