- Array says its $1.63 billion revenues in 2022 reflect 49% organic, out of 92% annual growth,
- Higher revenues and improved gross margin helped improve adjusted EBITDA of $128.7 million
- Management has guided for 2023 revenues within $1.8 billion to $1.95 billion without factoring in potential benefits of IRA
Released after 2 extensions of late filing, Array Technologies, Inc has finally published its annual results for 2022 reporting 92% annual revenue growth to $1.63 billion. The strong revenue increase is thanks to the STI Norland acquisition. Array says 49% was ‘organic increase’ due to improved shipments and higher ASPs for its Duratrack product.
Of 2022 revenues for Array, 2 customers alone accounted for 11.8% and 10.6% respectively. The US contributed 79% of its total revenues and the remaining 21% came from rest of the world. As of December 31, 2022, Array counts as having shipped over 58 GW of trackers worldwide, including STI.
Gross margin was reported to have gone up 420 basis points YoY to 13.9%, while adjusted EBITDA improved to $128.7 million, from $43.2 million in the previous year for which the company attributes higher revenue and improved gross margin.
For full year 2022, its net loss reduced by $22.5 million to -$43.6 million. In 2021, it was -$66.1 million.
Higher ASPs along with STI business helped Array’s revenues improve 83% YoY to $402.1 million in Q4/2022, while its gross profit went up 683% to 80.5 million. Gross margin too rose to 20.0% from 4.7% ‘driven by a larger portion of higher priced contracts and the addition of STI’ (see Array technologies’ 2021 Annual Results).
Net loss during the reporting quarter narrowed down to -$17.3 million, from -$32.1 million in Q4/2021. Adjusted EBITDA too reported an increase to $51.7 million from $0.5 million in the previous year.
Array operates close to 57,900 sq. ft. manufacturing facility in Albuquerque, New Mexico. With the acquisition of STI, it now also has access to approximately 122,000 sq. ft. and 632,000 sq. ft. of manufacturing and warehouse facilities in Spain and Brazil, respectively, where it manufactures and assembles component parts for local and international markets.
For full year 2023, Array forecasts its revenues to increase to a range of $1.8 billion to $1.95 billion to which the legacy Array business will contribute between $1.375 billion to $1.475 billion.The remaining revenues of $425 million to $475 million are likely to come from STI Norland. Gross margin for both these categories are envisioned to be in the low 20s. Adjusted EBITDA for the year is guided between $240 million and $265 million.
Array CEO Kevin Hostetler cleared that this guidance does not assume any potential benefits from the Inflation Reduction Act (IRA) related to the domestic content provision and the tracker manufacturing credits. He explained that the company sees these as ‘being additive to results in 2023 if resolution is reached on either topic’.
Confidence stems from order book of executed contracts and awarded orders worth $1.9 billion as on December 31, 2022, comprising $1.4 billion from Array’s legacy operations and $0.5 billion from STI Norland (see Array’s Order Book Till Dec 2022-End Was Worth $1.9 Billion).
Jeffrey Osborne of Cowen, post the company’s call with analysts, said, “Customers look for clarity from the Treasury as it relates to the domestic content provision in order to maximize their potential project returns. That said, we note that activity is still elevated with Array securing an additional ~$500mn of orders in 4Q22. Management also addressed the 45x manufacturing credit, which it believes will equate to ~15% of a total trackers cost. This does not include the company’s internally manufactured clamping solution, which could be an additional source of upside.”
TaiyangNews covers product developments of leading solar tracker providers, including Array, in our Solar Trackers Market Survey 2022 released in December 2022. It is available for free download on our website here.