November 24, 2020

Nynas Nytex BT22 | FLD Top Leaderboard | 600×75

New Fortress Energy Announces First Quarter 2020 Results

NEW YORK--(BUSINESS WIRE)--New Fortress Energy LLC (NASDAQ: NFE) (“NFE” or the “Company”) today reported its financial results for the first quarter ending March 31, 2020. Business Highlights Record volumes were achieved in the first quarter and for the first time exceeded 1,650,000 gallons per day (“GPD”) in April 2020 Average daily volumes sold in Q1 2020 were in excess of 750,000 gallons per day which is a 200,000 increase from Q4 2019 Gallons per day volumes are expected to be between 1,500,000 and 2,500,000 on average for the remainder of 2020 As development projects reach full commercial operations, the Company expects Operating Margin to expand as asset utilization is enhanced All terminals in Jamaica and Puerto Rico are complete and fully operational Jamalco CHP Plant declared COD(1) on March 3, 2020; we are now consistently delivering approximately 100 MW of power to the Jamaican grid and 300 klbs per hour of steam to Jamalco from the Jamalco CHP Plant Our Puerto Rico Facility commenced delivering natural gas to San Juan Units 5 & 6 New business pipeline is very robust We continue to focus on 10 key markets with 5 of them having terminals that are either Operational(2), Under Development(3) or In Discussions Total Committed Volumes(4) and In Discussion Volumes(5) continue to be over 19 million GPD(6) COVID-19 during Q1 2020 did not materially impact financial results While the coronavirus has affected our customers and electricity demand in the markets we serve, power and gas remain an essential good Customer receivables remain current and the business has ample liquidity to support operational demands and growth initiatives Financial Overview For the three months ended, December 31, March 31, (in millions, except Average Volumes) 2019 2020 Revenues $69.8 $74.5 Net Loss ($38.4) ($60.1) Operating Margin* $1.3 ($2.2) Average Volumes (k GPD) 538 755 *Operating Margin is a non-GAAP financial measure. For definitions and reconciliations of non-GAAP results please refer to the exhibit to this press release. Revenue increased by $4.7mm from Q4 2019 driven by an increase in volumes due to Jamalco CHP Plant coming online, partially offset by a 22% lower price of Henry Hub for the quarter along with lower development services revenue. The net loss increased $21.7mm from Q4 2019 primarily driven by $8.9mm additional interest expense incurred associated with additional debt outstanding and a $9.6mm loss recognized as a result of the extinguishment of the previous term loan facility. Operating Margin was impacted by a reduced price of Henry Hub and increased logistics costs of gas acquired from third parties during Q1 2020 compared to Q4 2019. SG&A was approximately $20mm when excluding non-cash share-based compensation expense and non-capitalizable development related expenses. Please refer to our Q1 2020 Investor Presentation for further information about the following terms: 1) “COD” means commercial operations date, as defined in the power purchase agreement between us and JPS, and as defined in the steam supply agreement between us and Jamalco.2) “Operational” with respect to a particular project means we expect gas to be made available within thirty (30) days, gas has been made available to the relevant project, or that the relevant project is in full commercial operations. Where gas is going to be made available or has been made available but full commercial operations have not yet begun, full commercial operations will occur later than, and may occur substantially later than, our reported Operational date. We cannot assure you if or when such projects will reach full commercial operations. Actual results could differ materially from the illustrations reflected in this presentation and there can be no assurance we will achieve our goals. 3) “Under Development” or similar statuses means that we have taken steps and invested money to develop a facility, including procuring land rights and entitlements, negotiating or signing construction contracts, and undertaking active engineering, procurement and construction work. Our development projects are in various phases of progress, and there can be no assurance that we will continue progress on each development as we expect. If we are unable to enter into favorable contracts or to obtain the necessary regulatory and land use approvals on favorable terms, we may not be able to construct and operate these assets as expected, or at all. Additionally, the construction of facilities is inherently subject to the risks of cost overruns and delays. 4) “Committed Volumes” means our expected volumes to be sold to customers under (i) binding contracts, (ii) non-binding letters of intent, (iii) non-binding memorandums of understanding, (iv) binding or non-binding term sheets or (v) have been officially selected as the winning provider in a request for proposals or competitive bid process. We cannot assure you if or when we will enter into binding definitive agreements for the sales of volumes under non-binding letters of intent, non-binding memorandums of understanding, non-binding term sheets or based on our selection as the winning provider under a request for proposals or competitive bid process. Some but not all of our contracts contain minimum volume commitments, and our expected volumes to be sold to customers reflected in our “Committed Volumes” are substantially in excess of such minimum volume commitments. 