Clean Energy Fuels Corp. (NASDAQ: CLNE) (“Clean Energy” or the
“Company”) today announced its operating results for the first
quarter of 2019.
Andrew J. Littlefair, Clean Energy’s President and Chief
Executive Officer, stated “I’m pleased with our start to 2019, and
particularly the volume growth momentum together with our continued
financial discipline. Our focus in 2019 is on increasing heavy-duty
truck adoption and the use of Clean Energy's Redeem renewable
natural gas as it is the cleanest, most affordable and immediate
alternative fuel solution available. With the help from our
partner, Total, we are seeing the first signs of success of fleets
taking advantage of our Zero Now truck financing program which is
encouraging. We will also continue to build on our improving
financial performance as we exploit our existing fueling
infrastructure with increased volumes.”
The Company delivered 95.2 million gallons in the first quarter
of 2019, an 11.9% increase from 85.1 million in the first quarter
of 2018. This increase was due to growth in CNG and LNG volumes
principally from increased sales of Redeem.
The Company’s revenue for the first quarter of 2019 was $77.7
million, including an unrealized loss of $5.0 million on commodity
swap contracts that support the Company’s Zero Now program,
compared to $102.4 million of revenue in the same period last year,
which included $25.5 million of U.S. federal excise tax credits for
alternative fuels (“AFTC”). The AFTC applied to vehicle fuel sales
made from January 1, 2017 through December 31, 2017 and expired
effective January 1, 2018. Excluding the unrealized loss on
commodity swaps of $5.0 million in 2019 and the AFTC of $25.5
million in 2018, revenue increased 7.5% for the first quarter of
2019 compared to the prior year period, which was driven by an
18.3% increase in volume -related revenue, reflecting higher
volumes and retail pump prices and a continued strong renewable
natural gas market. Station construction revenue was $3.2 million
for the first quarter of 2019 compared to $5.8 million in the 2018
period. Also, 2018 included $3.9 million in revenue from the sale
of used natural gas trucks acquired in 2017 which did not recur in
2019.
On a GAAP (as defined below) basis, net income (loss)
attributable to Clean Energy for the first quarter of 2019 was
$(10.9) million or $(0.05) per share, compared to $12.2 million, or
$0.08 per share, for the first quarter of 2018. The first quarter
of 2019 was negatively affected by $6.6 million in unrealized
losses from changes in fair value of derivative instruments whereas
2018 was positively affected by AFTC revenue of $25.5 million.
Non-GAAP income (loss) per share and Adjusted EBITDA (each as
defined below) for the first quarter of 2019 was $(0.01) and $11.2
million, respectively. Non-GAAP income per share and Adjusted
EBITDA for the first quarter of 2018 was $0.10 and $32.4 million,
respectively, which included the AFTC revenue.
Non-GAAP income (loss) per share and Adjusted EBITDA are
described below and reconciled to GAAP net income (loss) per share
attributable to Clean Energy and GAAP net income (loss) per share
attributable to Clean Energy, respectively.
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 income (loss) per share (“non-GAAP income (loss) per
share”) and adjusted EBITDA (“Adjusted EBITDA”). Management
presents non-GAAP income (loss) per share and Adjusted EBITDA
because it believes these measures provide meaningful supplemental
information about the Company’s performance, for the following
reasons: (1) these measures allow for greater transparency
with respect to key metrics used by management to assess the
Company’s operating performance and making financial and
operational decisions; (2) these measures exclude the effect
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 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 are limited 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 income (loss) per
share and Adjusted EBITDA are not recognized terms under GAAP and
do not purport to be an alternative to GAAP income (loss), GAAP
income (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 income (loss) per share and Adjusted EBITDA may not be
comparable to other similarly titled measures used by other
companies.
Non-GAAP Income (Loss) Per Share
Non-GAAP income (loss) per share, which the Company presents as
a non-GAAP measure of its performance, is defined as net income
(loss) attributable to Clean Energy Fuels Corp., plus stock-based
compensation expense, plus (minus) loss (income) from equity method
investments, and plus (minus) any loss (gain) from changes in the
fair value of derivative instruments, 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, we believe excluding the non-cash results from equity
method investments is useful to investors because these charges are
not part of or representative of the core operations of the
Company. In addition, the Company’s management believes excluding
the non-cash loss (gain) from changes in the fair value of
derivative instruments is useful to investors because the valuation
of the derivative instruments is based on a number of subjective
assumptions, the amount of the loss or gain is derived from market
forces outside of management’s control, and the exclusion of these
amounts enables investors to compare the Company’s performance with
other companies that do not use, or use different forms of,
derivative instruments.
