Aemetis Q1 2025 Earnings Call Transcript

Quartr
Provided by Quartr
May 8, 2025

There are 10 speakers on the call.

Operator

Day, everyone. Welcome to the Aemetis First Quarter twenty twenty five Earnings Review Conference Call. At this time, all participants are in a listen only mode. A question and answer session will follow the formal presentation. As a reminder, this conference is being recorded.

Operator

It is now my pleasure to introduce your host, Mr. Todd Waltz, the Executive Vice President and Chief Financial Officer of Aemetis. Mr. Waltz, you may begin.

Speaker 1

Thank you, Kelly, and welcome, everyone. Before we begin, I'd like to remind everyone that during this call, we'll be making forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on our current expectations and belief and involve risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. These risks and uncertainties include, but are not limited to, those factors discussed in our earnings release issued today and in our most recent Form 10 ks filing with the Securities and Exchange Commission under the caption Risk Factors and Management Discussion and Analysis of Financial Condition and Results of Operation, as well as in our other filings with the SEC. We undertake no obligation to publicly update any forward looking statements, whether as a result of new information, future developments or otherwise, except as required by law.

Speaker 1

Please refer to our earnings release and our SEC filings for a more detailed discussion of the risks and uncertainties. Full financial details can be found in our Q1 twenty twenty five earnings release and Form 10 Q available on the Aemetis website and EDGAR. I'll briefly highlight the key items. Revenues were $42,900,000 down from $72,600,000 last year, primarily due to delayed biodiesel contracts in India. That business resumed shipments in April, and we expect revenue to rebound meaningfully in Q2.

Speaker 1

The Quays ethanol plant saw a revenue lift of $1,700,000 due to stronger ethanol pricing, and RNG volumes were up 17% year over year. Operating loss was $15,600,000 reflecting a $1,600,000 increase in SG and A, mostly legal and transaction costs related to the $19,000,000 of cash we received from selling investment tax credits. That cost will not recur at the same level going forward. Interest expense rose to $13,700,000 in line with our capital structure and investment phase. We reported a net loss of $24,500,000 roughly flat versus Q1 last year.

Speaker 1

Cash at the end of the quarter was $500,000 following 15,400,000 of debt repayment and $1,800,000 of investment into carbon intensity reduction and dairy RNG expansion. As Eric will describe shortly, we expect multiple revenue streams from India, LCFS credits and federal tax incentives to ramp up as the year progresses, positioning us for a stronger back half of 2025. Now, I'll turn it over to Eric McAfee, our Chairman and CEO. Thanks, Todd. Let me

Speaker 2

start with an update on our three core businesses, dairy, RNG, California ethanol and India biofuels. In our dairy RNG business, we're scaling gas production quickly. We expect to reach 550,000 of production capacity this year and grow to 1,000,000 MMBtu annually by the end of twenty twenty six. We're now operating or building at 18 dairies backed by $50,000,000 of USDA guaranteed financing. Seven of our dairy pathways have completed third party verification and are in final review at CARB with approvals expected this quarter, unlocking meaningful LCFS revenue starting in Q3.

Speaker 2

At our ethanol plant, we've begun off-site construction of the $30,000,000 mechanical vapor recompression system. This project is expected to reduce natural gas use by 80% and add an estimated $32,000,000 in annual cash flow starting in 2026. We've already secured $20,000,000 in grants and tax credits to help fund the system. Ethanol pricing has strengthened since earlier this year and the recent EPA approval of summer E15 blending provides tailwinds for margin expansion. In India, we resumed biodiesel deliveries to government oil marketing companies in April, following a six month pause in OMC purchasing.

Speaker 2

New OMC tenders have been issued and the business remains EBITDA positive and self funding. We're preparing for an IPO of our India subsidiary targeting late twenty twenty five or early twenty twenty six and evaluating expansion into RNG and ethanol production in that market. Looking at future projects, sustainable aviation fuel, we've received air permits and other permits for our 90,000,000 gallon per year SAF and renewable diesel facility at the Riverbank site. When operated solely for SAF, capacity will be approximately 78,000,000 gallons per year. We are in active discussions on financing structures and are awaiting further clarity on the 45C tax credit and state level SAF mandates to support project financing.