5) “In Discussion”, “In Discussion Volumes” or similar words refer to expected volumes to be sold to customers for which (i) we are in active negotiations, (ii) there is a request for proposals or competitive bid process, or (iii) we anticipate a request for proposals or competitive bid process will soon be announced based on our discussions with the potential customer. We cannot assure you if or when we will enter into contracts for sales of additional volumes, the price at which we will be able to sell such volumes, or our costs to purchase, liquefy, deliver and sell such volumes. Some but not all of our contracts contain minimum volume commitments, and our expected sales to customers reflected in our “in discussion volumes” are substantially in excess of potential minimum volume commitments. 6) Based on Committed Volumes and In Discussion Volumes as of May 1, 2020 in total for all of Jamaica, Mexico, Puerto Rico and other countries with Committed Volumes and In Discussion Volumes. Additional Information For additional information that management believes to be useful for investors, please refer to the presentation posted on the Investor Relations section of New Fortress Energy’s website, www.newfortressenergy.com, and the Company’s most recent Quarterly Report on Form 10-Q or Annual Report on Form 10-K, which will be available on the Company’s website. Nothing on our website is included or incorporated by reference herein. Earnings Conference Call Management will host a conference call on Tuesday, May 5, 2020 at 8:00 A.M. Eastern Time. The conference call may be accessed by dialing (866) 953-0778 (from within the U.S.) or (630) 652-5853 (from outside of the U.S.) fifteen minutes prior to the scheduled start of the call; please reference “NFE First Quarter 2020 Earnings Call.” A simultaneous webcast of the conference call will be available to the public on a listen-only basis at www.newfortressenergy.com. Please allow extra time prior to the call to visit the website and download any necessary software required to listen to the internet broadcast. A replay of the conference call will also be available after 11:00 A.M. on Tuesday May 5, 2020 through 11:00 P.M. on Tuesday, May 12, 2020 at (855) 859-2056 (from within the U.S.) or (404) 537-3406 (from outside of the U.S.), Passcode: 3085606. About New Fortress Energy LLC New Fortress Energy (NASDAQ: NFE) is a global energy infrastructure company founded to help accelerate the world’s transition to clean energy. The company funds, builds and operates natural gas infrastructure and logistics to rapidly deliver fully-integrated, turnkey energy solutions that enable economic growth, enhance environmental stewardship and transform local industries and communities. New Fortress Energy is majority-owned by a fund managed by an affiliate of Fortress Investment Group. Non-GAAP Financial Measure Operating Margin is not a measurement of financial performance under GAAP and should not be considered in isolation or as an alternative to income/(loss) from operations, net income/(loss), cash flow from operating activities or any other measure of performance or liquidity derived in accordance with GAAP. We believe this non-GAAP financial measure, as we have defined it, provides a supplemental measure of financial performance of our current liquefaction and regasification operations. This measure excludes items that have little or no significance on day-to-day performance of our current liquefaction and regasification operations, including our corporate SG&A, loss on mitigation sales, loss on extinguishment of debt, net, and other (income) expense. As Operating Margin measures our financial performance based on operational factors that management can impact in the short-term and provides an assessment of controllable expenses, items associated with our capital structure and beyond the control of management in the short-term, such as depreciation and amortization, taxation, and interest expense are excluded. As a result, this supplemental metric affords management the ability to make decisions to facilitate meeting current financial goals as well as to achieve optimal financial performance of our current liquefaction and regasification operations. The principal limitation of this non-GAAP measure is that it excludes significant expenses and income that are required by GAAP to be recorded in our financial statements. A reconciliation is provided for the non-GAAP financial measure to our GAAP net income/(loss). Investors are encouraged to review the related GAAP financial measures and the reconciliation of the non-GAAP financial measure to our GAAP net income/(loss), and not to rely on any single financial measure to evaluate our business. Cautionary Statement Concerning Forward-Looking Statements Certain statements