Excelerate Energy Reports Strong Third Quarter 2024 Results, Raises and Narrows Full Year Adjusted EBITDA Guidance
-- Quarterly Cash Dividend Increased 140% from the Prior Quarter --
RECENT HIGHLIGHTS
-
Reported Net Income of
$45.5 million for the third quarter -
Reported Adjusted EBITDA of
$92.3 million for the third quarter -
Raised and narrowed Full Year 2024 Adjusted EBITDA guidance, now expected to range between
$335 million and$345 million -
Declared a quarterly cash dividend of
$0.06 per share, or$0.24 per share on an annualized basis, representing a 140% increase from the prior quarter, payable onDecember 5, 2024
CEO COMMENT
“Excelerate delivered another quarter of solid financial and operational performance. Our ability to deliver consistent results and generate strong cash flow is driven by the high quality of our FSRU and terminals business,” said Steven Kobos, President and Chief Executive Officer of
Kobos continued, “As a US LNG company with a global presence, we are focused on expanding our reach in both new and existing markets around the world. We continue to execute a disciplined capital allocation plan with the aim of driving value creation for our shareholders.”
THIRD QUARTER 2024 FINANCIAL RESULTS
|
For the three months ended |
|
|||||||||
|
|
|
|
|
|
|
|
|
|||
(in millions, except per share amounts) |
2024 |
|
|
2024 |
|
|
2023 |
|
|||
Revenues |
$ |
193.4 |
|
|
$ |
183.3 |
|
|
$ |
275.5 |
|
Operating Income |
$ |
59.7 |
|
|
$ |
49.9 |
|
|
$ |
67.5 |
|
Net Income |
$ |
45.5 |
|
|
$ |
33.3 |
|
|
$ |
46.5 |
|
Adjusted EBITDA (1) |
$ |
92.3 |
|
|
$ |
89.0 |
|
|
$ |
106.9 |
|
Earnings Per Share (diluted) |
$ |
0.35 |
|
|
$ |
0.26 |
|
|
$ |
0.40 |
|
(1) See the reconciliation of non-GAAP financial measures to the most comparable GAAP financial measure in the section titled "Non-GAAP Reconciliation" below. |
Net income for the third quarter of 2024 increased sequentially from the last quarter primarily due to lower operating costs across several regasification projects, higher gas sales margins and lower depreciation expense. Adjusted EBITDA increased sequentially primarily due to the lower operating costs and higher gas sales margins.
Net Income and Adjusted EBITDA for the third quarter of 2024 decreased from the prior year third quarter primarily due to the transition of the FSRU Sequoia to a time charter party agreement in the first quarter of 2024, increased costs primarily related to business development activities, and a decrease in other gas sales opportunities, partially offset by higher interest income.
KEY COMMERCIAL UPDATES
LNG Supply Portfolio
In the third quarter of 2024,
In
LIQUIDITY AND CAPITAL RESOURCES
As of
On
2024 FINANCIAL OUTLOOK
Actual results may differ materially from the Company’s outlook as a result of, among other things, the factors described under “Forward-Looking Statements” below.
INVESTOR CONFERENCE CALL AND WEBCAST
The
ABOUT
USE OF NON-GAAP FINANCIAL MEASURES
The Company reports financial results in accordance with accounting principles generally accepted in
Adjusted Gross Margin
We use Adjusted Gross Margin, a non-GAAP financial measure, which we define as revenues less direct cost of sales and operating expenses, excluding depreciation and amortization, to measure our operational financial performance. Management believes Adjusted Gross Margin is useful because it provides insight on profitability and true operating performance excluding the implications of the historical cost basis of our assets. Our computation of Adjusted Gross Margin may not be comparable to other similarly titled measures of other companies, and you are cautioned not to place undue reliance on this information.
Adjusted EBITDA
Adjusted EBITDA is a non-GAAP financial measure included as a supplemental disclosure because we believe it is a useful indicator of our operating performance. We define Adjusted EBITDA as net income before interest expense, income taxes, depreciation and amortization, accretion, non-cash long-term incentive compensation expense and items such as charges and non-recurring expenses that management does not consider as part of assessing ongoing operating performance.
