Sunnova Energy International Inc. (NYSE:NOVA) Q3 2023 Earnings Conference Call October 26, 2023 8:00 AM ET

Company Participants

Rodney McMahan – Vice President-Investor Relations

John Berger – Chairman and Chief Executive Officer

Robert Lane – Executive Vice President and Chief Financial Officer

Conference Call Participants

Philip Shen – ROTH MKM

James West – Evercore ISI

Ben Kallo – Baird

Pavel Molchanov – Raymond James

Sophie Karp – KeyBanc

Praneeth Satish – Wells Fargo

Jordan Levy – Truist

Operator

Good morning and welcome to Sunnova’s Third Quarter 2023 Earnings Conference Call. Today’s call is being recorded and we have allocated an hour for prepared remarks and question and answer. At this time, I would like to turn the conference over to Rodney McMahan, Vice President, Investor Relations at Sunnova. Thank you. Please go ahead.

Rodney McMahan

Thank you, operator. Before we begin, please note during today’s call we will make forward-looking statements that are subject to various risks and uncertainties that are described in our slide presentation, earnings press release, and our 2022 Form 10-K. Please see those documents for additional information regarding those factors that may affect these forward-looking statements. Also, we will reference certain non-GAAP measures during today’s call. Please refer to the appendix of our presentation as well as the earnings press release for the appropriate GAAP to non-GAAP reconciliations and cautionary disclosures.

On the call today are John Berger, Sunnova’s Chairman and Chief Executive Officer; and Robert Lane, Executive Vice President and Chief Financial Officer.

I will now turn the call over to John.

John Berger

Good morning and thank you for joining us. Sunnova remains resilient despite the challenging market dynamics marked by higher interest rates and concerns about overall residential solar growth. Our commitment to develop a sustainable, profitable platform has positioned Sunnova for long-term success in the face of significant macroeconomic challenges, as evidenced by increases to our fully burdened unlevered return as we continue to add new customers.

Through our adaptive energy platform, we continue to provide our customers with a better energy service at a better price, ensuring system performance and optimized power generation and economics. The steady robust demand for our distinct suite of energy service offerings, coupled with our dealer network and our increasing market share, have been instrumental in achieving this performance.

Sunnova is focused on liquidity, profitability, and cash flow. We continue to act on these focus areas by raising price, reducing working capital needs, and reducing operating expenses. First, our focus on profitability has pushed up our returns to 12% for the third quarter, allowing us to achieve a healthy implied spread even in this higher interest rate environment, and we are expecting to push past 13% during the fourth quarter.