contained in this press release constitute “forward-looking statements” including our expected volumes of LNG or production of power in particular jurisdictions; our expected volumes for Committed Volumes and In Discussion Volumes; the expectation that we will continue to capitalize on the depressed LNG market to expand Operating Margins; our expectation that we are able to fund Committed projects using current Cash on hand. You can identify these forward-looking statements by the use of forward-looking words such as “expects,” “may,” “will,” “approximately,” “predicts,” “intends,” “plans,” “estimates,” “anticipates,” or the negative version of those words or other comparable words. These forward-looking statements represent the Company’s expectations or beliefs concerning future events, and it is possible that the results described in this press release will not be achieved. These forward-looking statements are subject to risks, uncertainties and other factors, many of which are outside of the Company’s control, that could cause actual results to differ materially from the results discussed in the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to: the risk that our construction or commissioning schedules will take longer than we expect, the risk that the volumes we are able to sell are less than we expect due to decreased customer demand or our inability to supply, the risk that our expectations about the price at which we purchase LNG, the price at which we sell LNG, the cost at which we produce, ship and deliver LNG, and the margin that we receive for the LNG that we sell are not in line with our expectations, risks that our operating or other costs will increase and our expected funding of projects may not be possible, and risks that our downstream Committed projects costs are greater than we expect so the expected funding of such projects may not be possible. Accordingly, readers should not place undue reliance on forward-looking statements as a prediction of actual results. Any forward-looking statement speaks only as of the date on which it is made, and, except as required by law, the Company does not undertake any obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. New factors emerge from time to time, and it is not possible for the Company to predict all such factors. When considering these forward-looking statements, you should keep in mind the risk factors and other cautionary statements included in the Company’s annual and quarterly reports filed with the SEC, which could cause its actual results to differ materially from those contained in any forward-looking statement. Exhibits – Financial Statements Condensed Consolidated Statements of Operations and Comprehensive Loss For the three months ended December 31, 2019 and March 31, 2020 (Unaudited, in thousands of U.S. dollars, except share and per share amounts) For the Three Months Ended December 31, 2019 March 31, 2020 Revenues Operating revenue $ 52,279 $ 63,502 Other revenue 17,473 11,028 Total revenues 69,752 74,530 Operating expenses Cost of sales 60,135 68,216 Operations and maintenance 8,290 8,483 Selling, general and administrative 30,091 28,370 Loss on mitigation sales 5,280 208 Depreciation and amortization 2,209 5,254 Total operating expenses 106,005 110,531 Operating loss (36,253) (36,001) Interest expense 4,955 13,890 Other (income) expense, net (2,940) 611 Loss on extinguishment of debt, net - 9,557 Loss before taxes (38,268) (60,059) Tax expense (benefit) 102 (4) Net loss (38,370) (60,055) Net loss attributable to non-controlling interest 31,027 51,757 Net loss attributable to stockholders $ (7,343) $ (8,298) Net loss per share – basic and diluted $ (0.30) $ (0.32) Weighted average number of shares outstanding – basic and diluted 24,330,516 26,029,492 Other comprehensive loss: Net loss $ (38,370) $ (60,055) Unrealized loss on currency translation adjustment 76 369 Comprehensive loss (38,446) (60,424) Comprehensive loss attributable to non-controlling interest 31,092 52,073 Comprehensive loss attributable to stockholders $ (7,354) $ (8,351) Non-GAAP Operating Margin (Unaudited, in thousands of U.S. dollars) We define non-GAAP operating margin as GAAP net loss, adjusted for selling, general and administrative expense, loss on mitigation sales, depreciation and amortization, interest expense, other expense (income), loss on extinguishment of debt, net and tax expense (benefit). For the three months ended, December 31, 2019 March 31, 2020 Net loss $ (38,370) $ (60,055) Add: Selling, general and administrative 30,091 28,370 Loss on mitigation sales 5,280 208 Depreciation and amortization 2,209 5,254 Interest expense 4,955 13,890 Other (income) expense, net (2,940) 611 Loss on extinguishment of debt, net - 9,557 Tax expense (benefit) 102 (4) Non-GAAP operating margin $ 1,327 $ (2,169) Condensed Consolidated Balance Sheets As of March 31, 2020 and December 31, 2019 (Unaudited, in thousands of U.S. dollars, except share amounts) March 31, December 31, 2020 2019 Assets Current assets Cash and cash equivalents $ 232,698 $ 27,098 Restricted cash 32,512 30,966 Receivables, net of allowances of $0 and $0, respectively 45,976 49,890 