Opal Fuels (OPAL) Q1 2025 earnings summary

Executive summary

• Q1 2025 results met expectations, with revenue up 31% year-over-year to $85.4 million, driven by strong performance in RNG Fuel and Fuel Station Services segments and continued execution on strategic objectives.

• Net income rose to $1.3 million from $0.7 million, aided by a one-time $8.0 million income tax benefit from ITC sales.

• Adjusted EBITDA reached $20.2 million, up over 30% year-over-year, with Fuel Station Services segment EBITDA growing 80% to $12.5 million.

• Two new RNG facilities contributed to higher volumes and environmental attribute sales, and vertical integration provided steady, growing cash flow.

• Liquidity remains strong at $239.9 million, with ample credit facility headroom.

Financial highlights

• Revenue for Q1 2025 was $85.4 million, up from $64.9 million in Q1 2024, with RNG Fuel up 56% and Fuel Station Services up 36%.

• Adjusted EBITDA was $20.2 million, compared to $15.2 million in the prior year.

• Net income increased to $1.3 million from $0.7 million year-over-year, with EPS at $(0.01), unchanged year-over-year.

• Operating cash flow rose to $29.7 million, up from $13.7 million a year ago.

• Monetized $8.9 million in investment tax credit proceeds in Q1, with $50 million expected for 2025.

Outlook and guidance

• Full-year 2025 guidance maintained: adjusted EBITDA of $90–$110 million and RNG production of 5.0–5.4 million MMBTU.

• Sequential quarterly RNG production growth expected as new projects ramp and existing facilities expand.

• Atlantic landfill RNG project expected to commence commercial operations in Q3 2025, with three more projects scheduled for 2026.

• Fuel Station Services 2025 adjusted EBITDA expected to grow 30–50% versus 2024.

• Guidance assumes D3 RIN pricing of $2.60 per gallon for 2025.