Clean Energy Fuels ((CLNE)) has held its Q4 earnings call. Read on for the main highlights of the call.
The recent earnings call for Clean Energy Fuels presented a mixed sentiment, highlighting both positive strides and notable challenges. The company reported encouraging revenue growth and increased sales of renewable natural gas (RNG), yet faced a significant GAAP net loss and a downward revision of its 2025 EBITDA outlook. The introduction of the Cummins X15N engine was a bright spot, offering a promising outlook for future growth, though uncertainties in policy and credit support remain a concern.
Strong Fourth Quarter Results
The company closed the fourth quarter with impressive results, selling 62 million gallons of RNG, marking a 9% increase from the previous year. This achievement generated $109 million in revenue and $24 million of adjusted EBITDA, showcasing the company’s robust performance in the last quarter.
Full Year 2024 Performance
For the full year 2024, Clean Energy Fuels sold 237 million gallons of RNG, reflecting a nearly 5% increase over 2023. The company reported $77 million in adjusted EBITDA, underscoring a solid year despite the challenges faced.
Downstream RNG Fueling Business Success
The downstream RNG fueling business proved to be a significant contributor to the company’s success in 2024, generating almost $89 million of EBITDA even before the introduction of the new X15 engine. This highlights the strength and potential of this segment.
Adoption of Cummins X15N Engine
The introduction of the Cummins X15N engine has been met with positive feedback and initial orders from major fleets such as Food Express, Cemex, Mullen, and FedEx. This adoption indicates a promising growth trajectory for the company as it expands its market reach.
GAAP Net Loss in 2024
Despite the positive sales figures, Clean Energy Fuels reported a GAAP net loss of $83.1 million for 2024. This loss was partly due to non-cash stock-based Amazon warrant charges amounting to approximately $61 million, highlighting a significant financial challenge.
2025 Adjusted EBITDA Outlook
Looking ahead, the company has revised its 2025 adjusted EBITDA outlook to between $50 million and $55 million, down from $77 million in 2024. This reduction is attributed to the exclusion of the alternative fuel tax credit (AFTC) and a 30% decrease in RIN prices, which together accounted for a $34 million decrease.
Exit from Pilot Flying J Locations
Clean Energy Fuels is considering exiting 55 Pilot Flying J locations that house LNG fueling equipment. This move would result in a non-cash hit and additional costs for equipment removal, presenting another operational challenge for the company.
Forward-Looking Guidance
In their guidance for 2025, Clean Energy Fuels anticipates selling 246 million gallons of RNG, with an adjusted EBITDA projected between $50 million to $55 million. The company plans a capital expenditure of $30 million, with $104 million allocated for RNG upstream projects. The adoption of the Cummins X15N engine is expected to contribute 3 to 5 million gallons of fuel, indicating a positive impact on future growth.
In summary, the earnings call for Clean Energy Fuels reflected a blend of optimism and caution. While the company demonstrated strong revenue growth and promising developments with the Cummins X15N engine, it also faced financial challenges and a reduced EBITDA outlook for 2025. Investors will be keenly watching how the company navigates these challenges and capitalizes on its growth opportunities.