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EnerNOC Outlook Offers Hope for Cleantech

Cleantech companies are painting a cautious but encouraging picture with their most recent quarterly numbers. A week after solar panel maker SunPower (s SPWRA) posted surprisingly strong earnings, EnerNOC (s ENOC) has delivered better-than-expected numbers and raised its forecast for the rest of the year.

In the quarter ended June 30, EnerNOC saw revenue of $42.4 million, or 79 percent higher than the same quarter a year earlier and above the $39 million that analysts had estimated. Net loss totaled 29 cents a share, compared with a loss of 54 cents a share in the same quarter last year and narrower than the 33-cent loss average forecast of analysts.

The company also indicated that its financials for the rest of the year would come in stronger than Wall Street has been expecting. It raised its revenue estimate to a midpoint of $178.5 million vs. the Street’s estimate of $167 million, and a net loss of 81 cents a share compared with analyst expectations of a 98-cent loss. In after-hours trading, EnerNOC’s stock rose as much as 12 percent from its official Monday close to change hands for $27.70.

EnerNOC has been posting losses for years as it builds software infrastructure that helps utilities and their industrial customers — from manufacturers and data centers to hotels and retail chains – curtail non-essential energy usage, particularly during periods of peak demand. And as the company signs on more business, its losses are starting to shrink.

Gross margins, which rose to 42.8 percent in the second quarter from 37.5 percent a year earlier, are expected to stay there for the rest of 2009. EnerNOC saw negative cash flow of $10.2 million in the first half of 2009; it expects to turn cash-flow positive for the remainder of the year and to post a net profit in 2010.

“We’re starting to see what the business looks like as it reaches an ongoing mature business model,” said CEO Tim Healy in a conference call to discuss its latest results. “Adding new megawatts to our demand-response network doesn’t require the same kind of investment as it did in earlier stages when we were building our network.” Healy said EnerNOC is exploring expanding into the UK and other foreign markets.

He also said that EnerNOC plans to continue to focus on industrial customers — where there is “a lot of low-hanging fruit” — rather than working with utilities on building out a smart grid. “There are a lot of innings to be played in the whole smart grid, demand-response game,” he said. “Right now there’s enough demand on the industrial side that we can rest assured there‘s ample opportunity to focus on.”

Also on Monday, EnerNOC filed a form with the Securities & Exchange Commission declaring its intention to issue as much as $150 million of new equity or debt at an undetermined date and that existing shareholders might also sell up to $50 million of common stock.