Speaker 2

In carbon capture at our Riverbank site, we've completed initial drilling and pipe installation for our CO2 characterization well. The data we obtained from the next phase of drilling will support our classic sequestration permit application. Once permitted the site is expected to sequester up to 1,400,000 tons of CO2 annually. Regulatory tailwinds support strong growth outlook. Aemetis is positioned to benefit from a range of federal state policies that directly enhance the value of our low carbon fuel operations.

Speaker 2

The California Low Carbon Fuel Standard, amendments adopted by CARB to establish a twenty year framework for reducing transportation fuel emissions are expected to become effective within the next few months. Credit prices are expected to rise significantly as credit supply tightens and credit demand increases. Once provisional LCFS pathways are approved, Aemetis Biogas could generate over $60,000,000 annually from LCFS credits alone. Federal Renewable Fuel Standard. The sale of renewable natural gas qualifies for D3 RINs, adding $28 to $40 per MMBtu in value.

Speaker 2

When combined with LCFS credits, this represents up to $100,000,000 in potential revenue from RNG in 2026. Section 45Z production tax credit. Effective 01/01/2025, this new federal incentive supports low emission ethanol and RNG production. Aemetis is currently applying treasury guidance to calculate and market these credits with additional clarification expected later this year. Section 48, investment tax credits.

Speaker 2

Aemetis received $19,000,000 in cash proceeds in Q1 twenty twenty five from the sale of solar and biogas related investment tax credits. The company expects additional sales of both investment and production tax credits in 2025. E15 ethanol blend expansion. The EPA has approved summer use of E15, a 15% blend of ethanol in 49 states and new legislation is advancing to allow year round use, including in California. This would expand The U.

Speaker 2

S. Ethanol market by more than 600,000,000 gallons annually and lower fuel prices for consumers. In California, governor Newsom has directed CARB to expedite the process for allowing the sale of E15 gasoline in the state, and the state legislature is currently considering conforming legislation. Today, California is the only USDA that the state that does not allow the sale of E15 gasoline. Implementing E15 in California will increase domestic US demand for ethanol by over 600,000,000 gallons annually.

Speaker 2

These aligned policy developments are expected to significantly strengthen Aemetis' revenue, cash flow and project economics across its renewable natural gas, ethanol, carbon capture and SCF segments. Looking ahead to full year 2025, we expect a significant ramp in RNG revenues starting in Q3, driven by LCFS pathway approvals and volume growth. India revenues are recovering with resumed biodiesel shipments. Ethanol margins will be supported by policy tailwinds in the near term and by the significant reduction in costs and increases in revenue planned from our NVR project beginning in 2026. We are monetizing tax credits and advancing development stage projects, including SAF and carbon capture.

Speaker 2

Aemetis is positioned for growth and improved cash flow in the second half of the year and continuing through 2026. Now let's take questions from our call participants.

Speaker 3

Operator?

Operator

Thank you, Mr. McAfee. We will now be connecting a question and answer session. You may press star two if you would like to remove your question from the queue. Your first question is coming from Sumayya Jain with UBS.

Operator

Please pose your question. Your line is live. Sumai, your line is live.

Speaker 4

Oh, sorry. Hi. I was wondering how are you guys looking at the impact of tariffs on RNG production for 2025 and 2026 and how that's also playing out on the staff side of things?

Speaker 2

Well, RNG value chain is almost entirely domestic. Our feedstock is produced by dairies in California. Our operating costs are primary electricity we get from our local supply chain, which is actually hydroelectric in California. And our customers are all California trucking companies and fueling stations. So the actual direct business is all domestic.

