Aemetis Q1 Earnings Call Highlights

Key Points

• "Financial inflection point": Q1 revenue rose 27% to $54.6 million and gross profit swung to $2.8 million from a year-ago loss, with production tax credits under Section 45Z contributing $4 million of operating income (dairy RNG $1.4M, California ethanol $2.6M).
• LCFS approvals and dairy RNG scale-up: CARB approved seven new LCFS pathways averaging a negative 380 CI score (vs. the -150 default), boosting credit value, while dairy RNG sales jumped 55% to 110,000 MMBTUs and Aemetis is on track to double its operating dairy digester network.
• Key projects and financing focus: The Keyes MVR project is expected to commission later this year to displace ~80% of fossil natural gas and add about $32 million in annual cash flow, while the company pursues refinancing and an India IPO amid financing being the main outstanding item for its larger RD/SAF expansion.

Aemetis NASDAQ: AMTX reported first-quarter 2026 results that management described as a “financial inflection point,” driven by higher revenue across all three operating segments, a swing to positive gross profit, and initial quarterly production tax credit generation under Section 45Z.

Quarterly results and 45Z credit contribution

Chief Financial Officer Todd Waltz said first-quarter revenue rose 27% year over year to $54.6 million, compared with $42.9 million in the first quarter of 2025. Gross profit was $2.8 million, improving from a gross loss of $5.1 million a year ago. Operating loss improved about 60% to $6.3 million from $15.6 million, and net loss narrowed to $21.7 million from $24.5 million.

Waltz said production tax credits under Section 45Z contributed $4 million of operating income during the quarter, including $1.4 million from dairy renewable natural gas (RNG) and $2.6 million from California ethanol. He characterized the quarter as the company’s first period of “ongoing credit generation tied to quarterly production since 45Z eligibility was established in the fourth quarter of 2025.”

Adjusted EBITDA was negative $1.3 million, which Waltz attributed to “typical winter seasonality,” with stronger revenue and margin performance later in the quarter. Cash and cash equivalents ended the quarter at $4.8 million, comparable to year-end 2025. Capital investments in carbon intensity reduction and dairy digester construction totaled $6.5 million in the quarter.

Management highlights: LCFS pathway approvals and project progress

Chairman and CEO Eric McAfee pointed to three main takeaways from the quarter. First, he emphasized the year-over-year improvements in consolidated revenue, gross profit, and operating loss, noting that all three reportable operating segments contributed.

Second, McAfee highlighted California Air Resources Board (CARB) approval of seven new Low Carbon Fuel Standard (LCFS) pathways for Aemetis’ RNG business. He said the newly approved pathways carry an average carbon intensity (CI) score of negative 380, compared with the negative 150 default score, and have provided additional revenue at higher LCFS value each quarter since the third quarter of 2025. McAfee added that six additional biogas digester pathways are nearing approval, and said the pathway approvals “substantially expand the LCFS credit generation per MMBTU of RNG produced.”

Third, McAfee detailed progress on capital projects. He said Aemetis received initial deliveries of dairy biogas pretreatment skids in April under a $27 million fabrication contract. He also said major equipment for a $40 million mechanical vapor recompression (MVR) project at the Keyes, California ethanol plant has arrived on-site and construction has begun.

In dairy RNG, McAfee said the company sold 110,000 MMBTUs in the first quarter, a 55% increase over the same quarter last year. He said hydrogen sulfide cleanup and biogas compression equipment has been contracted for 15 additional digesters, with four units already delivered, and that Aemetis is “on track to double” its operating dairy network with construction continuing into 2027.

Keyes ethanol MVR timeline and expected impact

McAfee said the Keyes MVR project remains on track for completion later this year and is intended to displace about 80% of fossil natural gas use at the plant by using on-site solar and grid electricity. He said the company expects MVR commissioning later this year to add about $32 million in annual cash flow from operations, including incremental 45Z and LCFS benefits from a lower CI score for the ethanol produced, as well as natural gas cost savings.

In response to an analyst question, President of Aemetis Advanced Fuels Andy Foster said no additional certifications are necessary beyond permits already obtained. Foster said the company received an authority to construct from the air district last year and has local permits that proceed as construction continues. He added that demolition has started and that major long-lead equipment is already in transit or on-site, including turbofans received from Germany and an evaporator from Praj in India that was in transit to the Keyes plant.

