Archaea Energy Inc. Reports Results for the Three and Nine Months Ended September 30, 2022
Archaea Energy Inc. (NYSE: LFG) reported financial results for Q3 and YTD 2022, showing revenues of $105 million and $239 million respectively. However, the company faced a net loss of $24.2 million for Q3 and $24.8 million YTD. The merger with bp, valued at $4.1 billion, is pending regulatory and shareholder approval, targeting closure by year-end. Cash and equivalents totaled $299.5 million as of September 30, 2022. Notably, costs surged due to increased general and administrative expenses and higher energy prices, impacting profitability.
- Revenue of $105 million in Q3 2022, up from previous periods.
- Produced 2.42 million MMBtu of RNG in Q3 2022.
- Secured $299.5 million in cash and equivalents as of September 30, 2022.
- Net loss of $24.2 million for Q3 2022 and $24.8 million YTD.
- Increased general and administrative expenses affected profitability.
- Total cash used in investing activities was $366.3 million for Q3, primarily for acquisitions.
FINANCIAL HIGHLIGHTS
-
Revenue of
and net equity investment income of$105.0 million for the three months ended$2.9 million September 30, 2022 and revenue of and net equity investment income of$239.1 million for the nine months ended$7.1 million September 30, 2022 . -
Net loss1 of
for the three months ended$24.2 million September 30, 2022 and for the nine months ended$24.8 million September 30, 2022 . -
Net loss per Class A Common Share (basic) of
for the three months ended$0.18 September 30, 2022 and for the nine months ended$0.15 September 30, 2022 . -
Produced and sold 2.42 million MMBtu of RNG for the three months ended
September 30, 2022 and 6.00 million MMBtu of RNG for the nine months endedSeptember 30, 2022 .2 -
Produced and sold 260 thousand MWh of electricity for the three months ended
September 30, 2022 and 584 thousand MWh of electricity for the nine months endedSeptember 30, 2022 .2
PENDING MERGER
In October, the Company announced that it has agreed to be acquired by bp (NYSE: BP) for
SUMMARY AND REVIEW OF FINANCIAL RESULTS
The following results for the three months and nine months ended
($ in thousands) |
Three Months Ended |
Nine Months Ended |
|||||
Revenue |
$ |
104,993 |
|
$ |
239,109 |
|
|
Equity Investment Income, Net |
|
2,945 |
|
|
7,067 |
|
|
Net Loss1 |
|
(24,235 |
) |
|
(24,783 |
) |
|
|
|
|
|||||
RNG Production Sold2 (MMBtu) |
|
2,418,057 |
|
|
5,995,854 |
|
|
Electricity Production Sold2 (MWh) |
|
259,960 |
|
|
584,346 |
|
RNG production sold for the three months and nine months ended
Electricity production sold for the three months and nine months ended
Revenues for the three months and nine months ended
Net loss for the three months and nine months ended
ACCOUNTING TREATMENT OF LIGHTNING RENEWABLES, LLC
The Company has determined that
LIQUIDITY AND CAPITAL INVESTMENTS
As of
Capital Investments
Total cash used in investing activities was
Total cash used in investing activities was
1. Unless otherwise specified, net income (loss) as shown herein is before net income (loss) attributable to both nonredeemable and redeemable noncontrolling interest. For information regarding net income (loss) attributable to Class A Common Stock, please see the Consolidated Statements of Operations included in this release.
2. Volumes produced and sold include production from the Company’s wholly-owned facilities and its proportionate share of production from its equity method investment facilities.
3.
4. Environmental Attributes refer to federal, state, and local government incentives in
ABOUT ARCHAEA
Additional information is available at www.archaeaenergy.com.
FORWARD-LOOKING STATEMENTS
This release contains certain statements that may include forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Statements that do not relate strictly to historical or current facts are forward-looking and usually identified by the use of words such as “anticipate,” “estimate,” “could,” “would,” “should,” “will,” “may,” “forecast,” “approximate,” “expect,” “project,” “intend,” “plan,” “believe” and other similar words. Forward looking statements are based on current expectations, estimates, projections, targets, opinions and/or beliefs of Archaea, and such statements involve known and unknown risks, uncertainties and other factors.