Inventory 28,602 63,432 Prepaid expenses and other current assets 74,826 39,734 Total current assets 414,614 211,120 Restricted cash 26,055 34,971 Construction in progress 333,646 466,587 Property, plant and equipment, net 479,089 192,222 Right-of-use asset, net 115,511 - Intangibles, net 42,276 43,540 Finance leases, net 1,002 91,174 Investment in equity securities 140 2,540 Deferred tax assets, net 2,756 34 Other non-current assets 74,027 81,626 Total assets $ 1,489,116 $ 1,123,814 Liabilities Current liabilities Accounts payable $ 21,256 $ 11,593 Accrued liabilities 68,529 54,943 Current lease liabilities 29,944 - Due to affiliates 7,377 10,252 Other current liabilities 24,545 25,475 Total current liabilities 151,651 102,263 Long-term debt 945,209 619,057 Non-current lease liabilities 64,760 - Deferred tax liabilities, net - 241 Other long-term liabilities 13,305 14,929 Total liabilities 1,174,925 736,490 Stockholders’ equity Class A shares, 24,820,003 shares issued and 24,236,495 outstanding as of March 31, 2020; 23,607,096 shares issued and outstanding as of December 31, 2019 133,166 130,658 Treasury shares, 583,508 shares as of March 31, 2020, at cost; 0 shares at December 31, 2019, at cost (6,132) - Class B shares, 144,342,572 shares, issued and outstanding as of March 31, 2020 and December 31, 2019 - - Accumulated deficit (55,427) (45,823) Accumulated other comprehensive loss (83) (30) Total stockholders' equity attributable to NFE 71,524 84,805 Non-controlling interest 242,667 302,519 Total stockholders' equity 314,191 387,324 Total liabilities and stockholders' equity $ 1,489,116 $ 1,123,814 Condensed Consolidated Statements of Operations and Comprehensive Loss For the three months ended March 31, 2020 and 2019 (Unaudited, in thousands of U.S. dollars, except share and per share amounts) Three Months Ended March 31, 2020 2019 Revenues Operating revenue $ 63,502 $ 26,138 Other revenue 11,028 3,813 Total revenues 74,530 29,951 Operating expenses Cost of sales 68,216 33,349 Operations and maintenance 8,483 4,499 Selling, general and administrative 28,370 49,749 Loss on mitigation sales 208 - Depreciation and amortization 5,254 1,691 Total operating expenses 110,531 89,288 Operating loss (36,001) (59,337) Interest expense 13,890 3,284 Other expense (income), net 611 (2,575) Loss on extinguishment of debt, net 9,557 - Loss before taxes (60,059) (60,046) Tax (benefit) expense (4) 246 Net loss (60,055) (60,292) Net loss attributable to non-controlling interest 51,757 46,735 Net loss attributable to stockholders $ (8,298) $ (13,557) Net loss per share – basic and diluted $ (0.32) $ (0.96) Weighted average number of shares outstanding – basic and diluted 26,029,492 14,094,534 Other comprehensive loss: Net loss $ (60,055) $ (60,292) Unrealized loss on currency translation adjustment 369 - Comprehensive loss (60,424) (60,292) Comprehensive loss attributable to non-controlling interest 52,073 46,735 Comprehensive loss attributable to stockholders $ (8,351) $ (13,557) Condensed Consolidated Statements of Cash Flows For the three months ended March 31, 2020 and 2019 (Unaudited, in thousands of U.S. dollars) Three Months Ended March 31, 2020 2019 Cash flows from operating activities Net loss $ (60,055) $ (60,292) Adjustments for: Amortization of deferred financing costs 3,353 981 Depreciation and amortization 5,481 1,849 Loss on extinguishment of debt, net 9,557 - Deferred taxes (18) 201 Change in value of investment in equity securities 2,400 (896) Share-based compensation 2,508 19,037 Other 88 204 Decrease (Increase) in receivables 5,752 (3,102) Decrease (Increase) in inventories 34,830 (11,043) (Increase) Decrease in other assets (54,080) 15,684 Decrease in right-of-use asset, net 9,263 - Increase in accounts payable/accrued liabilities 2,132 3,567 (Decrease) Increase in amounts due to affiliates (2,875) 3,117 (Decrease) in lease liabilities (9,170) - (Decrease) in other liabilities (477) (355) Net cash used in operating activities (51,311) (31,048) Cash flows from investing activities Capital expenditures (56,098) (136,281) Principal payments received on finance lease, net 50 284 Net cash used in investing activities (56,048) (135,997) Cash flows from financing activities Proceeds from borrowings of debt 832,144 220,000 Payment of deferred financing costs (14,069) (4,400) Repayment of debt (506,402) (1,250) Proceeds from IPO - 274,948 Payments related to tax withholdings for share-based compensation (6,084) - Payment of offering costs - (6,105) Net cash provided by financing activities 305,589 483,193 Net increase in cash, cash equivalents and restricted cash 198,230 316,148 Cash, cash equivalents and restricted cash – beginning of period 93,035 100,853 Cash, cash equivalents and restricted cash – end of period $ 291,265 $ 417,001 Supplemental disclosure of non-cash investing and financing activities: Changes in accounts payable and accrued liabilities associated with construction in progress and property, plant and equipment additions $ 13,359 $ (32,946) Contacts IR:Alan Andreini (212) 798-6128 [email protected] Joshua Kane (516) 268-7455 [email protected] Media:Jake Suski (516) 268-7403 [email protected]