Speaker 2

We do have construction and we so far have qualified for domestic content on all of our capital equipment investments. And so we are largely domestic in our supply chain for investments. So RNG is a very domestic business. I would anticipate no direct impact. Sustainable aviation fuel as an operating activity is anticipating to use domestic feedstocks and sell to airlines in California.

Speaker 2

Our contracts all have delivery into San Francisco Airport, and we'd be shipping using our renewable natural gas trucks, which are again, California located. I think the investment in the capital construction may have some indirect impacts from tariffs. These tariff burdens have been changing daily. So by the time I think we're actually doing these purchases, think we'll have a substantially different picture of what the tariff impact is. And it'll primarily just be on the one time purchase of capital equipment if we do any offshore work.

Speaker 4

Okay. Great. And then how are you guys I guess, what is driving the improvement in the balance sheet that you're forecasting? Or like, how's the debt outlook for 2025?

Speaker 2

Well, we paid off $15,500,000 of debt in the first quarter of this year, and anticipate we will continue to be doing that through the next three quarters of the year. That is primarily from the benefits of the investments we're making. We get investment tax credits from those investments. And then secondly, we are anticipating both the low carbon fuel standard seven dairy pathways to be approved and the twenty year mandate that's under the LCFS amendment to be adopted sometime over the next couple of quarters. Both of those together substantially increase our LCFS revenues and substantially as in 120% those seven dairies, just in terms of number of LCFS credits.

Speaker 2

And then if those credits go up anywhere from 20% to 50%, of course that's compounded against the 120%, so dramatic increase. And then the third element there is additional dairies coming online. We have four dairies slated to come online this early this summer and that of course is additional revenue. We also have an India IPO we're actively working on and that will put a lot of cash on the balance sheet, as well as put us in position to reduce debt. And then the last point is actually probably the most important point and that is starting January 2025, the 45Z production tax credit, not investment tax credit, but production tax credit started and we are currently working on marketing our first round of production tax credits.

Speaker 2

This is revenue for both our ethanol business as well as our biogas business and will significantly increase our ability to pay down debt during 2025 and 2026 as we ramp.

Speaker 4

Got it. Thank you.

Speaker 2

Thank you, Samira.

Operator

Your next question is coming from Matthew Blair with TPH. Please pose your question. Your line is live.

Speaker 3

Great. Thank you very much. I had a question on the dairy RNG OpEx. It looks like OpEx per MMBtu has been trending in the $29 to $30 per MMBtu range the past few quarters. Is that a good long term target?

Speaker 3

Or do you expect that to come down when you have the new dairies up and running? If so, what's a good long term target for dairy RNG OpEx?

Speaker 2

Our initial OpEx as a percentage of production has been inhibited because we've been in the startup phases of the dairies we bring online. And so our operating costs includes actually digesters that aren't generating any MMBtus at all yet. So I think we're going to be seeing a dramatic decrease in OpEx per MMBtu as MMBtus increase. A factor there by the way is we're in the winter. In the winter our production significantly less because it's colder and microbes just don't produce as much RNG.

Speaker 2

So just the natural function of seasonality would cut that almost in half just because you're doubling your MMBTs without doubling your staff. And I would remark that we have built out a strong team that operates our own digesters and we do very little outside contracting related to operations. And so our team is scaling up not just the 16 digesters were scheduled to have by the end of this quarter, but frankly 50 digesters. So you'll see our OpEx is operating on the idea that we're scaling rapidly.

Speaker 3

Sounds good. And then Eric, you mentioned that ethanol margins are improving in the second quarter and we are seeing better ethanol prices, cheaper corn costs. Do you think that your California ethanol segment is on track for an EBITDA positive quarter? Is that that may be a little too much to ask?

Speaker 2

It's all about demand. The E15 approval happened last week. And ethanol is a national market, as you know. So with more ethanol being exported, we set a new March record for ethanol exports with 155,000,000 gallons. And we expect increasingly be adopted because the EPA not only assured that this year we'd have not just the short waiver they provided, but all throughout the summer we have the waiver.

