Clean Energy Fuels Corp. Stock Earnings Reports

Financial Performance

• Q4 2024: Company sold 62 million gallons of renewable natural gas (RNG), a 9% increase YoY, generating $109 million in revenue and $24 million in adjusted EBITDA.
• Full Year 2024: Total sales were 237 million gallons, yielding an adjusted EBITDA of $77 million. However, a GAAP net loss of $29.8 million for Q4 and $83.1 million for the year was reported, influenced by non-cash stock-based expenses and asset write-downs.

Market Growth

• The RNG industry has grown significantly, with the company marking a decade since the initial sales of RNG as a transportation fuel.
• The majority of growth in RNG sales is coming from transit agencies converting their fleets from compressed natural gas (CNG) to RNG.
• New contracts for hydrogen fueling stations are being pursued, indicating diversification within the fuel offerings.

X15 Engine Adoption

• Adoption of the Cummins X15 engine represents a significant growth opportunity, with initial orders expected from both existing natural gas operators and new fleets entering the market.
• The expectation is for modest growth in RNG volumes associated with the X15 engine rollout, with estimates of 3 million to 5 million gallons attributable to this new engine in 2025.

Regulatory Environment

• The Federal Alternative Fuel Tax Credit (AFTC) expired at the end of 2024 and has not been included in the 2025 outlook. The company has expressed optimism for its potential retroactive approval.
• The company anticipates the finalization of the Section 45Z Clean Fuel Production Credit, which could support low-carbon fuel production, though it has not been incorporated into 2025 projections due to pending regulations.

2025 Guidance

• Forecasted adjusted EBITDA for 2025 is expected to be between $50 million to $55 million, a decrease from 2024 due to several factors including lower AFTC contribution and reduced Renewable Identification Number (RIN) prices.
• Guidance expects consolidated revenues around $400 million for 2025, reflecting a lack of AFTC revenue and anticipated lower environmental credit revenue.

CAPEX and Investments

• Capital expenditures for 2025 are projected at $30 million, a decrease from previous years, primarily focused on completing Amazon-dedicated fueling stations and ongoing RNG upstream projects.

Overall Outlook

• The company maintains a strong balance sheet with $217 million in unrestricted cash and investments.
• Positive sentiment about RNG remains strong, particularly in light of federal support for domestically-produced clean fuels. The company anticipates gradual growth driven by fleet adoptions and infrastructure expansion.

Investor Takeaway

Investors should monitor developments regarding regulatory changes, progress on RNG credit eligibility, and customer adoption rates for the X15 engine, while acknowledging the company’s solid financial position and market growth potential in the RNG sector amidst a complex regulatory environment.