NEW YORK–(BUSINESS WIRE)–New Fortress Energy LLC (NASDAQ: NFE) (“NFE” or the “Company”) today reported its financial results for the first quarter ending March 31, 2020.

Business Highlights

  • Record volumes were achieved in the first quarter and for the first time exceeded 1,650,000 gallons per day (“GPD”) in April 2020

    • Average daily volumes sold in Q1 2020 were in excess of 750,000 gallons per day which is a 200,000 increase from Q4 2019
    • Gallons per day volumes are expected to be between 1,500,000 and 2,500,000 on average for the remainder of 2020
    • As development projects reach full commercial operations, the Company expects Operating Margin to expand as asset utilization is enhanced
  • All terminals in Jamaica and Puerto Rico are complete and fully operational

    • Jamalco CHP Plant declared COD(1) on March 3, 2020; we are now consistently delivering approximately 100 MW of power to the Jamaican grid and 300 klbs per hour of steam to Jamalco from the Jamalco CHP Plant
    • Our Puerto Rico Facility commenced delivering natural gas to San Juan Units 5 & 6
  • New business pipeline is very robust

    • We continue to focus on 10 key markets with 5 of them having terminals that are either Operational(2), Under Development(3) or In Discussions
    • Total Committed Volumes(4) and In Discussion Volumes(5) continue to be over 19 million GPD(6)
  • COVID-19 during Q1 2020 did not materially impact financial results

    • While the coronavirus has affected our customers and electricity demand in the markets we serve, power and gas remain an essential good
    • Customer receivables remain current and the business has ample liquidity to support operational demands and growth initiatives

Financial Overview

For the three months ended,

December 31,

March 31,

(in millions, except Average Volumes)

2019

2020

Revenues

$69.8

$74.5

Net Loss

($38.4)

($60.1)

Operating Margin*

$1.3

($2.2)

Average Volumes (k GPD)

538

755

*Operating Margin is a non-GAAP financial measure. For definitions and reconciliations of non-GAAP results please refer to the exhibit to this press release.

  • Revenue increased by $4.7mm from Q4 2019 driven by an increase in volumes due to Jamalco CHP Plant coming online, partially offset by a 22% lower price of Henry Hub for the quarter along with lower development services revenue.
  • The net loss increased $21.7mm from Q4 2019 primarily driven by $8.9mm additional interest expense incurred associated with additional debt outstanding and a $9.6mm loss recognized as a result of the extinguishment of the previous term loan facility.
  • Operating Margin was impacted by a reduced price of Henry Hub and increased logistics costs of gas acquired from third parties during Q1 2020 compared to Q4 2019.
  • SG&A was approximately $20mm when excluding non-cash share-based compensation expense and non-capitalizable development related expenses.

Please refer to our Q1 2020 Investor Presentation for further information about the following terms:

1) “COD” means commercial operations date, as defined in the power purchase agreement between us and JPS, and as defined in the steam supply agreement between us and Jamalco.
2) “Operational” with respect to a particular project means we expect gas to be made available within thirty (30) days, gas has been made available to the relevant project, or that the relevant project is in full commercial operations. Where gas is going to be made available or has been made available but full commercial operations have not yet begun, full commercial operations will occur later than, and may occur substantially later than, our reported Operational date. We cannot assure you if or when such projects will reach full commercial operations. Actual results could differ materially from the illustrations reflected in this presentation and there can be no assurance we will achieve our goals.

3) “Under Development” or similar statuses means that we have taken steps and invested money to develop a facility, including procuring land rights and entitlements, negotiating or signing construction contracts, and undertaking active engineering, procurement and construction work. Our development projects are in various phases of progress, and there can be no assurance that we will continue progress on each development as we expect. If we are unable to enter into favorable contracts or to obtain the necessary regulatory and land use approvals on favorable terms, we may not be able to construct and operate these assets as expected, or at all. Additionally, the construction of facilities is inherently subject to the risks of cost overruns and delays.

4) “Committed Volumes” means our expected volumes to be sold to customers under (i) binding contracts, (ii) non-binding letters of intent, (iii) non-binding memorandums of understanding, (iv) binding or non-binding term sheets or (v) have been officially selected as the winning provider in a request for proposals or competitive bid process. We cannot assure you if or when we will enter into binding definitive agreements for the sales of volumes under non-binding letters of intent, non-binding memorandums of understanding, non-binding term sheets or based on our selection as the winning provider under a request for proposals or competitive bid process. Some but not all of our contracts contain minimum volume commitments, and our expected volumes to be sold to customers reflected in our “Committed Volumes” are substantially in excess of such minimum volume commitments.

5) “In Discussion”, “In Discussion Volumes” or similar words refer to expected volumes to be sold to customers for which (i) we are in active negotiations, (ii) there is a request for proposals or competitive bid process, or (iii) we anticipate a request for proposals or competitive bid process will soon be announced based on our discussions with the potential customer. We cannot assure you if or when we will enter into contracts for sales of additional volumes, the price at which we will be able to sell such volumes, or our costs to purchase, liquefy, deliver and sell such volumes. Some but not all of our contracts contain minimum volume commitments, and our expected sales to customers reflected in our “in discussion volumes” are substantially in excess of potential minimum volume commitments.