The table below shows GAAP and non-GAAP income (loss) per share
and also reconciles GAAP net income (loss) attributable to Clean
Energy Fuels Corp. to an adjusted net income (loss) figure used in
the calculation of non-GAAP income (loss) per share:
Three Months EndedMarch
31,
(in thousands, except share and per-share amounts)
2018 2019 Net
Income (Loss) Attributable to Clean Energy Fuels Corp. $ 12,222
$ (10,946 ) Stock-Based Compensation 1,898 1,246 Loss from Equity
Method Investments 1,468 467 Loss (Gain) from Change in Fair Value
of Derivative Instruments (21 ) 6,584 Adjusted
(Non-GAAP) Net Income (Loss) $ 15,567 $ (2,649 ) Diluted
Weighted-Average Common Shares Outstanding 156,643,092 204,196,669
GAAP Income (Loss) Per Share $ 0.08 $ (0.05 )
Non-GAAP
Income (Loss) Per Share $ 0.10 $ (0.01 )
Adjusted EBITDA
Adjusted EBITDA, which the Company presents as a non-GAAP
measure of its performance, is defined as net income (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, plus (minus) loss (income) from equity method
investments, and plus (minus) any loss (gain) from changes in the
fair value of derivative instruments. 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 income (loss) per share. 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 income (loss) attributable to Clean Energy Fuels
Corp.:
Three Months EndedMarch 31, (in
thousands) 2018
2019 Net Income (Loss) Attributable to Clean
Energy Fuels Corp. $ 12,222 $ (10,946 ) Income Tax Expense 88
60 Interest Expense 4,503 1,891 Interest Income (575 ) (580 )
Depreciation and Amortization 12,801 12,479 Stock-Based
Compensation 1,898 1,246 Loss from Equity Method Investments 1,468
467 Loss (Gain) from Change in Fair Value of Derivative Instruments
(21 ) 6,584
Adjusted EBITDA $ 32,384
$ 11,201
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 months
ended March 31, 2018 and 2019:
Three Months EndedMarch 31, Gallons
Delivered (in millions) 2018 2019
CNG 70.8 78.5 LNG 14.3 16.7 Total 85.1 95.2
Sources of Revenue
The following table represents our sources of revenue for the
three months ended March 31, 2018 and 2019:
Three Months EndedMarch 31, Revenue
(in millions) 2018
2019 Volume -Related (1) $ 67.2 $ 74.5 Station Construction
Sales 5.8 3.2 AFTC 25.5 — Other 3.9 — Total Revenue $
102.4 $ 77.7 (1) For the three months ended March 31,
2019, volume -related revenue includes an unrealized loss from the
change in fair value of commodity swap contracts of $5.0 million.
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 Sunday, June 9,
2019, by dialing 1.844.512.2921 from the U.S., or
1.412.317.6671 from international locations, and entering Replay
Pin Number 13690206. 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, as
amended, and Section 21E of the Securities Exchange Act of
1934, as amended, including statements about, among other things,
the Company’s expectations regarding its 2019 results; the
Company’s ability to convert heavy -duty truck fleets with whom it
is in discussions into participants in the Company’s Zero Now truck
financing program; the success of the Zero Now program generally
and its effect, if any, on 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 fuels market, including the level of adoption of natural
gas vehicle fuels generally, and specifically in the trucking
sector, and with respect to renewable natural gas; and the
Company’s supply agreement with BP and its effect, if any, on the
Company’s Redeem renewable natural gas business.
