• Fourth-Quarter Revenue: $20.2 million, up from $15.7 million in the prior year period.
• Full Year 2024 Revenue: $82.1 million, compared to $79.9 million in 2023.
• Fourth-Quarter Core OpEx: $20.7 million, compared to $17.6 million in the prior year period.
• Portfolio O&M Expense: Decreased to $5.3 million in the fourth quarter from $5.6 million in the prior year period.
• SG&A Expense: Increased to $15.5 million in the fourth quarter from $12 million in the prior year period.
• GAAP Net Loss: $5.9 million attributable to stockholders.
• Operating EBITDA: $10.8 million for the fourth quarter, $53.9 million for the full year 2024.
• Total Cash: Approximately $109.1 million at the end of the fourth quarter.
• Unrestricted Cash Balance: Approximately $72.8 million at quarter end.
• Total Principal Balance of Long-Term Debt: $730.6 million with a blended interest rate of 6%.
• Gross Portfolio Value: $910 million in the fourth quarter, up from $749 million without the NJR transaction.

• Warning! GuruFocus has detected 4 Warning Signs with SPRU.

Release Date: March 31, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Spruce Power Holding Corp (NYSE:SPRU) offers greater stability and predictability in the residential solar market due to its unique business model focused on maximizing existing solar assets rather than aggressive new customer acquisition.
• The company successfully acquired a residential solar portfolio of approximately 9,800 systems from NJR Clean Energy Ventures, significantly expanding its presence in New Jersey and increasing its total owned portfolio to approximately 85,000 home solar assets.
• Operational improvements led to a material increase in customer satisfaction, with the Customer Satisfaction (CSAT) score rising to 83% in 2024 from 74% in 2023.
• Spruce Power launched a third-party servicing platform, Spruce Pro, which gained traction with a significant agreement with ADT Solar, covering approximately 60,000 systems.
• The company maintains a strong financial position with stable, predictable cash flows and a focus on long-term financial stability over short-term sales growth.

Negative Points

• Spruce Power Holding Corp (NYSE:SPRU) reported a GAAP net loss attributable to stockholders of $5.9 million for the fourth quarter.
• The company missed its full-year 2024 operating EBITDA guidance range of $57 million to $62 million, primarily due to O&M and legal expenses.
• There was a sequential decline in unrestricted cash, largely due to the NJR transaction and ongoing operational spend, including O&M costs and legal expenses.
• Spruce Power's SG&A expenses increased in the fourth quarter due to higher professional services costs related to the NJR acquisition.
• The company decided not to provide financial guidance for 2025, citing the volatile residential solar, macroeconomic, inflationary interest rate, and utility rate environment.

Q & A Highlights

Q: Can you elaborate on the strategic significance of the NJR Clean Energy Ventures acquisition? A: Chris Hayes, CEO, explained that the acquisition of approximately 9,800 systems from NJR Clean Energy Ventures significantly expanded Spruce Power's presence in New Jersey, making it the company's second-largest market. This acquisition increased the company's portfolio to about 85,000 home solar assets and customer contracts, enhancing financial and strategic outlook through scaling ownership of home solar assets.

Q: How did Spruce Power improve operational efficiency and customer satisfaction in 2024? A: Chris Hayes, CEO, highlighted that Spruce Power reconnected 4,800 systems, reduced ticket cycle times, and cleared 10,000 backlogged service tickets. They also implemented an advanced asset management system and upgraded meters, leading to a rise in Customer Satisfaction (CSAT) score to 83% in 2024 from 74% in 2023.

Q: What are the financial highlights for the fourth quarter and full year 2024? A: Sarah Wells, CFO, reported that fourth-quarter revenue was $20.2 million, up from $15.7 million in the prior year, primarily due to the NJR acquisition. Full-year GAAP revenue was $82.1 million compared to $79.9 million in 2023. Operating EBITDA for the fourth quarter was $10.8 million, and for the full year, it was $53.9 million, missing the guidance range due to O&M and legal expenses.

Q: What is the status of Spruce Power's debt and cash position? A: Sarah Wells, CFO, stated that at the end of the fourth quarter, total cash was approximately $109.1 million, with unrestricted cash at $72.8 million. The total principal balance of long-term debt was $730.6 million, with a blended interest rate of 6%. All debt is non-recourse and serviced by customer collections, with interest rate swaps hedging floating rate debt.

Q: What are Spruce Power's strategic priorities for 2025? A: Chris Hayes, CEO, outlined that the company will focus on acquiring portfolios of installed systems, expanding the Spruce Pro channel for capital light growth, and enhancing subscription-based solutions for distributed energy. They aim to optimize cash flow, manage operating expenses, and improve efficiency while prioritizing long-term financial stability over short-term sales growth.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.