Speaker 2

And they also stated they have every intention to get it approved. So next year no waivers are required. So E15 is an underlying, what I would call incoming tide that's going to lift all boats. So the combination of seasonality where people just drive more during the summer and then E15 adoption is a generally positive trend. Our margins are based upon the delta between corn and ethanol as you know.

Speaker 2

So currently the corn prospects are moderate, but not bullish and ethanol margins I would say are more on the bullish side. So in general, I would think a strengthening trend, which we see almost every year, we'd expect to see again this year.

Speaker 3

Great. Thanks for your comments.

Speaker 2

Thank you, Pam.

Operator

Your next question is coming from Sameer Joshi with H. C. Wainwright. Please pose your question. Your line is live.

Speaker 5

Hey, good afternoon, and good morning, Todd, Eric. Thanks for taking my questions. I I think I heard you while describing the India business IPO later this year or early next year, but you also mentioned potential of RNG and ethanol in that in the in that market. Can you please elaborate or give some color on that?

Speaker 2

Yes, and I actually appreciate you bringing it up. Our current business in India is a dominant biodiesel facility. We have 80,000,000 gallons a year. We sell the product for roughly $3 to $4 a gallon depending on markets, but usually it's about $4 a gallon including glycerin. So you take 80 and multiply it then four, it's a $320,000,000 revenue business in India that is well established.

Speaker 2

Did $112,000,000 as of the September in the trailing twelve months. And so it's plenty large to get a successful IPO done. But our parent company has extensive experience in ethanol. We're the largest ethanol producer in California, one of the largest in the Western United States, of course, and in biogas, which has been for us a very, very successful venture in terms of new market position and signing 50 dairies, etc. So in our India business, we are very proactive proactively looking at renewable natural gas opportunities and frankly ethanol.

Speaker 2

Ethanol is a favorite of the India government. It's a domestic feedstock, it comes from either sugarcane or corn. They call it, call it maize in India, but corn has a benefit of providing about 20% of it, 28% of the feedstock becomes an animal feed. That's the disposed grain that helps farmers. And so not only is corn grown by farmers, but then it feeds livestock in India.

Speaker 2

So it's sort of a double benefit to the farming community. And that is as a result in a lot of political power and the consumption of ethanol hit 19.4% in 2024 in India. And they've set a new target of 30% over the next sixty months. So the ethanol business in India has also the benefit that the government sets a minimum price for corn, and then sets a minimum price for ethanol in order to provide new markets for corn and in the country. And so we see the same opportunities in biogas.

Speaker 2

They set a threshold price on renewable natural gas that is very attractive. And so being in a strong position, we decided that diversification is something we have both the technical competence as well as the market position to be able to take full advantage of. And the timing of that is designed to help our IPO valuation. So we have specific projects we're reviewing right now. We expect over the next two quarters to announce what those projects are and to have a diversified IPO of rapidly growing company in India with with truly exciting prospects, and strongly supported by the India India government because of the benefits to the agricultural sector in India.

Speaker 5

Yeah. No, thanks for that color. It makes sense. Just a follow-up on India there. There's trouble on the border there right now.

Speaker 5

Do you expect any early days and maybe it will subside? But do you see any hiccups that could arise because of that development?

Speaker 2

We're down on the the East Coast and the Southern part of the East Coast in Ashe Pradesh. So we're about as far from it as you can get without going swimming in the ocean. So it has had no impact on us, including our supply chain, our customer base, it's just that had no impact at all. And I've watched the same news reports you have. The Indian government is working diligently to try to deescalate.

Speaker 2

This is a flare up that I don't think either side needed or wanted, but I don't expect it to last very long. And I do expect it to be resolved favorably for both parties by just saying don't shoot at each other. This they're not gonna become friends, but they're not gonna see any benefit from a military skirmishing.

Speaker 5

Makes sense. In addition to the $31,000,000 that order from the biogas for for the biogas in India, do you expect another round before the before, like, say, in fall or something, or you don't see that happening?

