Group 1 - The stock of Shoals (NASDAQ: SHLS) has experienced a significant decline of approximately 65% since the last analysis [1] - The analysis emphasizes the importance of resilient management and lasting competitive advantages in technology sector investments [1] Group 2 - The investment analyst Oliver Rodzianko specializes in sectors such as AI, semiconductors, software, and renewable energy [1] - Rodzianko's insights are recognized and published across various platforms, indicating a trusted voice in financial analysis [1]

Core Insights - Shoals Technologies Group, Inc. (NASDAQ: SHLS) reported mixed Q3 earnings, indicating a further decline in topline revenue and a miss on earnings per share (EPS) due to delays experienced recently [1] Financial Performance - The company experienced a decline in topline revenue during Q3, which suggests challenges in maintaining growth [1] - The EPS miss indicates that the company's profitability was affected, likely due to operational delays [1]

Financial Data and Key Metrics Changes - Third quarter net revenue declined 23.9% year-over-year to $102.2 million but increased 2.9% sequentially [35] - Gross profit increased to $25.4 million compared to $14.2 million in the prior year, with a GAAP gross profit percentage of 24.8% compared to 10.5% in the prior year [36] - Adjusted EBITDA was $24.5 million, down from $48.0 million in the prior year, with an adjusted EBITDA margin of 24.0% compared to 35.8% a year ago [38] - Net loss was $0.3 million compared to a net loss of $9.8 million in the prior year [40] - Adjusted net income was $13.9 million compared to $33.4 million in the prior year [40] Business Line Data and Key Metrics Changes - The company quoted almost $2 billion worth of projects this year, reflecting a 50% year-over-year increase [72] - The backlog and awarded orders ended the third quarter at $596.6 million, a sequential decline of $46 million [51] - Approximately $455.2 million of backlog and awarded orders have planned delivery dates in the coming four quarters [51] Market Data and Key Metrics Changes - The company noted that 60% of utility-scale solar projects are delayed, which is 10 percentage points higher than the same time last year [16] - The active capacity seeking grid interconnection has increased eightfold in the last decade, with solar, battery storage, and wind accounting for 95% of this capacity [15] Company Strategy and Development Direction - The company is focused on the clean energy transition, emphasizing solar as the most efficient near-term solution for power needs [10] - The company is investing heavily in Battery Energy Storage Solutions, anticipating significant market growth [33] - The company aims to improve relationships with existing customers and establish new ones, targeting both traditional and incremental markets [22] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the clean energy sector despite current macro headwinds, citing strong power needs driven by AI and other factors [11] - The company expects to return to growth in 2025, supported by a healthy backlog and awarded orders [59] - Management highlighted the importance of navigating regulatory environments and ensuring timely delivery of quality products [52] Other Important Information - The company is pursuing damages in a patent infringement case against Voltage, with a target date for completion of the ITC investigation scheduled for late December [18] - The company has a strong balance sheet, ending the quarter with net debt to adjusted EBITDA of 1.2 times [48] - The company has $125 million remaining under the share repurchase authorization [50] Q&A Session Summary Question: Clarification on ITC decision and review deadline - Management confirmed the deadline for review is imminent and remains excited about the initial determination, viewing it as a win for the company [61][62] Question: Bookings strength and run rate - Management indicated strong bookings activity at the start of Q4, with a healthy pipeline and record quoting activity [64] Question: Gross margins and operational challenges - Management acknowledged that gross margins were impacted by elevated labor costs and supply chain issues but remains confident in achieving long-term targets [66][67] Question: Backlog and delivery timelines - Management clarified that they work closely with customers to understand project timelines and do not use discretion in pacing backlog [85] Question: Pricing strategy and volume-driven discounts - Management discussed the impact of master supply agreements on pricing and volume-driven discounts, indicating a focus on partnerships with top customers [97]

