US solar manufacturer and developer SunPower Corp (NASDAQ:SPWR) will cut its workforce by 15% or 1,200 employees as it has decided to close its panel assembly facility in the Philippines.
The company announced a "realignment" of its manufacturing operations and power plant segment as it reported second-quarter results on Tuesday. This includes plans to increase the mix of X-Series panel capacity and adjust panel assembly capacity to be closer to the company's core markets. The equipment from the Philippine facility will be moved to SunPower’s facilities in Mexico.
As a result of the realignment, the company will book restructuring charges of USD 30 million (EUR 27.3m) to USD 45 million.
SunPower also revised its 2016 guidance. It now expects GAAP net loss of USD 175 million to USD 125 million, against a net profit of zero to USD 50 million previously. The revisions also include cutting the EBITDA outlook to USD 275 million to USD 325 million from USD 450 million-USD 500 million. The gigawatts deployed forecast was also cut to a range of 1.45 GW to 1.65 GW from 1.6 GW to 1.9 GW.
"However, while the long-term fundamentals for solar power remain strong, we see a number of near-term industry challenges, primarily in our power plant segment, that we expect to impact our business and financial performance in the second half of 2016," said president and chief executive Tom Werner. Among these are reduced urgency to complete projects due to the extension of the Investment Tax Credit (ITC) and aggressive power purchase agreement (PPA) pricing by new market entrants. "As a result, we have proactively decided to streamline our power plant development segment while shifting investment to our distributed generation (DG) segments," Werner said, adding that the company would focus its development resources on a limited number of core markets, mainly in the Americas.
SunPower also said that for 2017 it expected a GAAP net loss of USD 200 million to USD 100 million and EBITDA in the range of USD 300 million to USD 400 million.
For its second fiscal quarter to July 3, it reported a GAAP net loss of USD 70 million, versus a profit of USD 6.5 million a year ago. Gross margin declined to 9.8% from 18.6%, while revenue increased to USD 420.5 million from USD 381 million.
Non-GAAP net loss was USD 30.1 million, or USD 0.22 per diluted share, against a profit of USD 27.2 million, or USD 0.18 in the same period of 2015.