6) Based on Committed Volumes and In Discussion Volumes as of May 1, 2020 in total for all of Jamaica, Mexico, Puerto Rico and other countries with Committed Volumes and In Discussion Volumes.

Additional Information

For additional information that management believes to be useful for investors, please refer to the presentation posted on the Investor Relations section of New Fortress Energy’s website, www.newfortressenergy.com, and the Company’s most recent Quarterly Report on Form 10-Q or Annual Report on Form 10-K, which will be available on the Company’s website. Nothing on our website is included or incorporated by reference herein.

Earnings Conference Call

Management will host a conference call on Tuesday, May 5, 2020 at 8:00 A.M. Eastern Time. The conference call may be accessed by dialing (866) 953-0778 (from within the U.S.) or (630) 652-5853 (from outside of the U.S.) fifteen minutes prior to the scheduled start of the call; please reference “NFE First Quarter 2020 Earnings Call.”

A simultaneous webcast of the conference call will be available to the public on a listen-only basis at www.newfortressenergy.com. Please allow extra time prior to the call to visit the website and download any necessary software required to listen to the internet broadcast.

A replay of the conference call will also be available after 11:00 A.M. on Tuesday May 5, 2020 through 11:00 P.M. on Tuesday, May 12, 2020 at (855) 859-2056 (from within the U.S.) or (404) 537-3406 (from outside of the U.S.), Passcode: 3085606.

About New Fortress Energy LLC

New Fortress Energy (NASDAQ: NFE) is a global energy infrastructure company founded to help accelerate the world’s transition to clean energy. The company funds, builds and operates natural gas infrastructure and logistics to rapidly deliver fully-integrated, turnkey energy solutions that enable economic growth, enhance environmental stewardship and transform local industries and communities. New Fortress Energy is majority-owned by a fund managed by an affiliate of Fortress Investment Group.

Non-GAAP Financial Measure

Operating Margin is not a measurement of financial performance under GAAP and should not be considered in isolation or as an alternative to income/(loss) from operations, net income/(loss), cash flow from operating activities or any other measure of performance or liquidity derived in accordance with GAAP. We believe this non-GAAP financial measure, as we have defined it, provides a supplemental measure of financial performance of our current liquefaction and regasification operations. This measure excludes items that have little or no significance on day-to-day performance of our current liquefaction and regasification operations, including our corporate SG&A, loss on mitigation sales, loss on extinguishment of debt, net, and other (income) expense.

As Operating Margin measures our financial performance based on operational factors that management can impact in the short-term and provides an assessment of controllable expenses, items associated with our capital structure and beyond the control of management in the short-term, such as depreciation and amortization, taxation, and interest expense are excluded. As a result, this supplemental metric affords management the ability to make decisions to facilitate meeting current financial goals as well as to achieve optimal financial performance of our current liquefaction and regasification operations.

The principal limitation of this non-GAAP measure is that it excludes significant expenses and income that are required by GAAP to be recorded in our financial statements. A reconciliation is provided for the non-GAAP financial measure to our GAAP net income/(loss). Investors are encouraged to review the related GAAP financial measures and the reconciliation of the non-GAAP financial measure to our GAAP net income/(loss), and not to rely on any single financial measure to evaluate our business.

Cautionary Statement Concerning Forward-Looking Statements

Certain statements contained in this press release constitute “forward-looking statements” including our expected volumes of LNG or production of power in particular jurisdictions; our expected volumes for Committed Volumes and In Discussion Volumes; the expectation that we will continue to capitalize on the depressed LNG market to expand Operating Margins; our expectation that we are able to fund Committed projects using current Cash on hand. You can identify these forward-looking statements by the use of forward-looking words such as “expects,” “may,” “will,” “approximately,” “predicts,” “intends,” “plans,” “estimates,” “anticipates,” or the negative version of those words or other comparable words. These forward-looking statements represent the Company’s expectations or beliefs concerning future events, and it is possible that the results described in this press release will not be achieved. These forward-looking statements are subject to risks, uncertainties and other factors, many of which are outside of the Company’s control, that could cause actual results to differ materially from the results discussed in the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to: the risk that our construction or commissioning schedules will take longer than we expect, the risk that the volumes we are able to sell are less than we expect due to decreased customer demand or our inability to supply, the risk that our expectations about the price at which we purchase LNG, the price at which we sell LNG, the cost at which we produce, ship and deliver LNG, and the margin that we receive for the LNG that we sell are not in line with our expectations, risks that our operating or other costs will increase and our expected funding of projects may not be possible, and risks that our downstream Committed projects costs are greater than we expect so the expected funding of such projects may not be possible. Accordingly, readers should not place undue reliance on forward-looking statements as a prediction of actual results.

