Clean Energy Fuels Corp. (NASDAQ: CLNE) (“Clean Energy” or the
“Company”) today announced its operating results for the quarter
and nine months ended September 30, 2018.
Andrew J. Littlefair, Clean Energy’s President and Chief
Executive Officer, stated, “In the third quarter we improved
financial operating results, including continued positive operating
cash flows, launched the Zero Now Finance program with our new
partner Total S.A., and gained additional customers across
different markets. Zero Now Financing has tremendous potential
because it gives heavy-duty truck fleets the opportunity to
purchase clean natural gas trucks for the price of diesel trucks,
while also allowing them to lock in a fixed discount to diesel.
Subsequent to quarter end we also signed a significant joint
marketing RNG deal with BP. We believe we are well positioned
financially and anticipate rapidly growing our Redeem renewable
natural gas business with the new BP deal and adding volume
through the Zero Now Finance program.”
The Company delivered 92.3 million gallons in the third quarter
of 2018, an increase from 91.5 million for the third quarter of
2017. For the nine months ended September 30, 2018, the
Company delivered 266.8 million gallons, an increase from 265.0
million delivered in the same period in 2017. Growth in CNG volumes
was partially offset by a reduction in LNG volumes due to the
non-renewal of two contracts and a decrease in RNG volumes for
non-vehicle fuel that were included in contracts sold to BP in
2017.
The Company’s revenue for the third quarter of 2018 was $77.3
million, driven by a 7.4% increase from a year ago in
volume-related revenue, reflecting higher volumes and pump prices
and a continued strong renewable natural gas market. Station
construction revenue trended up to $9.4 million for the third
quarter of 2018 from $5.8 million in the second quarter of 2018.
Station construction revenue for the third quarter of 2017 was
$12.5 million and included a greater mix of full station builds.
Revenue for 2017 included $5.9 million in compressor sales whereas
in 2018 the Company did not report any such sales, due to the
Company combining its compressor manufacturing business (“CEC”) in
December 2017 with Landi Renzo's compressor manufacturing
business.
On a GAAP basis, net loss for the third quarter of 2018 improved
by $83.2 million from $(94.1) million, or $(0.62) per share, for
the third quarter of 2017 to $(10.9) million, or $(0.05) per share,
for the third quarter of 2018. The third quarter of 2017 was
negatively affected by $73.8 million in cash and non-cash charges,
including asset impairment charges, resulting from steps taken to
minimize and eliminate underperforming assets and to lower
operating expenses going forward ("the Third Quarter Incremental
Charges”).
Revenue for the nine months ended September 30, 2018 was
$250.2 million, a decrease from $252.3 million of revenue for the
same period in 2017. The Company recognized $26.9 million in
revenue from the U.S. federal excise tax credits for alternative
fuels (“AFTC”) during the 2018 period, offset by decreases in
compressor and station construction revenue. The AFTC, which had
previously expired on December 31, 2016, was reinstated on
February 9, 2018 to apply to vehicle fuel sales made from
January 1, 2017 through December 31, 2017, but is not
presently available for fuel sales made after 2017.
On a GAAP basis, net loss for the nine months ended
September 30, 2018 was $(10.7) million, or $(0.06) per share,
compared to net loss of $(50.9) million, or $(0.34) per share, for
the same period in 2017. The nine months ended September 30,
2018 was positively impacted by AFTC revenue of $26.9 million. The
nine months ended September 30, 2017 included a $69.9 million
gain from the Company’s sale of its upstream RNG production
business to BP in March 2017 (the “BP Transaction”) and a $3.2
million gain from the repurchase of a portion of the Company’s
debt, as well as the Third Quarter Incremental Charges.
Non-GAAP loss per share and Adjusted EBITDA for the third
quarter of 2018 was $(0.04) and $7.3 million, respectively.
Non-GAAP loss per share and Adjusted EBITDA for the third quarter
of 2017 was $(0.61) and $(74.0) million, respectively, which
included the Third Quarter Incremental Charges.
Non-GAAP loss per share and Adjusted EBITDA for the nine months
ended September 30, 2018 was $(0.02) and $47.1 million,
respectively, which included the AFTC revenue recognized in the
period. Non-GAAP loss per share and Adjusted EBITDA for the nine
months ended September 30, 2017 was $(0.29) and $10.0 million,
respectively, which included the gains from the BP Transaction, the
debt repurchase and the Third Quarter Incremental Charges.
