Clean Energy Fuels Corp. · NASDAQ:CLNE
Clean Energy Fuels — Investor Day (January 2022)
53 slides from Clean Energy Fuels's investor day presentation, Jan 26, 2022
Slide 1: RNG Day: CLNE Five Year Outlook
RNG Day CLNE Five Year Outlook January 26, 2022 Welcome Raleigh Gerber Director, Corporate Communications 1
Slide 2: Today's presenters
Today’s presenters Andrew J. Littlefair Robert Vreeland President and CEO Chief Financial Officer 2
Slide 3: Q&A participants
Q&A participants Andrew J. Littlefair Robert Vreeland Will Flanagan President and CEO Chief Financial Officer Vice President, Strategic Development RNG Investment 3
Slide 4: Safe harbor
Safe harbor This presentation contains forward-looking statements within the meaning of Section 27A of the to manage and grow its business of transporting and selling compressed natural gas for non- Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as vehicl
Slide 5: Non-GAAP financial measures
Non-GAAP financial measures Non-GAAP Financial Measures To supplement the Company’s unaudited consolidated financial statements presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”), the Company uses non-GAAP financial measures that it calls a
Slide 6: RNG Day: CLNE Five Year Outlook
RNG Day CLNE Five Year Outlook January 26, 2022 7
Slide 7: Who we are / Why RNG / What we can earn
Who we are Why RNG What we can earn RNG supply RNG distribution Financial summary 8
Slide 8: Who we are
Who we are Why RNG What we can earn RNG supply RNG distribution Financial summary 9
Slide 9: Who we are
Who we are + = RNG Supply Distribution – Dairy/RNG production – 550+ stations – Vertically integrated RNG solutions – 3rd party RNG supply – Capacity to double volumes contracts – 25+ years of experience – Fleet + marine customers – Invented RNG as a – Maintenance + construction commercial fuel – 2
Slide 10: Why RNG
Who we are Why RNG What we can earn RNG supply RNG distribution Financial summary 11
Slide 11: Why RNG
Why RNG Sustainable: Affordable: Lowers carbon emissions Stabilized prices and lower by up to 500% maintenance costs Renewable: Proven: Made from organic waste, Trusted by companies like Amazon, UPS, not drilling WM, and major transit fleets in NY & LA No diesel pollution: Less maintenance: Reduces
Slide 12: The RNG advantage: carbon intensity
The RNG advantage: carbon intensity Carbon emission by fuel type (gCO2e per MJ) 100 100.6 50 RNG RNG 41.7 15.2 44.8 Food waste Dairy 38.7 Zero emissions Gasoline/ Hydrogen Renewable Electric RNG diesel diesel vehicle Landfill -79.9 -100 -200 -300 -354.5 average CI -400 -500 -532.7 Source: California
Slide 13: Why RNG
Why RNG Sustainable: Affordable: Lowers carbon emissions Stabilized prices and lower by up to 500% maintenance costs Renewable: Proven: Made from organic waste, Trusted by companies like Amazon, UPS, not drilling WM, and major transit fleets in NY & LA No diesel pollution: Less maintenance: Reduces
Slide 14: RNG volume potential in US (2040)
RNG volume potential in US (2040) Animal Manure RNG (GGEs) (GGEs) 3.7B 36.1B Carbon-for-carbon reduction compared to diesel at 1.8B multiples of RNG GGEs 15.3B Low case High case Source: American Gas Association and ICF Note: Estimated gasoline gallons equivalent (GGE) assuming 125,000 mcf per gasol
Slide 15: Why RNG
Why RNG Sustainable: Affordable: Lowers carbon emissions Stabilized prices and lower by up to 500% maintenance costs Renewable: Proven: Made from organic waste, Trusted by companies like Amazon, UPS, not drilling WM, and major transit fleets in NY & LA No diesel pollution: Less maintenance: Reduces
Slide 16: What we can earn
Who we are Why RNG What we can earn RNG supply RNG distribution Financial summary 17
Slide 17: What we can earn
What we can earn + = RNG Supply Distribution GAAP net income (loss) GAAP net income (loss) GAAP net income (loss) 2022E 2026E 2022E 2026E 2022E 2026E ($3M) $173M ($54M) $112M ($57M) $285M Adj. EBITDA Adj. EBITDA Adj. EBITDA 2022E 2026E 2022E 2026E 2022E 2026E ($3M) $250M $68M $305M $65M $555M See th
Slide 18: RNG supply
Who we are Why RNG What we can earn RNG supply RNG distribution Financial summary 19
Slide 19: RNG supply
RNG supply Dairy RNG production – Produce RNG from dairy farms with JV partners Total Energies and BP – All gas produced goes to fill CLNE demand – Enhances overall economics of RNG to CLNE RNG 3rd party supply – Our demand creates value for the supply side – We see many deals due to our demand – Le
