8point3 Energy Partners LP announced that its board of directors has announced a hike in the quarterly distribution of Class A shares for the fiscal third quarter of 2017, bringing the annualized payout to $1.088 per share, up from $1.057 paid earlier. The annual yield on distribution is 7.4%.
The new quarterly distribution amounts to 27.21 cents per share, reflecting a 3% increase from the second-quarter level of 26.42 cents. The new distribution will be paid on Oct 13 to shareholders of record as of Oct 3, 2017.
Distribution Target & Financials
8point3 Energy, a limited partnership formed by two major solar companies – First Solar Inc. (FSLR - Free Report) and SunPower Corp. (SPWR - Free Report) – is on track to meet its targeted annual distribution growth rate of 12–15% through 2017-end.
8point3 Energy generated $18.8 million of cash available for distribution in the fiscal second quarter. The partnership’s cash and cash equivalents as of May 31 were $10.6 million.
During the fiscal second-quarter earnings call, the company stated that it projects revenues in the range of $63.3–$66.7 million, net income of $27.0–$32.6 million, adjusted earnings before interest, taxes, depreciation and amortization of $106.5–$113.1 million and cash of $91.5–$101.0 million available for distribution for the current fiscal year.
8point3 Energy’s portfolio consisted of 945 MW of the U.S. solar generating assets as of May 2017 end. Notably, the partnership still continues to deliver solid performance and is expected to generate annual CAFD of approximately $100 million in fiscal 2017.
Scope in Solar Industry
A major growth area in the renewable space is solar energy. An EIA report indicates continued growth in utility-scale solar power capacity by almost 44% from 22 GW at the end of 2016. The projected increase is expected to bring the amount of solar capacity to 29 GW and 32 GW at the end of the 2017 and 2018, respectively.
However, in spite of the rapid improvement, solar energy will still constitute just 1% of total U.S. utility-scale generation in the next year, indicating immense scope for growth. Thus indicating that solar companies like First Solar, SunPower and ReneSola Ltd (SOL - Free Report) might grow in the near future.
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