Non-GAAP loss per share and Adjusted EBITDA are described below
and reconciled to GAAP net loss and loss per share attributable to
Clean Energy Fuels Corp.
Non-GAAP Financial Measures
To supplement the Company’s unaudited condensed consolidated
financial statements presented in accordance with accounting
principles generally accepted in the United States of America
(“GAAP”), the Company uses non-GAAP financial measures that it
calls non-GAAP loss per share (“non-GAAP EPS" or “non-GAAP loss per
share”) and adjusted EBITDA (“Adjusted EBITDA”). Management
presents non-GAAP EPS and Adjusted EBITDA because it believes these
measures provide meaningful supplemental information regarding the
Company’s performance, for the following reasons: (1) these
measures allow for greater transparency with respect to key
metrics used by management, as management uses these measures to
assess the Company’s operating performance and for financial and
operational decision-making; (2) these measures exclude the
impact of items that management believes are not directly
attributable to the Company’s core operating performance and may
obscure trends in the business; and (3) these measures are
used by institutional investors and the analyst community to help
analyze the Company’s business. In future quarters, the Company may
make adjustments for other expenditures, charges or gains in order
to present non-GAAP financial measures that the Company’s
management believes are indicative of the Company’s core operating
performance.
Non-GAAP financial measures have limitations as an analytical
tool and should not be considered in isolation from, or as a
substitute for, the Company’s GAAP results. The Company expects to
continue reporting non-GAAP financial measures, adjusting for the
items described below (and/or other items that may arise in the
future as the Company’s management deems appropriate), and the
Company expects to continue to incur expenses, charges or gains
similar to the non-GAAP adjustments described below. Accordingly,
unless expressly stated otherwise, the exclusion of these and other
similar items in the presentation of non-GAAP financial measures
should not be construed as an inference that these costs are
unusual, infrequent or non-recurring. Non-GAAP EPS and Adjusted
EBITDA are not recognized terms under GAAP and do not purport to be
an alternative to GAAP loss, GAAP loss per share or any other GAAP
measure as an indicator of operating performance. Moreover, because
not all companies use identical measures and calculations, the
Company’s presentation of non-GAAP EPS and Adjusted EBITDA may not
be comparable to other similarly titled measures used by other
companies.
Non-GAAP EPS
Non-GAAP EPS, which the Company presents as a non-GAAP measure
of its performance, is defined as net loss attributable to Clean
Energy Fuels Corp., plus stock-based compensation expense, and plus
(minus) loss (income) from equity method investments, the total of
which is divided by the Company’s weighted-average shares
outstanding on a diluted basis. The Company’s management believes
excluding non-cash expenses related to stock-based compensation
provides useful information to investors regarding the Company’s
performance because of the varying available valuation
methodologies, the volatility of the expense (which depends on
market forces outside of management’s control), the subjectivity of
the assumptions and the variety of award types that a company can
use, which may obscure trends in a company’s core operating
performance. Similarly, as a result of combining CEC with SAFE in
the fourth quarter of 2017, the Company’s management believes that
excluding the non-cash results from equity method investments is
useful to investors because the charges are not part of or
representative of the core operations of the Company.
The table below shows GAAP and non-GAAP EPS and also reconciles
GAAP net loss attributable to Clean Energy Fuels Corp. to an
adjusted net loss figure used in the calculation of non-GAAP
EPS:
Three Months EndedSeptember
30,
Nine Months EndedSeptember
30,
(in thousands, except share and per-share amounts)
2017 2018 2017 2018
Net Loss Attributable to Clean Energy Fuels Corp. $ (94,141
) $ (10,899 ) $ (50,890 ) $ (10,652 ) Stock-Based Compensation
2,216 1,206 6,904 4,312 Loss from Equity Method Investments 30
542 100 2,739 Adjusted (Non-GAAP) Net
Loss $ (91,895 ) $ (9,151 ) $ (43,886 ) $ (3,601 ) Diluted
Weighted-Average Common Shares Outstanding 150,927,825 203,469,222
150,128,204 172,946,896
GAAP Loss Per Share $ (0.62 ) $
(0.05 ) $ (0.34 ) $ (0.06 )
Non-GAAP Loss Per Share $ (0.61
) $ (0.04 ) $ (0.29 ) $ (0.02 )
Adjusted EBITDA
Adjusted EBITDA, which the Company presents as a non-GAAP
measure of its performance, is defined as net loss attributable to
Clean Energy Fuels Corp., plus (minus) income tax expense
(benefit), plus interest expense, minus interest income, plus
depreciation and amortization expense, plus stock-based
compensation expense, and plus (minus) loss (income) from equity
method investments. The Company’s management believes Adjusted
EBITDA provides useful information to investors regarding the
Company’s performance for the same reasons discussed above with
respect to non-GAAP EPS. In addition, management internally uses
Adjusted EBITDA to determine elements of executive and employee
compensation.
