Clean Energy Fuels Corporation (CLNE)
Q2 2010 Earnings Call Transcript
August 9, 2010 4:30 pm ET
Ina McGuinness – IR, ICR
Andrew Littlefair – President & CEO
Rick Wheeler – CFO
Rob Brown – Craig-Hallum
Graham Mattison – Lazard Capital Markets
Brian Gamble – Simmons & Company
Ryan Wright – Northland Capital Markets
Steve Milunovich – Merrill Lynch
Rupert Merer – National Bank Financial
Cory Garcia – Raymond James
Previous Statements by CLNE
» Clean Energy Fuels Corp. Q1 2010 Earnings Call Transcript
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Greetings and welcome to the Clean Energy Fuels second quarter 2010 earnings call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. As a reminder, this conference is being recorded.
It is now my pleasure to introduce your host Ina McGuinness of ICR. Thank you, Ms. McGuinness, you may begin.
Thank you, operator. Earlier this afternoon, Clean Energy released financial results for the second quarter ended June 30, 2010. If you did not receive the press release, it’s available on the Investor Relations section of the Company’s Web site at
. This call is being webcast and a replay will be available on the Web site for 30 days.
Before we begin, we’d like to remind you that some of the information contained in the news release and on this conference call contain forward-looking statements that involve risks, uncertainties and assumptions that are difficult to predict. Words and expressions reflecting optimism, satisfaction with current prospects as well as words as “believe,” “intend,” “expect,” “plan,” “anticipate” and similar variations identify forward-looking statements, but their absence does not mean that the statement is not forward-looking.
Such forward-looking statements are not a guarantee of performance and the Company’s actually results could differ materially from those contained in such statements. Several factors that could cause or contribute to such differences are described in detail in the Risk Factor section of Clean Energy’s Form 10-K filed on March 10, 2010 and its 10-Q filed earlier today.
These forward-looking statements speak only as of the date of this release, and the Company undertakes no obligation to publicly update any forward-looking statements or supply new information regarding circumstances after the date of this release.
The Company’s non-GAAP EPS and adjusted EBITDA, which will be reviewed on this call excludes certain expenses that the Company’s management does not believe are indicative of the Company’s core business operating results. Non-GAAP financial measures should be considered in addition to results prepared in accordance with GAAP and should not be considered as a substitute for or superior to GAAP results.
The direct comparable GAAP information, reasons why management uses non-GAAP information, a definition of non-GAAP EPS and adjusted EBITDA, and a reconciliation between the non-GAAP and GAAP figures is provided in the Company’s press release, which has been furnished to the SEC on Form 8-K today.
Participating on today’s call from the Company are President and Chief Executive Officer, Andrew Littlefair and Chief Financial Officer, Rick Wheeler.
With that, I’ll turn the call over to Andrew.
Thank you, Ina and welcome to everyone joining us this afternoon. Today we’ve reported another good growth quarter and made some very substantial progress in advancing our core business and expanding our global reach.
Revenues were $44 million, up 58% from a year ago and volume increased 31% to 31.1 million GGEs and we delivered positive adjusted EBITDA of $1.4 million, without any VETC revenues.
We also expanded the number of our construction projects. As of today, we have 74 station construction projects underway. These are projects either under the contract or that we have committed to build, that are in design, permitting, or the construction phase.
Year-to-date, we’ve completed 13 projects and we are gaining momentum as we completed twice as many stations in the second quarter as we did in the first.
We remain on track to complete somewhere between 50 and 55 projects this year, which would be nearly double what we’ve accomplished last year. Importantly, we count 173 projects in our pipeline.
Our biggest news came just a few weeks ago with the announcement of our attempt to acquire what we believe to be the best-in-class compressor manufacturer, IMW. IMW has more than 1,000 installations in 20 countries and they are active in 27 countries. Teaming up with IMW gives us just the opportunity we were looking to get into the international market.
As you know, we have been looking at ways to capitalize on the growth in the international market for several years, but we were having a hard time finding places where our business model worked.
Since we primarily offer long-term fuel supply contracts, we needed places where there were stable and reliable sources of natural gas and the ability to control our pricing. With many countries controlling or owning their natural gas supply, this was challenging for us.
Now, with IMW, we can participate in the international market growth as IMW primarily sells compressors and other equipments to their international customers and gets paid upfront, which reduces the political and business risks that were challenging for others.
IMW’s biggest near-term growth opportunity is an exclusive arrangement it has with China Gas Holdings to build stations in approximately 132 cities in China. Already IMW has received orders to supply equipment for 120 stations to be built within the next 18 months. We also see additional opportunities in South America and Asia for the company.
Domestically, the acquisition rounds out our turnkey offerings in the refuse and airport markets and makes us more competitive in terms of integration and station design.