The risks and uncertainties that could cause those actual results to differ materially from those expressed or implied by these forward looking statements include, but are not limited to: (a) the risk that the pending merger may not be completed in a timely manner or at all, which may adversely affect Archaea’s business and the price of Archaea’s Class A Common Stock; (b) the failure to satisfy any of the conditions to the consummation of the pending merger, including the receipt of certain regulatory approvals and stockholder approval; (c) the occurrence of any event, change, or other circumstance or condition that could give rise to the termination of the merger agreement; and (d) other risks and uncertainties described in Archaea’s Annual Report on Form 10-K for the year ended
Forward-looking statements should not be relied upon as representing Archaea’s views as of any subsequent date. Archaea does not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events, or otherwise, except as may be required under applicable securities laws.
(Financial Tables and Supplementary Information Follow)
Consolidated Statements of Operations (Unaudited) |
|||||||||||||||
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||
(in thousands, except shares and per share |
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Revenues and Other Income |
|
|
|
|
|
|
|
||||||||
Energy revenue |
$ |
98,377 |
|
|
$ |
10,916 |
|
|
$ |
222,528 |
|
|
$ |
13,975 |
|
Other revenue |
|
3,894 |
|
|
|
865 |
|
|
|
8,322 |
|
|
|
4,588 |
|
Amortization of intangibles and below-market contracts |
|
2,722 |
|
|
|
205 |
|
|
|
8,259 |
|
|
|
205 |
|
Total Revenues and Other Income |
$ |
104,993 |
|
|
$ |
11,986 |
|
|
$ |
239,109 |
|
|
$ |
18,768 |
|
Equity Investment Income, Net |
|
2,945 |
|
|
|
879 |
|
|
|
7,067 |
|
|
|
879 |
|
Cost of Sales |
|
|
|
|
|
|
|
||||||||
Cost of energy |
|
63,253 |
|
|
|
9,478 |
|
|
|
138,531 |
|
|
|
12,625 |
|
Cost of other revenues |
|
3,109 |
|
|
|
615 |
|
|
|
7,049 |
|
|
|
2,976 |
|
Depreciation, amortization and |
|
16,972 |
|
|
|
3,142 |
|
|
|
43,191 |
|
|
|
4,077 |
|
Total Cost of Sales |
|
83,334 |
|
|
|
13,235 |
|
|
|
188,771 |
|
|
|
19,678 |
|
General and administrative expenses |
|
30,478 |
|
|
|
11,889 |
|
|
|
75,714 |
|
|
|
22,933 |
|
Operating Income (Loss) |
|
(5,874 |
) |
|
|
(12,259 |
) |
|
|
(18,309 |
) |
|
|
(22,964 |
) |
Other Income (Expense) |
|
|
|
|
|
|
|
||||||||
Interest expense, net |
|
(10,575 |
) |
|
|
(1,586 |
) |
|
|
(16,941 |
) |
|
|
(1,606 |
) |
Gain (loss) on warrants and derivative contracts |
|
(7,605 |
) |
|
|
(10,413 |
) |
|
|
10,575 |
|
|
|
(10,413 |
) |
Other income (expense) |
|
(124 |
) |
|
|
81 |
|
|
|
78 |
|
|
|
377 |
|
Total Other Income (Expense) |
|
(18,304 |
) |
|
|
(11,918 |
) |
|
|
(6,288 |
) |
|
|
(11,642 |
) |
Income (Loss) Before Income |
|
(24,178 |
) |
|
|
(24,177 |
) |
|
|
(24,597 |
) |
|
|
(34,606 |
) |
Income tax expense |
|
57 |
|
|
|
— |
|
|
|
186 |
|
|
|
— |
|
Net Income (Loss) |
|
(24,235 |
) |
|
|
(24,177 |
) |
|
|
(24,783 |
) |
|
|
(34,606 |
) |
Net income (loss) attributable to nonredeemable noncontrolling interests |
|
(2,020 |
) |
|
|
(335 |
) |
|
|
(2,020 |
) |
|
|
(589 |
) |
Net income (loss) attributable to Legacy Archaea |
|
— |
|
|
|
(8,569 |
) |
|
|
— |
|
|
|
(18,744 |
) |
Net income (loss) attributable to redeemable noncontrolling interests |
|
(7,224 |
) |
|
|
(8,262 |
) |
|
|
(11,295 |
) |
|
|
(8,262 |
) |
Net Income (Loss) Attributable to Class A Common Stock |
$ |
(14,991 |
) |
|
$ |
(7,011 |
) |
|
$ |
(11,468 |
) |
|
$ |
(7,011 |
) |
Net income (loss) per Class A common share: |
|
|
|
|
|
|
|
||||||||
Basic (1) |
$ |
(0.18 |
) |
|
$ |
(0.13 |
) |
|
$ |
(0.15 |
) |
|
$ |
(0.13 |
) |
Diluted (1) |
$ |
(0.18 |
) |
|
$ |
(0.13 |
) |
|
$ |
(0.18 |
) |
|
$ |
(0.13 |
) |
Weighted average shares of Class A Common Stock outstanding: |
|
|
|
|
|
|
|
||||||||
Basic (1) |
|
81,044,814 |
|
|
|
52,847,195 |
|
|
|
76,034,987 |
|
|
|
52,847,195 |
|
Diluted (1) |
|
81,044,814 |
|
|
|
52,847,195 |
|
|
|
78,542,786 |
|
|
|
52,847,195 |
|
(1) Class A Common Stock is outstanding beginning
Consolidated Balance Sheets (Unaudited) |
|||||||
(in thousands, except shares and per share data) |
|
|
|
||||
ASSETS |
|
|
|
||||
Current Assets |
|
|
|
||||
Cash and cash equivalents ( |
$ |
299,467 |
|
|
$ |
77,860 |
|
Restricted cash |
|
19,225 |
|
|
|
15,206 |
|
Accounts receivable, net ( |
|
47,255 |
|
|
|
37,010 |
|
Inventory |
|
19,084 |
|
|
|
9,164 |
|
Prepaid expenses and other current assets ( |
|
34,956 |
|
|
|
21,225 |
|
Total Current Assets |
|
419,987 |
|
|
|
160,465 |
|
Property, plant and equipment, net ( |
|
596,112 |
|
|
|
350,583 |
|
Intangible assets, net ( |
|
999,787 |
|
|
|
638,471 |
|
|
|
47,833 |
|
|
|
29,211 |
|
Equity method investments |
|
260,111 |
|
|
|
262,738 |
|
Operating lease right-of-use assets |
|
6,639 |
|
|
|
— |
|
Other non-current assets |
|
16,573 |
|
|
|
9,721 |
|
Total Assets |
$ |
2,347,042 |
|
|
$ |
1,451,189 |
|
LIABILITIES AND EQUITY |
|
|
|
||||
Current Liabilities |
|
|
|
||||
Accounts payable - trade ( |
$ |
31,777 |
|
|
$ |
11,096 |
|
Current portion of long-term debt, net |
|
24,120 |
|
|
|
11,378 |
|
Current portion of operating lease liabilities |
|
1,239 |
|
|
|
— |
|
Accrued and other current liabilities ( |
|
93,694 |
|
|
|
46,279 |
|
Total Current Liabilities |
|
150,830 |
|
|
|
68,753 |
|
Long-term debt, net |
|
887,824 |
|
|
|
331,396 |
|
Derivative liabilities |
|
53,349 |
|
|
|
67,424 |
|
Below-market contracts |
|
132,626 |
|
|
|
142,630 |
|
Asset retirement obligations |
|
9,656 |
|
|
|
4,677 |
|
Long-term operating lease liabilities |
|
5,657 |
|
|
|
— |
|
Other long-term liabilities |
|
2,553 |
|
|
|
5,316 |
|
Total Liabilities |
|
1,242,495 |
|
|
|
620,196 |
|
Commitments and Contingencies |
|
|
|
||||
Redeemable Noncontrolling Interests |
|
703,339 |
|
|
|
993,301 |
|
Equity |
|
|
|
||||
Stockholders’ Equity |
|
|
|
||||
Preferred stock, |
|
— |
|
|
|
— |
|
Class A Common Stock, |
|
8 |
|
|
|
7 |
|
Class B Common Stock, |
|
4 |
|
|
|
5 |
|
Additional paid in capital |
|
304,296 |
|
|
|
— |
|
Accumulated deficit |
|
(173,788 |
) |
|
|
(162,320 |
) |
Total Stockholders’ Equity |
|
130,520 |
|
|
|
(162,308 |
) |
Nonredeemable noncontrolling interests |
|
270,688 |
|
|
|
— |
|
Total Equity |
|
401,208 |
|
|
|
(162,308 |
) |
Total Liabilities, Redeemable Noncontrolling Interests and Equity |
$ |
2,347,042 |
|
|
$ |
1,451,189 |
|
Parenthetical references reflect amounts as of
View source version on businesswire.com: https://www.businesswire.com/news/home/20221110005934/en/
ARCHAEA
mlight@archaea.energy
346-439-7589
bschreiber@archaea.energy
346-440-1627
Source:
FAQ
What were Archaea Energy's revenues for Q3 and YTD 2022?
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What is the status of Archaea Energy's merger with bp?
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