RNG: Non-GAAP cash EBITDA of
See “Non-GAAP Financial Information” below.
Net-Zero 1 Development: Net-Zero 1 is in the diligence phase of the
Verity: Verity, an end-to-end carbon accounting solution SaaS (Software as a Service) business built on proprietary distributed ledger technology, expects to announce its first revenue in 2024 and to pursue scalable customer growth in 2025. Verity is a capital light, fixed fee and profit sharing business. Based on a market and business analysis by a well known global consulting firm, the initial target market for Verity is estimated to be
ETO: Our Ethanol-to-Olefins (“ETO”) technology pilot plant has started production and is operating as expected.
2024 Expected Uses of Cash
Net-Zero 1
- This spend includes long-lead equipment, related wind and onsite hydrogen projects and value engineering to advance a financeable EPC contract.
- We expect this spend, plus the previous spend of approximately
$111 million as of end of 2023 and other associated costs, to be fully recoverable at financial close from project-level debt and equity sources of capital, as is customary in project financings.
- We anticipate reinvesting all or a portion of the development recoveries into the project alongside third-party, project level equity at financial close at rates of return commensurate with our developer role.
- After financial close of the project, we expect that project construction through startup and commissioning would be fully funded with no additional cash commitments from Gevo.
- The engineering would result in a modularized, reusable and purpose built alcohol-to-jet plant design. We believe such design will be highly beneficial to the buildout of future alcohol-to-jet projects and the use of ethanol to make SAF.
- Multiple patents have been filed on this plant design.
NZ and
In 2023, Gevo engaged an independent third party audit firm to perform a cost allocation analysis. The purpose of this analysis was twofold: (1) to document to third parties our project development costs for recovery purposes (e.g., recovery at Net Zero 1 financial close); (2) to more accurately reflect the discretionary, non-recurring and growth project development related nature of such costs. The independent auditor based its analysis on the Treas. Reg. §1.482 transfer pricing guidelines, which set forth the arm’s length principle, whereby related parties shall operate in such manner as would true commercial parties. As a result of this analysis, the audit firm identified a substantial amount of costs historically classified as GAAP G&A that may be classified as project development.
Research & Development: Expected uses of cash of
Non-Discretionary, Non-Growth Project Related Uses of Cash
General & Administrative (“G&A”): Expected G&A uses of cash of
Luverne Facility: Expected facility idling use of cash of
2024 Guidance Summary | ||||
($ in millions) | ||||
RNG non-GAAP cash EBITDA | ||||
3Q 2023, reported | ||||
Annualized 3Q 2023 | ||||
Annualized expected sensitivities: | ||||
With Permanent CARB CI Pathway | ||||
With LCFS Prices at | ||||
With Biogas PTC (2025-2027) | ||||
Verity | ||||
First revenue year | 2024 | |||
Scalable growth year | 2025 | |||
2024 Expected Uses of Cash | ||||
and restricted cash | ||||
Discretionary Growth / Project | ||||
Development | ||||
Net-Zero 1 | ||||
until Financial Close | ||||
Additional NZ Project Developments | ||||
Research & Development | ||||
Non-Discretionary, Run-Rate Spend | ||||
General & Administrative | ||||
run-rate, non-discretionary | ||||
Luverne Facility | ||||
Remaining cash, equivalents and | ||||
restricted cash before RNG, Verity, | ||||
investment income, interest and other | ||||
See “Non-GAAP Financial Information” below.
Non-GAAP Financial Information
This press release contains a financial measure that does not comply with
Non-GAAP cash EBITDA is calculated by adding back depreciation and amortization and non-cash stock-based compensation to GAAP loss from operations.
This measure supplements the company’s financial results prepared in accordance with GAAP. Gevo management uses this measure to better analyze its financial results and to help make managerial decisions. In management’s opinion, this non-GAAP measure is useful to investors and other users of the company’s financial statements by providing greater transparency into the ongoing operating performance of Gevo and its future outlook. This measure should not be deemed to be an alternative to GAAP requirements. The non-GAAP measure presented here is also unlikely to be comparable with non-GAAP disclosures released by other companies. See the table below for a reconciliation of GAAP to our non-GAAP measure.
Reconciliation of GAAP to Non-GAAP Financial Information
(Unaudited, in thousands)
Three Months Ended | Nine Months Ended | |||||||||||||||
Non-GAAP Cash EBITDA (Gevo NW Iowa RNG): | ||||||||||||||||
Loss from operations | $ | (230 | ) | $ | (3,481 | ) | $ | (3,711 | ) | $ | (4,088 | ) | ||||
Depreciation and amortization | 1,914 | 3,185 | 5,099 | 313 | ||||||||||||
Stock-based compensation | 18 | 42 | 59 | 7 | ||||||||||||
Non-GAAP cash EBITDA (loss) (Gevo NW Iowa RNG) | $ | 1,702 | $ | (254 | ) | $ | 1,447 | $ | (3,768 | ) |
About Gevo
Gevo’s mission is to transform renewable energy and carbon into energy-dense liquid hydrocarbons. These liquid hydrocarbons can be used for drop-in transportation fuels such as gasoline, jet fuel and diesel fuel, that when burned have potential to yield net-zero greenhouse gas emissions when measured across the full life cycle of the products. Gevo uses low-carbon renewable resource-based carbohydrates as raw materials, and is in an advanced state of developing renewable electricity and renewable natural gas for use in production processes, resulting in low-carbon fuels with substantially reduced carbon intensity (the level of greenhouse gas emissions compared to standard petroleum fossil-based fuels across their life cycle). Gevo’s products perform as well or better than traditional fossil-based fuels in infrastructure and engines, but with substantially reduced greenhouse gas emissions. In addition to addressing the problems of fuels, Gevo’s technology also enables certain plastics, such as polyester, to be made with more sustainable ingredients. Gevo’s ability to penetrate the growing low-carbon fuels market depends on the price of oil and the value of abating carbon emissions that would otherwise increase greenhouse gas emissions. Gevo believes that its proven, patented technology enabling the use of a variety of low-carbon sustainable feedstocks to produce price-competitive low-carbon products such as gasoline components, jet fuel and diesel fuel yields the potential to generate project and corporate returns that justify the build-out of a multi-billion-dollar business.
Gevo believes that the Argonne National Laboratory GREET model is the best available standard of scientific-based measurement for life cycle inventory or LCI.
Learn more at Gevo’s website: www.gevo.com
Forward-Looking Statements
Certain statements in this press release may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements relate to a variety of matters, including, without limitation, statements related to expected results of the Company’s RNG and other business lines, Verity revenue, guidance from the
IR Contact
IR@gevo.com
Source:
2024 GlobeNewswire, Inc., source