Speaker 2

The $31,000,000 order is through the month of July. So our shipments started basically the April, but mostly it's May, June and July. We are pressing as the industry is to not see a repeat of what happened to us in the fourth quarter of twenty twenty four and the first quarter of twenty twenty five. And so the delay that occurred there, we're not looking to repeat. And I think the oil marketing companies and the government are now highly, certainly very aware, and I would even say it sensitized to the need to keep the orders flowing in order to not have this sort of an industry production gap that happened.

Speaker 5

Understood. Just one last question. And I know you talked about, in addition to, in response to previous questions about reducing debt, but the EB-five, and maybe now the gold card that Trump is proposing, has proposed, Does are there any opportunities where you can get cheaper debt from those sources?

Speaker 2

Yes. And we announced last year that we are approved now for $200,000,000 in EB-five financing. Our net interest costs are less than 3% on those funds and it's subordinated debt, so we can do senior debt on top of it. We are seeing a very active EB-five and it's a combination of enforcement of immigration rules in a way that we haven't seen for a while. And so people here on their work visas and student visas are looking seriously about whether they want to stay for a while.

Speaker 2

And EB-five is really the only program available to really assure them of not having loss of immigration rights. And then secondly, interestingly enough in India, the stock market has done very, very well. And so we're seeing many more Indian families that just have the financial capacity to have their kids go to school in The US or already are in school and already have family here. And so EB-five is I think just more affordable than maybe perhaps four or five, six years ago. So that combination together has brought a number of very proactive investors to us and we continue to work on closing our next round of EB-five investors.

Speaker 5

Sounds good. Thanks, guys for taking my questions.

Speaker 2

Thank you.

Operator

Your next question is coming from Derrick Whitfield with Texas Capital. Please pose your question. Your line is live.

Speaker 6

Good morning, Eric and team, and thanks for taking my questions.

Speaker 2

Hey, Derrick.

Speaker 6

Eric, could you update us on the progress of 45Z as you understand it with respect to timing of final rules from Treasury and whether you're expecting a unique pathway for dairy or energy?

Speaker 2

The appointment of the head of tax policy at Treasury is pending. It could happen in the next couple of days. That will be Ken Keyes. I attended Ken Keyes' confirmation hearing approximately two weeks ago, and he is a well known factor in Washington. And I believe that his response to the confirmation question from Senator Grassley

Speaker 2

Senator Grassley from Iowa, of course, has 42 ethanol plants in the state and specifically asked, would N Keyes as the head of tax policy for Treasury not wait for new legislation, not wait for new regulation to be issued by Treasury, but instead take the existing law passed in 2022, the regulations issued in January 2025 and implemented. And the response in writing from Ken Keyes was, yes, I will do so. And what it was referring to was the provisional emissions rate, which for biogas is a very large number compared to the emissions rate that is a default in the Greek model. The emissions rates default, was the Department of Energy and EPA calculating all the methane emissions from all the animals in The US divided by all the animals. So all the chickens and ducks and turkeys and everything else were divided into the emissions.

Speaker 2

So the loser in that calculation, which for us was, ends up being about a negative 33 carbon intensity is dairies. Dairies produce a lot more manure and then do an excellent job of capturing it and converting it to valuable vehicle fuel. So our carbon intensity in California under the California agreed is a negative three eighty, not a negative 33. So for us, our focus has been on getting the provisional emissions rate process to work. We have Ken joining the treasury as early as next week, and his task is going to be to figure out how to get a PER process to work, which they promised in January.

Speaker 2

And we are certainly looking for that to be a short process. The benefit for us would be significant increase in the value of our RNG molecule. Currently, we're about $14 an MMBtu. And we would expect a very significant increase in terms of 5x plus multiple of that in terms of an approved provisional emissions rate.

Speaker 7

Eric and just to put

Speaker 6

a bow on that. I mean you guys will be looking at something north of $60 per hour in BTU. It all depends on conversion but just playing the math of the PER at your negative $3.80, it's a big number.

Speaker 2

It is. And actually there's three numbers. The third one's a dollar. The first one's a number of gallons. The second's the emission rate.

