NXT Nextracker Inc

50% Revenue Growth YoY; Reaffirms FY25 Outlook

Adds Solar Foundation Offerings with Ojjo and Solar Pile International Acquisitions

Nextracker (Nasdaq: NXT), a global market leader of intelligent solar tracker and software solutions, today announced financial results for the first quarter of fiscal year 2025, ended June 28, 2024.

Financial Summary

(In millions, except per share)

 

Q1 FY25*

Q4 FY24*

Q1 FY24*

Revenue

$720

$737

$480

GAAP Gross Profit

$237

$340

$114

GAAP Gross Margin

33.0%

46.2%

23.7%

GAAP Net Income

$125

$223

$64

GAAP Net Income Margin

17.3%

30.3%

13.3%

GAAP Diluted EPS

$0.84

$1.51

$0.43

 

 

 

 

Adjusted Gross Profit

$241

$222

$116

Adjusted Gross Margin

33.5%

30.2%

24.1%

Adjusted EBITDA

$175

$160

$84

Adjusted EBITDA Margin

24.3%

21.7%

17.4%

Adjusted Net Income

$139

$142

$71

Adjusted Diluted EPS

$0.93

$0.96

$0.48

*Q1 FY25 GAAP and adjusted results include approximately $47 million of IRA 45X advanced manufacturing tax credit vendor rebates (45X credits). Q4 FY24 GAAP results include a cumulative adjustment to recognize 45X credits of $121 million earned on eligible deliveries from January 1, 2023, through March 31, 2024. Q1 FY24 results do not include 45X credits.

 

Please refer to Nextracker’s most recent Annual Report on Form 10-K for more information on 45X credits and schedules IV and V attached to this press release for a reconciliation of non-GAAP to GAAP financial measures, and additional information can be found on the Investor Relations section of our website.

Business Highlights

• Launched NX Horizon Low Carbon Tracker in April 2024 and unveiled Agrivoltaics in July 2024
• Expanded JM Steel’s Pittsburgh facility with Nextracker-dedicated manufacturing in April 2024
• Opened a second Nevada factory by Unimacts with Nextracker-dedicated manufacturing in June 2024
• Acquired Ojjo, Inc. on June 20, 2024 for approximately $120 million
• Acquired Solar Pile International’s foundations business on July 31, 2024 for approximately $48 million
• Amended credit agreement and expanded revolver facility from $500 million to $1 billion on June 21, 2024
• Currently expect 100% U.S. domestic content capability with an early CY25 planned ship date

“Our fiscal year is off to an excellent start with another quarter of strong execution, where healthy demand dynamics continued for solar trackers in both the U.S. and international markets,” said Dan Shugar, founder and CEO of Nextracker. “We also unveiled new product solutions, expanded several of our partner manufacturing facilities, and added foundations solutions with the acquisitions of Ojjo and Solar Pile International’s foundations business.”

“Our exceptional Q1 results led to our sixth consecutive quarter of year-over-year double-digit revenue growth,” said Chuck Boynton, CFO of Nextracker. “We continued to bolster our strong balance sheet with healthy operating cash flows, limited debt, and an expanded total liquidity of over $1.4 billion.”

FY2025 Annual Outlook

Nextracker reaffirmed its full-year fiscal year 2025 outlook:

 

FY25 Outlook

Revenue

$2.8 billion to $2.9 billion

GAAP Net Income

$363 million to $393 million

GAAP Diluted EPS

$2.37 to $2.57

Adjusted EBITDA

$600 million to $650 million

Adjusted Diluted EPS

$2.89 to $3.09

GAAP net income range of $363 million to $393 million is updated from previous range of $369 million to $399 million to include estimated impact of incremental net intangible asset amortization resulting from acquisitions. GAAP diluted EPS range of $2.37 to $2.57 is updated from previous $2.41 to $2.61 to include the estimated impact of incremental net intangible asset amortization resulting from acquisitions.

Adjusted EBITDA and adjusted diluted EPS exclude approximately $103 million and $0.52, respectively, for stock-based compensation and net intangible amortization.

Q1 FY2025 Earnings Call

August 1, 2024 2:00 p.m. PT / 5:00 p.m. ET Live webcast available on investors.nextracker.com

We encourage you to review our Q1 FY25 Shareholder Letter, which, along with this press release, is available on the Nextracker Investor Relations website and includes important information for Nextracker shareholders that supplements and expands on the information in this press release.

The webcast replay will be available on the Nextracker Investor Relations website following the conclusion of the event.

