Recent Corporate Highlights
Renewable Natural Gas (“RNG”): The previously announced capacity expansion from 355,000 MMBtu to 400,000 MMBtu was completed during the third quarter of 2023.- Verity: This quarter, we entered into agreements with an ethanol producer customer in the US Southwest. This brings our growing total ethanol producer customer base to three customers, and total planned volume of ethanol tracked by Verity to over 300M gallons per year, or approximately 2% of the US ethanol market, since
March 2023 . Our agreements with customers will allow them to use Verity to track their ongoing ethanol production and implement Verity to incorporate measurement, reporting, and verification (“MRV”) of carbon intensity (“CI”) through the entire agriculture and biofuels value chain, inclusive of climate-smart agriculture practices, in order to assist with unlocking carbon value for voluntary carbon markets and federal tax credit opportunities. Our Verity Tracking platform went live this quarter with farmers inSouth Dakota andMinnesota that participated in our 2022 grower program. - USDA Grant: In
September 2023 , we finalized and executed the previously announcedU.S. Department of Agriculture (“USDA”) grant of up to$30 million for Gevo’sClimate-Smart Farm -to-Flight Program. This program is aimed at tracking and quantifying the CI impact of climate-smart farming practices while creating market incentives for low CI corn to help accelerate production of sustainable aviation fuel (“SAF”) and low-CI ethanol. Gevo’s project was one of the 70 projects selected by theUSDA under the first pool of the Partnerships forClimate-Smart Commodities funding opportunity. Angelo Amorelli , PhD, was appointed to the Board of Directors.Dr. Amorelli retired recently from bp, where he held leadership, development, and innovation roles for 35 years.Dr. Amorelli held a variety of roles at bp focused on the development of clean fuels. He was considered one of the company’s leading technical experts in clean-energy technologies, including wind, biofuels, low-carbon power, and hydrogen applications. He is aCambridge University graduate in Natural Sciences and holds a PhD in Chemistry from theUniversity of Wales –Cardiff .Dr. Amorelli is a Fellow of theRoyal Society of Chemistry .Andy Shafer has joined Gevo as its Chief Marketing, Customer, and Brand Officer.Mr. Shafer has a proven track record of developing markets for renewable products, including selling them into the unregulated voluntary and the regulated compliance markets.Mr. Shafer has extensive experience in capturing value from new product attributes brought into the market. During his tenure at Dow Chemical, he led the integration of regional strategies and wrote global business plans. As a commercial director,Mr. Shafer brought his entrepreneurial business building skills into the embryonic Industrial Bio-Products group at Cargill-Dow Polymers, now known asNatureWorks, LLC , a global leader in the bio-products marketplace.Mr. Shafer then went on to co-foundElevance Renewable Sciences, Inc. , which creates novel, high-performing specialty chemicals from renewable feedstocks using a proprietary Nobel Prize-winning olefin metathesis technology.
2023 Third Quarter Financial Highlights
- Ended the quarter with cash, cash equivalents, restricted cash, and marketable securities of
$401.3 million . - During Q3 2023, we sold 81,271 MMBtu of RNG from our RNG project. Revenue of
$4.5 million for the quarter includes RNG sales of$0.2 million and$4.3 million of net proceeds from sales of environmental attributes. - Combined revenue and interest income increased to
$9.8 million for the quarter. - Loss from operations of
$20.7 million for the quarter. - Non-GAAP cash EBITDA loss1 of
$11.6 million for the quarter. - Gevo NW Iowa RNG generated positive, stand-alone non-GAAP cash EBITDA1 of
$1.7 million for the quarter. - Net loss per share of
$0.07 for the quarter.
_______________
1 Cash EBITDA is a non-GAAP measure calculated by adding back depreciation and amortization and non-cash stock-based compensation to GAAP loss from operations. A reconciliation of cash EBITDA to GAAP loss from operations is provided in the financial statement tables following this release.
Management Comment
Commenting on the third quarter of 2023 and recent corporate events, Dr.
In addition to progress on NZ1, we are pleased that we completed the planned capacity expansion of our
In Q2 we achieved a significant milestone in our Verity Carbon Solutions business by launching a carbon tracking application for farmers. This application provides farmers with a digital interface for a personal computer or other device to visualize data related to the production of corn and determine a CI score field by field. This enables the farmers to make better decisions as to how to improve production and carbon footprint, which go hand in hand, particularly when it comes to soil health and sustainability. We also achieved a milestone in tracking CI scores in an operating ethanol plant. We are able to capture the data from ethanol plants and use that data to calculate CI for the plant on a real time basis. We believe that tracking field level data for feedstock production and the plant operating data will enable a robust system of measuring, reporting, and verifying the CI of low-carbon fuel and food products that we produce. We expect that we will be able to offer some guidance for Verity’s growth profile sometime late this year.
