Verde Clean Fuels, Inc. Reports First Quarter 2024 Results
Verde Clean Fuels (NASDAQ: VGAS) reported a GAAP diluted net loss per share of $(0.13) for Q1 2024, primarily due to general, administrative, and R&D expenses. The company continues to develop its first commercial facility using proprietary STG+® technology, aimed at converting syngas into gasoline from waste feedstocks. Verde is part of a DOE-funded consortium studying zero-emission methanol production, with a total project funding of up to $500,000. Financials show decreased general and administrative expenses compared to Q1 2023 but an increased net loss attributable to Verde shareholders. As of March 31, 2024, Verde's total assets stood at $30.05 million with total liabilities at $3.1 million.
- General and administrative expenses decreased to $2,789,376 in Q1 2024 from $4,265,640 in Q1 2023.
- Participation in a DOE-funded consortium to explore zero-emission methanol production with total funding up to $500,000.
- Ongoing development of Verde's first commercial facility using proprietary STG+® technology.
- The company is in discussions for potential long-term offtake arrangements for carbon credits and gasoline, which could manage price risk and support project finance.
- GAAP diluted net loss per share increased to $(0.13) in Q1 2024 from $(0.09) in Q1 2023.
- Total net loss attributable to Verde shareholders increased to $772,371 in Q1 2024 from $574,461 in Q1 2023.
- Total assets decreased to $30.05 million as of March 31, 2024, from $31.93 million as of December 31, 2023.
- Cash and cash equivalents dropped to $25.94 million from $28.78 million at the end of 2023.
Insights
Verde Clean Fuels, Inc. reported a first-quarter GAAP diluted net loss per share of $(0.13), up from $(0.09) in the same period last year. This increase in losses can be primarily attributed to ongoing general and administrative expenses and research and development (R&D) costs, which are consistent with the company's focus on developing its first commercial facility leveraging its STG+® technology. While the R&D expenses remained relatively stable, the general and administrative expenses saw a significant reduction from
On the balance sheet, the company’s cash and cash equivalents lowered to
For investors, the continued R&D investments underscore Verde's commitment to its growth trajectory and innovation in renewable fuels, though these efforts are currently a drain on profitability. The company's intention to secure long-term offtake arrangements for gasoline and carbon credits could provide stable revenue streams in the future, yet these are still in preliminary discussions.
The company's involvement in a DOE-funded consortium to study the production of zero-emission methanol is promising, especially given the potential role methanol could play in decarbonizing the maritime and chemical industries. The total funding for this project is
Verde's ongoing selection process for FEED/EPC services for the Cottonmouth Ventures Permian Basin project and preliminary discussions with potential offtake parties are steps in the right direction. These arrangements could help manage price risks associated with their commodities, which is important for a company dealing in fluctuating energy markets.
Retail investors should appreciate that while these are positive developments, they reflect long-term potential rather than immediate financial gains. The focus on future-oriented projects and partnerships indicates a strategic vision aimed at sustainability and growth.
Business Update Highlights Through May 14, 2024
-
Verde is participating in a US Department of Energy (DOE) funded consortium that is studying the production of zero emission methanol. A consortium, led by TDA Research, Inc. and which also includes the University of
Colorado –Denver , plans to complete a conceptual design study for a system having the potential of capturing and then utilizing ambient CO2 to produce “green” methanol. TDA will design a direct air capture (DAC) process for sourcing of CO2 from the atmosphere and lead the integration of the DAC with the methanol plant. Verde plans to design and model the methanol production unit using its proprietary STG+® technology, with the goal to utilize CO2 from the DAC, and hydrogen from a carbon-free source, to potentially produce green methanol. Total funding under the award to the consortium is$400,000 $100,000 $500,000
- Verde continues to proceed with the selection process for FEED/EPC services for the Cottonmouth Ventures Permian Basin project. Since the execution of the Cottonmouth Ventures JDA in February 2024, Verde continues with the selection process of a front-end engineering and design (“FEED”) and engineering, procurement, and construction (“EPC”) partner.
