Greetings. Welcome to Sunlight Financial first quarter 2022 earnings call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Lucia Dempsey, with Investor Relations. Please go ahead. Good afternoon, and welcome to Sunlight Financial's first quarter 2022 earnings call. After the close of the market today, we announced first quarter 2022 financial results and posted an earnings presentation to our investor relations website at ir.sunlightfinancial.com. Before we begin, I'd like to remind everyone that this webcast may contain certain statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These include remarks about future expectations, beliefs, estimates, plans, and prospects. Such statements are subject to a variety of risks, uncertainties, and other factors that could cause actual results to differ materially from those indicated or implied by such statements. Forward-looking statements include, but are not limited to, Sunlight Financial's expectation or prediction of financial and business performance and conditions and competitive and industry outlooks. Forward-looking statements speak as of the day they are made, are subject to risks, uncertainties, and assumptions and are not guarantees of performance. Sunlight Financial is under no obligation and expressly disclaims any obligation to update, alter, or otherwise revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law. The company also refers participants on this call to the press release issued by the company and filed today with the SEC, the supplemental presentation posted to Sunlight Financial's website, and Sunlight Financial's SEC filings for a discussion of the risks that can affect our business. Additionally, during today's call, we will discuss non-GAAP measures which we believe can be useful in evaluating our performance. The presentation of this additional information should not be considered in isolation or as a substitute for results prepared in accordance with GAAP. A reconciliation of these non-GAAP measures to the most directly comparable GAAP measures can be found in both our press release and the supplemental presentation. Joining me today are Matt Potere, Sunlight Financial's Chief Executive Officer, and Rodney Yoder, Sunlight's new Chief Financial Officer. Matt will provide an operational update on the quarter, and then Rodney will share additional detail on our financial results. Following these prepared remarks, we will open the call to Q&A. It is now my pleasure to turn the call over to Matt Potere. Thank you, Lucia. Thank you all for joining us as we discuss Sunlight Financial's first quarter 2022 operational and financial results. I'm pleased to report strong first quarter results, which are on track with our expectations for 2022. As such, we are affirming each of our previously provided full year 2022 guidance metrics. In the first quarter, Sunlight funded $593 million of solar and home improvement loans, $8 million higher than the midpoint of our first quarter funded loan guidance of $580-$590 million, and $12 million higher than our funded loans in the first quarter of 2021. Importantly, this level of volume is in line with typical seasonality, where sales and credit approvals slow down over the holiday season, driving lighter installation volumes in the first quarter. Home improvement volumes were particularly strong, with $76 million in the first quarter of 2022, more than double the first quarter of 2021 volume of $31 million. While it will take some time for home improvement to become a significant portion of our business, we're excited about this strong growth trajectory as we drive more business in this rapidly growing $400 billion market. We're further encouraged by the strength in customer demand we've seen over the last two months as the Omicron wave has receded. That said, we are keeping a watchful eye on the overall macro environment, as I'll discuss in greater detail shortly. Sunlight continued to perform well on other operational key metrics. We remain a leading financing choice for contractors and homeowners as our Orange platform provides a fast and frictionless process for financing solar installations and home improvement projects. We funded loans for nearly 17,000 borrowers in the first quarter, up 5% from the same period a year ago. Average loan balances also continue to increase, which drives incremental revenue for Sunlight without any additional expense. First quarter 2022 solar loans in particular averaged $44,000, the highest yet for the company, and up 12% relative to the first quarter of 2021. Sunlight's battery attachment rate was 13% in the first quarter of this year. While this is lower than attachment rates we saw in 2021, driven by tighter battery supplies and our contractor mix, we believe that battery storage will continue to provide increasing benefits to homeowners over time, and that our battery attachment rates will increase as a result, particularly as battery supply shortages abate. We were also pleased to have 80 additional active contractors on our platform in the first quarter of this year, bringing our total relationships to nearly 1,600. We continue to see rapid growth in our home improvement contractor network as we build brand awareness in that market. On the solar side, we're focused on adding new contractors as well as strengthening loyalty and increasing volume with existing contractors by building relationships that lead installers to choose Sunlight first each and every time. While Rodney will discuss our profitability in more detail, I'd like to share an update on our strategic capital deployment as we continue to operate a capital-light business that generates significant cash. I'm excited to announce that our board of directors has approved a share repurchase program under which the company may buy back up to $50 million of Class A common shares over the next 18 months. This program will be funded with excess cash on hand as well as cash generated from operations. We