EnSync Energy Systems misses Wall Street's fiscal 4Q revenue and profit estimates, hit by contract delays

EnSync Energy Systems (NYSE American:ESNC) the Honolulu-based provider of energy resource systems, fell short of Wall Street’s forecasts for both revenue and profit in its fiscal fourth quarter, as it was hit by delays for three power purchase agreements.

During the fourth quarter, EnSync posted losses of $3.17m or $0.07 per share compared to net income of $9.2m or $0.19 per share in the fourth quarter of 2017. Its revenue, meanwhile, came in at  $1.7m, down from $3.1m in the year-ago quarter.

The results failed to meet the expectations of analysts who had expected EnSync to report a loss of $0.05 on revenue of $4.57m and Ensyc shares dipped 5% in Tuesday’s after-hours session to $0.28.

Sales in the fourth quarter were hit by sale and construction delays for three power purchase agreement projects, which resulted in the shifting of revenue to the first half of fiscal 2019, the company said. Revenue in the quarter was largely derived from nine power purchase agreement contracts in Hawaii.

The announcement of results came as EnSync announced a 20-year power purchase agreement with Hawaii Pacific University to build a 211-kilowatt photovoltaic system on four buildings at its non-profit affiliate, the Oceanic Institute, on Oahu, Hawaii.

The 211-kW roof installation will generate local and clean energy, which the Oceanic Institute will be able to use on its site. The solar project will also pare back the Institute’s energy costs by reducing its dependence on grid-supplied energy.

EnSync has twelve power purchase agreement projects in backlog in various stages of execution, which are worth about $16.4m.

The bulk of its ongoing projects are in Hawaii where energy costs run high. EnSync has contracted 27 commercial projects in Hawaii, which will account for more than $42.8m in electricity sales over the terms of the agreements.

EnSync focuses on providing cost-effective electricity delivered from an electrical infrastructure that takes advantage of renewables, energy storage and the utility grid.

Story by ProactiveInvestors