WASHINGTON, D.C. 20549

FORM 8-K

 

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

SOLAREDGE TECHNOLOGIES, INC.

(Exact name of registrant as specified in its charter)

 

 

Registrant’s Telephone number, including area code: 972 (9) 957-6620

 

Not Applicable

(Former name or former address, if changed since last report.)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instructions A.2 below):

 

☐          Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐          Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐          Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐          Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

Item 2.02.          Results of Operations and Financial Condition.

On February 14, 2017 SolarEdge Technologies, Inc. (the “Company”) issued a press release announcing its financial results for the fourth quarter and the transition period ended December 31, 2016. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

 

In accordance with General Instruction B.2 of Form 8-K, this information, including the exhibits hereto, shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall such information, including the exhibits hereto be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

 

Item 9.01.          Financial Statements and Exhibits

SIGNATURE

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	SOLAREDGE TECHNOLOGIES, INC.
Date:  February 14, 2017	By:	/s/ Ronen Faier
	Name:	Ronen Faier
	Title:	Chief Financial Officer

---

SolarEdge Announces Quarter Ended December 31, 2016

Financial Results

 

FREMONT, Calif. — February 14, 2017. SolarEdge Technologies, Inc. (Nasdaq: SEDG), a global leader in PV inverters, power optimizers, and module-level monitoring services, today announced its financial results for the quarter ended December 31, 2016.

 

Quarter Ended December 31, 2016 Highlights

 

·

Revenues for the quarter of $111.5 million

 

·

GAAP gross margin for the quarter of 35.0%

 

·

GAAP operating income for the quarter of $15.1 million

 

·

GAAP net income for the quarter of $9.8 million

 

·

Non-GAAP net income for the quarter of $14.7 million

 

·

GAAP net diluted earnings per share for the quarter of $0.22

 

·

Non-GAAP net diluted earnings per share for the quarter of $0.32

 

·

413 Megawatts (AC) of inverters shipped for the quarter

 

“We focused this quarter on the ramp up of manufacturing new products, including the HD Wave inverter which is now available worldwide. We continued our cost reduction measures yielding solid operating income and record gross margin despite lower revenues than in previous quarters,” said Guy Sella, Founder, Chairman and CEO of SolarEdge. “We remain confident in our ability to grow revenues and profitability in 2017.”

 

Quarter Ended December 31, 2016 Summary

 

The Company reported revenues of $111.5 million, 13% down from the prior quarter and of 11% year over year.

 

GAAP gross margin reached 35.0%, up from 32.6% in the prior quarter and from 30.9% year over year.

 

GAAP operating expenses were $23.9 million, an increase of 1% from the prior quarter and of 24% year over year.

 

GAAP operating income was $15.1 million, down from $18.2 million in the prior quarter and from $19.3 million year over year.

 

GAAP net income was $9.8 million, down from $15.6 million in the prior quarter and from $24.1 million year over year.

 

Non-GAAP net income was $14.7 million, down from $20.9 million in the prior quarter and down from $19.8 million year over year.

 

 

GAAP net diluted earnings per shares (“EPS”) was $0.22, down from $0.35 in the prior quarter and down from $0.55 year over year.

 

Non-GAAP net diluted EPS was $0.32, down from $0.46 in the prior quarter and down from $0.44 year over year.

 

As of December 31, 2016, cash, cash equivalents, restricted cash and marketable securities totaled $224.3 million, compared to $206.7 million on September 30, 2016.

 

Outlook for the Quarter Ending March 31, 2017

 

The Company also provides guidance for the quarter ending March 31, 2017 as follows:

·

Revenues to be within the range of $110 million to $120 million;

 

·

Gross margins to be within the range of 31% to 33%.

 

Conference Call

 

The Company will host a conference call to discuss these results at 5:00 P.M. EST on Tuesday, February 14, 2017. The call will be available, live, to interested parties by dialing 877-874-1570. For international callers, please dial +1 719-325-4762. The Conference ID number is 9063628.  A live webcast will also be available in the Investors Relations section of the Company’s website at: http://investors.solaredge.com

 

A replay of the webcast will be available in the Investor Relations section of the Company’s web site approximately two hours after the conclusion of the call and will remain available for approximately 30 calendar days.