The table below shows Adjusted EBITDA and also reconciles this
figure to GAAP net loss attributable to Clean Energy Fuels
Corp.:
Three Months EndedSeptember 30,
Nine Months EndedSeptember 30, (in
thousands) 2017 2018 2017
2018 Net Loss Attributable to Clean Energy Fuels
Corp. $ (94,141 ) $ (10,899 ) $ (50,890 ) $ (10,652 ) Income
Tax Expense (Benefit) (44 ) 89 (2,183 ) 266 Interest Expense 4,270
4,096 13,466 13,126 Interest Income (465 ) (1,129 ) (1,156 ) (2,193
) Depreciation and Amortization 14,104 13,363 43,757 39,496
Stock-Based Compensation 2,216 1,206 6,904 4,312 Loss from Equity
Method Investments 30 542 100 2,739
Adjusted EBITDA $ (74,030 ) $ 7,268 $ 9,998 $ 47,094
Definition of “Gallons Delivered”
The Company defines “gallons delivered” as its gallons of
renewable natural gas (“RNG”), compressed natural gas (“CNG”) and
liquefied natural gas (“LNG”), along with its gallons associated
with providing operations and maintenance services, in each case
delivered to its customers in the applicable period, plus the
Company’s proportionate share of gallons delivered by joint
ventures in the applicable period.
The table below shows gallons delivered for the three and nine
months ended September 30, 2017 and 2018:
Three Months EndedSeptember
30,
Nine Months EndedSeptember 30, Gallons
Delivered (in millions) 2017 2018
2017 2018 CNG 73.5 75.4 213.1 220.0 LNG 17.3
16.9 50.0 46.8 RNG (1) 0.7 — 1.9 —
Total 91.5 92.3 265.0 266.8 (1) Represents RNG sold
as non-vehicle fuel. RNG sold as vehicle fuel is sold under the
brand name Redeem™, and is included in this table in the CNG or LNG
amounts as applicable based on the form in which it was sold.
Sources of Revenue
The following table represents our sources of revenue for the
three and nine months ended September 30, 2017 and 2018:
Three Months EndedSeptember 30,
Nine Months EndedSeptember 30,
Revenue (in Millions) 2017
2018 2017 2018 Volume -Related (1) $
63.1 $ 67.8 $ 200.0 $ 197.8 Compressor Sales 5.9 — 17.6 — Station
Construction Sales 12.5 9.4 34.1 20.9 AFTC — — — 26.9 Other 0.3
0.1 0.6 4.6 Total $ 81.8 $ 77.3 $ 252.3 $
250.2 (1) Volume -related revenue primarily consists of
sales of RNG, CNG and LNG fuel, performance of operations and
maintenance services, and sales of certain tradable credits the
Company generates by selling RNG, CNG and LNG as vehicle fuel.
Today’s Conference Call
The Company will host an investor conference call today at 4:30
p.m. Eastern time (1:30 p.m. Pacific). Investors
interested in participating in the live call can dial
1.877.407.4018 from the U.S. and international callers can dial
1.201.689.8471. A telephone replay will be available approximately
two hours after the call concludes through Friday, December 7,
2018, by dialing 1.844.512.2921 from the U.S., or
1.412.317.6671 from international locations, and entering Replay
Pin Number 13684336. There also will be a simultaneous live webcast
available on the Investor Relations section of the Company’s web
site at www.cleanenergyfuels.com, which will be available for
replay for 30 days.
About Clean Energy Fuels
Clean Energy Fuels Corp. is the leading provider of natural gas
fuel for transportation in North America. We build and operate CNG
and LNG vehicle fueling stations; manufacture CNG and LNG equipment
and technologies; and deliver more CNG and LNG vehicle fuel than
any other company in the United States. Clean Energy also sells
Redeem™ RNG fuel and believes it is the cleanest transportation
fuel commercially available, reducing greenhouse gas emissions by
up to 70%. For more information,
visit www.cleanenergyfuels.com.