believe the program is an attractive use of capital to drive long-term shareholder return while maintaining ample cash on hand to ensure liquidity and execute on our growth strategies. To that end, we also continue to invest in our contractor advances program, where we provide qualified contractors with working capital for Sunlight Financial-financed installations. We find this to be an effective way to leverage our balance sheet to strengthen relationships with our contractor partners. In the first quarter, we invested an additional $19 million in advances and will continue to allocate capital to this program opportunistically to drive profitable volume. We may also strategically use capital toward M&A opportunities and are continually evaluating acquisition opportunities that further enhance our value proposition or that enable us to apply our unique capabilities in adjacent verticals. It's now my pleasure to turn the call over to Rodney Yoder, Sunlight's new CFO, who joins me today for his first Sunlight Financial earnings release. Thanks, Matt. I'm excited to be here, and I've thoroughly enjoyed my first six weeks here at Sunlight. Sunlight generated total revenue of $30 million in the first quarter of 2022, up 11% from the first quarter of 2021, primarily driven by an increase in platform fee margin. As we have discussed, our industry-leading credit quality and capital provider demand for Sunlight loans led to increased margin in the second half of last year and into the first quarter of 2022. Our total platform fee this quarter was 4.7%, up 50 basis points from 4.2% in the same period last year. The direct solar platform fee percentage was even higher at 5.3%, up 90 basis points from 4.4% in the first quarter of 2021. Adjusted net income for the quarter was $4.9 million, or $0.03 per fully diluted share, relative to $9.3 million in the first quarter of 2021. Adjusted EBITDA for the first quarter was $7.8 million compared to $11.5 million in the first quarter of 2021. This decrease was driven by higher operational expenses, including approximately $4 million of public company expense we did not incur as a private company in the first quarter of 2021, as well as $1.4 million of incremental SG&A and other costs to drive growth in the business. This was partially offset by increased platform fee revenue relative to higher platform fee margins, as I just discussed. Due to higher expenses, adjusted EBITDA margin decreased from 42.5% in the first quarter of 2021 to 25.9% in the first quarter of 2022. However, we expect adjusted EBITDA margin to improve throughout the year as we continue to generate higher revenue relative to a similar cost base, setting us up to drive incremental operating leverage in 2023 and beyond. Sunlight continues to operate a profitable business model and generates significant cash flow. In the first quarter of 2022, free cash flow was $6.5 million, representing an 83% EBITDA to free cash flow conversion rate. The company is also well capitalized and maintains strong liquidity, with nearly $70 million of unrestricted cash and cash equivalents and only $21 million of short-term debt on the balance sheet, underscoring our cash generative capital-light business model. While free cash flow may fluctuate from quarter to quarter due to various adjustments, we expect to maintain a high conversion rate and deploy our free cash flow to earn attractive returns through share repurchases, contractor advances, and/or M&A opportunities, all of which Matt discussed earlier. I'd also like to provide a short update on our capital provider relationships. Our ability to execute has always been driven by our funding strategy with long-term capital partners, which we are able to maintain and grow thanks to our industry-leading credit quality. We are working closely with our capital providers to monitor the interest rate environment and ensure they are receiving high quality assets with attractive returns. While we are not immune to the impact of rising interest rates, our relationships with depositories and the strong demand for our credit quality reduces our exposure to pricing changes relative to capital markets execution. We also expect to continue to add in capital providers in the coming quarters in order to expand our access to low-cost funding and enhance platform fee stability in various market conditions. Before we open up for question and answer, I'd like to turn it back to Matt to provide our perspective on the macro industry environment and outline for the remainder of the year. Thanks, Rodney. As we discussed on our prior earnings call in March, Sunlight has a history of achieving results on this challenging macro environment. While the industry is facing a number of macro challenges, we remain focused on our execution and are positioned favorably, particularly relative to our peers. First, while we saw Omicron-related impacts to volume improve in the back half of the first quarter, component availability, labor shortages, and permitting delays have not yet normalized from pre-COVID-19 levels. Second, while inflation is having an increasing impact on our industry with rising installation and equipment costs, Sunlight fortunately does not procure equipment and therefore is not directly exposed to increasing equipment costs. From an industry perspective, though, solar is becoming more competitive due to significant retail rate increases from utilities across the nation, including double-digit rate increases in several states. As solar presents a cost savings opportunity relative to these utility price increases, we expect solar and battery storage demand to remain strong. Now, rising interest rates are having an impact on the broader industry, though initial impacts to Sunlight are more muted. We intentionally choose to fund our loans primarily by depository institutions versus accessing the ABS markets, which provides some protections against this. While rising rates may have some impact, particularly