 

About SolarEdge

 

SolarEdge provides an intelligent inverter solution that has changed the way power is harvested and managed in solar photovoltaic systems. The SolarEdge DC optimized inverter system maximizes power generation at the individual PV module-level while lowering the cost of energy produced by the solar PV system. The SolarEdge system consists of power optimizers, inverters, storage solutions and a cloud-based monitoring platform and addresses a broad range of solar market segments, from residential solar installations to commercial and small utility-scale solar installations. SolarEdge is online at http://www.solaredge.com

 

Use of Non-GAAP Financial Measures

 

This release contains forward looking statements which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.  These forward-looking statements include information, among other things, concerning: our possible or assumed future results of operations; future demands for solar energy solutions; business strategies; technology developments; financing and investment plans; dividend policy; competitive position; industry and regulatory environment; general economic conditions; potential growth opportunities; and the effects of competition. These forward-looking statements are often characterized by the use of words such as “anticipate,” “believe,” “could,” “seek,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “will,” “would” or similar expressions and the negative or plural of those terms and other like terminology.

Forward-looking statements are only predictions based on our current expectations and our projections about future events.  These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from those expressed or implied by the forward-looking statements. Given these factors, you should not place undue reliance on these forward-looking statements.  These factors include, but are not limited to, the matters discussed in the section entitled “Risk Factors” of our Registration Statement on Form S-1 (including the related prospectus), Annual Report on Form 10-K for the fiscal year ended June 30, 2016, filed on August 17, 2016, Current Reports on Form 8-K and other reports filed with the SEC. All information set forth in this release is as of February 14, 2017.  The Company undertakes no duty or obligation to update any forward-looking statements contained in this release as a result of new information, future events or changes in its expectations.

Investor Contacts

SolarEdge Technologies, Inc.

Ronen Faier, Chief Financial Officer

+1 510-498-3263

Sapphire Investor Relations, LLC

Erica Mannion or Michael Funari

+1 617-542-6180

 

		Six months Ended December 31,				Year ended June 30,
		2016				2016				2015				2014
Revenues		$	239,997			$	489,843			$	325,078			$	133,217
Cost of revenues			159,097				337,887				243,295				111,246
Gross profit			80,900				151,956				81,783				21,971
Operating expenses:
Research and development, net			20,279				33,231				22,018				18,256
Sales and marketing			20,444				34,833				24,973				17,792
General and administrative			6,790				12,133				6,535				4,294
Total operating expenses			47,513				80,197				53,526				40,342
Operating income (loss)			33,387				71,759				28,257				(18,371	)
Other expenses			-				-				104				-
Financial income (expenses), net			(2,789	)			471				(5,077	)			(2,787	)
Income (loss) before taxes on income			30,598				72,230				23,076				(21,158	)
Taxes on income (tax benefit)			5,217				(4,379	)			1,955				220
Net income (loss)		$	25,381			$	76,609			$	21,121			$	(21,378	)

		December 31,				June 30,				June 30,
		2016				2016				2015
CURRENT ASSETS:
Cash and cash equivalents		$	104,683			$	74,032			$	144,750
Restricted cash			897				928				3,639
Marketable Securities			74,465				59,163				-
Trade receivables, net			71,041				72,737				35,428
Prepaid expenses and other accounts receivable			21,347				21,340				32,645
Inventories			67,363				81,550				73,950
Total current assets			339,796				309,750				290,412
LONG-TERM ASSETS:
Marketable securities			44,262				52,446				-
Property, equipment and intangible assets, net			37,381				28,547				14,717
Prepaid expenses and lease deposits			489				399				529
Deferred tax assets, net			2,815				6,296				-
Total long term assets			84,947				87,688				15,246
Total assets		$	424,743			$	397,438			$	305,658
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Trade payables		$	34,001			$	48,481			$	80,684
Employees and payroll accruals			13,018				10,092				6,814
Warranty obligations			13,616				14,114				9,431
Deferred revenues			1,202				3,859				1,676
Accrued expenses and other accounts payable			8,648				10,725				6,987
Total current liabilities			70,485				87,271				105,592
LONG-TERM LIABILITIES:
Warranty obligations			44,759				37,078				22,448
Deferred revenues			18,660				14,684				8,289
Lease incentive obligation			2,061				2,297				2,385
Total long-term liabilities			65,480				54,059				33,122
COMMITMENTS AND CONTINGENT LIABILITIES
STOCKHOLDERS’ EQUITY:
Common stock			4				4				4
Additional paid-in capital			307,098				299,214				287,152
Accumulated other comprehensive income (loss)			(324	)			271				(222	)
Accumulated deficit			(18,000	)			(43,381	)			(119,990	)
Total stockholders’ equity			288,778				256,108				166,944
Total liabilities and stockholders’ equity		$	424,743			$	397,438			$	305,658