Any forward-looking statement speaks only as of the date on which it is made, and, except as required by law, the Company does not undertake any obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. New factors emerge from time to time, and it is not possible for the Company to predict all such factors. When considering these forward-looking statements, you should keep in mind the risk factors and other cautionary statements included in the Company’s annual and quarterly reports filed with the SEC, which could cause its actual results to differ materially from those contained in any forward-looking statement.

Exhibits – Financial Statements

Condensed Consolidated Statements of Operations and Comprehensive Loss

For the three months ended December 31, 2019 and March 31, 2020

(Unaudited, in thousands of U.S. dollars, except share and per share amounts)

For the Three Months Ended

December 31,

2019

March 31,

2020

Revenues

Operating revenue

$

52,279

$

63,502

Other revenue

17,473

11,028

Total revenues

69,752

74,530

Operating expenses

Cost of sales

60,135

68,216

Operations and maintenance

8,290

8,483

Selling, general and administrative

30,091

28,370

Loss on mitigation sales

5,280

208

Depreciation and amortization

2,209

5,254

Total operating expenses

106,005

110,531

Operating loss

(36,253)

(36,001)

Interest expense

4,955

13,890

Other (income) expense, net

(2,940)

611

Loss on extinguishment of debt, net

9,557

Loss before taxes

(38,268)

(60,059)

Tax expense (benefit)

102

(4)

Net loss

(38,370)

(60,055)

Net loss attributable to non-controlling interest

31,027

51,757

Net loss attributable to stockholders

$

(7,343)

$

(8,298)

Net loss per share – basic and diluted

$

(0.30)

$

(0.32)

Weighted average number of shares outstanding – basic and diluted

24,330,516

26,029,492

Other comprehensive loss:

Net loss

$

(38,370)

$

(60,055)

Unrealized loss on currency translation adjustment

76

369

Comprehensive loss

(38,446)

(60,424)

Comprehensive loss attributable to non-controlling interest

31,092

52,073

Comprehensive loss attributable to stockholders

$

(7,354)

$

(8,351)

Non-GAAP Operating Margin

(Unaudited, in thousands of U.S. dollars)

We define non-GAAP operating margin as GAAP net loss, adjusted for selling, general and administrative expense, loss on mitigation sales, depreciation and amortization, interest expense, other expense (income), loss on extinguishment of debt, net and tax expense (benefit).

For the three months ended,

December 31, 2019

March 31, 2020

Net loss

$

(38,370)

$

(60,055)

Add:

Selling, general and administrative

30,091

28,370

Loss on mitigation sales

5,280

208

Depreciation and amortization

2,209

5,254

Interest expense

4,955

13,890

Other (income) expense, net

(2,940)

611

Loss on extinguishment of debt, net

9,557

Tax expense (benefit)

102

(4)

Non-GAAP operating margin

$

1,327

$

(2,169)

Condensed Consolidated Balance Sheets

As of March 31, 2020 and December 31, 2019

(Unaudited, in thousands of U.S. dollars, except share amounts)

March 31,

December 31,

2020

2019

Assets

Current assets

Cash and cash equivalents

$

232,698

$

27,098

Restricted cash

32,512

30,966

Receivables, net of allowances of $0 and $0, respectively

45,976

49,890

Inventory

28,602

63,432

Prepaid expenses and other current assets

74,826

39,734

Total current assets

414,614

211,120

Restricted cash

26,055

34,971

Construction in progress

333,646

466,587

Property, plant and equipment, net

479,089

192,222

Right-of-use asset, net

115,511

Intangibles, net

42,276

43,540

Finance leases, net

1,002

91,174

Investment in equity securities

140

2,540

Deferred tax assets, net

2,756

34

Other non-current assets

74,027

81,626

Total assets

$

1,489,116

$

1,123,814

Liabilities

Current liabilities

Accounts payable

$

21,256

$

11,593

Accrued liabilities

68,529

54,943

Current lease liabilities

29,944

Due to affiliates

7,377

10,252

Other current liabilities

24,545

25,475

Total current liabilities

151,651

102,263

Long-term debt

945,209

619,057

Non-current lease liabilities

64,760

Deferred tax liabilities, net

241

Other long-term liabilities

13,305

14,929

Total liabilities

1,174,925

736,490

Stockholders’ equity

Class A shares, 24,820,003 shares issued and 24,236,495 outstanding as of March 31, 2020;

23,607,096 shares issued and outstanding as of December 31, 2019

133,166

130,658

Treasury shares, 583,508 shares as of March 31, 2020, at cost;

