UGE Reports Audited Fiscal Year 2019 Financial Results
Toronto, Ontario--(Newsfile Corp. - May 5, 2020) - UGE International Ltd. (TSXV: UGE) (OTCQB: UGEIF) (the "Company" or "UGE"), a leader in commercial and community solar energy solutions, reported its financial results for the year ended December 31, 2019. UGE reports all amounts in US dollars.
2019 was a transformative year for UGE, as the Company positioned itself for a stronger future by completing several important transitionary steps. This began to drive stronger results for the Company by the fourth quarter in terms of higher operating margins and quarter over quarter revenue growth.
Entering 2019, UGE had concentrated its focus on its turnkey develop/build/finance business model, which management expects will result in stronger performance going forward. In previous years, UGE had also sought to capture "EPC" services revenue, which is revenue generated by building (engineering, procurement, construction) projects for other solar developers. UGE's initiative to focus solely on self-developed projects was the primary focus of the Company in 2019, and resulted in these accomplishments, as demonstrated in the financial statements:
As new self-developed projects began to be deployed, and past EPC projects were wrapped up, gross margins almost tripled, from 10% in 2018 to 27% in 2019.
Without new revenue from the EPC business, revenues fell significantly, but were again increasing by year end with Q4 revenue more than triple Q3 revenue.
The Company had its first six self-financed projects under construction at year-end, and plans to finance an increasing portion of its self-developed projects going forward. In addition to Q4 revenue, the Company had $0.7 million of construction in progress and unbilled revenue related to self-financed projects at year-end, which will convert to recurring revenue as the projects reach commercial operation in 2020.
Further revenue growth is expected to be generated by the Company's large and growing backlog, which was $30.3 million as of December 31, 2019, and has since grown to over $45 million, a new record for the Company. Importantly, $0 of that backlog is from EPC services as more profitable self-developed projects will drive results going forward.
As the Company wound down less profitable areas of the business, overhead decreased 39% in 2019; management expects overhead expenses to stay roughly constant this year, even with expected year-over-year revenue growth. The Company's net loss also decreased 59% as UGE works towards reaching profitable results in the near future.
Full financial results and Management's Discussion and Analysis are posted to SEDAR (www.sedar.com) as well as on the Company's website.
UGE's CEO, Nick Blitterswyk, and CFO, Paul Kania, will be hosting a webinar to provide further analysis of the financial results and to answer your questions following the presentation. You can register for the webinar, below:
Date: Wednesday, May 6, 2020
Time: 2:00pm EDT
UGE delivers immediate savings to businesses through the low cost of solar energy. We help commercial and industrial clients become more competitive by providing low cost distributed renewable energy solutions at no upfront cost and maximum long-term benefit. With over 400MW of global experience, we work daily to power a more sustainable world. Visit us at www.ugei.com.
To view the source version of this press release, please visit https://www.newsfilecorp.com/release/55443