in our indirect channel, our industry-leading credit quality and the strength of our capital provider relationships enable us to maintain strong demand for our loans. Lastly, while the recent anti-circumvention tariff investigation has not yet had an impact on Sunlight's business, we are watching these developments very closely. Sunlight doesn't take inventory risk, and our contractor advance program supports our contractor partners in their efforts to secure sufficient inventory to meet demand. On the net metering front, we are encouraged by recent developments in Florida and in California. We see both Governor DeSantis' veto of Florida's net metering bill and the California Public Utilities Commission reopening of its net metering docket as positive regulatory developments and further indications of bipartisan support of solar. Despite these macro challenges, our first quarter performance was in line with our expectations, and we remain on track to meet our full-year outlook. Therefore, I'm pleased to affirm Sunlight's 2022 full-year guidance ranges as follows. Total funded loan volume of $2.9 billion-$3.1 billion. Total revenue of $145 million-$155 million. Adjusted EBITDA of $55 million-$60 million. With that, I'll turn it back to the operator for Q&A. Thank you. At this time, we will be conducting a question-and-answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please, while we poll for questions. Your first question comes from the line of Philip Shen with Roth Capital Partners. Please proceed with your question. Hi, everybody. Thanks for taking my questions. First one is on the anti-circumvention case. Matt, I know you just alluded to it just now, but was wondering if you could give us a little bit more color on whether or not your contractors are experiencing any difficulty in securing modules. Have they communicated any challenges to you, or is it really just a price question, meaning they have to pay more for the modules and they have access to the supplies they need to meet their demand? Can you share what you think might be happening with your customer base? Thanks. Yeah. Phil, thanks for the question. On the anti-circumvention front, you know, we are watching it very closely. It is early. So far, we have not seen any impact of the case on our installers and on our results. As you mentioned, it is early. We're mindful that it could have an impact first on price and the price of equipment. Fortunately, for Sunlight, we don't take inventory risk, so we don't bear those costs directly. From a contractor standpoint and from a broader market standpoint, while the cost of equipment could go up over time as a result of the case, offsetting that is that we've seen significant increases from utilities in their rates. The first quarter, somewhere around a 9% plus increase across the country, and that's likely before some of the increased costs related to higher cost of commodities. You know, that is on a relative basis, making solar more attractive. From an availability standpoint, again, we'll monitor it closely. We're working closely with our partners. As I mentioned in my remarks, one of the benefits of our advanced program is it helps provide working capital to our partners to ensure that they can access equipment. We'll watch it closely, and we'll certainly continue to update you as things develop. Great. Thanks, Matt. Shifting gears to the rising funding costs. You know, some of our checks suggest that the price sheets that loan companies issue to their contractors haven't really changed too much. Our checks, the ones we did, weren't that comprehensive, so just a few conversations, but it suggests that. You know, the 20 and 25-year products are still kinda the dealer fees and the rates are still kind of where they were before the ABS movement. I could be wrong on that, but curious if you're seeing that from a competitive standpoint. Importantly, you know, you're not tapping into the ABS market, and so I'm guessing you guys don't see a meaningful need to change your pricing. I was wondering if you can talk through some of the dynamics you're seeing from a competitive standpoint, as well as what that might mean for your business ahead in terms of share and opportunity. Thanks. It's a great question. You know, we've talked about for a long time, we have a very intentional funding strategy. We partner with most of our funding partners are depositories, and that helps provide diverse and stable low-cost capital. And then the other thing that we've always talked about is that we focus on having the best credit quality and having high quality originations. We do that because it benefits us not during the good times, although it does certainly benefits us during the good times, but we do it because we know that cycles change. Interest rate cycles change, credit cycles change, and it provides a real strategic advantage as there become additional challenges in the market. Because of that thoughtfulness, we think we're really well positioned over the long term. It doesn't mean that we're immune from rising rates, particularly in our indirect channel that does have some exposure to market rates. As you mentioned, fortunately, we were very thoughtful about not building a large ABS program where we would have significant exposure to market rates, and our depositories give us much more stable and diverse capital. We think we're well positioned over the long term. You know, certainly from a quarter to quarter basis, you could always see things bounce around a little bit, and you know, just from broader market or because of product mix or contractor mix. We do think we're very well positioned. Great. Thanks. Was wondering if you could give us a little more color on the outlook for margins. I think, you know, we saw some compression. They stayed, you know, the past year, then we saw stabilization and then expansion. Given your stable depository funding, could we see that expansion accelerate in the coming