Company Performance - Shoals Technologies Group reported quarterly earnings of $0.08 per share, missing the Zacks Consensus Estimate of $0.10 per share, and down from $0.20 per share a year ago, representing an earnings surprise of -20% [1] - The company posted revenues of $102.17 million for the quarter ended September 2024, surpassing the Zacks Consensus Estimate by 3.70%, but down from $134.21 million year-over-year [2] - Over the last four quarters, Shoals Technologies has surpassed consensus EPS estimates two times and topped consensus revenue estimates two times [2] Stock Performance - Shoals Technologies shares have lost approximately 62.9% since the beginning of the year, contrasting with the S&P 500's gain of 25.8% [3] - The current consensus EPS estimate for the coming quarter is $0.09 on revenues of $94.63 million, and for the current fiscal year, it is $0.37 on revenues of $383.08 million [7] Industry Outlook - The solar industry, to which Shoals Technologies belongs, is currently ranked in the bottom 26% of over 250 Zacks industries, indicating potential challenges ahead [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which could impact Shoals Technologies' stock performance [5]

Financial Performance - Revenue for Q3 2024 was $102,165 thousand, a decrease of 24% compared to $134,209 thousand in Q3 2023[15] - Gross profit for Q3 2024 increased to $25,376 thousand, compared to $14,150 thousand in Q3 2023, reflecting a significant improvement[15] - Operating expenses decreased to $20,852 thousand in Q3 2024 from $24,721 thousand in Q3 2023, a reduction of approximately 16%[15] - Net loss attributable to Shoals Technologies Group, Inc. was $267 thousand in Q3 2024, an improvement from a net loss of $9,828 thousand in Q3 2023[15] - The company reported a net income of $4,774 thousand for the nine months ended September 30, 2024, compared to $26,079 thousand for the same period in 2023[15] - Net income for the nine months ended September 30, 2024, was $16,309,000, a decrease of 37.9% compared to $26,079,000 for the same period in 2023[20] - The net income attributable to Shoals Technologies Group, Inc. for the nine months ended September 30, 2024, was $16.3 million, a decrease of 30.1% from $23.4 million in the same period of 2023[55] Assets and Liabilities - Total current assets decreased to $190.769 million as of September 30, 2024, down from $227.186 million at December 31, 2023, representing a decline of approximately 16%[13] - Cash and cash equivalents dropped to $11.106 million from $22.707 million, a decrease of about 51%[13] - Accounts receivable decreased to $95.301 million from $107.118 million, reflecting a decline of approximately 11%[13] - Inventory increased to $65.854 million, up from $52.804 million, indicating a rise of about 25%[13] - Total liabilities decreased to $256.105 million from $298.997 million, a reduction of approximately 14%[13] - Long-term debt, net of deferred financing costs, decreased to $141,750,000 as of September 30, 2024, from $179,445,000 on December 31, 2023, a reduction of 21.0%[49] - Total accrued expenses decreased to $12,865,000 as of September 30, 2024, from $22,907,000 on December 31, 2023, indicating a 43.9% reduction[43] Equity and Capital - Additional paid-in capital increased to $479.764 million from $470.542 million, reflecting a growth of approximately 2.6%[13] - Retained earnings rose to $90.761 million from $74.452 million, an increase of about 22%[13] - Total stockholders' equity as of September 30, 2024, was $545,196 thousand, reflecting an increase from $524,640 thousand as of September 30, 2023[19] - The company has a revolving line of credit of $141.750 million, significantly higher than the previous $40 million[13] - The company repurchased $25,331,000 of Class A common stock during the financing activities, indicating a commitment to returning value to shareholders[20] - On June 11, 2024, the company announced a share repurchase program authorizing the repurchase of up to $150 million of Class A common stock, with an estimated completion date of December 31, 2025[65] Cash Flow and Expenses - Net cash provided by operating activities was $66,400,000, slightly up from $65,508,000 in the prior year, indicating a growth of 1.4%[20] - Cash paid for interest decreased to $13,452,000 in 2024 from $17,380,000 in 2023, a reduction of 22.4%[22] - Interest expense decreased to $(3,088) thousand in Q3 2024 from $(5,899) thousand in Q3 2023, indicating improved financial management[15] - Amortization expense related to intangible assets was $1.9 million for the three months ended September 30, 2024, down from $2.0 million in 2023, a decline of 5.0%[42] Warranty and Litigation - The company reported a current portion of warranty liability at $34.743 million, up from $31.099 million, an increase of about 12%[13] - The company recorded warranty liability decrease to $15,374,000 in 2024 from $3,669,000 in 2023, reflecting a significant increase in warranty claims[20] - The company recorded warranty expense of $13,809,000 for the three months ended September 30, 2024, compared to $50,421,000 for the same period in 2023, a decrease of 72.6%[46] - The company is involved in ongoing litigation related to defective wire insulation, which may impact future financial results[72] - The company has filed a complaint against Prysmian for damages related to defective wire, seeking compensatory and punitive damages[72] - The company has consolidated multiple derivative lawsuits related to fiduciary duty claims against current and former officers and directors[76] Market and Future Outlook - The company faces risks related to potential project delays and macroeconomic factors, including high inflation and interest rates, which could impact future growth[9] - The company anticipates continued growth in the energy transition market, focusing on expanding its electrical balance of systems solutions[24] - Customer A accounted for 30.4% of revenue in 2024, down from 34.1% in 2023, indicating a diversification in revenue sources[31] Stock and Compensation - The company granted 1,447,831 restricted stock units (RSUs) during the nine months ended September 30, 2024, with grant date fair values ranging from $5.12 to $15.39 per unit[58] - The company recognized equity-based compensation of $1.3 million for the three months ended September 30, 2024, compared to $5.1 million for the same period in 2023[60] - As of September 30, 2024, the company had $15.7 million of unrecognized compensation costs expected to be recognized over a weighted average period of 1.9 years[60] - The company had 1,838,740 outstanding RSUs as of September 30, 2024, with a weighted average price of $13.13[59] Revenue Breakdown - Revenue from system solutions in Q3 2024 was $78.587 million, down 21% from $99.461 million in Q3 2023[82] - Revenue from components in Q3 2024 was $23.578 million, a decline of 32% compared to $34.748 million in Q3 2023[82] - Total revenue for Q3 2024 was $102.165 million, a decrease of 24% compared to $134.209 million in Q3 2023[82]