The Company adjusts net income for the items listed above to arrive at Adjusted EBITDA because these amounts can vary substantially from company to company within its industry depending upon accounting methods and book values of assets, capital structures and the method by which the assets were acquired. Adjusted EBITDA should not be considered as an alternative to, or more meaningful than, net income as determined in accordance with GAAP or as an indicator of the Company's operating performance or liquidity. This measure has limitations as certain excluded items are significant components in understanding and assessing a company’s financial performance, such as a company’s cost of capital and tax structure, as well as the historic costs of depreciable assets, none of which are components of Adjusted EBITDA. The Company's presentation of Adjusted EBITDA should not be construed as an inference that its results will be unaffected by unusual or non-recurring items. The Company's computations of Adjusted EBITDA may not be comparable to other similarly titled measures of other companies. For the foregoing reasons, Adjusted EBITDA has significant limitations which affect its use as an indicator of its profitability and valuation, and you are cautioned not to place undue reliance on this information.
FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995 as contained in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, about
You should not rely on forward-looking statements as predictions of future events. We have based the forward-looking statements contained in this press release primarily on our current expectations and projections about future events and trends that we believe may affect our business, financial condition and operating results. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties and other factors, including, but not limited to, the following: unplanned issues, including time delays, unforeseen expenses, cost inflation, materials or labor shortages, which could result in delayed receipt of payment or existing or anticipated project cancellations; the competitive market for liquified natural gas (“LNG”) regasification services; changes in the supply of and demand for and price of LNG and natural gas and LNG regasification capacity; our need for substantial expenditures to maintain and replace, over the long-term, the operating capacity of our assets; our operations outside of
Moreover, we operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time, and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this press release. For example, the current global economic uncertainty and geopolitical climate, including international wars and conflicts, and world or regional health events, including pandemics and epidemics and governmental and third-party responses thereto, may give rise to risks that are currently unknown or amplify the risks associated with many of the foregoing events or factors. The results, events and circumstances reflected in the forward-looking statements may not be achieved or occur, and actual results, events or circumstances could differ materially from those described in the forward-looking statements.
In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based on information available to us as of the date of this press release. While we believe that the statements provided herein are supported by information obtained in a reasonable manner, that information may be limited or incomplete. Our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all relevant information. These statements are inherently uncertain, and investors are cautioned not to unduly rely on these statements.
The forward-looking statements made in this press release relate only to events as of the date on which the statements are made. We undertake no obligation to update any forward-looking statements made in this press release to reflect events or circumstances after the date of this press release or to reflect new information or the occurrence of unanticipated events, except as required by law. We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements, and you should not place undue reliance on our forward-looking statements. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures or investments.