Slide 20: Major energy partners
Major energy partners $100 million of equity for Up to $400 million of equity RNG investment for RNG investment Joint marketing agreement Largest shareholder of CLNE for RNG supply $400M+ pipeline $650M+ pipeline 21
Slide 21: RNG sources
RNG sources + = CLNE produced 3rd party supply Total RNG supply dairy RNG contracts to CLNE network Volume sales Volume sales Volume sales (GGEs, millions) (GGEs, millions) (GGEs, millions) 474 105 369 351 379 82 297 297 260 268 54 194 194 8 0 2022E 2023E 2024E 2025E 2026E 2022E 2023E 2024E 2025E 20
Slide 22: Where we are today: RNG supply
Where we are today: RNG supply 50M GGEs of investment opportunities in 11 states CLNE/JV Production Pipeline Closed/In contract 23
Slide 23: Millenkamp Dairy
Millenkamp Dairy On January 26, we announced an exciting RNG project at the Millenkamp Dairy in Southeastern Idaho One of the largest dairy farms in the United States Expected to produce 5M GGEs annually Part of BP Joint Venture 24
Slide 24: All roads lead to RNG
All roads lead to RNG RNG feedstock Hydrogen reformer Station compression Electric generation Compressor RNG Hydrogen Electric 25
Slide 25: Hydrogen station: Foothill Transit
Hydrogen station: Foothill Transit 20-year relationship with one of California’s largest transit agencies Initially provided CNG, now RNG for 300 buses Awarded Foothill’s first hydrogen station for 20 fuel cell buses Demonstrates importance of customer relationship 26
Slide 26: RNG distribution
Who we are Why RNG What we can earn RNG supply RNG distribution Financial summary 27
Slide 27: Distribution
Distribution Fueling and customer network key to monetizing supply of RNG 550+ station network—scale and footprint advantage Our portfolio of RNG volume Growth drivers – Trucking – Customer optimization – NG engine expansion and improvement CA opportunity Policy view 28
Slide 28: Where we are: distribution
Where we are: distribution Public and private stations 550+ Natural gas fueling stations 29
Slide 29: Distribution
Distribution Fueling and customer network key to monetizing supply of RNG 550+ station network—scale and footprint advantage Our portfolio of RNG volume Growth drivers – Trucking – Customer optimization – NG engine expansion and improvement CA opportunity Policy view 30
Slide 30: How much RNG we plan to deliver in 2022
How much RNG we plan to deliver in 2022 US total 194M GGEs in 34 states NY California New York Texas 128M 8M 11M CA GGEs GGEs GGEs TX 73% of vehicle fuel sold at Clean Energy’s stations in 2020 was RNG 31
Slide 31: Distribution
Distribution Fueling and customer network key to monetizing supply of RNG 550+ station network—scale and footprint advantage Our portfolio of RNG volume Growth drivers – Trucking – Customer optimization – NG engine expansion and improvement CA opportunity Policy view 32
Slide 32: Distribution growth driver: heavy-duty trucking sector
Distribution growth driver: heavy-duty trucking sector 40B+ gallons per year Sustainability goals increasing pressure while time is of the essence Large fleets create exponential growth – 3000 units (one fleet) can be 45M GGEs annually Current trucking customers include: – Amazon – Estes – UPS Sourc
Slide 33: Customer example
Customer example Switching just 10% 50% reduction in Achieve carbon of their fleet from diesel to RNG = carbon emissions from vehicles = emissions goals in only 2.5 years 34
Slide 34: Distribution
Distribution Fueling and customer network key to monetizing supply of RNG 550+ station network—scale and footprint advantage Our portfolio of RNG volume Growth drivers – Trucking – Customer optimization – NG engine expansion and improvement CA opportunity Policy view 35
Slide 35: Distribution growth driver: optimization of existing customer base
Distribution growth driver: optimization of existing customer base Converting maintenance to fuel Refuse – Republic Services Transit – LA Metro – New York City MTA 36
Slide 36: Distribution
Distribution Fueling and customer network key to monetizing supply of RNG 550+ station network—scale and footprint advantage Our portfolio of RNG volume Growth drivers – Trucking – Customer optimization – NG engine expansion and improvement CA opportunity Policy view 37