About Nextracker

Nextracker is a leading provider of intelligent, integrated solar tracker and software solutions used in utility-scale and ground-mounted distributed generation solar projects around the world. Our products enable solar panels power plants to follow the sun’s movement across the sky and optimize plant performance. With power plants operating in forty countries worldwide, Nextracker offers solar tracker technologies that increase energy production while reducing costs for significant plant ROI. For more information, please visit www.nextracker.com.

Forward Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements relating to the trends for future solar adoption, the expected benefits of the Ojjo and Solar Pile International acquisitions, our domestic content capabilities, and Nextracker’s outlook for fiscal 2025 and other periods. These forward-looking statements are based on various assumptions and on the current expectations of Nextracker’s management. These statements involve risks and uncertainties that could cause the actual results to differ materially from those anticipated by these forward-looking statements, including risks and uncertainties that are described under “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Nextracker’s most recent Quarterly Report on Form 10-Q, Annual Report on Form 10-K and other documents that Nextracker has filed or will file with the Securities and Exchange Commission. There may be additional risks that Nextracker is not aware of or that Nextracker currently believes are immaterial that could also cause actual results to differ from the forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements. Nextracker assumes no obligation to update these forward-looking statements.

Use of Adjusted Financial Information

An explanation and reconciliation of non-GAAP financial measures to GAAP financial measures is presented in Schedules IV and V attached to this press release, and can be found, along with other financial information including the Earnings Presentation, on the investor relations section of our website at investors.nextracker.com.

Channels for Disclosure of Information

Nextracker intends to announce material information to the public through the Nextracker Investor Relations website investors.nextracker.com, SEC filings, press releases, public conference calls, and public webcasts. Nextracker uses these channels to communicate with its investors, customers, and the public about the company, its offerings, and other issues. As such, Nextracker encourages investors, the media, and others to follow the channels listed above and to review the information disclosed through such channels.

Schedule I

Nextracker Inc. Unaudited condensed consolidated statements of operations and comprehensive income (In thousands, except share and per share data)

 

 

Three-month periods ended

 

June 28, 2024

 

March 31, 2024

 

June 30, 2023

Revenue

$

719,921

 

$

736,515

 

 

$

479,543

 

Cost of sales

 

482,481

 

 

396,045

 

 

 

365,799

 

Gross profit

 

237,440

 

 

340,470

 

 

 

113,744

 

Selling, general and administrative expenses

 

60,827

 

 

56,706

 

 

 

32,437

 

Research and development

 

16,519

 

 

13,090

 

 

 

7,427

 

Operating income

 

160,094

 

 

270,674

 

 

 

73,880

 

Interest expense

 

3,280

 

 

3,845

 

 

 

3,102

 

Other expense (income), net

 

4,868

 

 

(16,235

)

 

 

(1,968

)

Income before income taxes

 

151,946

 

 

283,064

 

 

 

72,746

 

Provision for income taxes

 

27,152

 

 

59,864

 

 

 

9,101

 

Net income and comprehensive income

 

124,794

 

 

223,200

 

 

 

63,645

 

Less: Net income attributable to non-controlling interests and redeemable non-controlling interests

 

3,094

 

 

18,037

 

 

 

43,216

 

Net income attributable to Nextracker Inc.

$

121,700

 

$

205,163

 

 

$

20,429

 

 

 

 

 

 

 

Earnings per share attributable to the stockholders of Nextracker Inc.

 

 

 

 

 

Basic

$

0.86

 

$

1.48

 

 

$

0.44

 

Diluted

$

0.84

 

$

1.51

 

 

$

0.43

 

Weighted-average shares used in computing per share amounts:

 

 

 

 

 

Basic

 

142,102,503

 

 

138,389,259

 

 

 

46,411,859

 

Diluted

 

149,233,237

 

 

148,144,066

 

 

 

146,868,852

 

Schedule II

Nextracker Inc. Unaudited condensed consolidated balance sheets (In thousands)

 

 

As of June 28, 2024

 

As of March 31, 2024

ASSETS

Current assets:

 

 

 

Cash and cash equivalents

$

471,879

 

$

474,054

Accounts receivable, net of allowance of $4,020 and $3,872, respectively

 

401,937

 

 

382,687

Contract assets

 

361,939

 

 

397,123

Inventories

 

166,023

 

 

201,736

Other current assets

 

295,633

 

 

312,635

Total current assets

 

1,697,411

 

 

1,768,235

Property and equipment, net

 

35,261

 

 

9,236

Goodwill

 

