Pineapple Energy Reports Third Quarter 2022 Financial Results

  • Increased revenue +31% from Q2 2022
  • Increased gross profit +58% from Q2 2022
  • Increased kW sold +105% YoY
  • Increased pending installations +40% from Q2 2022
  • $10.2 million of cash, restricted cash, and investments
  • Step-function growth going forward from SUNation acquisition

MINNETONKA, Minn., Nov. 14, 2022 (GLOBE NEWSWIRE) -- Pineapple Energy Inc. (NASDAQ:PEGY), a leading provider of sustainable solar energy and back-up power to households and small businesses, today announced financial results for the third quarter ended September 30, 2022. Results reflect performance of the Hawaiian operations; future results will reflect the SUNation acquisition that closed last week. 

Pineapple CEO Kyle Udseth commented, “The SUNation acquisition fundamentally transforms Pineapple, launching us on our path of intended growth. SUNation triples our current revenue run rate, and opens a large new geography for us in the Northeast U.S. We now have an even stronger team, an expanded service offering, and are starting to show our potential for national scale. As important, this deal demonstrates our ability to execute our acquisition-driven growth strategy. With each new acquisition, we fortify our track record, making subsequent deals easier to source and close, and making capital more accessible at lower cost. We believe the SUNation deal establishes our ‘street credibility’, showing the world that Pineapple is an emerging force in our industry.”

Pineapple CFO Eric Ingvaldson added, “Third quarter results demonstrate a solid foundation upon which we intend to grow. Revenue and gross profit grew sequentially, and new incoming orders outpaced our ability to install, driving robust backlog growth. Battery storage, which is a key incremental offering that adds revenue and margin per install, is seeing high demand. We had an 90% attach rate in the third quarter and anticipate ongoing high demand in the quarters ahead due to the compelling value proposition of stable reliable power.”

Third Quarter Business Highlights

  • Solid performance at our Hawaii operations (Q3 2022 vs Q3 2021)
    • kW sold +105%
    • Battery capacity sold +107%
    • Battery attachment rate of 90%
    • kW installed +37%
    • Battery capacity installed +52%
    • Customer acquisition cost per watt – 62%

  • Revenue, gross profit, and operating expense improvement in the third quarter of 2022 resulted in a 43% improvement in adjusted EBITDA from the second quarter of 2022

Subsequent Events

  • Appointed Eric Ingvaldson as Chief Financial Officer

On October 10, 2022, Eric Ingvaldson took the helm of all financial operations at Pineapple. Mr. Ingvaldson came to the Company with a track record of driving financial success at multiple companies. His experience includes “Big 4” accounting, as well as audit and corporate finance roles at large public companies, middle market companies and early-stage start-ups.

  • Transformative acquisition of New York-based solar installer SUNation

On November 9, 2022, Pineapple closed the acquisition of SUNation, a 19-year-old company in Long Island, New York that installs solar and battery energy storage systems for residential and small commercial customers. SUNation generated revenue of $48 million in the trailing twelve months ended September 30, 2022. The acquisition was valued at approximately $21.9 million. SUNation is a transformative acquisition for Pineapple, helping move toward a national service footprint, creating a substantial positive financial impact, and fortifying the team with an outstanding group of solar professionals.

Third Quarter 2022 Results1

  3rd Quarter 2022 2nd Quarter 2022 3rd Quarter 2021
Revenue $7,709,062 $5,890,636 $25,417
Gross Profit $2,013,742 $1,276,262 $25,417
Operating Expense $4,414,721 $4,473,164 $1,144,986
Net (Loss) Income $(2,519,996) $1,442,652 $(1,395,263)
Adjusted EBITDA2 $(1,050,722) $(1,834,584) ($216,311)
Cash, restricted cash & investments3 $10,236,453 $17,863,301 $66,624
Diluted Earnings (Loss) per share $(0.34) $0.15 $(0.45)

All figures are for the third quarter of 2022 unless noted otherwise. Because Pineapple had no meaningful operations in the third quarter of 2021, all comparisons are sequential with the second quarter of 2022, unless noted otherwise.

Total revenue of $7.7 million was up 31% sequentially, driven by an increased pace of installation and increasing penetration of battery storage add-on sales.

Gross profit of $2.0 million was up 58% sequentially, driven by the increase in revenue and improved margins from battery storage add-on sales.

Adjusted EBITDA loss of $(1.05) million was reduced by 43% sequentially, due to higher revenue, higher gross margins, and a slight improvement in operating expenses.