Our ethanol-to-olefins (“ETO”) technology development, believed to be a breakthrough for the process to convert ethanol into olefins that can be used to make chemicals, plastics and fuels, is going well. It was gratifying to receive the first licensing payment for our ETO technology from LG Chem, a very credible partner, in Q2. We have continued to file additional patents on our Net-Zero plant designs, and processes. We are a company with deep intellectual property, which we look forward to commercializing with partners like LG Chem.”
Third Quarter 2023 Financial Results
Operating revenue. During the three months ended
Cost of production. Cost of production increased
Depreciation and amortization. Depreciation and amortization increased
Research and development expense. Research and development expense remained flat during the three months ended
General and administrative expense. General and administrative expense decreased
Project development costs. Project development costs are related to our future Net-Zero Projects and Verity which consist primarily of employee expenses, preliminary engineering and technical consulting costs. Project development costs increased
Facility idling costs. Facility idling costs of
Impairment loss. No impairment loss was recorded during the three months ended
Loss from operations. Our loss from operations decreased by
Interest expense. Interest expense increased
Interest and investment income. Interest and investment income increased
Other income. Other income increased
During the nine months ended
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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 lifecycle 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 lifecycle). 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 it possesses the technology and know-how to convert various carbohydrate feedstocks through a fermentation process into alcohols and then transform the alcohols into renewable fuels and materials, through a combination of its own technology, know-how, engineering, and licensing of technology and engineering from
Gevo believes that 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, the timing of our NZ1 project, the agreement with LG Chem, the selection of an EPC contractor, timing regarding an EPC contract and its terms, the
Non-GAAP Financial Information
This press release contains a financial measure that does not comply with
Consolidated Balance Sheets
(Unaudited, in thousands, except share and per share amounts)
Assets | ||||||||
Current assets | ||||||||
Cash and cash equivalents | $ | 323,510 | $ | 237,125 | ||||
Marketable securities | — | 167,408 | ||||||
Restricted cash | 77,759 | 1,032 | ||||||
Trade accounts receivable, net | 2,242 | 476 | ||||||
Inventories | 3,688 | 6,347 | ||||||
Prepaid expenses and other current assets | 4,032 | 3,034 | ||||||
Total current assets | 411,231 | 415,422 | ||||||
Property, plant and equipment, net | 238,117 | 185,174 | ||||||
Restricted cash | — | 77,219 | ||||||
Operating right-of-use assets | 1,386 | 1,331 | ||||||
Finance right-of-use assets | 212 | 219 | ||||||
Intangible assets, net | 6,816 | 7,691 | ||||||
Deposits and other assets | 11,759 | 13,692 | ||||||
Total assets | $ | 669,521 | $ | 700,748 | ||||
Liabilities | ||||||||
Current liabilities | ||||||||
Accounts payable and accrued liabilities | $ | 27,895 | $ | 24,760 | ||||
Operating lease liabilities | 521 | 438 | ||||||
Finance lease liabilities | 28 | 79 | ||||||
Loans payable | 137 | 159 | ||||||
2021 Bonds payable, net | 67,780 | — | ||||||
Total current liabilities | 96,361 | 25,436 | ||||||
2021 Bonds payable, net | — | 67,223 | ||||||
Loans payable | 54 | 159 | ||||||
Operating lease liabilities | 1,376 | 1,450 | ||||||
Finance lease liabilities | 199 | 183 | ||||||
Other liabilities | — | 820 | ||||||
Total liabilities | 97,990 | 95,271 | ||||||
Stockholders' Equity | ||||||||
Common stock, | 2,403 | 2,372 | ||||||
Additional paid-in capital | 1,272,248 | 1,259,527 | ||||||
Accumulated other comprehensive loss | — | (1,040 | ) | |||||
Accumulated deficit | (703,120 | ) | (655,382 | ) | ||||