India biodiesel rebound and IPO planning

McAfee said India biodiesel revenue rebounded to $10.5 million in the quarter following the resumption of oil marketing company (OMC) shipments under new contracts. He said the revenue growth supports the planned initial public offering of the India subsidiary, Universal Biofuels Private Limited, and noted the company has retained legal, accounting, and IPO advisors.

Discussing India’s market dynamics during Q&A, McAfee attributed recent profitability pressure to government pricing decisions that held diesel prices flat despite higher crude oil costs, which he said has caused OMCs to lose money selling diesel below cost. He said he expects diesel pricing to increase and described ongoing discussions with OMCs and the Ministry of Petroleum regarding a “much more solid program” to better utilize industry production capacity.

McAfee also said a cost-plus contract structure is being strongly considered as a replacement for what he described as an uncertain pricing approach in recent years. He cited prior results under a cost-plus model, saying the company previously generated $112 million of revenue and about $14 million of positive cash flow under that structure. He linked the company’s IPO timing to clearer adoption and enforcement of India’s biofuels policies, including the National Policy on Biofuels’ stated 5% biodiesel blend target.

When asked about the use of potential IPO proceeds, McAfee said the India IPO is designed to support expansion of projects in India and California, including dairy RNG. He also said the India business is positioned to convert a biodiesel facility into sustainable aviation fuel (SAF) production in addition to expanding biodiesel output.

Financing, LCFS market outlook, and SAF/RD project update

On financing and debt, McAfee said improved margins and renewed “confidence in the need for domestic renewable fuels” have expanded refinancing options. He said the company has been supported by a Toronto fund that holds its senior debt, aside from $50 million of USDA debt, and said Aemetis is pursuing a municipal bond-style refinancing of existing bridge financing from Third Eye Capital. McAfee also addressed the USDA’s Rural Energy for America Program (REAP), saying activity continues but the agency has slowed renewable fuels expansion amid a portfolio review, creating uncertainty. He said growing interest in municipal bonds and private and commercial credit markets may “overshadow” REAP for Aemetis’ funding needs.

On LCFS prices, McAfee said he expects an upward trend with a “rapid price increase during the summer and early fall,” while acknowledging recent muted pricing. He attributed some market behavior to traders’ expectations about reduced driving with higher gasoline prices and said renewable diesel credit generation has underperformed, contributing to a larger-than-expected deficit. He also suggested market participants may move more aggressively to buy credits as they look ahead to potential scarcity, noting the LCFS credit price cap of $268 and saying he “wouldn’t be surprised” to see $150 in 2027.

McAfee also provided an update on the company’s long-discussed renewable diesel (RD) and sustainable aviation fuel project. He said the facility would have capacity of 80 million gallons per year of SAF, or 90 million gallons if operated only in renewable diesel mode, and that Aemetis has signed definitive agreements with 10 airlines and obtained full permitting approval for construction to begin in 2024. He said financing remains the key outstanding item and added that lenders are focused on clarity around 45Z economics, including the pending updated 45ZCF-GREET model and related Department of Energy calculator. McAfee said the project economics “work great without 45Z,” but that the credit remains an important factor in financing timelines.

Looking ahead, McAfee said the company’s 2026 priorities include scaling production, monetizing “stacked” credit value across its renewable fuels platform, completing the India IPO, and refinancing existing debt into long-term financing. He listed key catalysts the company is tracking this year, including the updated 45ZCF-GREET model, commissioning of the Keyes MVR project, rising LCFS credit prices amid continued deficits, and progress on the India IPO.

About Aemetis NASDAQ: AMTX

Aemetis, Inc, headquartered in Cupertino, California, is a renewable fuels and renewable natural gas producer dedicated to decarbonizing the transportation sector. The company operates two primary business segments: Aemetis Advanced Fuels, which manufactures ethanol, biodiesel and sustainable aviation fuel using patented carbon capture and separation technology; and Aemetis RNG, which develops dairy-based renewable natural gas projects in California for pipeline injection and transportation use.

Since its incorporation in 2006, Aemetis has expanded its production footprint through organic growth and strategic acquisitions.

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