Slide 37: Distribution growth driver: Near Zero NG engines
Distribution growth driver: Near Zero NG engines Cummins engine – Near Zero attributes – Clean, quiet enhanced transmission and 90% lower NOx Expansion to 15-liter: “game changer” per Cummins – “Initial interest in the 15-liter natural gas powertrain has far exceeded our expectations” per Cummins –
Slide 38: Distribution
Distribution Fueling and customer network key to monetizing supply of RNG 550+ station network—scale and footprint advantage Our portfolio of RNG volume Growth drivers – Trucking – Customer optimization – NG engine expansion and improvement CA opportunity Policy view 39
Slide 39: CA opportunity
CA opportunity As we increase the supply of dairy RNG in CA, we will distribute the landfill RNG to other states 125M+ Dairy RNG GGE Non-CA Network Opportunity to enhance margins by $13.00/GGE* displacing LFG with dairy bio-gas CA RNG Demand Landfill RNG $4.20/GGE* *gross values before value chain s
Slide 40: Distribution
Distribution Fueling and customer network key to monetizing supply of RNG 550+ station network—scale and footprint advantage Our portfolio of RNG volume Growth drivers – Trucking – Customer optimization – NG engine expansion and improvement CA opportunity Policy view 41
Slide 41: Policy view
Policy view Clean fuels policies Adopted & in effect California, Oregon, British Columbia Approved Washington State; expected effective date: January 1, 2023 Legislation introduced Massachusetts, Minnesota, New Mexico, New York Under study/in regulatory development Canada Federal, Colorado, Illinois
Slide 42: Federal RIN outlook
Federal RIN outlook Proposed RVO issued on December 7, 2021 2020* 2021 2022 Cellulosic biofuel (M GGE) 347 422 524 Growth 22% 24% Strong pricing fundamentals including – Significant year over year targets for cellulosic biofuels – Strong anticipated cellulosic waiver credit values – Higher commodity
Slide 43: Financial summary
Who we are Why RNG What we can earn RNG supply RNG distribution Financial summary 44
Slide 44: Financial summary
Financial summary RNG drives increase volume, revenue Volume and EBTIDA (GGEs, millions) – Delivery volumes increase at a 13% 741 684 610 CAGR, while RNG supplied grows at 25% 547 454 – EBITDA increase driven by growth in distribution margin & RNG supply investment earnings 2022E 2023E 2024E 2025E 2
Slide 45: Adjusted EBITDA bridge
Adjusted EBITDA bridge Note: in millions See the Appendix for a reconciliation of Adjusted EBITDA. 46
Slide 46: Thank you
We turn sustainability goals into reality. Thank you
Slide 47: Questions & Answers
Questions & Answers Andrew J. Littlefair Robert Vreeland Will Flanagan President and CEO Chief Financial Officer Vice President, Strategic Development RNG Investment 48
Slide 48: Conference call information
Conference call information Conference ID: 3562397 Participant toll-free dial-in number: (888) 985-1969 Participant international dial-in number: (873) 415-0181 49
Slide 49: Appendix
Appendix 50
Slide 50: Financial metrics
Financial metrics 2022E 2023E 2024E 2025E 2026E Volumes (GGEs) 454 547 610 684 741 Revenues $400 $484 $609 $780 $943 SG&A 101 118 125 138 152 GAAP net income (57) (117) (31) 171 285 Adjusted net income 8 9 114 276 355 Adjusted EBITDA 65 136 290 467 555 Cash flow from operations 57 75 127 169 239 Cap
Slide 51: Adjusted EBITDA reconciliation
Adjusted EBITDA reconciliation Adjusted EBITDA, which the Company presents as a non-GAAP changes in the fair value of derivative instruments. The Company’s measure of its performance, is defined as net income (loss) attributable management presents Adjusted EBITDA for the reasons discussed to Clean
Slide 52: Adjusted EBITDA reconciliation
Adjusted EBITDA reconciliation 2022E 2023E 2024E 2025E 2026E Net income (loss) attributed to Clean Energy Fuels Corp. $ (54) $ (93) $ (64) $ 9 $ 112 Income tax expense 0 0 0 0 0 Interest expense 9 46 62 57 48 Interest income (1) (1) (1) (1) (1) Depreciation and amortization 49 66 70 74 76 Stock-base
Slide 53: Adjusted net income (loss) reconciliation
Adjusted net income (loss) reconciliation Adjusted Net income (loss), which the Company presents as a non-GAAP measure of its performance, is defined as net income (loss) attributable to Clean Energy Fuels Corp., plus Amazon warrant charges, plus stock-based compensation expense, plus (minus) loss (