|
||||||||||||
Consolidated Statements of Income (Unaudited) |
||||||||||||
|
|
For the three months ended |
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|||
|
|
2024 |
|
|
2024 |
|
|
2023 |
|
|||
|
|
(In thousands, except share and per share amounts) |
|
|||||||||
Revenues |
|
|
|
|
|
|
|
|
|
|||
FSRU and terminal services |
|
$ |
150,139 |
|
|
$ |
150,987 |
|
|
$ |
133,177 |
|
Gas sales |
|
|
43,280 |
|
|
|
32,346 |
|
|
|
142,294 |
|
Total revenues |
|
|
193,419 |
|
|
|
183,333 |
|
|
|
275,471 |
|
Operating expenses |
|
|
|
|
|
|
|
|
|
|||
Cost of revenue and vessel operating expenses (exclusive of items below) |
|
|
45,431 |
|
|
|
46,579 |
|
|
|
49,190 |
|
Direct cost of gas sales |
|
|
41,399 |
|
|
|
31,173 |
|
|
|
106,109 |
|
Depreciation and amortization |
|
|
23,031 |
|
|
|
30,400 |
|
|
|
33,161 |
|
Selling, general and administrative expenses |
|
|
23,819 |
|
|
|
25,300 |
|
|
|
19,513 |
|
Total operating expenses |
|
|
133,680 |
|
|
|
133,452 |
|
|
|
207,973 |
|
Operating income |
|
|
59,739 |
|
|
|
49,881 |
|
|
|
67,498 |
|
Other income (expense) |
|
|
|
|
|
|
|
|
|
|||
Interest expense |
|
|
(11,711 |
) |
|
|
(12,057 |
) |
|
|
(13,926 |
) |
Interest expense – related party |
|
|
(3,411 |
) |
|
|
(3,419 |
) |
|
|
(3,592 |
) |
Earnings (loss) from equity method investment |
|
|
562 |
|
|
|
592 |
|
|
|
(550 |
) |
Other income, net |
|
|
6,525 |
|
|
|
5,707 |
|
|
|
5,263 |
|
Income before income taxes |
|
|
51,704 |
|
|
|
40,704 |
|
|
|
54,693 |
|
Provision for income taxes |
|
|
(6,158 |
) |
|
|
(7,427 |
) |
|
|
(8,188 |
) |
Net income |
|
|
45,546 |
|
|
|
33,277 |
|
|
|
46,505 |
|
Less net income attributable to non-controlling interest |
|
|
36,591 |
|
|
|
26,605 |
|
|
|
32,613 |
|
Net income attributable to shareholders |
|
$ |
8,955 |
|
|
$ |
6,672 |
|
|
$ |
13,892 |
|
|
|
|
|
|
|
|
|
|
|
|||
Net income per common share – basic |
|
$ |
0.36 |
|
|
$ |
0.27 |
|
|
$ |
0.53 |
|
Net income per common share – diluted |
|
$ |
0.35 |
|
|
$ |
0.26 |
|
|
$ |
0.40 |
|
Weighted average shares outstanding – basic |
|
|
25,009,326 |
|
|
|
25,175,057 |
|
|
|
26,254,243 |
|
Weighted average shares outstanding – diluted |
|
|
25,468,541 |
|
|
|
25,338,067 |
|
|
|
108,295,819 |
|
|
||||||||
Consolidated Balance Sheets |
||||||||
|
|
|
|
|
|
|
||
|
|
(Unaudited) |
|
|
|
|
||
ASSETS |
|
(In thousands) |
|
|||||
Current assets |
|
|
|
|
|
|
||
Cash and cash equivalents |
|
$ |
608,447 |
|
|
$ |
555,853 |
|
Current portion of restricted cash |
|
|
3,625 |
|
|
|
2,655 |
|
Accounts receivable, net |
|
|
81,506 |
|
|
|
97,285 |
|
Current portion of net investments in sales-type leases |
|
|
42,616 |
|
|
|
16,463 |
|
Other current assets |
|
|
27,781 |
|
|
|
27,356 |
|
Total current assets |
|
|
763,975 |
|
|
|
699,612 |
|
Restricted cash |
|
|
14,413 |
|
|
|
13,950 |
|
Property and equipment, net |
|
|
1,585,595 |
|
|
|
1,649,779 |
|
Net investments in sales-type leases |
|
|
388,120 |
|
|
|
383,547 |
|
Investment in equity method investee |
|
|
19,522 |
|
|
|
21,269 |
|
Deferred tax assets, net |
|
|
34,986 |
|
|
|
42,948 |
|
Other assets |
|
|
57,790 |
|
|
|
49,274 |
|
Total assets |
|
$ |
2,864,401 |
|
|
$ |
2,860,379 |
|
LIABILITIES AND EQUITY |
|
|
|
|
|
|
||
Current liabilities |
|
|
|
|
|
|
||
Accounts payable |
|
$ |
8,598 |
|
|
$ |
13,761 |
|
Accrued liabilities and other liabilities |
|
|
68,922 |
|
|
|
89,796 |
|
Current portion of deferred revenue |
|
|
29,422 |
|
|
|
27,169 |
|
Current portion of long-term debt |
|
|
46,448 |
|
|
|
42,614 |
|
Current portion of long-term debt – related party |
|
|
8,777 |
|
|
|
8,336 |
|
Current portion of finance lease liabilities |
|
|
23,115 |
|
|
|
22,080 |
|
Total current liabilities |
|
|
185,282 |
|
|
|
203,756 |
|
Long-term debt, net |
|
|
299,206 |
|
|
|
333,367 |
|
Long-term debt, net – related party |