quarters? Yeah. Great question, Philip. Overall, we expect the full year 2022 platform fee percentage to exceed that of the full year of 2021, as many of the improvements we saw come through the second half of last year will continue into 2022. I think it's important, though, to add some context. First, our margins have some normal variability quarter to quarter, as Matt suggested, and that is being driven by product, installer mix, and capital provider mix, as well as the competitive environment. You shouldn't expect margins to be perfectly consistent. Secondly, we think that we're relatively well positioned in this rising rate environment relative to those peers that are relying on the capital markets. It's likely we will see some impact from rates, especially in our indirect channel, but we feel really good about where we are. Rodney. Look forward to working with you. Thank you, Matt, as well. Thank you. Look forward to working with you. Your next question comes from the line of Aaron Lindenbaum with Citi. Please proceed with your question. Thanks. I just wanted to follow up on the question about funding costs. Are your bank partners asking for rate increases in this environment, or have they not really pushed back in terms of pricing it? Great question, Aaron. We have continuous dialogue with our capital providers, building and maintaining mutually beneficial relationships and agreements. As Matt mentioned, you know, we continue to deliver the highest credit quality in the industry, so strong demand remains in both solar and home improvement. We're constantly evaluating our pricing in the market with our contractors, in order to be as competitive as possible. As I mentioned earlier, there could be some noise quarter to quarter, but, again, you know, we are heavily reliant on our depository institutions and feel good about where we are. All right. Thanks. Following up on the new buyback that was announced, I think you said it's over an 18-month period. You know, looking at the free cash flow that you generated, is that kind of an idea of, you know, from a quarter-to-quarter basis, you know, how much you might think about as being available for buybacks? Or is this more of a, you know, just in case type of a plan and you may not utilize it near term? Yeah. Great question. Thanks. As you mentioned, we've been operating a very profitable business that generates a significant amount of free cash flow. Within that context, the board has authorized this program, $50 million over 18 months to address undervaluation, return value to our shareholders, and build long-term investor support. We think this program really affords us the flexibility to do that, to maximize value, and then attractive returns for these levels. The other thing I would say is the size is fairly standard given our company size and market dynamics. Okay. Thank you. Your next question comes from Maheep Mandloi with Credit Suisse. Please proceed with your question. Hi. Thank you for taking the question. This is Chandni on behalf of Maheep. You walked us through the adjusted EBITDA margin impacts from 1Q 2021 - 1Q 2022. Just wanted to understand, how should we think about adjusted EBITDA margin beyond 2022? Could you possibly disaggregate these public company expenses? How do you expect that to evolve? Also in terms of your hiring needs for 2023 and beyond, since you pulled forward some of that growth, can you expect that it will be flat or just slightly above for 2023 and beyond? Finally, like, what in your view would be sort of a long-term stable rate for adjusted EBITDA margin for this business? Thank you. Great question. Thank you. So as you mentioned, our expenses in the first quarter were in line, you know, with our expectations. As you mentioned, you know, we had $4 million of public company related expenses that didn't occur last year. I would expect a similar increase when you compare Q2 2021 - Q2 2022. Those expenses are, you know, things that you would expect, you know, that drive the public company expenses, accounting, D&O, and so forth to support public company. We also have year-over-year increases in our SG&A related to additional costs to drive business growth and some wage inflation. I do think about this as normalization to a new expense baseline and expect that our adjusted EBITDA margins will improve in the back half of this year and in future periods as fixed costs remain relatively constant in the context of continued volume growth and our operating model, operating leverage continues to take hold. This operating leverage, you know, that we've talked about consistently is an attractive feature of the business, and we expect that our expenses will grow at a much smaller rate than revenues going forward. Thank you. Your next question comes from Chris Donat with Piper Sandler. Please proceed with your question. Good afternoon. Thanks for taking my questions. First want to know just on the higher average solar loan balances, you know, going up about 12% year-on-year to nearly $44,000, but coming with the lower attachment rates, what was driving that increase? Is it something in the costs, or are you dealing in different geographies or are there other factors driving the higher loan balances? Yeah. Thanks, Chris. It's a great question. As solar has continued to add value, really across the market, it's provided an opportunity for installers to both build larger systems and also provide other services which help increase the average ticket, and ultimately increase our average loan balance. That plus, we do think we're likely seeing some inflation in cost, and that's getting priced into the higher average ticket. In some ways, inflation actually benefits us in that we're not taking the inventory risk, but we see higher balances which then pull through the bottom line. If you were to see higher attachment rates or rebound from where they are now, that should also be favorable to the balances typically, right? That's right. You know, it