0 shares at December 31, 2019, at cost

(6,132)

Class B shares, 144,342,572 shares, issued and outstanding as of March 31, 2020

and December 31, 2019

Accumulated deficit

(55,427)

(45,823)

Accumulated other comprehensive loss

(83)

(30)

Total stockholders' equity attributable to NFE

71,524

84,805

Non-controlling interest

242,667

302,519

Total stockholders' equity

314,191

387,324

Total liabilities and stockholders' equity

$

1,489,116

$

1,123,814

Condensed Consolidated Statements of Operations and Comprehensive Loss

For the three months ended March 31, 2020 and 2019

(Unaudited, in thousands of U.S. dollars, except share and per share amounts)

Three Months Ended March 31,

2020

2019

Revenues

Operating revenue

$

63,502

$

26,138

Other revenue

11,028

3,813

Total revenues

74,530

29,951

Operating expenses

Cost of sales

68,216

33,349

Operations and maintenance

8,483

4,499

Selling, general and administrative

28,370

49,749

Loss on mitigation sales

208

Depreciation and amortization

5,254

1,691

Total operating expenses

110,531

89,288

Operating loss

(36,001)

(59,337)

Interest expense

13,890

3,284

Other expense (income), net

611

(2,575)

Loss on extinguishment of debt, net

9,557

Loss before taxes

(60,059)

(60,046)

Tax (benefit) expense

(4)

246

Net loss

(60,055)

(60,292)

Net loss attributable to non-controlling interest

51,757

46,735

Net loss attributable to stockholders

$

(8,298)

$

(13,557)

Net loss per share – basic and diluted

$

(0.32)

$

(0.96)

Weighted average number of shares outstanding – basic and diluted

26,029,492

14,094,534

Other comprehensive loss:

Net loss

$

(60,055)

$

(60,292)

Unrealized loss on currency translation adjustment

369

Comprehensive loss

(60,424)

(60,292)

Comprehensive loss attributable to non-controlling interest

52,073

46,735

Comprehensive loss attributable to stockholders

$

(8,351)

$

(13,557)

Condensed Consolidated Statements of Cash Flows

For the three months ended March 31, 2020 and 2019

(Unaudited, in thousands of U.S. dollars)

Three Months Ended March 31,

2020

2019

Cash flows from operating activities

Net loss

$

(60,055)

$

(60,292)

Adjustments for:

Amortization of deferred financing costs

3,353

981

Depreciation and amortization

5,481

1,849

Loss on extinguishment of debt, net

9,557

Deferred taxes

(18)

201

Change in value of investment in equity securities

2,400

(896)

Share-based compensation

2,508

19,037

Other

88

204

Decrease (Increase) in receivables

5,752

(3,102)

Decrease (Increase) in inventories

34,830

(11,043)

(Increase) Decrease in other assets

(54,080)

15,684

Decrease in right-of-use asset, net

9,263

Increase in accounts payable/accrued liabilities

2,132

3,567

(Decrease) Increase in amounts due to affiliates

(2,875)

3,117

(Decrease) in lease liabilities

(9,170)

(Decrease) in other liabilities

(477)

(355)

Net cash used in operating activities

(51,311)

(31,048)

Cash flows from investing activities

Capital expenditures

(56,098)

(136,281)

Principal payments received on finance lease, net

50

284

Net cash used in investing activities

(56,048)

(135,997)

Cash flows from financing activities

Proceeds from borrowings of debt

832,144

220,000

Payment of deferred financing costs

(14,069)

(4,400)

Repayment of debt

(506,402)

(1,250)

Proceeds from IPO

274,948

Payments related to tax withholdings for share-based compensation

(6,084)

Payment of offering costs

(6,105)

Net cash provided by financing activities

305,589

483,193

Net increase in cash, cash equivalents and restricted cash

198,230

316,148

Cash, cash equivalents and restricted cash – beginning of period

93,035

100,853

Cash, cash equivalents and restricted cash – end of period

$

291,265

$

417,001

Supplemental disclosure of non-cash investing and financing activities:

Changes in accounts payable and accrued liabilities associated with

construction in progress and property, plant and equipment additions

$

13,359

$

(32,946)

Contacts

IR:
Alan Andreini

(212) 798-6128

[email protected]

Joshua Kane

(516) 268-7455

[email protected]

Media:
Jake Suski

(516) 268-7403

[email protected]

< Previous

Black Stone Minerals, L.P. Reports First Quarter Results

Analysis on Impact of Covid-19- Global Circulating Fluidized Bed Boiler Market 2020-2024 | Evolving Opportunities with Babcock & Wilcox Enterprises Inc. and Bharat Heavy Electricals Ltd. | Technavio