|
|
164,479 |
|
|
|
171,693 |
|
Finance lease liabilities |
|
|
173,520 |
|
|
|
189,807 |
|
TRA liability |
|
|
63,457 |
|
|
|
67,061 |
|
Asset retirement obligations |
|
|
43,217 |
|
|
|
41,834 |
|
Other long-term liabilities |
|
|
52,575 |
|
|
|
43,507 |
|
Total liabilities |
|
$ |
981,736 |
|
|
$ |
1,051,025 |
|
Commitments and contingencies |
|
|
|
|
|
|
||
Class A Common Stock ( |
|
|
26 |
|
|
|
26 |
|
Class B Common Stock ( |
|
|
82 |
|
|
|
82 |
|
Additional paid-in capital |
|
|
472,502 |
|
|
|
465,551 |
|
Retained earnings |
|
|
59,715 |
|
|
|
39,754 |
|
Accumulated other comprehensive income (loss) |
|
|
(381 |
) |
|
|
505 |
|
|
|
|
(29,759 |
) |
|
|
(472 |
) |
Non-controlling interest |
|
|
1,380,480 |
|
|
|
1,303,908 |
|
Total equity |
|
$ |
1,882,665 |
|
|
$ |
1,809,354 |
|
Total liabilities and equity |
|
$ |
2,864,401 |
|
|
$ |
2,860,379 |
|
|
||||||||
Consolidated Statements of Cash Flows (Unaudited) |
||||||||
|
|
For the nine months ended |
|
|||||
|
|
|
|
|
|
|
||
Cash flows from operating activities |
|
(In thousands) |
|
|||||
Net income |
|
|
106,963 |
|
|
$ |
106,800 |
|
Adjustments to reconcile net income to net cash from operating activities |
|
|
|
|
|
|
||
Depreciation and amortization |
|
|
76,341 |
|
|
|
89,126 |
|
Amortization of operating lease right-of-use assets |
|
|
1,300 |
|
|
|
12,006 |
|
ARO accretion expense |
|
|
1,384 |
|
|
|
1,323 |
|
Amortization of debt issuance costs |
|
|
2,258 |
|
|
|
4,875 |
|
Deferred income taxes |
|
|
5,190 |
|
|
|
(5,102 |
) |
Share of net earnings in equity method investee |
|
|
(1,685 |
) |
|
|
(258 |
) |
Distributions from equity method investee |
|
|
1,800 |
|
|
|
4,725 |
|
Long-term incentive compensation expense |
|
|
5,263 |
|
|
|
2,560 |
|
(Gain) loss on non-cash items |
|
|
(44 |
) |
|
|
1,370 |
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
||
Accounts receivable |
|
|
15,779 |
|
|
|
31,531 |
|
Other current assets and other assets |
|
|
(15,837 |
) |
|
|
143,003 |
|
Accounts payable and accrued liabilities |
|
|
(29,789 |
) |
|
|
(86,847 |
) |
Current portion of deferred revenue |
|
|
2,253 |
|
|
|
(120,374 |
) |
Net investments in sales-type leases |
|
|
15,263 |
|
|
|
10,681 |
|
Other long-term liabilities |
|
|
8,379 |
|
|
|
(145 |
) |
Net cash provided by operating activities |
|
$ |
194,818 |
|
|
$ |
195,274 |
|
|
|
|
|
|
|
|
||
Cash flows from investing activities |
|
|
|
|
|
|
||
Purchases of property and equipment |
|
|
(49,706 |
) |
|
|
(304,426 |
) |
Sales of property and equipment |
|
|
— |
|
|
|
4,101 |
|
Net cash used in investing activities |
|
$ |
(49,706 |
) |
|
$ |
(300,325 |
) |
|
|
|
|
|
|
|
||
Cash flows from financing activities |
|
|
|
|
|
|
||
Repurchase of Class A Common Stock |
|
|
(27,214 |
) |
|
|
— |
|
Proceeds from Term Loan Facility |
|
|
— |
|
|
|
250,000 |
|
Repayments of long-term debt |
|
|
(31,893 |
) |
|
|
(20,492 |
) |
Repayments of long-term debt – related party |
|
|
(6,773 |
) |
|
|
(6,221 |
) |
Payment of debt issuance costs |
|
|
— |
|
|
|
(7,307 |
) |
Principal payments under finance lease liabilities |
|
|
(15,252 |
) |
|
|
(15,661 |
) |
Taxes withheld for long-term incentive compensation |
|
|
(253 |
) |
|
|
— |
|
Dividends paid |
|
|
(2,067 |
) |
|
|
(1,969 |
) |
Distributions |
|
|
(8,591 |
) |
|
|
(8,153 |
) |
Minority owner contribution – |
|
|
1,012 |
|
|
|
3,108 |
|
Net cash provided by (used in) financing activities |
|
$ |
(91,031 |
) |
|
$ |
193,305 |
|
|
|
|
|
|
|
|
||
Effect of exchange rate on cash, cash equivalents, and restricted cash |
|
|
(54 |
) |
|
|
(43 |
) |
|
|
|
|
|
|
|
||
Net increase in cash, cash equivalents and restricted cash |
|
|
54,027 |
|
|
|
88,211 |
|
|
|
|
|
|
|
|
||
Cash, cash equivalents and restricted cash |
|
|
|
|
|
|
||
Beginning of period |
|
$ |
572,458 |
|
|
$ |
537,971 |
|
End of period |
|
$ |
626,485 |
|
|
$ |
626,182 |
|
Non-GAAP Reconciliation (Unaudited)
The following table presents a reconciliation of adjusted gross margin to the GAAP financial measures of gross margin for each of the period indicated.
