Ameresco Reports Second Quarter 2013 Financial Results
Ameresco Reports Second Quarter 2013 Financial Results
Second quarter revenue of $126.3 million
Second quarter net loss of $1.8 million
Second quarter net loss per diluted share of $0.04
FRAMINGHAM, Mass.--(BUSINESS WIRE)-- Ameresco, Inc. (NYS: AMRC) a leading energy efficiency and renewable energy company, today announced financial results for the fiscal quarter ended June 30, 2013. The Company has also furnished prepared remarks in conjunction with this press release in a Current Report on Form 8-K. The prepared remarks contain supplemental information, including non-GAAP financial metrics, and have been posted to the "Investor Relations" section of the Company's website at www.ameresco.com.
Total revenue for the second quarter of 2013 decreased to $126.3 million from $164.1 million, or 23%, for the same period in 2012. Second quarter operating income decreased from $8.3 million for 2012 to an operating loss of $1.9 million for 2013. Second quarter adjusted EBITDA, a non-GAAP financial measure, decreased from $13.9 million for 2012 to $3.3 million for 2013. Second quarter net income decreased from $4.8 million for 2012 to a net loss of $1.8 million for 2013. Second quarter 2013 net loss per diluted share was $0.04, compared to net income per diluted share of $0.10 for 2012.
"Revenue below our expectations negatively impacted profitability for the quarter," stated George P. Sakellaris, President and Chief Executive Officer of Ameresco. "We remain focused on delivering stronger results for the second half of 2013. Based upon current performance and visibility into the second half, we are expecting to return to revenue growth and profitability in the third and fourth quarters."
For the six months year-to-date ended June 30, 2013, total revenue decreased to $236.4 million from $310.7 million, or 24%, for the same period in 2012. Year-to-date operating income decreased from $11.7 million for 2012 to an operating loss of $4.0 million for 2013. Year-to-date adjusted EBITDA decreased from $23.1 million for 2012 to $7.6 million for 2013. Year-to-date net income decreased from $6.6 million for 2012 to a net loss of $3.7 million for 2013. Net loss per diluted share was $0.08, compared to net income per diluted share of $0.14 for 2012.
Additional Second Quarter 2013 Operating Highlights:
Revenue generated from backlog was $80.0 million for the second quarter of 2013, a decrease of 33% year-over-year.
All other revenue was $46.3 million for the second quarter of 2013, an increase of 3% year-over-year.
Operating cash flows were $6.9 million for the second quarter of 2013.
Total construction backlog was $1.4 billion as of June 30, 2013 and consisted of:
$324.0 million of fully-contracted backlog of signed customer contracts for installation or construction of projects, which we expect to convert into revenue over the next 12-24 months, on average; and
$1.1 billion of awarded projects representing projects in development for which we do not have signed contracts. Historically, awarded projects have converted to signed contracts over 6-12 months on average. However, we have been experiencing an unusually sustained lengthening of conversion times of awarded projects to signed contracts, a trend we expect to continue.
FY 2013 Guidance
Based upon year-to-date performance and visibility into the second half of 2013, Ameresco is narrowing our guidance range for the fiscal year ending December 31, 2013. We now expect to earn total revenue in the range of $620 million to $640 million. We expect net income for 2013 to be in the range of $18 million to $21 million. Our 2013 guidance is based upon the following assumptions: modest to strong revenue growth within a few regions; several project delays that are expected to impact timing of revenue recognition; an improvement in fully-contracted backlog in the second half; more than 5% year-over-year revenue growth from our all other offerings; and maintaining operating expenses slightly below the current run rate.