Total stockholders' equity | 571,531 | 605,477 | ||||||
Total liabilities and stockholders' equity | $ | 669,521 | $ | 700,748 | ||||
Consolidated Statements of Operations
(Unaudited, in thousands, except share and per share amounts)
Three Months Ended | Nine Months Ended | |||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||
Total operating revenues | $ | 4,528 | $ | 309 | $ | 12,826 | $ | 630 | ||||||||
Operating expenses: | ||||||||||||||||
Cost of production | 2,480 | 575 | 8,836 | 5,499 | ||||||||||||
Depreciation and amortization | 4,994 | 1,657 | 14,323 | 4,573 | ||||||||||||
Research and development expense | 1,558 | 1,562 | 4,716 | 4,720 | ||||||||||||
General and administrative expense | 10,522 | 11,144 | 31,891 | 29,205 | ||||||||||||
Project development costs | 4,789 | 2,218 | 10,635 | 5,550 | ||||||||||||
Facility idling costs | 911 | 2,330 | 2,923 | 2,330 | ||||||||||||
Impairment loss | — | 24,749 | — | 24,749 | ||||||||||||
Total operating expenses | 25,254 | 44,235 | 73,324 | 76,626 | ||||||||||||
Loss from operations | (20,726 | ) | (43,926 | ) | (60,498 | ) | (75,996 | ) | ||||||||
Other income (expense) | ||||||||||||||||
Interest expense | (540 | ) | (455 | ) | (1,615 | ) | (459 | ) | ||||||||
Interest and investment income | 5,261 | 896 | 14,083 | 1,226 | ||||||||||||
Other income (expense), net | 305 | (301 | ) | 292 | 2,609 | |||||||||||
Total other income, net | 5,026 | 140 | 12,760 | 3,376 | ||||||||||||
Net loss | $ | (15,700 | ) | $ | (43,786 | ) | $ | (47,738 | ) | $ | (72,620 | ) | ||||
Net loss per share - basic and diluted | $ | (0.07 | ) | $ | (0.19 | ) | $ | (0.20 | ) | $ | (0.34 | ) | ||||
Weighted-average number of common shares outstanding - basic and diluted | 239,537,811 | 236,649,805 | 238,100,986 | 216,255,710 | ||||||||||||
Consolidated Statements of Comprehensive Loss
(Unaudited, in thousands)
Three Months Ended | Nine Months Ended | |||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||
Net loss | $ | (15,700 | ) | $ | (43,786 | ) | $ | (47,738 | ) | $ | (72,620 | ) | ||||
Other comprehensive income (loss): | ||||||||||||||||
Unrealized gain (loss) on available-for-sale securities | — | 88 | 1,040 | (1,554 | ) | |||||||||||
Comprehensive loss | $ | (15,700 | ) | $ | (43,698 | ) | $ | (46,698 | ) | $ | (74,174 | ) | ||||
Consolidated Statements of Stockholders’ Equity
(Unaudited, in thousands, except share amounts)
For the Three Months Ended | ||||||||||||||||||||||||
Common Stock | Accumulated Other | Accumulated | Stockholders’ | |||||||||||||||||||||
Shares | Amount | Paid-In Capital | Comprehensive Loss | Deficit | Equity | |||||||||||||||||||
Balance, | 237,647,431 | $ | 2,377 | $ | 1,268,142 | $ | — | $ | (687,420 | ) | $ | 583,099 | ||||||||||||
Non-cash stock-based compensation | — | — | 4,132 | — | — | 4,132 | ||||||||||||||||||
Stock-based awards and related share issuances, net | 2,605,276 | 26 | (26 | ) | — | — | — | |||||||||||||||||
Net loss | — | — | — | — | (15,700 | ) | (15,700 | ) | ||||||||||||||||
Balance, | 240,252,707 | $ | 2,403 | $ | 1,272,248 | $ | — | $ | (703,120 | ) | $ | 571,531 | ||||||||||||
Balance, | 235,165,951 | $ | 2,353 | $ | 1,249,880 | $ | (2,256 | ) | $ | (586,209 | ) | $ | 663,768 | |||||||||||
Non-cash stock-based compensation | — | — | 4,361 | — | — | 4,361 | ||||||||||||||||||
Stock-based awards and related share issuances, net | 2,055,781 | 19 | 492 | — | — | 511 | ||||||||||||||||||
Other comprehensive income | — | — | — | 88 | — | 88 | ||||||||||||||||||
Net loss | — | — | — | — | (43,786 | ) | (43,786 | ) | ||||||||||||||||
Balance, | 237,221,732 | $ | 2,372 | $ | 1,254,733 | $ | (2,168 | ) | $ | (629,995 | ) | $ | 624,942 | |||||||||||
For the Nine Months Ended | ||||||||||||||||||||||||
Common Stock | Accumulated Other | Accumulated | Stockholders’ | |||||||||||||||||||||
Shares | Amount | Paid-In Capital | Comprehensive Loss | Deficit | Equity | |||||||||||||||||||
Balance, | 237,166,625 | $ | 2,372 | $ | 1,259,527 | $ | (1,040 | ) | $ | (655,382 | ) | $ | 605,477 | |||||||||||
Non-cash stock-based compensation | — | — | 12,752 | — | — | 12,752 | ||||||||||||||||||
