Clean Energy Fuels Corp.
Nov 7, 2013

Clean Energy Reports Gallons Delivered Rose 17% During The Third Quarter of 2013

NEWPORT BEACH, Calif.--(BUSINESS WIRE)-- Clean Energy Fuels Corp. (NASDAQ: CLNE) (Clean Energy or the Company) today announced operating results for the third quarter and nine months ended September 30, 2013.

Gallons delivered (defined below) for the third quarter of 2013 totaled 56.4 million gallons, compared to 50.9 million gallons delivered in the same period a year ago. Gallons delivered were up 17% for the third quarter of 2013 when excluding 2.5 million gallons delivered in the third quarter of 2012 by the Company's Peruvian joint venture, which was sold in March of 2013. For the nine months ended September 30, 2013, gallons delivered totaled 158.9 million gallons, up from 143.2 million gallons for the nine months ended September 30, 2012.

Revenue for the third quarter ended September 30, 2013 was $86.3 million. Revenue for the third quarter ended September 30, 2012 was $91.5 million, which included $17.6 million in construction revenue related to the sale of two large CNG stations to one transit customer. For the nine months ended September 30, 2013, revenue totaled $267.5 million, which is up from $234.9 million a year ago. Additionally, when comparing periods, note that the Company recognized revenue attributable to the volumetric excise tax credit (VETC) of $6.0 million and $38.1 million in the third quarter and first nine months of 2013, but did not recognize any revenue attributable to VETC in the third quarter and first nine months of 2012. The American Taxpayer Relief Act, signed into law on January 2, 2013, reinstated VETC through December 31, 2013 and made it retroactive to January 1, 2012. The Company recognized $20.8 million of VETC revenue in the first quarter of 2013 attributable to 2012 sales of CNG and LNG. Also during the second quarter, the Company sold its subsidiary, BAF Technologies, Inc., and recognized a gain of $15.5 million on the transaction.

Andrew J. Littlefair, Clean Energy's President and Chief Executive Officer, stated: "The natural gas fuel market is on the cusp of unprecedented levels of growth, and I am proud of Clean Energy's role in leading the way with our expanding network of both CNG & LNG stations to meet the growing needs of our fleet customers. With the recent introduction of the 12-liter engine and our strategic alliance with GE Capital to help offset the incremental cost of natural gas trucks, the final barriers to adoption are being removed for America's trucking fleets to take advantage of both the economic and environmental benefits of natural gas fueling."

Adjusted EBITDA for the third quarter of 2013 was $4.2 million. This compares with adjusted EBITDA of $(3.1) million in the third quarter of 2012. For the nine months ended September 30, 2013, adjusted EBITDA was $35.4 million, compared with $(6.7) million for the same period in 2012. Adjusted EBITDA is described below and reconciled to the GAAP measure net loss attributable to Clean Energy Fuels Corp.

Non-GAAP loss per share for the third quarter of 2013 was $0.16, compared with a non-GAAP loss per share for the third quarter of 2012 of $0.19. For the nine months ended September 30, 2013, non-GAAP loss per share was $0.19, compared with $0.52 per share for the first nine months in 2012. Non-GAAP loss per share is described below and reconciled to the GAAP measure net loss attributable to Clean Energy Fuels Corp.

On a GAAP basis, net loss for the third quarter of 2013 was $18.8 million, or $0.20 per share, and included a non-cash gain of $1.4 million related to the accounting treatment that requires Clean Energy to value its Series I warrants and mark them to market, a non-cash charge of $5.7 million related to stock-based compensation, and foreign currency gains of $0.2 million on the Company's IMW purchase notes. This compares with a net loss for the third quarter of 2012 of $16.3 million, or $0.19 per share, which included a non-cash gain of $5.7 million related to marking to market the Series I warrants, $6.0 million of non-cash stock-based compensation charges, and foreign currency gains of $0.7 million on the IMW purchase notes.

Net loss for the nine month period ended September 30, 2013, which included a non-cash gain of $0.9 million related to the valuation of the Series I warrants, non-cash stock-based compensation charges of $17.3 million, and foreign currency losses of $0.3 million on its IMW purchase notes, was $34.7 million, or $0.37 per share. This compares with a net loss in the nine months ended September 30, 2012 of $59.5 million, or $0.69 per share, which included a non-cash gain for the Series I warrants of $1.1 million, non-cash stock-based compensation charges of $16.5 million, and foreign currency gains of $0.7 million on its IMW purchase notes.