328,381

 

 

265,153

Other intangible assets, net

 

46,458

 

 

1,546

Deferred tax assets and other assets

 

519,418

 

 

474,612

Total assets

$

2,626,929

 

$

2,518,782

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:

 

 

 

Accounts payable

$

387,401

 

$

456,639

Accrued expenses

 

69,028

 

 

82,410

Deferred revenue

 

218,565

 

 

225,539

Current portion of long-term debt

 

4,688

 

 

3,750

Other current liabilities

 

123,275

 

 

123,148

Total current liabilities

 

802,957

 

 

891,486

Long-term debt, net of current portion

 

142,235

 

 

143,967

Tax receivable agreement liability and other liabilities

 

545,106

 

 

491,301

Total liabilities

 

1,490,298

 

 

1,526,754

Total stockholders' equity

 

1,136,631

 

 

992,028

Total liabilities and stockholders' equity

$

2,626,929

 

$

2,518,782

Schedule III

Nextracker Inc. Unaudited condensed consolidated statements of cash flows (In thousands)

 

Three-month periods ended

 

June 28, 2024

 

March 31, 2024

 

June 30, 2023

Cash flows from operating activities:

 

 

 

 

 

Net income

$

124,794

 

 

$

223,200

 

 

$

63,645

 

Depreciation and amortization

 

941

 

 

 

1,225

 

 

 

1,046

 

Changes in working capital and other, net

 

(4,889

)

 

 

(112,933

)

 

 

161,076

 

Net cash provided by operating activities

 

120,846

 

 

 

111,492

 

 

 

225,767

 

Cash flows from investing activities:

 

 

 

 

 

Purchases of property and equipment

 

(2,890

)

 

 

(2,310

)

 

 

(694

)

Payment of business acquisition, net of cash acquired

 

(110,165

)

 

 

—

 

 

 

—

 

Purchase of intangible assets

 

—

 

 

 

(500

)

 

 

—

 

Net cash used in investing activities

 

(113,055

)

 

 

(2,810

)

 

 

(694

)

Cash flows from financing activities:

 

 

 

 

 

Repayment of bank borrowings

 

(937

)

 

 

—

 

 

 

—

 

Payment of revolver issuance cost

 

(3,715

)

 

 

—

 

 

 

—

 

Distribution to non-controlling interest holders

 

(5,314

)

 

 

(2,516

)

 

 

—

 

Other financing activities

 

—

 

 

 

70

 

 

 

—

 

Net cash used in financing activities

 

(9,966

)

 

 

(2,446

)

 

 

—

 

Net (decrease) increase in cash and cash equivalents

 

(2,175

)

 

 

106,236

 

 

 

225,073

 

Cash and cash equivalents beginning of period

 

474,054

 

 

 

367,818

 

 

 

130,008

 

Cash and cash equivalents end of period

$

471,879

 

 

$

474,054

 

 

$

355,081

 

 

Three-month periods ended

Adjusted free cash flow

June 28, 2024

 

March 31, 2024

 

June 30, 2023

Net cash provided by operating activities

$

120,846

 

 

$

111,492

 

 

$

225,767

 

Purchases of property and equipment

 

(2,890

)

 

 

(2,310

)

 

 

(694

)

Other financing

 

—

 

 

 

3,750

 

 

 

—

 

Adjusted free cash flow

$

117,956

 

 

$

112,932

 

 

$

225,073

 

Schedule IV

Nextracker Inc. Reconciliation of GAAP to Non-GAAP Financial measures (In thousands, except percentages, shares and per share data)

 

 

Three-month periods ended

 

June 28, 2024

 

March 31, 2024

 

June 30, 2023

GAAP gross profit & margin

$

237,440

 

 

33.0

%

 

$

340,470

 

 

46.2

%

 

$

113,744

 

 

23.7

%

Stock-based compensation expense

 

3,780

 

 

 

 

 

3,096

 

 

 

 

 

1,926

 

 

 

Intangible amortization

 

88

 

 

 

 

 

87

 

 

 

 

 

63

 

 

 

Advanced manufacturing tax credit vendor rebate

 

—

 

 

 

 

 

(121,405

)

 

 

 

 

—

 

 

 

Adjusted gross profit & margin

$

241,308

 

 

33.5

%

 

$

222,248

 

 

30.2

%

 

$

115,733

 

 

24.1

%

 

 

 

 

 

 

 

 

 

 

 

 

GAAP operating income & margin

$

160,094

 

 

22.2

%

 

$

270,674

 

 