1 Includes ongoing Pineapple operations and legacy CSI operations that have not yet been divested.
2 Adjusted EBITDA is a non-GAAP financial measure. See “Non-GAAP Financial Measures” and the reconciliations in this release for further information.
3 Includes restricted cash and liquid investments of $4,578,099 as of September 30, 2022 and $14,368,066 as of June 30, 2022, earmarked for payment of contingent value rights.


Fourth quarter results will reflect approximately seven weeks of contribution from SUNation. SUNation’s revenue run rate is approximately double that of Pineapple’s Hawaii operations with similar margins.

About Pineapple Energy

Pineapple is focused on growing leading local and regional solar, storage, and energy services companies nationwide. Our vision is to power the energy transition through grass-roots growth of solar electricity paired with battery storage. Our portfolio of brands (SUNation, Hawaii Energy Connection, E-Gear, Sungevity, and Horizon Solar Power) provide homeowners and small businesses with an end-to-end product offering spanning solar, battery storage, and grid services.

Forward Looking Statements

This press release includes certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding future financial performance, future growth or growth opportunities, future opportunities, future flexibility to pursue acquisitions, future cash flows, and the expected financial impact of, and results following, the SUNation acquisition. These statements are based on the Company’s current expectations or beliefs and are subject to uncertainty and changes in circumstances. Actual results may vary materially from those expressed or implied by the statements here due to changes in economic, business, competitive or regulatory factors, and other risks and uncertainties, including those set forth in the Company’s filings with the Securities and Exchange Commission. The forward-looking statements in this press release speak only as of the date of this press release. The Company does not undertake any obligation to update or revise these forward-looking statements for any reason, except as required by law.

Pineapple Energy
Kyle Udseth
Chief Executive Officer
+1 (952) 996-1674

Eric Ingvaldson
Chief Financial Officer
+1 (952) 996-1674

The Blueshirt Group
Gary Dvorchak, CFA
Managing Director
+1 (323) 240-5796

  September 30   December 31
  2022   2021
Cash and cash equivalents $ 5,658,354     $ 18,966  
Restricted cash and cash equivalents   1,923,716        
Investments   2,654,383        
Trade accounts receivable, less allowance for          
doubtful accounts of $70,000 and $0, respectively   3,938,002        
Inventories, net   1,793,093        
Prepaid income taxes   14,671        
Other current assets   1,223,013        
TOTAL CURRENT ASSETS   17,205,232       18,966  
PROPERTY, PLANT AND EQUIPMENT, net   341,518        
OTHER ASSETS:          
Investments   250,000        
Goodwill   16,566,853        
Operating lease right of use asset   63,684        
Intangible assets, net   16,777,225       2,780,270  
Other assets, net   44,843        
TOTAL OTHER ASSETS   33,702,605       2,780,270  
TOTAL ASSETS $ 51,249,355     $ 2,799,236  
Accounts payable $ 2,404,964     $ 2,233,371  
Accrued compensation and benefits   458,177       307,828  
Operating lease liability   53,879        
Other accrued liabilities   96,631        
Working capital note payable         350,000  
Customer deposits   4,992,632        
Deferred revenue   663,480        
TOTAL CURRENT LIABILITIES   8,669,763       2,891,199  
Loan payable and related interest   1,257,038       6,194,931  
Related party payables         2,350,000  
Operating lease liability   16,632        
Deferred revenue   327,189        
Contingent value rights   10,743,224        
TOTAL LONG-TERM LIABILITIES   12,344,083       8,544,931  
Convertible preferred stock, par value $1.00 per share; 3,000,000 shares authorized; 32,000 and 0 shares issued and outstanding, respectively   32,000        
Common stock, par value $0.05 per share; 37,500,000 shares authorized;          
7,435,586 and 3,074,998 shares issued and outstanding, respectively   371,779       153,750  
Additional paid-in capital   41,562,362       (53,750 )
Accumulated deficit   (11,697,872 )     (8,736,894 )
Accumulated other comprehensive loss   (32,760 )      
TOTAL STOCKHOLDERS' EQUITY (DEFICIT)   30,235,509       (8,636,894 )