		Six months ended December 31,				Year ended June 30,
		2016				2016				2015				2014
Cash flows provided by (used in) operating activities:
Net income (loss)		$	25,381			$	76,609			$	21,121			$	(21,378	)
Adjustments to reconcile net income (loss) to net cash provided by (used in)  operating activities:
Depreciation and amortization of intangible assets			2,759				3,847				2,253				1,978
Amortization of premiums on available-for-sale marketable securities			681				532				-				-
Stock-based compensation			6,600				9,089				2,956				1,082
Financial expenses (income), net related to term loan			-				-				(992	)			431
Remeasurement of warrants to purchase convertible preferred stock			-				-				5,350				(53	)
Capital loss from disposal of property			-				-				104				-
Interest expenses related to short term bank loan			-				-				-				44
Changes in assets and liabilities:
Inventories			14,022				(7,356	)			(48,507	)			(10,681	)
Prepaid expenses and other accounts receivable			(367	)			10,542				(19,563	)			(7,409	)
Trade receivables, net			1,555				(37,271	)			(16,333	)			(9,911	)
Deferred tax assets, net			3,652				(6,380	)			-				-
Trade payables			(14,464	)			(32,200	)			41,111				19,441
Employees and payroll accruals			2,996				3,278				1,668				1,726
Warranty obligations			7,183				19,313				13,698				7,803
Deferred revenues			1,335				8,578				3,989				(500	)
Accrued expenses and other accounts payable			(1,999	)			3,934				2,530				(418	)
Lease incentive obligation			(236	)			(88	)			2,669				-
Net cash provided by (used in) operating activities			49,098				52,427				12,054				(17,845	)
Cash flows from investing activities:
Purchase of property and equipment			(11,025	)			(15,690	)			(11,765	)			(2,990	)
Purchase of intangible assets			(600	)			(800	)			-				-
Decrease (increase) in restricted cash			31				2,711				(2,038	)			(156	)
Decrease (increase) in long-term lease deposit			(77	)			103				(134	)			(1	)
Investment in available-for-sale marketable securities			(40,858	)			(118,511	)			-				-
Maturities of available-for-sale marketable securities			32,782				6,350				-				-
Net cash used in investing activities			(19,747	)			(125,837	)			(13,937	)			(3,147	)
Cash flows from financing activities:
Proceeds from short term bank loan			-				-				23,000				21,813
Repayment of short term bank loan			-				-				(36,326	)			(12,447	)
Repayments of term loan			-				-				(5,919	)			(2,401	)
Proceeds from issuance of Series D-2 Convertible Preferred stock, net			-				-				-				669
Proceeds from issuance of Series D-3 Convertible Preferred stock, net			-				-				-				9,991
Proceeds from issuance of Series E Convertible Preferred stock, net			-				-				24,712				-
Proceeds from initial public offering, net			-				-				131,402				-
Issuance costs related to initial public offering			-				(194	)			-				-
Proceeds from issuance of shares under stock purchase plan and upon exercise of stock-based awards			1,284				2,973				84				51
Net cash provided by financing activities			1,284				2,779				136,953				17,676
Increase (decrease) in cash and cash equivalents			30,635				(70,631	)			135,070				(3,316	)
Cash and cash equivalents at the beginning of the period			74,032				144,750				9,754				13,142
Effect of exchange rate differences on cash and cash equivalents			16				(87	)			(74	)			(72	)
Cash and cash equivalents at the end of the period		$	104,683			$	74,032			$	144,750			$	9,754

		Reconciliation of GAAP to Non-GAAP Gross Profit
		Three months ended												6 months ended
		December 31, 2016				September 30, 2016				December 31, 2015				December 31, 2016				December 31, 2015
Gross profit (GAAP)			39,025				41,875				38,582				80,900				72,109
Stock-based compensation			486				385				209				871				389
Gross profit (Non-GAAP)			39,511				42,260				38,791				81,771				72,498