Safe Harbor Statement
This press release contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934, including
statements about, among other things, the Company’s expectations
regarding its performance, including continued improvement in its
operating results; the success of the Company’s Zero Now Financing
program and its impact on the expansion, if any, of the U.S.
natural gas trucking market and the Company’s performance,
financial condition and ability to execute its strategic
initiatives; the state of the natural gas vehicle fuel market,
including the level of adoption of natural gas vehicle fuels
generally, and specifically in the trucking sector; the Company’s
joint marketing agreement with BP and such agreement’s effect on
the Redeem renewable natural gas business; and the Company’s
overall financial and strategic position.
Forward-looking statements are statements other than historical
facts and relate to future events or circumstances or the Company’s
future performance, and they are based on the Company’s current
assumptions, expectations and beliefs concerning future
developments and their potential effect on the Company and its
business. As a result, actual results, performance or achievements
and the timing of events could differ materially from those
anticipated in or implied by these forward-looking statements as a
result of many factors including, among others: future supply,
demand, use and prices of crude oil, gasoline, diesel, natural gas,
other vehicle fuels, and heavy-duty trucks and other vehicles and
engines powered by these fuels, including overall levels of and
volatility in these factors; the willingness of fleets and other
consumers to adopt natural gas as a vehicle fuel, and the rate of
any such adoption; the Company’s ability to execute its strategic
initiatives related to the market for natural gas heavy-duty
trucks, one of the Company’s target customer markets, including the
Company’s Zero Now Financing program, and the impact of these
initiatives on the Company and its industry; the Company’s ability
to capture a substantial share of the market for alternative
vehicle fuels and vehicle fuels generally and otherwise compete
successfully in these markets, including in the event of advances
or improvements in or perceived advantages of non-natural gas
vehicle fuels or engines powered by these fuels or other
competitive developments and particularly in light of increasing
competition from new entrants in these markets, expanded programs
by existing competitors, or other factors; the Company’s ability to
execute and realize the intended benefits of any mergers,
acquisitions, divestitures, investments or other strategic
measures, transactions or relationships, including, for example,
the investment of and other proposed relationships with an
affiliate of Total S.A.; the Company’s ability to accurately
predict natural gas vehicle fuel demand in the geographic and
customer markets in which it operates and effectively calibrate its
strategies, timing and levels of investments to be consistent with
this demand; the Company’s ability to recognize the anticipated
benefits of its CNG and LNG station network; future availability of
capital, which may include equity or debt financing, as needed to
fund the growth of the Company’s business, repayment of its debt
obligations (whether at or before their due dates) or other
expenditures; the availability of environmental, tax and other
government regulations, programs and incentives, such as AFTC, that
promote natural gas or other alternatives as a vehicle fuel,
including long-standing support for gasoline- and diesel-powered
vehicles and growing support for electric and hydrogen-powered
vehicles that could result in programs or incentives that favor
these or other vehicles or vehicle fuels over natural gas; changes
to federal, state or local greenhouse gas emissions regulations or
other environmental regulations applicable to natural gas
production, transportation or use; compliance with other applicable
government regulations; the Company’s ability to manage and grow
its RNG business, in particular after the BP Transaction, including
its ability to continue to receive revenue from sales of tradable
credits the Company generates by selling conventional and renewable
natural gas as vehicle fuel; construction, permitting and other
factors that could cause delays or other problems at station
construction projects; and general political, regulatory, economic
and market conditions.
The forward-looking statements made in this press release speak
only as of the date of this press release and the Company
undertakes no obligation to update publicly such forward-looking
statements to reflect subsequent events or circumstances, except as
otherwise required by law. The Company’s periodic reports filed
with the Securities and Exchange Commission (www.sec.gov),
including its Quarterly Report on Form 10-Q filed on
November 7, 2018, contains additional information about these
and other risk factors that may cause actual results to differ
materially from the forward-looking statements contained in this
press release.