Non-GAAP Financial Measures

To supplement the Company's consolidated financial statements, which statements are prepared and presented in accordance with generally accepted accounting principles (GAAP), the Company uses non-GAAP financial measures called non-GAAP earnings per share (non-GAAP EPS or non-GAAP earnings/loss per share) and Adjusted EBITDA. Management has presented non-GAAP EPS and Adjusted EBITDA because it uses these non-GAAP financial measures to assess its operational performance, for financial and operational decision-making, and as a means to evaluate period-to-period comparisons on a consistent basis. Management believes that these non-GAAP financial measures provide meaningful supplemental information regarding the Company's performance by excluding certain non-cash or non-recurring expenses that are not directly attributable to its core operating results. In addition, management believes these non-GAAP financial measures are useful to investors because: (1) they allow for greater transparency with respect to key metrics used by management in its financial and operational decision making; (2) they exclude the impact of non-cash or, when specified, non-recurring items that are not directly attributable to the Company's core operating performance and that may obscure trends in the core operating performance of the business; and (3) they are used by institutional investors and the analyst community to help them analyze the results of Clean Energy's business. In future quarters, the Company may make adjustments for other non-recurring significant expenditures or significant non-cash charges in order to present non-GAAP financial measures that 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 the Company expects to continue to incur expenses similar to the non-cash, non-GAAP adjustments described below. Accordingly, unless otherwise stated, the exclusion of these and other similar items in the presentation of non-cash, 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 earnings/loss per share or operating income (loss) as an indicator of operating performance or any other GAAP measure. Moreover, because not all companies use identical measures and calculations, the presentation of non-GAAP EPS or Adjusted EBITDA may not be comparable to other similarly titled measures of other companies. These limitations are compensated for by management by using non-GAAP EPS and Adjusted EBITDA in conjunction with traditional GAAP operating performance and cash flow measures.

Non-GAAP EPS

Non-GAAP EPS is defined as net income (loss) attributed to Clean Energy, plus stock-based compensation charges, net of related tax benefits, plus or minus any mark-to-market losses or gains on the Company's Series I warrants, and plus or minus the foreign currency losses or gains on the Company's purchase notes issued as part of the acquisition of IMW, the total of which is divided by the Company's weighted average shares outstanding on a diluted basis. The Company's management believes that excluding non-cash charges related to stock-based compensation provides useful information to investors because of varying available valuation methodologies, the volatility of the expense (which depends on market forces outside of management's control), and the subjectivity of the assumptions and the variety of award types that a company can use under the relevant accounting guidance may obscure trends in the Company's core operating performance. Similarly, the Company's management believes that excluding the non-cash, mark-to-market losses or gains on the Company's Series I warrants is useful to investors because the valuation of the Series I warrants is based on a number of subjective assumptions, the amount of the loss or gain is derived from market forces outside management's control, and it enables investors to compare the Company's performance with other companies that have different capital structures. The Company's management believes that excluding the foreign currency gains and losses on the notes it issued to purchase IMW provides useful information to investors as the amounts are based on market conditions outside of management's control and the amounts relate to financing the acquisition of the business as opposed to the core operations of the Company.

The table below shows non-GAAP EPS and also reconciles these figures to the GAAP measure net loss attributable to Clean Energy Fuels Corp.:

 
  Three Months Ended   Nine Months Ended
Sept. 30, Sept. 30,
(in 000s, except per-share amounts) 2012   2013 2012   2013
Net Loss Attributable to Clean Energy Fuels Corp. $ (16,321 ) $ (18,836 ) $ (59,520 ) $ (34,650 )
Stock Based Compensation, Net of Tax Benefits 6,044 5,684 16,492 17,347
Mark-to-Market Gain on Series I Warrants (5,692 ) (1,366 ) (1,085 ) (861 )
Foreign Currency (Gain) Loss on IMW Purchase Notes   (741 )   (150 )   (691 )   291  
Adjusted Net Loss $ (16,710 ) $ (14,668 ) $ (44,804 ) $ (17,873 )
Diluted Weighted Average Common Shares Outstanding 87,006,024 94,338,525 86,441,196 93,823,223
Non-GAAP Loss Per Share $ (0.19 ) $ (0.16 ) $ (0.52 ) $ (0.19 )
 

