Sun Pacific Holding Corp.

What they do

Sun Pacific Holding Corp. operates through four subsidiaries: Sun Pacific Power Corp. for solar and renewable energy projects, National Mechanical Group Corp. to hold patents, Street Smart Outdoor Corp. for outdoor advertising via solar bus stops, solar trashcans and street kiosks, and Elba Power Corp. for a planned solar assembly plant. It has agreements to distribute FoxEss inverter and energy storage products, to source solar panels from a South Asian OEM, and a two-year exclusive sales and distribution agreement with GEP New Energy for Vietnam-manufactured panels. As of the latest filings, principal revenue is derived from Street Smart Outdoor Corp.'s outdoor advertising operations with contracts in New Jersey and Florida.

Revenue drivers

• Outdoor advertising (Street Smart Outdoor Corp.) — The company states this is its principal source of revenues today, from contracts in New Jersey and Florida, generated via solar bus stops, solar trashcans and street kiosks.
• Solar panel and product sales (Sun Pacific Power Corp.) — Includes wholesale distribution of FoxEss inverter and energy storage products for North and South America and Australia, plus solar panels sourced from a South Asian OEM and a two-year exclusive sales and distribution agreement with GEP New Energy for Vietnam-manufactured panels.
• Residential solar installation program — Commenced in April 2023, a sales, marketing and affiliate program to market and install residential solar panels in various U.S. markets.
• Patent licensing or manufacturing (National Mechanical Group Corp.) — Holds a published patent for a frameless encapsulated photovoltaic panel; the company has been developing a business plan for manufacturing or licensing the technology since 2020, with work continuing into 2023.

Recent performance

Annual revenue declined from $584,650 in 2018 to $265,573 in 2022, with a net loss of $278,610 in 2022. Recent quarterly revenue was $29,863 for the quarter ended September 30, 2022; $13,459 for December 31, 2022; $22,735 for March 31, 2023; and $23,080 for June 30, 2023. As of September 30, 2023, total assets were $44,754, total liabilities were $3.5 million, shareholder equity was negative $3.5 million, and cash and equivalents were $20,181. Operating cash flow improved to negative $17,925 in 2022 from negative $522,748 in 2021.

Strategy

Management states its objective is to grow as a green energy-based provider of products and services to public and private sectors. The company is shifting focus away from outdoor advertising toward the assembly and sales of solar panels and associated products. It has entered distribution and OEM agreements and commenced a residential solar installation program in April 2023. Elba Power Corp. has a property purchase contract for approximately $3 million, pending financing, and an approval for a $50 million inducement resolution from the State of Alabama plus a 100% sales and use tax abatement for a solar assembly plant. Elba Power Corp. is working with potential funders for capitalization and development.

Risks

• Going concern — The company has an accumulated deficit of $8,447,732 and a working capital deficit of $3,524,185 as of September 30, 2023, and states its continuation depends on generating sufficient cash flows or obtaining additional financing, which it has not accomplished to date.
• Dependence on a single revenue source — Principal revenue comes from Street Smart Outdoor Corp.'s outdoor advertising operations with contracts in New Jersey and Florida, while the company is shifting away from this business.
• Financing and project execution risk — Elba Power Corp.'s approximately $3 million property purchase and planned solar assembly plant are pending financing, and the company has no guarantee it can raise additional capital on acceptable terms.
• Profitability uncertainty — The company states there is no assurance it will ever be profitable, and it has a history of net losses and declining revenue.

Outlook

Management states that to implement its business plan and meet working capital requirements it will need to raise additional capital, with no guarantee of success. The company is shifting focus from outdoor advertising to solar panel assembly and sales, supported by distribution and OEM agreements and a residential installation program started in April 2023. Elba Power Corp. is working with potential funders for its planned Alabama solar assembly plant. The company states there is no assurance it will ever be profitable.