Clean Energy Fuels Corp. and
SubsidiariesCondensed Consolidated Balance Sheets(In
thousands, except share data, Unaudited)
December 31, 2017
September 30, 2018 Assets Current assets:
Cash, cash equivalents and restricted cash $ 37,208 $ 160,020
Short-term investments 141,462 95,964 Accounts receivable, net of
allowance for doubtful accounts of $1,276 and $1,507 as of December
31, 2017 and September 30, 2018, respectively 63,961 69,822 Other
receivables 19,235 17,890 Inventory 35,238 37,103 Prepaid expenses
and other current assets 7,793 8,096
Total current assets
304,897 388,895 Land, property and equipment, net 367,305 344,077
Notes receivable and other long-term assets, net 21,397 15,978
Investments in other entities 30,395 27,674 Goodwill 64,328 64,328
Intangible assets, net 3,590 2,478 Total assets $
791,912 $ 843,430
Liabilities and Stockholders’
Equity Current liabilities: Current portion of debt and capital
lease obligations $ 139,699 $ 115,879 Accounts payable 17,901
12,849 Accrued liabilities
42,268
48,322 Deferred revenue 3,432 8,830 Total current
liabilities 203,300 185,880 Long-term portion of debt and capital
lease obligations 120,388 122,817 Other long-term liabilities
18,566 15,348 Total liabilities 342,254 324,045
Commitments and contingencies Stockholders’ equity: Preferred
stock, $0.0001 par value. Authorized 1,000,000 shares; issued and
outstanding no shares — — Common stock, $0.0001 par value.
Authorized 224,000,000 shares and 304,000,000 shares as of December
31, 2017 and September 30, 2018, respectively; issued and
outstanding 151,650,969 shares and 203,472,977 shares as of
December 31, 2017 and September 30, 2018, respectively 15 20
Additional paid-in capital 1,111,432 1,196,720 Accumulated deficit
(683,570 ) (695,515 ) Accumulated other comprehensive loss (887 )
(273 ) Total Clean Energy Fuels Corp. stockholders’ equity 426,990
500,952 Noncontrolling interest in subsidiary 22,668 18,433
Total stockholders’ equity 449,658 519,385
Total liabilities and stockholders’ equity $ 791,912 $
843,430
Clean Energy Fuels Corp. and
SubsidiariesCondensed Consolidated Statements of
Operations(In thousands, except share and per share data,
Unaudited)
Three Months EndedSeptember
30, Nine Months EndedSeptember 30, 2017
2018 2017 2018 Revenue: Product
revenue $ 67,669 $ 67,441 $ 211,747 $ 220,812 Service revenue
14,123 9,879 40,552 29,378 Total
revenue 81,792 77,320 252,299 250,190 Operating expenses: Cost of
sales (exclusive of depreciation and amortization shown separately
below): Product cost of sales 52,884 48,063 158,306 139,658 Service
cost of sales 7,283 4,743 20,066 13,595 Inventory valuation
provision 13,158 — 13,158 — Selling, general and administrative
24,798 18,396 71,875 57,101 Depreciation and amortization 14,104
13,363 43,757 39,496 Asset impairments and other charges 60,666
— 60,666 — Total operating expenses
172,893 84,565 367,828 249,850
Operating income (loss) (91,101 ) (7,245 ) (115,529 ) 340 Interest
expense (4,270 ) (4,096 ) (13,466 ) (13,126 ) Interest income 465
1,129 1,156 2,193 Other income (expense), net 4 (193 ) (28 ) (126 )
Loss from equity method investments (30 ) (542 ) (100 ) (2,739 )
Gain from extinguishment of debt — — 3,195 — Gain from sale of
certain assets of subsidiary — — 69,886 — Loss from formation of
equity method investment — (1,163 ) — (1,163 ) Loss
before income taxes (94,932 ) (12,110 ) (54,886 ) (14,621 ) Income
tax benefit (expense) 44 (89 ) 2,183 (266 ) Net loss
(94,888 ) (12,199 ) (52,703 ) (14,887 ) Loss attributable to
noncontrolling interest 747 1,300 1,813 4,235
Net loss attributable to Clean Energy Fuels Corp. $ (94,141
) $ (10,899 ) $ (50,890 ) $ (10,652 ) Loss per share: Basic $ (0.62
) $ (0.05 ) $ (0.34 ) $ (0.06 ) Diluted $ (0.62 ) $ (0.05 ) $ (0.34
) $ (0.06 ) Weighted-average common shares outstanding: Basic
150,927,825 203,469,222 150,128,204
172,946,896 Diluted 150,927,825 203,469,222
150,128,204 172,946,896
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Clean Energy Fuels Corp.Investor
Contact:investors@cleanenergyfuels.comorNews Media
Contact:Raleigh GerberManager of Corporate
Communications949.437.1397
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