Forward-looking 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: the willingness of
fleets and other consumers to adopt natural gas as a vehicle fuel,
and the rate and level of any such adoption; future supply, demand,
use and prices of crude oil, gasoline, diesel, natural gas, and
other vehicle fuels, including overall levels of and volatility in
these factors; natural gas vehicle and engine cost, fuel usage,
availability, quality, safety, convenience, design and performance,
as well as operator perception with respect to these factors, in
general and in the Company’s key customer markets, including
heavy-duty trucking; the Company’s ability to execute its Zero Now
truck financing program, a key strategic initiative related to the
market for natural gas heavy-duty trucks and the effect of this
initiative on the Company’s business, prospects, performance and
liquidity; 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 improvements in or perceived advantages
of non-natural gas vehicle fuels or engines powered by these fuels
or other competitive developments; the availability of
environmental, tax and other government regulations, programs and
incentives that promote natural gas, such as AFTC, 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; future availability of capital,
which may include equity or debt financing, in the amounts and at
the times 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, as well as the terms and other
effects of any such capital-raising transaction; the effect of, or
potential for changes to federal, state or local greenhouse gas
emissions regulations or other environmental regulations applicable
to natural gas production, transportation or use; 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 and
the effect of any increase in competition for RNG supply; 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; construction, permitting and other factors that
could cause delays or other problems at station construction
projects; the Company’s compliance with all applicable government
regulations; the Company’s ability to execute and realize the
intended benefits of any mergers, acquisitions, divestitures,
investments or other strategic measures, transactions or
relationships; 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
May 9, 2019, contain 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
Subsidiaries Condensed Consolidated Balance Sheets
(In thousands, except share and per
share data, Unaudited)
December 31, 2018 March 31, 2019
Assets Current assets: Cash, cash equivalents and current
portion of restricted cash $ 30,624 $ 28,763 Short-term investments
65,646 66,164 Accounts receivable, net of allowance for doubtful
accounts of $1,919 and $1,984 as of December 31, 2018 and March 31,
2019, respectively 68,865 70,341 Other receivables 15,544 9,198
Derivative assets, related party 1,508 728 Inventory 34,975 32,653
Prepaid expenses and other current assets 8,444
8,769 Total current assets 225,606 216,616 Operating
lease right-of-use assets — 23,801 Land, property and equipment,
net 350,568 338,192 Long-term portion of restricted cash 4,000
4,848 Notes receivable and other long-term assets, net 17,470
16,948 Long-term portion of derivative assets, related party 8,824
4,634 Investments in other entities 26,079 25,842 Goodwill 64,328
64,328 Intangible assets, net 2,207 1,951
Total assets $ 699,082 $ 697,160
Liabilities and Stockholders’ Equity Current liabilities:
Current portion of debt $ 4,712 $ 5,344 Current portion of finance
lease obligations 693 695 Current portion of operating lease
obligations — 3,545 Accounts payable 19,024 15,413 Accrued
liabilities 48,469 36,754 Deferred revenue 7,361
6,858 Total current liabilities 80,259 68,609
Long-term portion of debt 75,003 76,501 Long-term portion of
finance lease obligations 3,776 3,718 Long-term portion of
operating lease obligations — 21,621 Other long-term liabilities
15,035 12,732 Total liabilities 174,073
183,181 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 304,000,000 shares as of December 31, 2018 and
March 31, 2019, respectively; issued and outstanding 203,599,892
shares and 204,651,932 shares as of December 31, 2018 and March 31,
2019, respectively 20 20 Additional paid-in capital 1,198,769
1,200,418 Accumulated deficit (688,653 ) (699,599 ) Accumulated
other comprehensive loss (2,138 ) (1,764 ) Total
Clean Energy Fuels Corp. stockholders’ equity 507,998 499,075
Noncontrolling interest in subsidiary 17,011
14,904 Total stockholders’ equity 525,009
513,979 Total liabilities and stockholders’ equity $
699,082 $ 697,160
Clean
Energy Fuels Corp. and Subsidiaries Condensed Consolidated
Statements of Operations (In thousands, except share and per
share data, Unaudited) Three Months EndedMarch
31, 2018 2019
Revenue: Product revenue $ 92,251 $ 68,448 Service revenue
10,152 9,250 Total revenue 102,403
77,698 Operating expenses: Cost of sales (exclusive of depreciation
and amortization shown separately below): Product cost of sales
50,199 54,430 Service cost of sales 4,597 4,398 Change in fair
value of derivative warrants (21 ) 1,614 Selling, general and
administrative 18,858 18,434 Depreciation and amortization
12,801 12,479 Total operating expenses
86,434 91,355 Operating income (loss) 15,969
(13,657 ) Interest expense (4,503 ) (1,891 ) Interest income 575
580 Other income (expense), net (12 ) 2,670 Loss from equity method
investments (1,468 ) (467 ) Income (loss) before
income taxes 10,561 (12,765 ) Income tax expense (88 )
(60 ) Net income (loss) 10,473 (12,825 ) Loss attributable
to noncontrolling interest 1,749 1,879
Net income (loss) attributable to Clean Energy Fuels Corp. $ 12,222
$ (10,946 ) Income (loss) per share: Basic $ 0.08 $
(0.05 ) Diluted $ 0.08 $ (0.05 ) Weighted-average common
shares outstanding: Basic 152,194,695
204,196,669 Diluted 156,643,092
204,196,669
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version on businesswire.com: https://www.businesswire.com/news/home/20190509005833/en/
Investor Contact:investors@cleanenergyfuels.com
News Media Contact:Raleigh GerberManager of Corporate
Communications949.437.1397
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