36.8

%

 

$

73,880

 

 

15.4

%

Stock-based compensation expense

 

21,901

 

 

 

 

 

16,889

 

 

 

 

 

8,460

 

 

 

Intangible amortization

 

88

 

 

 

 

 

87

 

 

 

 

 

63

 

 

 

Acquisition costs

 

1,480

 

 

 

 

 

—

 

 

 

 

 

—

 

 

 

Advanced manufacturing tax credit vendor rebate

 

—

 

 

 

 

 

(121,405

)

 

 

 

 

—

 

 

 

Adjusted operating income & margin

$

183,563

 

 

25.5

%

 

$

166,245

 

 

22.6

%

 

$

82,403

 

 

17.2

%

 

 

 

 

 

 

 

 

 

 

 

 

GAAP net income & margin

$

124,794

 

 

17.3

%

 

$

223,200

 

 

30.3

%

 

$

63,645

 

 

13.3

%

Stock-based compensation expense

 

21,901

 

 

 

 

 

16,889

 

 

 

 

 

8,460

 

 

 

Intangible amortization

 

88

 

 

 

 

 

87

 

 

 

 

 

63

 

 

 

Adjustment for taxes

 

(9,644

)

 

 

 

 

23,567

 

 

 

 

 

(1,225

)

 

 

Acquisition costs

 

1,480

 

 

 

 

 

—

 

 

 

 

 

—

 

 

 

Advanced manufacturing tax credit vendor rebate

 

—

 

 

 

 

 

(121,405

)

 

 

 

 

—

 

 

 

Adjusted net income & margin

$

138,619

 

 

19.3

%

 

$

142,338

 

 

19.3

%

 

$

70,943

 

 

14.8

%

 

 

 

 

 

 

 

 

 

 

 

 

GAAP net income & margin

$

124,794

 

 

17.3

%

 

$

223,200

 

 

30.3

%

 

$

63,645

 

 

13.3

%

Interest, net

 

(1,292

)

 

 

 

 

988

 

 

 

 

 

1,420

 

 

 

Provision for income taxes

 

27,152

 

 

 

 

 

59,864

 

 

 

 

 

9,101

 

 

 

Depreciation expense

 

853

 

 

 

 

 

1,138

 

 

 

 

 

983

 

 

 

Intangible amortization

 

88

 

 

 

 

 

87

 

 

 

 

 

63

 

 

 

Stock-based compensation expense

 

21,901

 

 

 

 

 

16,889

 

 

 

 

 

8,460

 

 

 

Acquisition costs

 

1,480

 

 

 

 

 

—

 

 

 

 

 

—

 

 

 

Advanced manufacturing tax credit vendor rebate

 

—

 

 

 

 

 

(121,405

)

 

 

 

 

—

 

 

 

Other tax related income, net

 

—

 

 

 

 

 

(21,138

)

 

 

 

 

—

 

 

 

Adjusted EBITDA & margin

$

174,976

 

 

24.3

%

 

$

159,623

 

 

21.7

%

 

$

83,672

 

 

17.4

%

 

 

 

 

 

 

 

 

 

 

 

 

Diluted earnings per share

 

 

 

 

 

 

 

 

 

 

 

GAAP

$

0.84

 

 

 

 

$

1.51

 

 

 

 

$

0.43

 

 

 

Earnings per share attributable to Non-GAAP adjustments

$

0.09

 

 

 

 

$

(0.55

)

 

 

 

$

0.05

 

 

 

Adjusted

$

0.93

 

 

 

 

$

0.96

 

 

 

 

$

0.48

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted shares used in computing per share amounts

 

149,233,237

 

 

 

 

 

148,144,066

 

 

 

 

 

146,868,852

 

 

 

See the accompanying notes on Schedule V attached to this press release

Schedule V

Nextracker Inc. Notes

To supplement Nextracker’s unaudited selected financial data presented consistent with U.S. Generally Accepted Accounting Principles (“GAAP”), the Company discloses certain non-GAAP financial measures that exclude certain charges and gains, including adjusted earnings before interest, taxes, depreciation, and amortization (“Adjusted EBITDA”), adjusted gross profit, adjusted operating income, adjusted net income, adjusted diluted earnings per share, and adjusted free cash flow. These supplemental measures exclude certain legal and other charges, stock-based compensation expense and intangible amortization, other discrete events as applicable and the related tax effects. These non-GAAP measures are not in accordance with or an alternative for GAAP and may be different from non-GAAP measures used by other companies. We believe that these non-GAAP measures have limitations in that they do not reflect all the amounts associated with Nextracker’s results of operations as determined in accordance with GAAP and that these measures should only be used to evaluate Nextracker’s results of operations in conjunction with the corresponding GAAP measures. The presentation of this additional information is not meant to be considered in isolation or as a substitute for the most directly comparable GAAP measures. We compensate for the limitations of non-GAAP financial measures by relying upon GAAP results to gain a complete picture of the Company’s performance.