Exhibit 99.1 Shoals Technologies Group, Inc. Reports Financial Results for Third Quarter 2024 – Secures Favorable Initial Ruling in ITC Case Against Voltage, LLC – – Quarterly Revenue of $102.2 million – – Gross Profit Percentage of 24.8% and Adjusted Gross Profit Percentage of 37.9% – – Net Loss of $0.3 million – – Adjusted EBITDA of $24.5 million – – Raises Midpoint of Full-Year Revenue Outlook – PORTLAND, TN. – November 12, 2024 (GLOBE NEWSWIRE) – Shoals Technologies Group, Inc. ("Shoals" or the "Company ...

– Secures Favorable Initial Ruling in ITC Case Against Voltage, LLC – – Quarterly Revenue of $102.2 million – – Gross Profit Percentage of 24.8% and Adjusted Gross Profit Percentage of 37.9% – – Net Loss of $0.3 million – – Adjusted EBITDA of $24.5 million – – Raises Midpoint of Full-Year Revenue Outlook – PORTLAND, Tenn., Nov. 12, 2024 (GLOBE NEWSWIRE) -- Shoals Technologies Group, Inc. (“Shoals” or the “Company”) (Nasdaq: SHLS), a leading provider of electrical balance of system (“EBOS”) solutions for the ...

PORTLAND, Tenn., Oct. 14, 2024 (GLOBE NEWSWIRE) -- Shoals Technologies Group, Inc. (the "Company") (Nasdaq: SHLS) today announced that the Company will release its third quarter 2024 results before market open on Tuesday, November 12, 2024, to be followed by a conference call at 8:00 a.m. (Eastern Time) on the same day. Interested investors and other parties can access the live webcast through the Investor Relations section of the Company's website at https://investors.shoals.com. An archived replay of the ...

PORTLAND, Tenn., Sept. 30, 2024 (GLOBE NEWSWIRE) -- Shoals Technologies Group, Inc. ("Shoals"), a global leader in electrical balance of system ("EBOS") solutions for the energy transition market, announced today that it has further strengthened its executive team with two new additions to drive operational excellence. Kirsten Moen, newly appointed Chief Operations Officer, is an accomplished operations and manufacturing executive with extensive experience in leading organizations such as Eaton and Stanley ...

PORTLAND, Tenn., Sept. 05, 2024 (GLOBE NEWSWIRE) -- Shoals Technologies Group, Inc. ("the Company") (Nasdaq: SHLS), a global leader in electrical balance of system (EBOS) solutions for the energy transition market, announces financial highlights of its investor day, which was held today in Nashville, TN. Shoals' executive leadership team highlighted a proven track record of financial results, significant cash flow generation, a strong balance sheet and its strong position to achieve long-term (2027) financi ...