was unusual in the first quarter from recent trends that attachment rates went down. We don't think that's specific to Sunlight. As we talk to others in the market, you know, that's a pretty broad trend and it's a result of tighter supply around batteries. We think as those supply challenges start to resolve themselves, that'll help drive up average ticket as well, and you know, could potentially provide some additional lift. Okay. Just last for me, I'm curious about the comment about you launched your Credit 5.0, and it has higher approval rates. To me, that seems a little counterintuitive given the concerns around the economy or maybe that's the timing issue. Just wondering, with higher approval rates, is that a function just of the sort of credit scoring, or are there other factors that you're maybe seeing a different mix of customers? Just curious about higher approval rates given maybe a less certain environment. Yeah, absolutely. We've always been really thoughtful about credit. You know, I have 25 years in consumer credit. Rodney has 25+ years. If you go look across our team, you'll see really deep credit expertise. We build our credit strategies not based on FICO score alone. We use, you know, hundreds of variables to help drive the ultimate credit strategy. The result is to identify more good customers who have a very low propensity to go bad, and also identify those that have a higher propensity. When you swap those two out, as our models get better and better over time and we continue to leverage that data, the net result is we can actually increase our approval rates while maintaining or improving credit quality. Fortunately, we're experiencing the increases in approval rates and the benefits to our contractor network without taking on more risk for our capital providers. Okay. Got it. Thanks very much, and welcome, Rodney. Thank you very much. Appreciate it. As a reminder, if you'd like to ask a question, please press star one on your telephone keypad. As a reminder, if you'd like to ask a question, please press star one on your telephone keypad. One moment please, while we pull for more questions. Your next question comes from Jeffrey Osborne with Cowen and Company. Please proceed with your question. Yeah, good evening. A lot's been addressed, but I don't think you'll give an exact answer on this, Matt, but I was wondering if qualitatively you can touch on what the change has been over the last 6-12 months as it relates to time from loan approval to glass on the roof. You highlighted a couple things that are, you know, sort of, challenging the industry in terms of permitting and other delays. But I was curious what you're seeing in that regard. Thanks, Jeff. Yeah, we have over the last couple of quarters, we talked about delays from credit approval to loan funding and system installation. We especially saw that slow down in the back half of last year. I think when we announced year-end earnings in March, I mentioned we saw some green shoots that perhaps it was starting to improve. We do believe we've seen some improvement, but it is not yet those installation timelines have not yet returned to what we would consider historical norms. When we look at year-over-year pull-through timing and pull-through rates, they are, you know, materially lower than we had seen historically. That is something that we would expect to improve over time, as supply chain issues work themselves through. We're certainly watching that very closely. Got it. That's good to hear. A couple other quick ones. Maybe for Rodney or you, Matt. Is there a minimum cash balance that you need or feel comfortable with as it relates to the balance sheet? I'm just trying to understand the three uses of cash that you talked about in the presentation and here on the call. You know, how low that could go as it relates to creating shareholder value. Yeah. Great question. You know, as we mentioned before, and as you know, you know, we've been operating at a very profitable rate, generating significant amount of free cash flow. I think the size of this program gives us the flexibility to continue to invest in our contractor advances and continue to grow the business. We will continue to be thoughtful and mindful about you know, M&A. We look at that from time to time. No, I think it's the program's really designed to give us flexibility to use our capital for its best investment purpose. Got it. The last one I had is just, I think it was six months ago or so, you talked about some initiatives in the non-prime market, in terms of new capital providers and a go-to-market strategy there. Could you just give us an update on how that's panned out? We announced Sunlight Max, which helped partnering with other capital providers, allowed us to substantially increase our credit approval rates, and help serve the needs of more customers. It's been very well received in both solar and especially in home improvement. We think it's a good example of our credit acumen and using that credit acumen to ensure assets are priced appropriately and get a capital provider and asset with a good risk-adjusted return and help homeowners go solar or make home improvements and help contractors sell more. We're pleased with the results so far. Great to hear. That's all I had, Matt. Thank you. Great. Thank you. Ladies and gentlemen, we have reached the end of the question and answer session, and I would like to turn the call back to Mr. Matt Potere for closing remarks. Great. Thank you. We appreciate all of your questions and your continued interest and support of Sunlight Financial. I'm very pleased with our performance thus far, and I'm excited to continue executing on our growth plans as we leverage our capital-light, cash generative business model to provide value for all of our stakeholders. Thank you for joining us this evening and have a great night. This concludes today's conference. You may disconnect your lines at this time. Thank you all for your participation.