|
|
For the three months ended |
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|||
|
|
(In thousands) |
|
|||||||||
FSRU and terminal services revenues |
|
$ |
150,139 |
|
|
$ |
150,987 |
|
|
$ |
133,177 |
|
Gas sales revenues |
|
|
43,280 |
|
|
|
32,346 |
|
|
|
142,294 |
|
Cost of revenue and vessel operating expenses |
|
|
(45,431 |
) |
|
|
(46,579 |
) |
|
|
(49,190 |
) |
Direct cost of gas sales |
|
|
(41,399 |
) |
|
|
(31,173 |
) |
|
|
(106,109 |
) |
Depreciation and amortization expense |
|
|
(23,031 |
) |
|
|
(30,400 |
) |
|
|
(33,161 |
) |
Gross Margin |
|
$ |
83,558 |
|
|
$ |
75,181 |
|
|
$ |
87,011 |
|
Depreciation and amortization expense |
|
|
23,031 |
|
|
|
30,400 |
|
|
|
33,161 |
|
Adjusted Gross Margin |
|
$ |
106,589 |
|
|
$ |
105,581 |
|
|
$ |
120,172 |
|
The following table presents a reconciliation of Adjusted EBITDA to the GAAP financial measures of net income for each of the period indicated.
|
|
For the three months ended |
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|||
|
|
(In thousands) |
|
|||||||||
Net income |
|
$ |
45,546 |
|
|
$ |
33,277 |
|
|
$ |
46,505 |
|
Interest expense |
|
|
15,122 |
|
|
|
15,476 |
|
|
|
17,518 |
|
Provision for income taxes |
|
|
6,158 |
|
|
|
7,427 |
|
|
|
8,188 |
|
Depreciation and amortization expense |
|
|
23,031 |
|
|
|
30,400 |
|
|
|
33,161 |
|
Accretion expense |
|
|
466 |
|
|
|
463 |
|
|
|
446 |
|
Long-term incentive compensation expense |
|
|
1,966 |
|
|
|
1,920 |
|
|
|
1,129 |
|
Adjusted EBITDA |
|
$ |
92,289 |
|
|
$ |
88,963 |
|
|
$ |
106,947 |
|
|
|
2024E |
|
|
2024E |
|
||
(In millions) |
|
Low Case |
|
|
High Case |
|
||
Income before income taxes |
|
$ |
162 |
|
|
$ |
181 |
|
Interest expense |
|
|
63 |
|
|
|
58 |
|
Depreciation and amortization expense |
|
|
101 |
|
|
|
96 |
|
Accretion expense |
|
|
2 |
|
|
|
2 |
|
Long-term incentive compensation expense |
|
|
7 |
|
|
|
8 |
|
Adjusted EBITDA |
|
$ |
335 |
|
|
$ |
345 |
|
Note: We have not reconciled the Adjusted EBITDA outlook to net income, the most comparable measure, because it is not possible to estimate, without unreasonable effort, our income taxes with the level of required precision. Accordingly, we have reconciled these non-GAAP measures to our estimated income before taxes.
View source version on businesswire.com: https://www.businesswire.com/news/home/20241106575096/en/
Investors
Craig.Hicks@excelerateenergy.com
Media
FGS Global
Excelerate@fgsglobal.com
or
media@excelerateenergy.com
Source: