Q1 2022 Highlights
- Revenues of $936 million
- Net income available to common stockholders of $12 million, or
$0.25 per diluted share
- Adjusted EBITDA of $40 million
- Entered into the previously announced merger agreement with
Chevron for $61.50 per share in cash
- Launched branded fuel product line to enable customers to
increase biodiesel blending levels
- Carbon reduction of over 800,000 metric tons from REG-produced
fuels in the quarter
Post-Quarter Events:
- Geismar turnaround completed as planned
- Acquired Northern California distributor Dawson Oil
Company
Renewable Energy Group, Inc. ("REG" or the "Company") (NASDAQ:
REGI) today announced its financial results for the quarter ended
March 31, 2022.
Revenues for the first quarter were $936 million on 157 million
gallons of fuel sold. Net income available to common stockholders
was $12 million in the first quarter of 2022, compared to net
income of $39 million for the first quarter of 2021. Adjusted
EBITDA was $40 million in the first quarter of 2022, compared to
$56 million for the first quarter of 2021. Both net income and
adjusted EBITDA were negatively impacted by the hedge-related
timing impact from a $64 million risk management loss in the
quarter.
First Quarter 2022
Highlights
All figures refer to the quarter ended March 31, 2022, unless
otherwise noted. All comparisons are to the quarter ended March 31,
2021, unless otherwise noted.
The table below summarizes REG’s financial results for the first
quarter of 2022.
REG Q1 2022 Results
(dollars and gallons in
thousands, except as noted)
Q1 2022
Q1 2021
Y/Y Change
Market
Data
NYMEX ULSD average price per gallon
$
3.07
$
1.75
75.4
%
D4 RIN average price per credit
$
1.43
$
1.19
20.2
%
CME Soybean oil average price per
gallon
$
5.07
$
3.61
40.4
%
HOBO + 1.5xRIN average price per gallon
(1)
$
1.15
$
0.92
25.0
%
Gallons produced
99,137
99,012
0.1
%
Gallons sold
157,423
134,208
17.3
%
GAAP
Total revenues
$
935,989
$
539,744
73.4
%
Risk management loss
$
(63,648
)
$
(1,791
)
N/A
Operating income
$
18,225
$
41,803
(56.4
) %
Net income available to common
stockholders
$
12,392
$
38,583
(67.9
) %
Non-GAAP
Adjusted EBITDA2
$
40,184
$
56,055
(28.3
) %
(1) HOBO = HO NYMEX + $1.00 BTC - ((CME SBO
$/lb)/100 x 7.5) HOBO + RINs = HOBO + 1.5 x D4 RIN as quoted by the
Oil Price Information Service. (2) See table below for
reconciliation of Adjusted EBITDA to net income.
REG sold 157 million gallons of fuel, a 23 million gallon
increase compared to the first quarter of 2021. Petroleum diesel
sales increased 27 million gallons due to the Company's acquisition
of Amber Resources and North American renewable diesel sales
increased 7 million gallons. The increase in volumes was partially
offset by a 6 million gallon decrease in North American biodiesel
sales, due primarily to the closure of the Houston facility late
last year, and a 5 million gallon decrease in third party renewable
diesel sales.
REG produced 99 million gallons of biodiesel and renewable
diesel during the first quarter, flat versus prior year. Renewable
diesel production increased 42%, primarily due to the fact that the
2021 turnaround at the Company's Geismar facility was started and
completed in the first quarter of that year, while this year the
turnaround was started in March but completed in April. North
American biodiesel production decreased 10% primarily due to the
Houston facility shutdown referenced above.
Revenues increased from $540 million to $936 million, driven by
the Amber Resources acquisition and higher selling prices realized
from a combination of a 75% increase in ULSD prices and a 20%
increase in D4 RIN prices year over year.
Gross profit was $68 million compared to gross profit of $74
million in the first quarter of last year. The decrease in gross
profit was driven primarily by the hedge-related timing impact from
a $64 million risk management loss in the quarter due mostly to the
significant increase in ULSD prices. The loss was partially offset
by an increase in gross profit for separated RINs, driven both by
increased RIN monetization and higher D4 RIN prices. Higher raw
materials and co-products profitability, an increase in LCFS credit
monetization due to the Company's downstream strategy, and an
increase in petroleum gross profit due to the Amber acquisition
were also positive factors in the quarter.
Operating income was $18 million compared to operating income of
$42 million, driven by the same factors as those described above
for gross profit along with an $18 million increase in selling,
general and administrative costs. The increase in selling, general
and administrative costs was driven primarily by increased
headcount from the Amber acquisition and higher legal and
professional fees stemming from the proposed merger with
Chevron.
GAAP net income available to common stockholders was $12
million, or $0.25 per share on a fully diluted basis, compared to
GAAP net income available to common stockholders of $39 million, or
$0.88 per share on a fully diluted basis. The differential drivers
are the same as those described above for operating income and
gross profit along with an increase in interest expense of $6
million from the green bond issuance that closed in the second
quarter of last year.
Adjusted EBITDA was $40 million compared to $56 million, with
the decrease resulting from the same factors as described above for
operating income. Expenses related to the proposed merger have been
excluded from Adjusted EBITDA.
At March 31, 2022, REG had cash and cash equivalents, restricted
cash, and marketable securities (including long-term marketable
securities) of $790 million, a decrease of $170 million from
December 31, 2021. The decrease in cash and cash equivalents was
primarily driven by an increase in inventories and accounts
receivable due to rising commodity prices in the quarter and from
capital expenditures, including those for the Geismar improvement
and expansion project.
At March 31, 2022, accounts receivable were $213 million, an
increase of $54 million from December 31, 2021 and accounts payable
were $222 million, an increase of $59 million from December 31,
2021. The value of the Company's inventory at the end of the
quarter was $551 million, an increase of $97 million from December
31, 2021.
Reconciliation of Non-GAAP
Measures
The Company uses earnings before interest, taxes, depreciation
and amortization, adjusted for certain additional items identified
in the table below, or Adjusted EBITDA, as a supplemental
performance measure. Adjusted EBITDA is presented in order to
assist investors in analyzing performance across reporting periods
on a consistent basis by excluding items that are not believed to
be indicative of core operating performance. Adjusted EBITDA is
used by the Company to evaluate, assess and benchmark financial
performance on a consistent and a comparable basis and as a factor
in determining incentive compensation for Company executives.
The following table sets forth Adjusted EBITDA for the periods
presented, as well as a reconciliation to net income (loss)
determined in accordance with GAAP:
Three months ended March 31,
2022
Three months ended March 31,
2021
(In thousands)
Net income
$
12,477
$
39,222
Adjustments:
Income tax expense
421
1,633
Interest expense
7,479
1,117
Depreciation
10,497
10,915
Amortization of intangible and other
assets
1,757
671
EBITDA
32,631
53,558
(Gain) on sale of assets
(1,935
)
—
Loss on debt extinguishment
—
1,922
Interest income
(496
)
(652
)
Other (income) expense, net
(1,656
)
(1,439
)
Impairment of assets
2,748
822
Expenses related to the proposed
merger
6,636
—
Stock compensation
2,256
1,844
Adjusted EBITDA
$
40,184
$
56,055
Adjusted EBITDA is a supplemental performance measure that is
not required by, or presented in accordance with, generally
accepted accounting principles, or GAAP. Adjusted EBITDA should not
be considered as an alternative to net income or any other
performance measure derived in accordance with GAAP, or as an
alternative to cash flows from operating activities or a measure of
liquidity or profitability. Adjusted EBITDA has limitations as an
analytical tool, and should not be considered in isolation, or as a
substitute for any of the results as reported under GAAP. Some of
these limitations are:
- Adjusted EBITDA does not reflect certain cash expenditures,
including capital spending, or the impact of certain cash charges
that the Company considers not to be an indication of ongoing
operations;
- Adjusted EBITDA does not reflect changes in, or cash
requirements for, working capital requirements;
- Adjusted EBITDA does not reflect the interest expense, or the
cash requirements necessary to service interest or principal
payments, on indebtedness;
- Although depreciation and amortization are non-cash charges,
the assets being depreciated and amortized will often have to be
replaced in the future, and Adjusted EBITDA does not reflect cash
requirements for such replacements;
- Non-recurring, non-operating expenses related to the proposed
merger with Chevron have been added back to Adjusted EBITDA;
- Stock-based compensation expense is an important element of the
Company’s long-term incentive compensation program, although the
Company has excluded it as an expense when evaluating our operating
performance; and
- Other companies, including other companies in the same
industry, may calculate these measures differently, limiting their
usefulness as a comparative measure.
About Renewable Energy
Group
Renewable Energy Group is leading the energy and transportation
industries’ transition to sustainability by converting renewable
resources into high-quality, sustainable fuels. Renewable Energy
Group is an international producer of sustainable fuels that
significantly lower greenhouse gas emissions to immediately reduce
carbon impact. Renewable Energy Group utilizes a global integrated
procurement, distribution and logistics network to operate 11
biorefineries in the U.S. and Europe. In 2021, Renewable Energy
Group produced 480 million gallons delivering 4.1 million metric
tons of carbon reduction. Renewable Energy Group is meeting the
growing global demand for lower-carbon fuels and leading the way to
a more sustainable future.
Note Regarding Forward-Looking
Statements
This press release contains certain forward-looking statements
within the meaning of the Private Securities Litigation Reform Act
of 1995, as amended, including statements regarding the proposed
merger with Chevron and our new branded fuel product line. These
forward-looking statements are based on current expectations,
estimates, assumptions and projections that are subject to change,
and actual results may differ materially from the forward-looking
statements. Factors that could cause actual results to differ
materially include, but are not limited to, cost overruns and
construction delays related to the expansion project; the
availability, future price, and volatility of feedstocks; the
availability, future price and volatility of petroleum and products
derived from petroleum; the Company’s financial performance,
including revenues, cost of revenues and operating expenses;
changes in governmental programs and policies requiring or
encouraging the use of biofuels, including RFS2 in the United
States, renewable fuel policies in Canada and Europe, and state
level programs such as California's Low Carbon Fuel Standard;
availability of federal and state governmental tax incentives and
incentives for bio-based diesel production; changes in the spread
between bio-based diesel prices and feedstock costs; the potential
impact of COVID-19 on our business and operations; risks associated
with fire, explosions, leaks and other natural disasters at our
facilities; any disruption of operations at our Geismar renewable
diesel refinery (which would have a disproportionately adverse
effect on our profitability); the unexpected closure of any of our
facilities; the effect of excess capacity in the bio-based diesel
industry and announced large plant expansions and potential
co-processing of renewable diesel by petroleum refiners;
unanticipated changes in the bio-based diesel market from which we
generate almost all of our revenues; seasonal fluctuations in our
operating results; potential failure to comply with government
regulations; competition in the markets in which we operate; our
dependence on sales to a single customer; technological advances or
new methods of bio-based diesel production or the development of
energy alternatives to bio-based diesel; our ability to
successfully implement our acquisition strategy; the Company’s
ability to retain and recruit key personnel; the Company's
indebtedness and its compliance, or failure to comply, with
restrictive and financial covenants in its various debt agreements;
risks associated with customer negotiations; the risk that measures
intended to remediate weaknesses in internal controls will prove to
be inadequate; the potential for our risk management program to
fail to minimize volatility; the inability to consummate the merger
transaction within the anticipated time period, or at all, due to
any reason, including the failure to obtain stockholder approval to
adopt the merger agreement, the failure to obtain required
regulatory approvals or the failure to satisfy the other conditions
to the consummation of the merger; the risk that the merger
agreement may be terminated in circumstances requiring REG to pay a
termination fee; the risk that the merger disrupts REG’s current
plans and operations or diverts management’s attention from its
ongoing business; the effect of the announcement of the merger on
the ability of REG to retain and hire key personnel and maintain
relationships with its customers, suppliers and others with whom it
does business; the effect of the announcement of the merger on
REG’s operating results and business generally; the amount of
costs, fees and expenses related to the merger; the risk that REG’s
stock price may decline significantly if the merger is not
consummated; the nature, cost and outcome of any litigation and
other legal proceedings, including any such proceedings related to
the merger and instituted against REG and others; other risks to
consummation of the proposed merger, including the risk that the
proposed merger will not be consummated within the expected time
period or at all; and other risks and uncertainties described in
REG’s annual report on Form 10-K for the year ended December 31,
2021 and subsequently filed Form 10-Q and other periodic filings
with the Securities and Exchange Commission. All forward-looking
statements are made as of the date of this press release and REG
does not undertake to update any forward-looking statements based
on new developments or changes in our expectations.
Additional Information about the Acquisition and Where to
Find It
This press release does not constitute a solicitation of any
vote or approval in respect of the proposed transaction involving
REG, Chevron Corporation and Cyclone Merger Sub Inc. In connection
with the proposed merger, REG filed with the SEC a definitive proxy
statement. Beginning on April 6, 2022, REG mailed the definitive
proxy statement to the stockholders. INVESTORS AND STOCKHOLDERS OF
REG ARE URGED TO READ THE DEFINITIVE PROXY STATEMENT AND OTHER
RELEVANT MATERIALS CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME
AVAILABLE BECAUSE THEY CONTAIN OR WILL CONTAIN IMPORTANT
INFORMATION ABOUT REG AND THE MERGER. Investors may obtain a free
copy of these materials at the SEC’s website at www.sec.gov, from
REG at its website at www.regi.com, or from Chevron Corporation at
its website www.chevron.com.