Webcast Reminder
Ameresco will hold its earnings conference call today, August 8th, at 8:30 a.m. Eastern Time with President and Chief Executive Officer, George Sakellaris, and Vice President and Chief Financial Officer, Andrew Spence, to discuss details regarding the Company's second quarter 2013 results, business outlook and strategy. Participants may access it by dialing domestically 888.680.0869 or internationally 617.213.4854. The passcode is 44996711. Participants are advised to dial into the call at least ten minutes prior to the call to register. A live, listen-only webcast of the conference call will also be available over the Internet. Individuals wishing to listen can access the call through the "Investor Relations" section of the Company's website at www.ameresco.com. If you are unable to listen to the live call, the webcast will be archived on the Company's website shortly after the call and be available for one year.
Pre-Registration for the call is also available at: https://www.theconferencingservice.com/prereg/key.process?key=P3JREQVF3. Pre-registrants will be issued a pin number to use when dialing into the live call which will provide faster access to the conference by bypassing the operator upon connection.
Use of Non-GAAP Financial Measures
This press release and the accompanying tables include references to adjusted EBITDA, which is a non-GAAP financial measure. For a description of this non-GAAP financial measure, including the reasons management uses this measure, please see the section following the accompanying tables titled "Exhibit A: Non-GAAP Financial Measures". For a reconciliation of adjusted EBITDA to operating income, the most directly comparable financial measure prepared in accordance with GAAP, please see Other Non-GAAP Disclosure in the accompanying tables.
Prior Period Financial Results
Certain prior period financial information included in this press release and the accompanying tables have been revised from amounts previously reported to reflect our previously reported restatement related to accounting treatment for certain derivative transactions. See note 2 to our consolidated financial statements included in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 18, 2013 for further discussion.
About Ameresco, Inc.
Founded in 2000, Ameresco, Inc. (NYS: AMRC) is a leading independent provider of comprehensive services, energy efficiency, infrastructure upgrades, asset sustainability and renewable energy solutions for facilities throughout North America. Ameresco's services include upgrades to a facility's energy infrastructure and the development, construction and operation of renewable energy plants. Ameresco has successfully completed energy saving, environmentally responsible projects with federal, state and local governments, healthcare and educational institutions, housing authorities, and commercial and industrial customers. With its corporate headquarters in Framingham, MA, Ameresco provides local expertise through its 66 offices in 33 states, five Canadian provinces and the United Kingdom. Ameresco has more than 900 employees. For more information, visit www.ameresco.com.
Safe Harbor Statement
Any statements in this press release about future expectations, plans and prospects for Ameresco, Inc., including statements about market conditions, pipeline and backlog, as well as estimated future revenues and net income, and other statements containing the words "projects," "believes," "anticipates," "plans," "expects," "will" and similar expressions, constitute forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including the timing of, and ability to, enter into contracts for awarded projects on the terms proposed; the timing of work we do on projects where we recognize revenue on a percentage of completion basis, including the ability to perform under recently signed contracts without unusual delay; demand for our energy efficiency and renewable energy solutions; our ability to arrange financing for our projects; changes in federal, state and local government policies and programs related to energy efficiency and renewable energy; the ability of customers to cancel or defer contracts included in our backlog; the effects of our recent acquisitions; seasonality in construction and in demand for our products and services; a customer's decision to delay our work on, or other risks involved with, a particular project; availability and costs of labor and equipment; the addition of new customers or the loss of existing customers; and other factors discussed in our Annual Report on Form 10-K for the year ended December 31, 2012, filed with the U.S. Securities and Exchange Commission on March 18, 2013. In addition, the forward-looking statements included in this press release represent our views as of the date of this press release. We anticipate that subsequent events and developments will cause our views to change. However, while we may elect to update these forward-looking statements at some point in the future, we specifically disclaim any obligation to do so. These forward-looking statements should not be relied upon as representing our views as of any date subsequent to the date of this press release.