Adjusted EBITDA

Adjusted EBITDA is defined as net income (loss) attributable to Clean Energy, plus or minus income tax expense or benefit, plus or minus interest expense or income, net, plus depreciation and amortization expense, plus or minus the foreign currency losses or gains on the Company's notes issued as part of its acquisition of IMW, plus stock-based compensation charges, net of related tax benefits, and plus or minus any mark-to-market losses or gains on the Company's Series I warrants. The Company's management believes that Adjusted EBITDA provides useful information to investors for the same reasons discussed above for 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 these figures to the GAAP measure net loss attributable to Clean Energy Fuels Corp.:

 
  Three Months Ended   Nine Months Ended
Sept. 30, Sept. 30,
(in 000s) 2012   2013 2012   2013
Net Loss Attributable to Clean Energy Fuels Corp. $ (16,321 ) $ (18,836 ) $ (59,520 ) $ (34,650 )
Income Tax Expense 277 558 695 2,656
Interest Expense, Net 4,314 7,418 11,337 18,771
Depreciation and Amortization 9,047 10,924 26,098 31,859
Foreign Currency (Gain) Loss on IMW Purchase Notes (741 ) (150 ) (691 ) 291
Stock Based Compensation, Net of Tax Benefits 6,044 5,684 16,492 17,347
Mark-to-Market Gain on Series I Warrants   (5,692 )   (1,366 )   (1,085 )   (861 )
Adjusted EBITDA $ (3,072 ) $ 4,232 $ (6,674 ) $ 35,413
 

Gallons Delivered

The Company defines "gallons delivered" as its compressed natural gas (CNG), liquefied natural gas (LNG), renewable natural gas (RNG) and the gallons associated with providing operations and maintenance services delivered to its customers during the period.

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 Saturday, December 7, 2013, which can be reached by dialing 1-877-870-5176 from the U.S., or 1-858-384-5517 from international locations, and entering Replay Pin Number 13572489. 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. (Nasdaq: CLNE) is the largest provider of natural gas fuel for transportation in North America. We build and operate compressed natural gas (CNG) and liquefied natural gas (LNG) fueling stations; manufacture CNG and LNG equipment and technologies for ourselves and other companies; and develop renewable natural gas (RNG) production facilities. 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 that involve risks, uncertainties and assumptions, such as statements regarding growth in the natural gas fuels market, the benefits of the Company's strategic alliance with GE Capital to help offset the incremental cost of natural gas trucks, America's Natural Gas Highway, the transition of the heavy-duty trucking industry to natural gas, market acceptance of natural gas as a vehicle fuel, future growth and sales opportunities in all of the Company's markets, which include trucking, refuse, airport, taxi and transit, the availability of natural gas engines and natural gas heavy-duty trucks, the benefits of natural gas relative to diesel and gasoline, and the recognition of revenue attributable to the VETC. Actual results and the timing of events could differ materially from those anticipated in these forward-looking statements as a result of several factors including, but not limited to, changes in the prices of natural gas relative to gasoline and diesel, the Company's failure to recognize the anticipated benefits of building America's Natural Gas Highway, the availability and deployment of, as well as the demand for, natural gas engines that are well-suited for the U.S. long-haul, heavy-duty truck market, future availability of equity or debt financing needed to fund the growth of the Company's business, the Company's ability to source and supply sufficient LNG to meet the needs of its business, the Company's ability to effectively manage its current LNG plants and the construction of new LNG plants, the Company's ability to efficiently manage its growth and retain and hire key personnel, the acceptance of natural gas vehicles in the Company's markets, the availability of natural gas vehicles, relaxation or waiver of fuel emission standards, the Company's ability to capture a substantial share of the anticipated growth in the market for natural gas fuel and otherwise compete successfully, the Company's failure to manage risks and uncertainties related to its international operations, construction and permitting delays at station construction projects, the Company's ability to integrate acquisitions, the availability of tax and related government incentives for natural gas fueling and vehicles, compliance with governmental regulations and the Company's ability to manage and grow its RNG business. The forward-looking statements made herein 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. Additionally, the Company's Form 10-Q filed on November 7, 2013 with the SEC (www.sec.gov), contains 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
December 31, 2012 and September 30, 2013
(Unaudited)
(In thousands, except share data)
 
  December 31, September 30,
2012 2013
Assets
Current assets:
Cash and cash equivalents $ 108,522 $ 352,136
Restricted cash 8,445 10,632
Short-term investments 38,175 54,307
Accounts receivable, net of allowance for doubtful accounts of $905 and $768 as of December 31, 2012 and September 30, 2013, respectively 57,594 56,259
Other receivables 17,808 27,685
Inventory, net 38,152 39,720
Prepaid expenses and other current assets 16,002 17,402  
Total current assets 284,698 558,141
Land, property and equipment, net 428,177 468,224
Restricted cash 13,208 564
Notes receivable and other long-term assets 71,389 75,918
Investments in other entities 2,581

