Today, we’d like to highlight some notable Executive Casts segments on UGE International (OTCQB:UGEIF) (UGE.V) (TSXV: UGE), where CEO Nick Blitterswyk appeared on Executive Casts, a platform for executives of well-established smaller capitalized companies to open up about various aspects of their company.
The segments highlighted here help investors learn a little more about some of UGE’s recent projects, inflection points, the company’s rationale for exiting the wind business, and a recent acquisition. Transcriptions are provided for your convenience.
Highlighted in this post:
- Recent Project
- Inflection Points
- Rationale for Exiting Wind Business
- Recent Acquisition
Recent Project
Yeah, so one project that we’re just completing that I’m really excited about is the largest church in New York state, which isn’t too far from us here in New York City. So, for this project, you know, they have a very large roof across the megachurch and so we’re putting solar on that rooftop, and the client is saving more than 25% versus the cost that they could buy energy from the utility for. So, the client, you know, with really no money down, is just taking advantage of this cheaper solar. We’re just finishing installation right now and then we have a long-term investor lined up who owns the project long-term and collects an IRR from doing so.
Inflection Points
…so I’ll talk about inflection points in two ways: one in terms of the industry and then two just in terms of where the company is at. So, for the industry, you know solar used to be, even five or ten years ago, quite an expensive technology to leverage, but the cost has come down so much, you know, to give you an example, the first time we bought solar panels now eight years ago, the cost per watt, which is usually what we talk about in the industry, was close to four dollars. Now we’re below forty cents. So, with a 90% drop of costs in the industry, it’s past a point of just being now the cheapest form of energy for our clients, so now the industry is really starting to take off. On the flip side, in terms of UGE, you know, we’ve been in the industry now for about seven, eight years, and so we have a number of repeat clients and so on and as the company has grown, become stronger, become really known in the industry, and as the economics have gotten so compelling, we’re really starting to grow quickly. So, you know, in our Q1 numbers from 2017, we had 10x growth over last year, and just in Q1 the revenue was similar to all of last year, which itself was a growth year off the year before, so things are really starting to ramp up, and I think at the end of the day it’s based on the company strength but also the ever-increasing economics of the industry.
Rationale For Exiting Wind Business
So, one of the things that we did in 2016 to really put us in ever more firm ground as we continued to grow, is that we also had as part of the company a wind business, distributed wind energy, which hasn’t come down the cost curve the way solar has. So, we had this business that was with us really since the start of the company, and we sold it last year. The reasons why, number one is that our clients’ economics are really driven by solar these days, so we wanted to make sure we had a good focus there. And then number two is, from a balance sheet perspective, it really strengthened the balance sheet, and we really felt it was the last structural move for us to make to be profitable as a company as well.
Recent Acquisition
Yeah, so in the Canadian market, which, along with the U.S. are our two biggest markets that we serve, we’ve arguably been number one for some time now in terms of market share. We had the opportunity earlier this year to acquire the number two company which was a subsidiary of a much larger, more diversified company and so we are very excited to get that deal done. So, the acquisition closed April 3rd, it’s a company also based out of Toronto, which is one of our two duel headquarters that we’ve known for a long time. And so, you know, that company like us in the Canadian market really focuses on the mid-scale market across the country. So yeah, the deal closed April 3rd, gives us a lot more resources, backlog, pipeline, market share, and so on, so we’re excited to make the acquisition.
About Nick Blitterswyk
Nick founded UGE with a focus on distributed renewables to address the world’s energy challenges. His leadership and belief in a productive and enjoyable company culture has grown UGE into a global leader. Raised on a Canadian nature reserve, Nick is a Fellow of the Society Actuaries with previous experience at JPMorgan and AIG.