-- Record Q4-2009 revenue of $548 million; fiscal-year 2009 revenue of $1.52 billion

-- Q4 GAAP EPS of $0.09 and non-GAAP EPS of $0.47 - includes $0.03 per share in accounting investigation expenses

-- Completed largest solar power plant in Italy, 24-megawatt (MW) project in Montalto

-- Completed construction of more than 100-MW rooftop and ground mount systems in 2009

-- More than doubled the number of SunPower dealers in 2009 to ~1,000 dealers in eight countries

-- Announced the acquisition of SunRay Renewable Energy - will add 1.2 gigawatt pipeline

-- Announced 200 MW, five year rooftop supply agreement with Southern California Edison

-- Financed 19-MW power plant for Xcel Energy in Colorado to be completed in 2010

-- Announced 32-MW supply agreement with Toshiba for 2010 delivery

-- Appointed Jim Pape to lead Residential and Commercial (R&C) business unit

SAN JOSE, Calif., March 18 /PRNewswire-FirstCall/ -- SunPower Corp. (Nasdaq: SPWRA, SPWRB) today announced financial results for its 2009 fourth quarter and fiscal year 2009 which ended January 3, 2010.  Revenue for the 2009 fourth quarter was $548 million which compares to $465 million in the third quarter of 2009 and $398 million in the fourth quarter of 2008.  The company’s Components and Systems segments accounted for 62% and 38% of fourth-quarter 2009 revenue, respectively.  The company also issued a press release reporting the results of its audit committee investigation concurrent with this release.

“Our 2009 year-end results reflect the continued success of our portfolio strategy to channels and geographic markets as we further expanded our global dealer presence and completed construction of more than 40 megawatts (MW) of large scale power plant projects during the fourth quarter,” said Tom Werner, SunPower’s CEO.  “In the past four years, we have invested heavily in our long-term strategy of building our brand and channel, and this investment continues to pay off.  In the residential channel, our strong brand enabled us to double the number of dealer partners in 2009 and we are selling our high-efficiency systems to approximately 1,000 dealer partners in eight countries.  Additionally, as a result of our rapid growth and expanding customer base, we have started to re-align our business units into Residential and Commercial (R&C) and Utilities and Power Plants (UPP).  As part of this strategy, we have appointed Jim Pape, former vice president of North America for Trane Commercial Systems, to lead our R&C business group.  With more than 25 years of management experience, we are excited to have Jim join the team.

“In the systems segment, we added to our industry-leading installed base by delivering on our engineering, procurement and construction (EPC) commitments, installing more than 100 MW of rooftop and ground mounted systems in 2009.   In the fourth quarter, we completed the largest Italian photovoltaic (PV) power plant to date at 24 MW, installed 10 MW for Florida Power & Light at the Kennedy Space Center, and substantially completed our 8-MW project for Exelon in Chicago.  We are also encouraged by the continued improvement in credit conditions as evidenced by the recent financing of our 19-MW project with Xcel Energy in Colorado.  

“Additionally, our global UPP pipeline continues to grow as customers are choosing SunPower for our industry-leading technology, bankability, significant EPC experience, and ability to offer a competitive levelized cost of energy.  With the acquisition of SunRay Renewable Energy, we will significantly increase our demand visibility by adding more than 1,200 MW of Europe, Middle East and Africa (EMEA) power plant opportunities to our pipeline with more than 80 MW planned for delivery in Italy in 2010.  This acquisition of the premiere European developer and financing team complements our established European team, enabling us to offer our customers a world-class utility power plant development expertise in both the United States and Europe.  Looking forward, we see demand remaining strong for 2010 across all segments.  Our recent wins with Toshiba and Southern California Edison position us well for multi-year supply agreements in our UPP business on top of our continued success in R&C,” Werner concluded.

On a Generally Accepted Accounting Principles (GAAP) basis for the 2009 fourth quarter, SunPower reported gross margin of 20.3%, operating income of $43.0 million and net income per diluted share of $0.09.  This compares to gross margin of 21.5%, operating income of $46.2 million and net income per diluted share of $0.20 in the third quarter of 2009.  As a result of the restatement, the fourth quarter of 2009 includes a $2.6 million benefit, or $0.02 earnings per share.  The company’s fourth-quarter GAAP results include $3.6 million, or $0.03 per diluted share, in expenses related to its recently completed accounting investigation.  