In calculating non-GAAP financial measures, we exclude certain items to facilitate a review of the comparability of the Company’s operating performance on a period-to-period basis because such items are not, in our view, related to the Company’s ongoing operational performance. We use non-GAAP measures to evaluate the operating performance of our business, for comparison with forecasts and strategic plans, for calculating return on investment, and for benchmarking performance externally against competitors. In addition, management’s incentive compensation is determined using certain non-GAAP measures. Since we find these measures to be useful, we believe that investors benefit from seeing results “through the eyes” of management in addition to seeing GAAP results. We believe that these non-GAAP measures, when read in conjunction with the Company’s GAAP financials, provide useful information to investors by offering:

• the ability to make more meaningful period-to-period comparisons of the Company’s ongoing operating results;
• the ability to better identify trends in the Company’s underlying business and perform related trend analysis;
• a better understanding of how management plans and measures the Company’s underlying business; and
• an easier way to compare the Company’s operating results against analyst financial models and operating results of competitors that supplement their GAAP results with non-GAAP financial measures.

The following are explanations of each of the adjustments that we incorporate into non-GAAP measures, as well as the reasons for excluding each of these individual items in the reconciliations of these non-GAAP financial measures:

Stock-based compensation expense consists of non-cash charges for the estimated fair value of unvested restricted share unit and stock option awards granted to employees and assumed in business acquisitions. The Company believes that the exclusion of these charges provides for more accurate comparisons of its operating results to peer companies due to the varying available valuation methodologies, subjective assumptions, and the variety of award types. In addition, the Company believes it is useful to investors to understand the specific impact stock-based compensation expense has on its operating results.

Intangible amortization consists primarily of non-cash charges that can be impacted by, among other things, the timing and magnitude of acquisitions. The Company considers its operating results without these charges when evaluating its ongoing performance and forecasting its earnings trends, and therefore excludes such charges when presenting non-GAAP financial measures. The Company believes that the assessment of its operations excluding these costs is relevant to its assessment of internal operations and comparisons to the performance of its competitors.

The 45X Advanced Manufacturing Production Tax Credit (“45X Credit”) which was established as part of the Inflation Reduction Act (IRA), is a per-unit tax credit earned over time for each clean energy component domestically produced and sold by a manufacturer. The 45X Credit was eligible for domestic parts manufactured after January 1, 2023. The Company has executed agreements with certain suppliers to ramp up its U.S. manufacturing footprint. These suppliers produce 45X Credit eligible parts, including torque tubes, and structural fasteners, that will then be incorporated into a solar tracker. The Company has contractually agreed with these suppliers to share a portion of the credit related to Nextracker’s purchases. The Company accounts for these credits as a reduction of the purchase price of the parts acquired from the vendor and therefore a reduction of inventory until the part is sold, at which point the Company recognizes such credit as a reduction of cost of sales on the unaudited condensed consolidated statements of operations and comprehensive income. During the fourth quarter of fiscal 2024, the Company determined the amount of the 45X vendor rebates it expects to receive in accordance with the vendor contracts and recognized a cumulative reduction to cost of sales of $121.4 million related to 45X Credit vendor rebates earned on production of eligible components shipped to projects starting on January 1, 2023 through March 31, 2024. The Company believes that the assessment of its operations excluding the benefit from the vendor credits provides a more consistent comparison of its performance given the cumulative nature of the amount recorded in the fiscal fourth quarter. Beginning in the first quarter of fiscal year 2025, these 45X credit vendor rebates are not excluded from our non-GAAP financial measures.

Acquisition costs consist primarily of nonrecurring transaction costs for business acquisition.

Adjustment for taxes relates to the tax effects of the various adjustments that we incorporate into non-GAAP measures to provide a more meaningful measure on non-GAAP net income and certain adjustments related to non-recurring settlements of tax contingencies or other non-recurring tax charges, when applicable.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240801264651/en/

Investors, Financial Media & Press Mary Lai VP, IR & Financial Communications Investor@nextracker.com

Media & Press Kristan Kirsh SVP, Global Marketing Media@nextracker.com