Stock-based awards and related share issuances, net | 3,086,082 | 31 | (31 | ) | — | — | — | |||||||||||||||||
Other comprehensive income | — | — | — | 1,040 | — | 1,040 | ||||||||||||||||||
Net loss | — | — | — | — | (47,738 | ) | (47,738 | ) | ||||||||||||||||
Balance, | 240,252,707 | $ | 2,403 | $ | 1,272,248 | $ | — | $ | (703,120 | ) | $ | 571,531 | ||||||||||||
Balance, | 201,988,662 | $ | 2,020 | $ | 1,103,224 | $ | (614 | ) | $ | (557,375 | ) | $ | 547,255 | |||||||||||
Issuance of common stock and common stock warrants, net of issuance costs | 33,333,336 | 333 | 138,675 | — | — | 139,008 | ||||||||||||||||||
Issuance of common stock upon exercise of warrants | 4,677 | — | 3 | — | — | 3 | ||||||||||||||||||
Non-cash stock-based compensation | — | — | 12,625 | — | — | 12,625 | ||||||||||||||||||
Stock-based awards and related share issuances, net | 1,895,057 | 19 | 206 | — | — | 225 | ||||||||||||||||||
Other comprehensive loss | — | — | — | (1,554 | ) | — | (1,554 | ) | ||||||||||||||||
Net loss | — | — | — | — | (72,620 | ) | (72,620 | ) | ||||||||||||||||
Balance, | 237,221,732 | $ | 2,372 | $ | 1,254,733 | $ | (2,168 | ) | $ | (629,995 | ) | $ | 624,942 | |||||||||||
Consolidated Statements of Cash Flows
(Unaudited, in thousands)
Nine Months Ended | ||||||||
2023 | 2022 | |||||||
Operating Activities | ||||||||
Net loss | $ | (47,738 | ) | $ | (72,620 | ) | ||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
Impairment loss | — | 24,749 | ||||||
Stock-based compensation | 12,752 | 12,624 | ||||||
Depreciation and amortization | 14,323 | 4,452 | ||||||
Amortization of marketable securities (discount) premium | (102 | ) | 2,755 | |||||
Other noncash expense (income) | 655 | (153 | ) | |||||
Changes in operating assets and liabilities: | ||||||||
Accounts receivable | (1,766 | ) | 626 | |||||
Inventories | 1,137 | (338 | ) | |||||
Prepaid expenses and other current assets, deposits and other assets | (816 | ) | (5,078 | ) | ||||
Accounts payable, accrued expenses and non-current liabilities | 5,756 | 207 | ||||||
Net cash used in operating activities | (15,799 | ) | (32,776 | ) | ||||
Investing Activities | ||||||||
Acquisitions of property, plant and equipment | (61,413 | ) | (76,837 | ) | ||||
Acquisition of patent portfolio | — | (10 | ) | |||||
Proceeds from maturity of marketable securities | 168,550 | 243,817 | ||||||
Purchase of marketable securities | — | (130,402 | ) | |||||
Proceeds from sale of property, plant and equipment | 34 | - | ||||||
Net cash provided by investing activities | 101,842 | 36,568 | ||||||
Financing Activities | ||||||||
Debt and equity offering costs | — | (10,993 | ) | |||||
Proceeds from issuance of common stock and common stock warrants | — | 150,000 | ||||||
Proceeds from exercise of warrants | — | 3 | ||||||
Net settlement of common stock under stock plans | — | (285 | ) | |||||
Payment of loans payable | (128 | ) | (112 | ) | ||||
Payment of finance lease liabilities | (22 | ) | (8 | ) | ||||
Net cash (used in) provided by financing activities | (150 | ) | 138,605 | |||||
Net increase in cash and cash equivalents | 85,893 | 142,397 | ||||||
Cash, cash equivalents and restricted cash at beginning of period | 315,376 | 136,033 | ||||||
Cash, cash equivalents and restricted cash at end of period | $ | 401,269 | $ | 278,430 | ||||
Reconciliation of GAAP to Non-GAAP Financial Information
(Unaudited, in thousands)
Three Months Ended | Nine Months Ended | |||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||
Non-GAAP Cash EBITDA (Consolidated): | ||||||||||||||||
Loss from operations | $ | (20,726 | ) | $ | (43,926 | ) | $ | (60,498 | ) | $ | (75,996 | ) | ||||
Depreciation and amortization | 4,994 | 1,657 | 14,323 | 4,573 | ||||||||||||
Stock-based compensation | 4,132 | 4,220 | 12,752 | 12,165 | ||||||||||||
Non-GAAP cash EBITDA (loss) (Consolidated) | $ | (11,600 | ) | $ | (38,049 | ) | $ | (33,423 | ) | $ | (59,258 | ) |
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 | ) | ||||||
Investor Relations Contact
+1 303-883-1114
IR@gevo.com
Source:
2023 GlobeNewswire, Inc., source