On a non-GAAP basis for the fourth quarter of 2009, SunPower reported a total gross margin of 21.7%.  Operating income for the quarter was $60.3 million and net income per share was $0.47.  The company’s fourth-quarter non-GAAP results include $3.6M million, or $0.03 per diluted share, in expenses related to the completed accounting investigation.  As a result of the restatement, the fourth quarter of 2009 includes a $2.6 million benefit, or $0.02 earnings per share.  In the third quarter 2009, the company reported non-GAAP gross margin of 23.1%, operating income of $63.8 million and $0.46 net income per share.  For the 2009 fourth quarter, the Components segment non-GAAP gross margin was 21.5% and Systems segment gross margin was 21.9%.  Non-GAAP figures are reconciled to the closest GAAP equivalent categories in the financial attachment of this press release.

“We improved our working capital efficiency during the fourth quarter reducing inventories by 12%, generating positive operating cash flow and ending the year with more than $925 million in cash and investments,” said Dennis Arriola, SunPower’s CFO.  “Despite the difficult industry conditions in the first half of 2009, we grew revenue by 6% versus 2008.  With the completion of the audit committee investigation, our efforts will focus on strengthening the trust with our stakeholders, customers and employees while driving increased shareholder value.

“Looking forward, our acquisition of SunRay positions us for more predictable growth in the second half of 2010 and into 2011.  By extending into the development business, we expect to expand our gross profits as we monetize these power plants.  We will strategically use our balance sheet to accelerate the development of these projects.  This strategy will significantly shift the timing of revenue of these projects from the first half of the year to the second half of 2010,” concluded Arriola.

2010 Guidance

For fiscal year 2010, the company’s non-GAAP guidance is as follows: revenue of $2.0 billion to $2.25 billion, net income per diluted share of $1.25 to $1.65, capital expenditures of $375 million to $475 million, and solar cell production of approximately 550 MW.  For fiscal year 2010, the company’s GAAP guidance is as follows: revenue of $2.00 billion to $2.25 billion and net income per diluted share of $0.05 to $0.35.

For the first quarter of 2010, the company’s non-GAAP guidance is as follows: revenue of $330 million to $350 million and net income per diluted share of approximately $0.05.  Guidance for the first quarter of 2010 includes the negative impact of $3.3 million or $0.03 per diluted share in SunRay acquisition costs and $5.3 million or $0.04 per diluted share in costs associated with the company’s accounting investigation.  

For the first quarter of 2010, the company’s GAAP guidance is as follows:  revenue of $330 million to $350 million and net income per diluted share of approximately breakeven.  Guidance includes the negative impact from the company’s accounting investigation and SunRay acquisition referenced above.

This press release contains both GAAP and non-GAAP financial information.  Non-GAAP figures are reconciled to the closest GAAP equivalent categories in the financial attachment of this press release.  Please note that the company has posted supplemental information and slides related to its fourth quarter 2009 performance on the Events and Presentations section of the SunPower Investor Relations page at http://investors.sunpowercorp.com/events.cfm.  The capacity of power plants in this release is described in approximate MW on an alternating current (ac) basis while supply agreements are expressed in direct current (dc).