- Verde is in preliminary discussions with various potential offtake parties of carbon credits and gasoline. Verde is in preliminary discussions with various parties with respect to long-term offtake arrangements for the purchase of D3 RINs, LCFS Credits, and gasoline that may be produced in any future projects. Such potential arrangements, if entered into, could help manage price risk associated with these commodities and could support expected project finance requirements.
VERDE CLEAN FUELS, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) |
||||||||
|
|
Three Months Ended
|
|
|||||
|
|
2024 |
|
|
2023 |
|
||
General and administrative expenses |
|
$ |
2,789,376 |
|
|
$ |
4,265,640 |
|
Contingent consideration |
|
|
- |
|
|
|
(1,299,000 |
) |
Research and development expenses |
|
|
85,835 |
|
|
|
82,662 |
|
Total operating loss |
|
|
2,875,211 |
|
|
|
3,049,302 |
|
|
|
|
|
|
|
|
|
|
Other (income) |
|
|
(346,128 |
) |
|
|
- |
|
Interest expense |
|
|
- |
|
|
|
67,825 |
|
Loss before income taxes |
|
|
(2,529,083 |
) |
|
|
(3,117,127 |
) |
Provision for income taxes |
|
|
- |
|
|
|
- |
|
Net loss |
|
$ |
(2,529,083 |
) |
|
$ |
(3,117,127 |
) |
Net loss attributable to noncontrolling interest |
|
$ |
(1,756,712 |
) |
|
$ |
(2,542,666 |
) |
Net loss attributable to Verde Clean Fuels, Inc. |
|
$ |
(772,371 |
) |
|
$ |
(574,461 |
) |
|
|
|
|
|
|
|
|
|
Earnings per share |
|
|
|
|
|
|
|
|
Weighted average Class A common stock outstanding, basic and diluted |
|
|
6,173,716 |
|
|
|
6,124,245 |
|
Net loss per share of Class A common stock |
|
$ |
(0.13 |
) |
|
$ |
(0.09 |
) |
VERDE CLEAN FUELS, INC. CONSOLIDATED BALANCE SHEETS (Unaudited) |
||||||||
|
|
As of |
|
|||||
|
|
March 31,
|
|
|
December 31,
|
|
||
ASSETS |
|
|
|
|
|
|
||
Current assets: |
|
|
|
|
|
|
||
Cash and cash equivalents |
|
$ |
25,941,604 |
|
|
$ |
28,779,177 |
|
Restricted cash |
|
|
100,000 |
|
|
|
100,000 |
|
Prepaid expenses |
|
|
1,406,010 |
|
|
|
373,324 |
|
Total current assets |
|
|
27,447,614 |
|
|
|
29,252,501 |
|
|
|
|
|
|
|
|
|
|
Non-current assets: |
|
|
|
|
|
|
|
|
Security deposits |
|
|
160,669 |
|
|
|
160,669 |
|
Property, plant and equipment, net |
|
|
67,791 |
|
|
|
62,505 |
|
Operating lease right-of-use assets, net |
|
|
453,862 |
|
|
|
524,813 |
|
Intellectual patented technology |
|
|
1,925,151 |
|
|
|
1,925,151 |
|
Total non-current assets |
|
|
2,607,473 |
|
|
|
2,673,138 |
|
Total assets |
|
$ |
30,055,087 |
|
|
$ |
31,925,639 |
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
367,036 |
|
|
$ |
184,343 |
|
Accrued liabilities |
|
|
2,227,546 |
|
|
|
1,976,812 |
|
Operating lease liabilities – current portion |
|
|
326,446 |
|
|
|
297,380 |
|
Other current liabilities |
|
|
32,027 |
|
|
|
- |
|
Total current liabilities |
|
|
2,953,055 |
|
|
|
2,458,535 |
|
|
|
|
|
|
|
|
|
|
Non-current liabilities: |
|
|
|
|
|
|
|
|
Promissory note – related party |
|
|
- |
|
|
|
409,612 |
|
Operating lease liabilities |
|
|
147,472 |
|
|
|
232,162 |
|
Total non-current liabilities |
|
|
147,472 |
|
|
|
641,774 |
|
Total liabilities |
|
|
3,100,527 |
|
|
|
3,100,309 |
|
|
|
|
|
|
|
|
|
|
Stockholders’ equity |
|
|
|
|
|
|
|
|
Class A common stock, par value |
|
|
943 |
|
|
|
939 |
|
Class C common stock, par value |
|
|
2,250 |
|
|
|
2,250 |
|
Additional paid in capital |
|
|
35,673,145 |
|
|
|
35,014,836 |
|
Accumulated deficit |
|
|
(24,695,101 |
) |
|
|
(23,922,730 |
) |
Noncontrolling interest |
|
|
15,973,323 |
|
|
|
17,730,035 |
|
Total stockholders’ equity |
|
|
26,954,560 |
|
|
|
28,825,330 |
|
Total liabilities and stockholders’ equity |
|
$ |
30,055,087 |
|
|
$ |
31,925,639 |
|
About Verde Clean Fuels, Inc.
