Spruce Power Holding Corporation (NYSE:SPRU) Q3 2023 Earnings Call Transcript

It’s work that we’ve already accomplished. I would say that if somebody tried to step into the market or they called them up and said, what would you — how would you recommend we do M&A. I’d warn them off and say you need to be prepared for three or four years of really hard work, systems upgrades, service center upgrades before you try to do this. So, fundamentally, there’s nothing that keeps people from it, except that really hard work of being prepared to do it. I think it would take any 1 that’s tried to step into the space a number of years to get to where we are. Our moat. I’m going to say our moat sometimes is just that integrated servicing of such complex assets and diverse assets.

Mo Chen: Great. Thanks for the detailed answer. So, Sarah, maybe just 1 for you. You affirmed your cash flow guidance of $120 million to $130 million run rate so that’s great. So, can you maybe address, I mean, address the outlook and walk us through the puts and takes and your projections, anything you should be aware of? Thanks.

Sarah Wells: Sure. Hi Mo. Thanks for that question. When I think about the top of the funnel, we’ve got about $105 to $115 million coming in customer collections that would include the buyouts and the prepays that we see throughout the year. We have another seven to eight in renewable energy credits, the SRECs that Christian spoke about previously and then another seven to eight in interest on our cash that’s invested. That gets you to the top and then circling down for O&M and SG&A gets us down to that 77 cash available for debt service that we’ve previously spoken about as kind of being in the middle and then after loan interest and principal payments, we land at around five to 10 of normalized cash flows before any kind of additional CapEx, IT infrastructure, or meter swap initiatives.

Mo Chen: That’s helpful.

Operator: Thank you. At this time, there are no further questions. I will now turn the call back over to Bronson Fleig for closing remarks. Please go ahead.

Bronson Fleig: Thanks, operator and thank you again for joining us today and for your continued support. If you have any questions, please contact me or our Investor Relations team. This concludes our call today. You may all disconnect.