About SunPower

Founded in 1985, SunPower Corp. (Nasdaq: SPWRA, SPWRB) designs, manufactures and delivers the planet's most powerful solar technology broadly available today. Residential, business, government and utility customers rely on the company's experience and proven results to maximize return on investment. With headquarters in San Jose, Calif., SunPower has offices in North America, Europe, Australia and Asia. For more information, visit www.sunpowercorp.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  Forward-looking statements are statements that do not represent historical facts and may be based on underlying assumptions. The company uses words and phrases such as "pipeline," "to be completed," "rapid," "growth," "expanding," "continues," "grow," "opportunities," "planed," "looking forward," "see," "demand," "remaining," "position," "continued," "predictable," "will," "guidance," and "expects" to identify forward-looking statements in this press release, including forward-looking statements regarding:  (a) acquisition of SunRay and increase in business pipeline of 1.2 gigawatt pipeline of opportunities in Europe, Middle East and Africa, including including more than 80 MW planned for delivery in Italy in 2010; (b) 200 MW, 5-year supply agreement with Southern California Edison; (c) construction schedule for 19-MW power plant for Xcel Energy; (d) rapid growth, expanding customer base, growing global UPP pipeline, and strong demand for 2010 across all segments; (e) improving credit conditions and bankability of SunPower projects; (f) the company's ability to offer competitive levelized cost of energy; (g) possible multi-year supply agreements in the company's UPP business and continued success in R&C; (h) increasing shareholder value; (i) predictable growth and expanding gross margins when the company monetizes power plants; (j) using the company's balance sheet to accelerate project development; (k) shifting revenue from first half of 2010 to second half of 2010; (l) GAAP and non-GAAP fiscal year 2010 revenue and net income per diluted share; (m) 2010 capital expenditures and solar cell production; (n) GAAP and non-GAAP first quarter 2010 revenue and net income per diluted share; and (o) estimated SunRay acquisition costs and accounting investigation costs.  Such forward-looking statements are based on information available to the company as of the date of this release and involve a number of risks and uncertainties, some beyond the company's control, that could cause actual results to differ materially from those anticipated by these forward-looking statements, including risks and uncertainties such as:  (i) the company's ability to obtain and maintain an adequate supply of raw materials and components, as well as the price it pays for such items; (ii) general business and economic conditions, including seasonality of the industry; (iii) growth trends in the solar power industry; (iv) the continuation of governmental and related economic incentives promoting the use of solar power, particularly in Europe, Middle East, and Africa within the acquired pipeline; (v) the improved availability of third-party financing arrangements for the company's customers; (vi) construction difficulties or potential delays, including permitting and transmission access and upgrades; (vii) the company's ability to ramp new production lines and realize expected manufacturing efficiencies; (viii) manufacturing difficulties that could arise; (ix) the success of the company's ongoing research and development efforts to compete with other companies and competing technologies; (x) the company's ability to sell or otherwise monetize power plants; (xi) SCE's exercising early termination rights to purchase less than 200 megawatts during the term of the agreement; (xii) the satisfaction of closing conditions and the possibility that SunRay acquisition may not be completed; (xiii) potential difficulties associated with integrating the combined businesses; and (xiv) other risks described in the company's Annual Report on Form 10-K for the year ended December 28, 2008, its Quarterly Report on Form 10-Q for the quarter ended September 27, 2009, and other filings with the Securities and Exchange Commission.  These forward-looking statements should not be relied upon as representing the company's views as of any subsequent date, and the company is under no obligation to, and expressly disclaims any responsibility to, update or alter its forward-looking statements, whether as a result of new information, future events or otherwise.

Segment Reporting Information

For fourth quarter 2009 reporting purposes, the Systems segment generally represents products and services sold directly to the system owner.  Additionally, both SunPower and third-party solar panels sold through the Systems segment channels are recorded as Systems segment revenue. The Components segment primarily represents products sold to installers and resellers.  

Non-GAAP Measures

To supplement the consolidated financial results prepared under GAAP, SunPower uses non-GAAP measures which are adjusted from the most directly comparable GAAP results to exclude non-cash charges related to amortization of intangible assets, stock-based compensation, impairment of long-lived assets and interest expense, non-cash gain on purchased options related to the company’s convertible debt offering, and its related tax effects.  Management does not consider these charges in evaluating the core operational activities of SunPower.  Management uses these non-GAAP measures internally to make strategic decisions, forecast future results and evaluate SunPower’s current performance.  Most analysts covering SunPower use the non-GAAP measures as well.  Given management’s use of these non-GAAP measures, SunPower believes these measures are important to investors in understanding SunPower’s current and future operating results as seen through the eyes of management.  In addition, management believes these non-GAAP measures are useful to investors in enabling them to better assess changes in SunPower’s core business across different time periods.  These non-GAAP measures are not in accordance with or an alternative for GAAP financial data and may be different from non-GAAP measures used by other companies.

Fiscal Periods

The Company reports on a fiscal-year basis and ends its quarters on the Sunday closest to the end of the applicable calendar quarter, except in a 53-week fiscal year, in which case the additional week falls into the fourth quarter of that fiscal year. Fiscal year 2009 consists of 53 weeks while fiscal year 2008 consists of 52 weeks. The third quarter of fiscal 2009 ended on September 27, 2009 and the third quarter of fiscal 2008 ended on September 29, 2008.

SunPower is a registered trademark of SunPower Corp. All other trademarks are the property of their respective owners.