AMERESCO, INC. | |||||||||
CONSOLIDATED BALANCE SHEETS | |||||||||
June 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
(Unaudited) | |||||||||
ASSETS | |||||||||
Current assets: | |||||||||
Cash and cash equivalents | $ | 17,629,963 | $ | 63,347,645 | |||||
Restricted cash | 26,239,829 | 26,358,908 | |||||||
Accounts receivable, net | 76,760,410 | 84,124,627 | |||||||
Accounts receivable retainage | 24,758,030 | 23,197,784 | |||||||
Costs and estimated earnings in excess of billings | 52,564,885 | 62,096,284 | |||||||
Inventory, net | 11,548,873 | 9,502,289 | |||||||
Prepaid expenses and other current assets | 11,022,225 | 9,600,619 | |||||||
Income tax receivable | 5,760,545 | 5,385,242 | |||||||
Deferred income taxes | 4,480,218 | 5,190,718 | |||||||
Project development costs | 11,458,555 | 9,038,725 | |||||||
Total current assets | 242,223,533 | 297,842,841 | |||||||
Federal ESPC receivable | 60,900,144 | 91,854,808 | |||||||
Property and equipment, net | 9,422,097 | 9,387,218 | |||||||
Project assets, net | 229,428,429 | 207,274,982 | |||||||
Deferred financing fees, net | 6,103,850 | 5,746,177 | |||||||
Goodwill | 55,239,777 | 48,968,390 | |||||||
Intangible assets, net | 11,490,617 | 9,742,878 | |||||||
Other assets | 5,140,628 | 4,654,709 | |||||||
377,725,542 | 377,629,162 | ||||||||
$ | 619,949,075 | $ | 675,472,003 | ||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||
Current liabilities: | |||||||||
Current portion of long-term debt | $ | 13,921,986 | $ | 12,452,678 | |||||
Accounts payable | 67,318,276 | 101,007,455 | |||||||
Accrued expenses and other current liabilities | 10,667,868 | 13,157,024 | |||||||
Billings in excess of cost and estimated earnings | 22,525,255 | 22,271,655 | |||||||
Total current liabilities | 114,433,385 | 148,888,812 | |||||||
Long-term debt, less current portion | 186,354,568 | 201,922,172 | |||||||
Deferred income taxes | 23,273,100 | 24,888,229 | |||||||
Deferred grant income | 7,864,941 | 7,590,730 | |||||||
Other liabilities | 26,001,304 | 30,362,869 | |||||||
$ | 243,493,913 | $ | 264,764,000 | ||||||
AMERESCO, INC. | ||||||||||
CONSOLIDATED BALANCE SHEETS — (Continued) | ||||||||||
June 30, | December 31, | |||||||||
2013 | 2012 | |||||||||
(Unaudited) | ||||||||||
Stockholders' equity: | ||||||||||
Preferred stock, $0.0001 par value, 5,000,000 shares authorized, no shares issued and outstanding at June 30, 2013 and December 31, 2012 | $ | — | $ | — | ||||||
Class A common stock, $0.0001 par value, 500,000,000 shares authorized, 32,384,648 shares issued and 27,551,364 outstanding at June 30, 2013, 32,019,982 shares issued and 27,186,698 outstanding at December 31, 2012 | 3,238 | 3,202 | ||||||||
Class B common stock, $0.0001 par value, 144,000,000 shares authorized, 18,000,000 shares issued and outstanding at June 30, 2013 and December 31, 2012 | 1,800 | 1,800 | ||||||||
Additional paid-in capital | 96,024,019 | 93,141,432 | ||||||||
Retained earnings | 173,464,894 | 177,169,717 | ||||||||
Accumulated other comprehensive income | 1,697,350 | 713,194 | ||||||||
Non-controlling interest | 13,047 | (27,583 | ) | |||||||
Less - treasury stock, at cost, 4,833,284 shares | (9,182,571 | ) | (9,182,571 | ) | ||||||
Total stockholders' equity | 262,021,777 | 261,819,191 | ||||||||