Verde Clean Fuels, Inc. is a renewable energy company focused on the development of commercial production plants to convert syngas, derived from diverse feedstocks including biomass or stranded or flared natural gas into gasoline through its innovative and proprietary liquid fuels technology, the STG+® process. Through its STG+® process, Verde converts syngas into fully finished fuels that require no additional refining, such as Reformulated Blend-stock for Oxygenate Blending (“RBOB”) gasoline. To learn more, please visit www.verdecleanfuels.com.
Forward-Looking Statements
The information included herein and in any oral statements made in connection herewith 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. All statements, other than statements of present or historical fact included herein, regarding Verde’s expectations and any future financial performance, as well as Verde’s strategy, future operations, financial position, prospects, plans and objectives of management are forward-looking statements. When used herein, including any oral statements made in connection herewith, the words “could,” “should,” “will,” “may,” “believe,” “anticipate,” “intend,” “estimate,” “expect,” “plans,” “goal,” “project,” “preliminary discussions,” “designed,” “potential,” the negative of such terms and other similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. These forward-looking statements are based on Verde management’s current expectations and assumptions about future events and are based on currently available information as to the outcome and timing of future events. Except as otherwise required by applicable law, Verde disclaims any duty to update any forward-looking statements, all of which are expressly qualified by the statements in this section, to reflect events or circumstances after the date hereof. Verde cautions you that these forward-looking statements are subject to risks and uncertainties, most of which are difficult to predict and many of which are beyond the control of Verde. These risks include, but are not limited to: general economic, financial, legal, political and business conditions and changes in domestic and foreign markets; the failure to realize the anticipated benefits of a particular transaction; the risks related to the growth of Verde’s business and the timing of expected business milestones; the ability of Verde to obtain financing in connection with a particular transaction or in the future; and the effects of competition on Verde’s future business. Should one or more of the risks or uncertainties described herein and in any oral statements made in connection therewith occur, or should underlying assumptions prove incorrect, actual results and plans could differ materially from those expressed in any forward-looking statements. There may be additional risks that Verde presently do not know or that Verde currently believe are immaterial that could cause actual results to differ from those contained in the forward-looking statements. Additional information concerning these and other factors that may impact Verde’s expectations and projections can be found in Verde’s filings with the Securities and Exchange Commission (the “SEC”). Verde’s SEC filings are available publicly on the SEC’s website at www.sec.gov.
Source: Verde Clean Fuels, Inc.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240514806886/en/
Investor Contact:
Caldwell Bailey (ICR)
verdeIR@icrinc.com
Source: Verde Clean Fuels, Inc.
FAQ
What was Verde Clean Fuels' net loss per share for Q1 2024?
What is the total funding for the DOE consortium project Verde Clean Fuels is part of?
How did Verde Clean Fuels' general and administrative expenses change in Q1 2024 compared to Q1 2023?
What are Verde Clean Fuels' total assets as of March 31, 2024?
What proprietary technology is Verde Clean Fuels using for its first commercial facility?
What was Verde Clean Fuels' net loss attributable to shareholders in Q1 2024?
How did Verde Clean Fuels' cash and cash equivalents change by the end of March 2024?