Goodwill 75,865 90,031
Intangible assets, net 99,282 83,706  
Total assets $ 975,200 $ 1,276,584  
Liabilities and Stockholders' Equity
Current liabilities:
Current portion of long-term debt and capital lease obligations $ 30,389 $ 25,797
Accounts payable 39,216 30,861
Accrued liabilities 30,794 49,957
Deferred revenue 13,521 13,501  
Total current liabilities 113,920 120,116
Long-term debt and capital lease obligations, less current portion 300,636

529,424

Long-term debt, related party

65,000

Other long-term liabilities 14,014 14,061  
Total liabilities 428,570 728,601
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 149,000,000 shares; issued and outstanding 87,634,478 shares and 89,355,397 shares at December 31, 2012 and September 30, 2013, respectively 9 9
Additional paid-in capital 837,367 877,351
Accumulated deficit (300,814 ) (335,464 )
Accumulated other comprehensive income 6,151 2,158  
Total Clean Energy Fuels Corp. stockholders' equity 542,713 544,054
Noncontrolling interest in subsidiary 3,917 3,929  
Total stockholders' equity 546,630 547,983  
Total liabilities and stockholders' equity $ 975,200 $ 1,276,584  
 
 
Clean Energy Fuels Corp. and Subsidiaries
Condensed Consolidated Statements of Operations
For the Three Months and Nine Months Ended September 30, 2012 and 2013
(Unaudited)
(In thousands, except share and per share data)
 
  Three Months Ended   Nine Months Ended
September 30, September 30,
2012   2013 2012   2013
Revenue:
Product revenues $ 82,720 $ 75,389 $ 206,201 $ 237,247
Service revenues   8,739     10,932   28,734   30,233  
Total revenues 91,459 86,321 234,935 267,480
Operating expenses:
Cost of sales:
Product cost of sales 67,392 51,941 162,985 157,680
Service cost of sales 3,839 2,866 12,662 9,809
Derivative gains:
Series I warrant valuation (5,692 ) (1,366 ) (1,085 ) (861 )
Selling, general and administrative 30,557 33,511 83,323 101,574
Depreciation and amortization   9,047     10,924   26,098   31,859  
Total operating expenses   105,143     97,876   283,983   300,061  
Operating loss (13,684 ) (11,555 ) (49,048 ) (32,581 )
Interest expense, net (4,314 ) (7,418 ) (11,337 ) (18,771 )
Other income (expense), net 1,914 736 1,578 (757 )
Income (loss) from equity method investment 152 315 (76 )
Gain from sale of equity method investment 4,705
Gain from sale of subsidiary           15,498  
Loss before income taxes (15,932 ) (18,237 ) (58,492 ) (31,982 )
Income tax expense   (277 )   (558 ) (695 ) (2,656 )
Net loss (16,209 ) (18,795 ) (59,187 ) (34,638 )
Income of noncontrolling interest   (112 )   (41 ) (333 ) (12 )
Net loss attributable to Clean Energy Fuels Corp. $ (16,321 ) $ (18,836 ) $ (59,520 ) $ (34,650 )
Loss per share attributable to Clean Energy Fuels Corp.:
Basic $ (0.19 ) $ (0.20 ) $ (0.69 ) $ (0.37 )
Diluted $ (0.19 ) $ (0.20 ) $ (0.69 ) $ (0.37 )
Weighted-average common shares outstanding:
Basic   87,006,024     94,338,525   86,441,196   93,823,223  
Diluted   87,006,024     94,338,525   86,441,196   93,823,223  
 

Included in net loss are the following amounts (in millions):

 
  Three Months Ended   Nine Months Ended
Sept. 30, Sept. 30,
2012   2013 2012   2013
Construction Revenues $ 31.0 $ 5.2 $ 53.6 $ 20.2
Construction Cost of Sales (28.4 ) (3.9 ) (49.5 ) (16.6 )
Fuel Tax Credits 6.0 38.1
Stock-based Compensation Expense, Net of Tax Benefits (6.0 ) (5.7 ) (16.5 ) (17.3 )
 

Clean Energy Fuels Corp.
Investor Contact:
Tony Kritzer, 949-437-1403
Director of Investor Communications
or
News Media Contact:
Gary Foster, 949-437-1113
Senior Vice President, Corporate Communications

Source: Clean Energy Fuels Corp.

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