Participants in the Merger Solicitation
REG and certain of its directors, executive officers and other
members of management and employees may be deemed to be
participants in soliciting proxies from its stockholders in
connection with the merger. Information regarding the persons who
may, under the rules of the SEC, be considered to be participants
in the solicitation of REG’s stockholders in connection with the
proposed transaction is set forth in REG’s definitive proxy
statement for its stockholder meeting at which the proposed
transaction will be submitted for approval by REG’s stockholders
and the Annual Report on Form 10-K for the fiscal year ended
December 31, 2021. You may also find additional information about
REG’s directors and executive officers in REG’s definitive proxy
statement for its 2022 annual meeting of stockholders, which was
filed with the SEC on April 5, 2022 and in subsequently filed
Current Reports on Form 8-K and Quarterly Reports on Form 10-Q.
RENEWABLE ENERGY GROUP, INC.
AND SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS (unaudited)
FOR THE THREE MONTHS ENDED
MARCH 31, 2022 AND 2021
(in thousands, except share
and per share amounts)
Three months ended
March 31, 2022
March 31, 2021
REVENUES:
Bio-based diesel sales
$
757,914
$
449,894
Separated RIN sales
111,474
29,601
Bio-based diesel government incentives
63,729
60,249
933,117
539,744
Other revenue
2,872
—
935,989
539,744
COSTS OF GOODS SOLD:
868,239
465,942
GROSS PROFIT
67,750
73,802
SELLING, GENERAL AND ADMINISTRATIVE
EXPENSES
48,712
31,177
(GAIN) ON DISPOSAL OF PROPERTY, PLANT AND
EQUIPMENT
(1,935
)
—
IMPAIRMENT OF ASSETS
2,748
822
INCOME FROM OPERATIONS
18,225
41,803
OTHER EXPENSE, NET
(5,327
)
(948
)
INCOME BEFORE INCOME TAXES
12,898
40,855
INCOME TAX EXPENSE
(421
)
(1,633
)
NET INCOME
$
12,477
$
39,222
NET INCOME AVAILABLE TO COMMON
STOCKHOLDERS
$
12,392
$
38,583
Basic net income per share available to
common stockholders:
Net income per share
$
0.25
$
0.95
Diluted net income per share available to
common stockholders:
Net income per share
$
0.25
$
0.88
Weighted-average shares used to compute
basic net income per share available to common stockholders:
Basic
50,338,496
40,425,593
Weighted-average shares used to compute
diluted net income per share available to common stockholders:
Diluted
50,558,898
43,661,568
RENEWABLE ENERGY GROUP, INC.
AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE
SHEETS (unaudited)
AS OF MARCH 31, 2022 AND
DECEMBER 31, 2021
(in thousands, except share
and per share amounts)
March 31, 2022
December 31, 2021
ASSETS
CURRENT ASSETS:
Cash and cash equivalents
$
340,703
$
497,653
Marketable securities
342,572
290,818
Accounts receivable, net
212,584
158,187
Inventories
550,612
453,592
Prepaid expenses and other assets
134,659
93,443
Restricted cash
3,000
4,218
Total current assets
1,584,130
1,497,911
Long-term marketable securities
104,131
167,767
Property, plant and equipment, net
727,052
677,444
Right of use assets
54,178
51,730
Goodwill
40,066
43,864
Intangible assets, net
52,028
53,175
Deferred income tax assets
5,514
6,171
Other assets
60,947
60,882
TOTAL ASSETS
$
2,628,046
$
2,558,944
LIABILITIES AND EQUITY
CURRENT LIABILITIES:
Current maturities of operating lease
obligations
$
13,217
$
13,026
Accounts payable
221,982
162,847
Accrued expenses and other liabilities
46,003
53,884
Deferred revenue
26,890
16,856
Total current liabilities
308,092
246,613
Deferred income tax liabilities
3,896
4,659
Long-term debt (net of debt issuance costs
of $12,727 and $13,243, respectively)
537,273
536,757
Long-term operating lease obligations
40,778
38,989
Other liabilities
4,034
4,100
Total liabilities
894,073
831,118
Total equity
1,733,973
1,727,826
TOTAL LIABILITIES AND EQUITY
$
2,628,046
$
2,558,944
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220504006039/en/
Renewable Energy Group, Inc. Todd Robinson Deputy Chief
Financial Officer and Treasurer +1 (515) 239-8048
Todd.Robinson@regi.com
Renewable Energy (NASDAQ:REGI)
Graphique Historique de l'Action
De Mai 2024 à Juin 2024
Renewable Energy (NASDAQ:REGI)
Graphique Historique de l'Action
De Juin 2023 à Juin 2024