Clean Energy Reports Revenues Rose 26% During the Second Quarter of 2013

  Clean Energy Reports Revenues Rose 26% During the Second Quarter of 2013

Business Wire

NEWPORT BEACH, Calif. -- August 8, 2013

Clean Energy Fuels Corp. (NASDAQ: CLNE) (Clean Energy or the Company) today
announced operating results for the second quarter and six months ended June
30, 2013.

Revenue for the second quarter ended June 30, 2013 was $88.1 million, which is
up from $69.8 million for the second quarter of 2012. For the six months ended
June 30, 2013, revenue totaled $181.2 million, which is up from $143.5 million
a year ago. When comparing periods, note that the Company recognized revenue
attributable to the volumetric excise tax credit (VETC) of $6.0 million and
$32.2 million in the second quarter and first six months of 2013, but did not
recognize any revenue attributable to VETC in the second quarter and first six
months of 2012. The American Taxpayer Relief Act, signed into law on January
2, 2013, reinstated VETC through December 31, 2013 and made it retroactive to
January 1, 2012. The Company recognized $20.8 million of VETC revenue in the
first quarter of 2013 attributable to 2012 sales of CNG and LNG. Also during
the second quarter, the Company sold its subsidiary BAF Technologies, Inc. and
recognized a gain of $15.5 million on the transaction.

Gallons delivered (defined below) for the second quarter of 2013 totaled 52.6
million gallons, up 8% from 48.6 million gallons delivered in the same period
a year ago. Gallons delivered were up 13% for the second quarter of 2013 when
excluding 2.1 million gallons delivered in the second quarter of 2012 by the
Company’s Peruvian joint venture, which was sold in March of 2013. For the six
months ended June 30, 2013, gallons delivered totaled 102.5 million gallons,
up from 92.3 million gallons for the six months ended June 30, 2012.

Andrew J. Littlefair, Clean Energy’s President and Chief Executive Officer,
stated: “I am very encouraged by the significant development that has taken
place over the first half of the year in both our core markets as well as in
the long-haul trucking market’s transition to natural gas. The 12-liter
natural gas engines have been well received by the early adopters and shippers
are now starting to request that their contract carriers make the switch to
natural gas. Clean Energy’s investment in ‘America's Natural Gas Highway’ has
laid the foundation to enable this transition to natural gas fueled trucking
throughout the country.”

Adjusted EBITDA for the second quarter of 2013 was $11.1 million. This
compares with adjusted EBITDA of $(1.6) million in the second quarter of 2012.
For the six months ended June 30, 2013, adjusted EBITDA was $31.2 million,
compared with $(3.6) million for the same period in 2012. Adjusted EBITDA is
described below and reconciled to the GAAP measure net loss attributable to
Clean Energy Fuels Corp.

Non-GAAP loss per share for the second quarter of 2013 was $0.07, compared
with a non-GAAP loss per share for the second quarter of 2012 of $0.16. For
the six months ended June 30, 2013, non-GAAP loss per share was $0.03,
compared with $0.33 per share for the first six months in 2012. Non-GAAP loss
per share is described below and reconciled to the GAAP measure net loss
attributable to Clean Energy Fuels Corp.

On a GAAP basis, net loss for the second quarter of 2013 was $11.9 million, or
$0.13 per share, and included a non-cash loss of $40,000 related to the
accounting treatment that requires Clean Energy to value its SeriesI warrants
and mark them to market, a non-cash charge of $5.5 million related to
stock-based compensation, and foreign currency losses of $0.2 million on the
Company’s IMW purchase notes. This compares with a net loss for the second
quarter of 2012 of $11.3 million, or $0.13 per share, which included a
non-cash gain of $8.9 million related to marking to market the SeriesI
warrants, $5.8 million of non-cash stock-based compensation charges, and
foreign currency losses of $0.5 million on the IMW purchase notes.

Net loss for the six month period ended June 30, 2013, which included a
non-cash charge of $0.5 million related to the valuation of the Series I
warrants, non-cash stock-based compensation charges of $11.7 million, and
foreign currency losses of $0.4 million on its IMW purchase notes, was $15.8
million, or $0.17 per share. This compares with a net loss in the six months
ended June 30, 2012 of $43.2 million, or $0.50 per share, which included a
non-cash charge for the Series I warrants of $4.6 million, non-cash
stock-based compensation charges of $10.4 million, and foreign currency losses
of $0.1 million on its IMW purchase notes.

