Opal Fuels (OPAL) Q4 2024 earnings summary

Executive summary

• Achieved strong execution in 2024, bringing three large landfill RNG projects online and increasing operational facilities from 2 in 2022 to 11 in 2024, with total annual design capacity reaching 11.4 million MMBtu including projects under construction.

• Adjusted EBITDA reached $90 million, in line with guidance and nearly doubling since 2022 through organic growth and vertical integration.

• Fuel station service segment EBITDA grew 76% year-over-year to $40.2 million, meeting guidance.

• Positioned as a leading integrated RNG operator, with disciplined execution and expansion in both RNG and Fuel Station Services segments.

• Leadership strengthened with new CFO and EVP of Biogas Operations.

Financial highlights

• Q4 2024 revenue was $80 million and adjusted EBITDA $22.6 million, down from $87 million and $32 million in Q4 2023.

• Full year 2024 revenue was $299.9 million, adjusted EBITDA $90.0 million, and net income $14.3 million, compared to $256.1 million, $51.9 million, and $127 million in 2023.

• 2023 net income included a $122.9 million gain from deconsolidation of Emerald and Sapphire.

• Basic EPS for Q4 2024 was $(0.05); full year 2024 was $0.02, compared to $0.70 in 2023.

• Full year capital expenditures were $162.3 million, including $35.2 million for equity method investments.

Outlook and guidance

• 2025 adjusted EBITDA expected between $90 million and $110 million, based on RNG production guidance of 5.0–5.4 million MMBtus (up 30–40% year-over-year), assuming $2.60 per D3 RIN.

• Fuel station services segment EBITDA expected to grow 30–50% in 2025.

• Guidance excludes ~$50 million of expected ITC sales in 2025 (vs. $9 million in 2024), which will boost operating cash flow and EPS.

• Plan to put ~2.0 million annual MMBtu of RNG design capacity into construction in 2025.

• Renewable power adjusted EBITDA to decline by ~$10 million in 2025 due to loss of European certification for U.S. biogas.