Making up for losses with volume
Following the First Wind model, SunEdison is losing money hand over fist while taking on astronomical debt. Apparebntly they hope to make up for their unprofitability with volume. This paid off for FW because Paul Gaynor found the proverbial 'Greater Fool' in SunEdison. But will SunEdison ever find a greater fool to bail them out? It's not likely.
https://cleantechnica.com/2015/08/08/sunedison-net-loss-outweighs-i...
SunEdison Net Loss Outweighs Importance For Skittish Investors After Record Quarter & 1.9 GW Under Construction
August 8th, 2015 by Joshua S Hill
SunEdison shares have plummeted after the world’s largest clean energy developer reports record growth, 1.9 GW of projects under construction, and the recent close of financing on a 300 MW wind farm in Texas.
Bloomberg Business has described analysts as “scratching their heads” in the wake of the biggest drop in SunEdison’s shares in almost 14 years. They quote Mahesh Sanganeria at RBC Capital Markets, who sent a note to clients on Thursday: “We have been receiving a lot of calls on today’s sell-off of SunEdison. We expected the stock to react positively.”
The company announced its second quarter earnings on Thursday, revealing a record 404 MW delivered in the quarter, versus guidance of 300 to 340 MW. SunEdison also has 1.9 GW of projects currently under construction, is up 1.1 GW quarter-over-quarter, has an 8.1 GW pipeline, a 5.6 GW backlog, and guidance for 2016 of between 4.2 to 4.5 GW. Net sales were up ($455 million) on both the previous quarter ($323 million) and a year earlier ($431 million), and the company’s first yieldco — TerraForm Power — has $65 million Q2 cash available for distribution, at $0.335 DPS.
However, it was the company’s $263 million net loss (attributable to shareholders) that appears to be the only takeaway from the company’s second quarter earnings, with shares plunging 25% at the close of trading — the company’s biggest decline since September 2001.
Reports are that investors are afraid of the net loss, which is in part due to the number of acquisitions the company has made over the past quarter. SunEdison acquired the India-based Continuum Wind Energy and the Central American Globeleq Mesoamerica Energy (GME). On top of that, SunEdison and TerraForm acquired a 521 MW wind energy portfolio from Atlantic Power, and a 930 MW wind energy portfolio from Invenergy. In the first quarter, the company announced the closure of SunEdison and TerraForm’s acquisition of First Wind.
This acquisition spree has apparently sent shivers through SunEdison investors, concerned at the net loss attributable to shareholders. However, Bloomberg Business spoke to SunEdison’s chief strategy officer, Jul... that the market may not recognize the benefit of investing so much revenue in future growth. “Earnings per share is not a good measure,” she said. “That will come back to the company over many years.”
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Comment
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Comment by Pineo Girl on August 11, 2015 at 11:41am
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It makes perfect sense that Sun Edison is losing money hand over fist! First Wind managed to to dupe Sun Edison with a future value of present dollar scenario as value of First Wind, a company with over $700 million in accumulated deficits!! It is the perfect Enron approach to business - But what more could you expect from Paul Gaynor and Michael Alvarez, CEO and COO of First Wind and former Enron managers?
Maine as Third World Country:
CMP Transmission Rate Skyrockets 19.6% Due to Wind Power
Click here to read how the Maine ratepayer has been sold down the river by the Angus King cabal.
Maine Center For Public Interest Reporting – Three Part Series: A CRITICAL LOOK AT MAINE’S WIND ACT
******** IF LINKS BELOW DON'T WORK, GOOGLE THEM*********
(excerpts) From Part 1 – On Maine’s Wind Law “Once the committee passed the wind energy bill on to the full House and Senate, lawmakers there didn’t even debate it. They passed it unanimously and with no discussion. House Majority Leader Hannah Pingree, a Democrat from North Haven, says legislators probably didn’t know how many turbines would be constructed in Maine if the law’s goals were met." . – Maine Center for Public Interest Reporting, August 2010 https://www.pinetreewatchdog.org/wind-power-bandwagon-hits-bumps-in-the-road-3/From Part 2 – On Wind and Oil Yet using wind energy doesn’t lower dependence on imported foreign oil. That’s because the majority of imported oil in Maine is used for heating and transportation. And switching our dependence from foreign oil to Maine-produced electricity isn’t likely to happen very soon, says Bartlett. “Right now, people can’t switch to electric cars and heating – if they did, we’d be in trouble.” So was one of the fundamental premises of the task force false, or at least misleading?" https://www.pinetreewatchdog.org/wind-swept-task-force-set-the-rules/From Part 3 – On Wind-Required New Transmission Lines Finally, the building of enormous, high-voltage transmission lines that the regional electricity system operator says are required to move substantial amounts of wind power to markets south of Maine was never even discussed by the task force – an omission that Mills said will come to haunt the state.“If you try to put 2,500 or 3,000 megawatts in northern or eastern Maine – oh, my god, try to build the transmission!” said Mills. “It’s not just the towers, it’s the lines – that’s when I begin to think that the goal is a little farfetched.” https://www.pinetreewatchdog.org/flaws-in-bill-like-skating-with-dull-skates/
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Hannah Pingree on the Maine expedited wind law
Hannah Pingree - Director of Maine's Office of Innovation and the Future
"Once the committee passed the wind energy bill on to the full House and Senate, lawmakers there didn’t even debate it. They passed it unanimously and with no discussion. House Majority Leader Hannah Pingree, a Democrat from North Haven, says legislators probably didn’t know how many turbines would be constructed in Maine."
https://pinetreewatch.org/wind-power-bandwagon-hits-bumps-in-the-road-3/
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