$ | 619,949,075 | $ | 675,472,003 | |||||||
AMERESCO, INC. | ||||||||||
CONSOLIDATED STATEMENTS OF (LOSS) INCOME | ||||||||||
Three Months Ended June 30, | ||||||||||
2013 | 2012 | |||||||||
(Unaudited) | (Unaudited and | |||||||||
Revenue: | ||||||||||
Energy efficiency revenue | $ | 85,251,138 | $ | 119,819,117 | ||||||
Renewable energy revenue | 41,001,556 | 44,280,788 | ||||||||
126,252,694 | 164,099,905 | |||||||||
Direct expenses: | ||||||||||
Energy efficiency expenses | 69,753,489 | 97,873,272 | ||||||||
Renewable energy expenses | 33,116,629 | 35,068,772 | ||||||||
102,870,118 | 132,942,044 | |||||||||
Gross profit | 23,382,576 | 31,157,861 | ||||||||
Operating expenses: | ||||||||||
Salaries and benefits | 10,774,591 | 11,558,732 | ||||||||
Project development costs | 5,039,217 | 3,830,866 | ||||||||
General, administrative and other | 9,477,788 | 7,509,639 | ||||||||
25,291,596 | 22,899,237 | |||||||||
Operating (loss) income | (1,909,020 | ) | 8,258,624 | |||||||
Other expenses, net | 448,732 | 1,412,744 | ||||||||
(Loss) income before (benefit) provision for income taxes | (2,357,752 | ) | 6,845,880 | |||||||
Income tax (benefit) provision | (577,001 | ) | 2,026,630 | |||||||
Net (loss) income | $ | (1,780,751 | ) | $ | 4,819,250 | |||||
Net (loss) income per share attributable to common shareholders: | ||||||||||
Basic | $ | (0.04 | ) | $ | 0.11 | |||||
Diluted | $ | (0.04 | ) | $ | 0.10 | |||||
Weighted average common shares outstanding: | ||||||||||
Basic | 45,465,529 | 44,541,025 | ||||||||
Diluted | 45,465,529 | 46,359,323 | ||||||||
OTHER NON-GAAP DISCLOSURES | ||||||||||
Gross margins: | ||||||||||
Energy efficiency revenue | 18.2 | % | 18.3 | % | ||||||
Renewable energy revenue | 19.2 | % | 20.8 | % | ||||||
Total | 18.5 | % | 19.0 | % | ||||||
Operating expenses as a percent of revenue | 20.0 | % | 14.0 | % | ||||||
Adjusted Earnings before interest, taxes, depreciation and amortization (Adjusted EBITDA): | ||||||||||
Operating (loss) income | $ | (1,909,020 | ) | $ | 8,258,624 | |||||
Depreciation and amortization of intangible assets | 4,580,462 | 4,769,256 | ||||||||
Stock-based compensation | 664,759 | 892,607 | ||||||||
Adjusted EBITDA | $ | 3,336,201 | $ | 13,920,487 | ||||||
Adjusted EBITDA margin | 2.6 | % | 8.5 | % | ||||||
Construction backlog: | ||||||||||
Awarded | $ | 1,112,502,163 | $ | 909,644,256 | ||||||
Fully-contracted | 324,036,401 | 390,695,907 | ||||||||
Total construction backlog | $ | 1,436,538,564 | $ | 1,300,340,163 | ||||||
Note: Awarded represents estimated future revenues from projects that have been awarded, though the contracts have not yet been signed.
AMERESCO, INC. | ||||||||||
CONSOLIDATED STATEMENTS OF (LOSS) INCOME | ||||||||||
Six Months Ended June 30, | ||||||||||
2013 | 2012 | |||||||||
(Unaudited) | (Unaudited and | |||||||||
Revenue: | ||||||||||
Energy efficiency revenue | $ | 155,071,617 | $ | 233,201,787 | ||||||
Renewable energy revenue | 81,316,600 | 77,471,487 | ||||||||
236,388,217 | 310,673,274 | |||||||||
Direct expenses: | ||||||||||
Energy efficiency expenses | 125,208,747 | 187,493,047 | ||||||||
Renewable energy expenses | 66,278,023 | 62,798,556 | ||||||||
191,486,770 | 250,291,603 | |||||||||
Gross profit | 44,901,447 | |||||||||
