Opal Fuels (OPAL) Q3 2024 earnings summary

Executive summary

• Q3 2024 revenue increased 18% year-over-year to $84.0 million, driven by higher RNG Fuel and Fuel Station Services sales, with net income rising to $17.1 million from $0.2 million in Q3 2023.

• Adjusted EBITDA for Q3 2024 was $31.1 million, up from $16.5 million in Q3 2023, reflecting margin expansion and higher production.

• RNG production reached 1.0 million MMBtu for Q3 2024, a 40–43% year-over-year increase, supported by new facilities and project ramp-ups.

• Three landfill RNG facilities were brought online in 2024, with six projects under construction and downstream business growth.

• Guidance for 2024 is maintained, with strong visibility on full-year results and continued growth in downstream business.

Financial highlights

• Q3 2024 revenue was $84.0 million, up from $71.1 million in Q3 2023, and net income was $17.1 million, compared to $0.2 million in Q3 2023.

• Adjusted EBITDA was $31.1 million for Q3 2024, with a $3.8 million add-back for project development and startup costs.

• RNG Fuel segment revenue was $25.9 million (+29% YoY), and Fuel Station Services revenue was $45.4 million (+22% YoY).

• Renewable Power revenue was $12.8 million for Q3 2024, down 7% year-over-year.

• Year-to-date capital expenditures totaled $95.6 million, including $22.8 million for equity method investments and $16.2 million for downstream stations.

Outlook and guidance

• 2024 guidance is maintained, with management confident in meeting current year targets and strong market fundamentals.

• Ongoing monetization of ITC credits from new and in-construction projects is expected to support liquidity and growth.

• $208.8 million in capital expenditures planned over the next 12 months for project development and construction.

• Regulatory changes in the EU will end ISCC Carbon Credit sales after November 2024, but electricity and REC sales will continue.

• Anticipates sufficient liquidity for at least the next twelve months, with additional capital raises possible for future growth.