		Reconciliation of GAAP to Non-GAAP Gross Margin
		Three months ended												6 months ended
		December 31, 2016				September 30, 2016				December 31, 2015				December 31, 2016				December 31, 2015
Gross margin (GAAP)			35.0	%			32.6	%			30.9	%			33.7	%			30.1	%
Stock-based compensation			0.4	%			0.3	%			0.2	%			0.4	%			0.1	%
Gross margin (Non-GAAP)			35.4	%			32.9	%			31.1	%			34.1	%			30.2	%

		Reconciliation of GAAP to Non-GAAP Operating expenses
		Three months ended												6 months ended
		December 31, 2016				September 30, 2016				December 31, 2015				December 31, 2016				December 31, 2015
Operating expenses (GAAP)			23,878				23,635				19,320				47,513				37,973
Stock-based compensation R&D			1,134				927				518				2,061				913
Stock-based compensation S&M			1,003				849				749				1,852				1,365
Stock-based compensation G&A			877				939				750				1,816				1,391
Operating expenses (Non-GAAP)			20,864				20,920				17,303				41,784				34,304

		Reconciliation of GAAP to Non-GAAP Operating income
		Three months ended												6 months ended
		December 31, 2016				September 30, 2016				December 31, 2015				December 31, 2016				December 31, 2015
Operating income (GAAP)			15,147				18,240				19,262				33,387				34,136
Stock-based compensation			3,500				3,100				2,226				6,600				4,058
Operating income (Non-GAAP)			18,647				21,340				21,488				39,987				38,194

		Reconciliation of GAAP to Non-GAAP Tax on income (Tax benefit)
		Three months ended												6 months ended
		December 31, 2016				September 30, 2016				December 31, 2015				December 31, 2016				December 31, 2015
Tax on income (Tax benefit) (GAAP)			2,203				3,014				(5,802	)			5,217				(5,432	)
Deferred tax asset (realized)			(1,473	)			(2,179	)			6,527				(3,652	)			6,527
Tax on income (Tax benefit) (Non-GAAP)			730				835				725				1,565				1,095

		Reconciliation of GAAP to Non-GAAP Net income
		Three months ended												6 months ended
		December 31, 2016				September 30, 2016				December 31, 2015				December 31, 2016				December 31, 2015
Net income (GAAP)			9,765				15,616				24,105				25,381				38,537
Stock-based compensation			3,500				3,100				2,226				6,600				4,058
Deferred tax realized (asset)			1,473				2,179				(6,527	)			3,652				(6,527	)
Net income (Non-GAAP)			14,738				20,895				19,804				35,633				36,068

		Reconciliation of GAAP to Non-GAAP Net basic EPS
		Three months ended												6 months ended
		December 31, 2016				September 30, 2016				December 31, 2015				December 31, 2016				December 31, 2015
Net basic earnings per share (GAAP)			0.24				0.38				0.61				0.62				0.98
Stock-based compensation			0.08				0.08				0.06				0.16				0.10
Deferred tax realized (asset)			0.04				0.05				(0.17	)			0.09				(0.16	)
Net basic earnings per share (Non-GAAP)			0.36				0.51				0.50				0.87				0.92

		Reconciliation of GAAP to Non-GAAP Net diluted EPS
		Three months ended												6 months ended
		December 31, 2016				September 30, 2016				December 31, 2015				December 31, 2016				December 31, 2015
Net diluted earnings per share (GAAP)			0.22				0.35				0.55				0.58				0.87
Stock-based compensation			0.07				0.06				0.03				0.12				0.07
Deferred tax realized (asset)			0.03				0.05				(0.14	)			0.08				(0.14	)
Net diluted earnings per share (Non-GAAP)			0.32				0.46				0.44				0.78				0.80

		Reconciliation of GAAP to Non-GAAP No. of shares used in Net diluted EPS
		Three months ended												6 months ended
		December 31, 2016				September 30, 2016				December 31, 2015				December 31, 2016				December 31, 2015
Number of shares used in computing net diluted earnings per share (GAAP)			43,683,458				43,995,227				44,007,348				43,839,342				44,231,660
Stock-based compensation			2,399,308				1,742,211				1,341,335				2,070,759				1,013,903
Number of shares used in computing net diluted earnings per share (Non-GAAP)			46,082,766				45,737,438				45,348,683				45,910,101				45,245,563