Speaker 2

Well, rate times a dollar, we get that, but they're currently calculating the number of gallons at 7.8 gallons per million British thermal units. Well, the same federal law, the same month we calculate our D3 RINs of the Renewable Fuel Standard at 11.7. So strangely enough, two federal laws have two different number of gallons we're delivering into a truck, same truck, same MMBtu, but instead of 11.7 gallons, which has been federal law for twenty years, we're only getting 7.8 gallons. And you can imagine that I've mentioned that to a number of senators and congressmen about that consistency needs to get rectified. And so we're looking actually at 11.7 times our emissions factor times a dollar is what the actual calculation should be.

Speaker 2

I think it's going to have to be baby steps. We get the emissions rate correct, and then we'll probably have to get treasury guidance to get the energy density corrected. But we can sell multiple rounds of tax credits on the same molecule. So we're not prohibited from selling at this current rate and then at a higher rate as they get their calculations to work.

Speaker 6

Very helpful. And then with my follow-up, I wanted to lean in on ethanol fundamentals. While there are several variables that play with ethanol, do you have a view on ethanol and corn crush margins in an environment where E15 were adopted across 49 states?

Speaker 2

Andy, you want to take that?

Speaker 8

Well, the waiver that was provided by the EPA certainly is positive. It's not new. As you know, they've provided the waiver previously. So I think it provides a level of certainty as we go into the summer. I think the thing that we're kind of keeping our eye on is being that one holdout state, California being the only state in The US that's not allowed to sell E15 gasoline.

Speaker 8

The governor has made it clear that he wants CARB to expedite the process. The legislature seems very open, really more so than we've ever seen before. There seems to be a good deal of support with that and adding E15 in California would be a huge boost to all of U. S. Ethanol producers, but certainly us in California would be a real benefit.

Speaker 8

So I think, you know, corn futures have come down quite a lot this week, which is, you know, not good for producers, but good for buyers, us. Ethanol has remained relatively stable, trading in about a $06 to $08 band for the last call it forty five days. Typically that does strengthen as we get into the summer. And I think the other thing that we've noticed in the last couple of weeks is there's been a drawdown in inventory, which is necessary and has been good. We still have a fair amount of inventory nationally that we need to chew through.

Speaker 8

But as you know, Derek, ethanol exports are well on pace this year to be smashing the record. So you add those combinations together and I think near term outlook is better. And then for us, getting our MVR system installed, speaking just about Aemetis and not the ethanol industry as a whole will have a dramatic impact on our carbon intensity score. So, you add those things together, I think the outlook from a cash flow perspective in the ethanol business is very positive as we head into 2026.

Speaker 1

That's great. A lot of

Speaker 6

potential tailwinds for you guys. I'll turn it back to the operator.

Speaker 8

Thank you.

Operator

Your next question is coming from Dave Storms with Stonegate. Please pose your question. Your line is live.

Speaker 9

Morning, everyone.

Speaker 3

Morning, Dave.

Speaker 7

Just wanna start with a quick modeling question. Are there any investment tax credits they have left to sell in 2025? And just any thoughts on how many tax credits investment credits you may generate in the remainder of the year?

Speaker 2

We definitely have a sale actually in process for ITCs. These lag the completion of the project, it's called the in service date, because of the various documentation you have to pull together. So there's up to a six month or more lag between completing the actual project. So we will be bringing projects online in the next couple of months and then another set of projects later on this year. So I expect probably another couple of ITC sales during the course of this year.

Speaker 2

And then probably even more important to the company's cash is 45Z sales. And if we can get provisional emissions rate, we'd be looking at some of those in the next couple of months. And that will be an ongoing process, which I would expect would be at least quarterly to get our 45Z production tax credits monetized.

Speaker 7

Understood. That's perfect. And can you just remind us, once your digesters are approved and achieve that full approval, is there a look back on the carbon intensity for credits that have been generated in the last six months here? Like any look back like that?

Speaker 2

Andy, you want to talk about them?