  Three Months Ended September 30   Nine Months Ended September 30
  2022   2021   2022   2021
Sales $ 7,709,062     $ 25,417     $ 13,918,498     $ 25,417  
Cost of sales   5,695,320             10,533,362        
Gross profit   2,013,742       25,417       3,385,136       25,417  
Operating expenses:                      
Selling, general and administrative expenses   3,122,976       241,728       6,653,796       697,985  
Amortization expense   1,026,362       357,324       2,410,045       1,071,971  
Transaction costs   265,383       545,934       1,447,284       1,977,436  
Total operating expenses   4,414,721       1,144,986       10,511,125       3,747,392  
Operating loss   (2,400,979 )     (1,119,569 )     (7,125,989 )     (3,721,975 )
Other income (expense):                      
Investment and other income   8,215             106,974        
Gain on sale of assets   14,573             1,229,133        
Fair value remeasurement of earnout consideration   13,000             4,684,000        
Fair value remeasurement of contingent value rights               (1,214,560 )      
Interest and other expense   (154,805 )     (275,694 )     (640,536 )     (1,004,964 )
Other income (expense), net   (119,017 )     (275,694 )     4,165,011       (1,004,964 )
Net loss before income taxes   (2,519,996 )     (1,395,263 )     (2,960,978 )     (4,726,939 )
Income tax expense                      
Net loss   (2,519,996 )     (1,395,263 )     (2,960,978 )     (4,726,939 )
Other comprehensive gain (loss), net of tax:                      
Unrealized gain (loss) on available-for-sale securities   38             (32,760 )      
Total other comprehensive gain (loss)   38             (32,760 )      
Comprehensive loss $ (2,519,958 )   $ (1,395,263 )   $ (2,993,738 )   $ (4,726,939 )
Basic net loss per share: $ (0.34 )   $ (0.45 )   $ (0.49 )   $ (1.54 )
Diluted net loss per share: $ (0.34 )   $ (0.45 )   $ (0.49 )   $ (1.54 )
Weighted Average Basic Shares Outstanding   7,435,586       3,074,998       6,049,611       3,074,998  
Weighted Average Dilutive Shares Outstanding   7,435,586       3,074,998       6,049,611       3,074,998  

Non-GAAP Financial Measures

This press release includes non-GAAP financial measures that differ from financial measures calculated in accordance with U.S. generally accepted accounting principles (“GAAP”).

Adjusted EBITDA is a non-GAAP financial measure provided in this release, and is net (loss) income, calculated in accordance with GAAP, adjusted for interest, income taxes, depreciation, amortization, transaction costs, and non-cash fair value remeasurement adjustments as detailed in the reconciliations presented below in this press release.

These non-GAAP financial measures are presented because the Company believes they are useful indicators of its operating performance. Management uses these measures principally as measures of the Company’s operating performance and for planning purposes, including the preparation of the Company’s annual operating plan and financial projections. The Company believes these measures are useful to investors as supplemental information and because they are frequently used by analysts, investors, and other interested parties to evaluate companies in its industry. The Company also believes these non-GAAP financial measures are useful to its management and investors as a measure of comparative operating performance from period to period.

The non-GAAP financial measures presented in this release should not be considered as an alternative to, or superior to, their respective GAAP financial measures, as measures of financial performance or cash flows from operations as a measure of liquidity, or any other performance measure derived in accordance with GAAP, and they should not be construed to imply that the Company’s future results will be unaffected by unusual or non-recurring items. In addition, these measures do not reflect certain cash requirements such as tax payments, debt service requirements, capital expenditures and certain other cash costs that may recur in the future. Adjusted EBITDA contains certain other limitations, including the failure to reflect our cash expenditures, cash requirements for working capital needs and cash costs to replace assets being depreciated and amortized. In evaluating non-GAAP financial measures, you should be aware that in the future the Company may incur expenses that are the same as or similar to some of the adjustments in this presentation. The Company’s presentation of non-GAAP financial measures should not be construed to imply that its future results will be unaffected by any such adjustments. Management compensates for these limitations by primarily relying on the Company’s GAAP results in addition to using non-GAAP financial measures on a supplemental basis. The Company’s definition of these non-GAAP financial measures is not necessarily comparable to other similarly titled captions of other companies due to different methods of calculation.

Reconciliation of Non-GAAP to GAAP Financial Information

Reconciliation of Net (Loss) Income to Adjusted EBITDA:

  Three Months Ended September 30   Three Months
Ended June 30
  2022   2021   2022
Net (Loss) Income $ (2,519,996 )   $ (1,395,263 )   $ 1,442,652  
Interest expense   151,025       275,694       131,568  
Interest income   (5,960 )     -       (5,143 )
Income taxes   -       -       -  
Depreciation   45,464       -       27,723  
Amortization   1,026,362       357,324       1,026,220  
Transaction costs   265,383       545,934       213,396  
Fair value remeasurement of earnout consideration   (13,000 )     -       (4,671,000 )
Adjusted EBITDA $ (1,050,722 )   $ (216,311 )   $ (1,834,584 )

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Source: Pineapple Energy