Speaker 8

Yes, one quarter is the look back period, depending on what the date is when we receive the final approval. We've gone back and forth with CARB on a couple of minor RFIs and we're expecting that approval to happen hopefully this month, the next couple

Speaker 2

of weeks. And just because from a modeling perspective, I want to make sure you get this clarity. We do expect to be approved this quarter for the first to seven dairies. It will be a first pathway approvals we've ever gotten, which is a little slow. It will have taken us about two years.

Speaker 2

But we won't reflect that revenue or cash during the second quarter. Those get generated at the end of the second quarter and will be monetized in the month of July. So we will show that as third quarter revenues. And by the time we do our conference call for the second quarter, we'll be able to tell everyone exactly how much we've monetized, but it'll show up in third quarter revenues. So from a process perspective, it will be for the first quarter's production, approved in the second quarter, and then very early, like the one week into the third quarter, we will show it as cash on our account.

Speaker 7

Understood. That's very insightful. Thank you for taking my questions.

Speaker 2

Sure. Thank you, Dave.

Operator

And your next question is coming from Ed Woo with Ascendiant Capital. Please pose your question. Your line is live.

Speaker 9

Yeah. Congratulations on all the progress and especially on the Indy IPO where you said it's going to be late this year, early this next year. Have you decided what you're going to be doing with the proceeds? Is there any plans for significant expansion into, like say, RNG or into sustainable aviation fuel?

Speaker 2

Our India IPO proceeds will be primarily focused on building out the India business. We're also going to be putting a cash balance that historically we've not run at the company. Historically, we try to pay down our expensive debt, but I would expect we'll end up with a significant cash balance, which will show up on the parent company consolidated balance sheet. And then I would expect a certain amount of the money would be repayment of parent company debt. So when we get repaid from India for amounts we've advanced to India, we would then use it to repay our parent company debt.

Speaker 2

Since we're talking about debt repayment, we do have not only investment tax credits, but also loan refinancings that we're working on. A debt repayment for us is a very high priority. And we expect later on this year to see continued progress, not only paying down interest and principal, but also refinancing into lower cost financing.

Speaker 9

Great. Thanks for answering my questions and I wish you

Speaker 5

guys good luck. Thank you.

Speaker 2

Thank you, Ed.

Operator

We have reached the end of our question and answer session, and I will now turn the call over to management for their closing remarks.

Speaker 2

Thank you to Aemetis stockholders, analysts, others for joining us today. We look forward to talking with you about participating in

Speaker 1

the growth opportunities at Aemetis. Thank you for attending today's Aemetis earnings conference call. Please visit the Investors section of the Aemetis website, where we'll post a written version and an audio version of this Aemetis earnings review and business update. Kelly?

Operator

Thank you, everyone. This does conclude today's teleconference. You may disconnect your lines at this time. Thank you for your participation.

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Key Takeaways

  • Revenues were $42.9 M in Q1, down from $72.6 M due to delayed biodiesel contracts in India, but shipments resumed in April and a meaningful rebound is expected in Q2.
  • The company posted an operating loss of $15.6 M—driven by higher SG&A and interest expense—and a net loss of $24.5 M, roughly flat year-over-year.
  • Dairy RNG volumes rose 17% year-over-year with production capacity set to reach 550,000 MMBtu in 2025 and 1,000,000 MMBtu by end of 2026, while seven pathways await final LCFS approval to unlock credits in Q3.
  • At the California ethanol plant, construction has begun on a $30 M mechanical vapor recompression system that will cut natural gas use by 80% and add an estimated $32 M in annual cash flow from 2026, with E15 and stronger ethanol pricing supporting near-term margins.
  • In India, the biodiesel business resumed deliveries, remains EBITDA-positive, and management is targeting an IPO for the India subsidiary in late 2025 or early 2026 while evaluating expansion into RNG and ethanol.
A.I. generated. May contain errors.
Earnings Conference Call
Aemetis Q1 2025
00:00 / 00:00