Non-GAAP Financial Measures

To supplement the Company’s consolidated financial statements, which
statements are prepared and presented in accordance with generally accepted
accounting principles (GAAP), the Company uses non-GAAP financial measures
called non-GAAP earnings per share (non-GAAP EPS or non-GAAP earnings/loss per
share) and Adjusted EBITDA. Management has presented non-GAAP EPS and Adjusted
EBITDA because it uses these non-GAAP financial measures to assess its
operational performance, for financial and operational decision-making, and as
a means to evaluate period-to-period comparisons on a consistent basis.
Management believes that these non-GAAP financial measures provide meaningful
supplemental information regarding the Company’s performance by excluding
certain non-cash or non-recurring expenses that are not directly attributable
to its core operating results. In addition, management believes these non-GAAP
financial measures are useful to investors because: (1)they allow for greater
transparency with respect to key metrics used by management in its financial
and operational decision making; (2)they exclude the impact of non-cash or,
when specified, non-recurring items that are not directly attributable to the
Company’s core operating performance and that may obscure trends in the core
operating performance of the business; and (3)they are used by institutional
investors and the analyst community to help them analyze the results of Clean
Energy’s business. In future quarters, the Company may make adjustments for
other non-recurring significant expenditures or significant non-cash charges
in order to present non-GAAP financial measures that are indicative of the
Company’s core operating performance.

Non-GAAP financial measures have limitations as an analytical tool and should
not be considered in isolation from, or as a substitute for, the Company’s
GAAP results. The Company expects to continue reporting non-GAAP financial
measures, adjusting for the items described below, and the Company expects to
continue to incur expenses similar to the non-cash, non-GAAP adjustments
described below. Accordingly, unless otherwise stated, the exclusion of these
and other similar items in the presentation of non-cash, non-GAAP financial
measures should not be construed as an inference that these costs are unusual,
infrequent or non-recurring. Non-GAAP EPS and Adjusted EBITDA are not
recognized terms under GAAP and do not purport to be an alternative to GAAP
earnings/loss per share or operating income (loss) as an indicator of
operating performance or any other GAAP measure. Moreover, because not all
companies use identical measures and calculations, the presentation of
non-GAAP EPS or Adjusted EBITDA may not be comparable to other similarly
titled measures of other companies. These limitations are compensated for by
management by using non-GAAP EPS and Adjusted EBITDA in conjunction with
traditional GAAP operating performance and cash flow measures.

Non-GAAP EPS

Non-GAAP EPS is defined as net income (loss) attributed to Clean Energy, plus
stock-based compensation charges, net of related tax benefits, plus or minus
any mark-to-market losses or gains on the Company’s SeriesI warrants, and
plus or minus the foreign currency losses or gains on the Company’s purchase
notes issued as part of the acquisition of IMW, the total of which is divided
by the Company’s weighted average shares outstanding on a diluted basis. The
Company’s management believes that excluding non-cash charges related to
stock-based compensation provides useful information to investors because of
varying available valuation methodologies, the volatility of the expense
(which depends on market forces outside of management’s control), and the
subjectivity of the assumptions and the variety of award types that a company
can use under the relevant accounting guidance may obscure trends in the
Company’s core operating performance. Similarly, the Company’s management
believes that excluding the non-cash, mark-to-market losses or gains on the
Company’s SeriesI warrants is useful to investors because the valuation of
the SeriesI warrants is based on a number of subjective assumptions, the
amount of the loss or gain is derived from market forces outside management’s
control, and it enables investors to compare the Company’s performance with
other companies that have different capital structures. The Company’s
management believes that excluding the foreign currency gains and losses on
the notes it issued to purchase IMW provides useful information to investors
as the amounts are based on market conditions outside of management’s control
and the amounts relate to financing the acquisition of the business as opposed
to the core operations of the Company.

The table below shows non-GAAP EPS and also reconciles these figures to the
GAAP measure net loss attributable to Clean Energy Fuels Corp.:

                Three Months Ended June 30,      Six Months Ended June 30,
(in 000s,
except            2012          2013           2012          2013       
per-share
amounts)
Net Loss
Attributable
to Clean         $ (11,294    )   $ (11,943    )   $ (43,199    )   $ (15,814    )
Energy Fuels
Corp.
Stock Based
Compensation,      5,768            5,451            10,448           11,663
Net of Tax
Benefits
Mark-to-Market
(Gain) Loss on     (8,899     )     39               4,607            505
Series I
Warrants
Foreign
Currency Loss     452            249            50             441        
on IMW
Purchase Notes
Adjusted Net     $ (13,973    )   $ (6,204     )   $ (28,094    )   $ (3,205     )
Loss
Diluted
Weighted
Average Common     86,625,655       93,985,438       86,155,678       93,561,302
Shares
Outstanding
Non-GAAP Loss    $ (0.16      )   $ (0.07      )   $ (0.33      )   $ (0.03      )
Per Share

Adjusted EBITDA

Adjusted EBITDA is defined as net income (loss) attributable to Clean Energy,
plus or minus income tax expense or benefit, plus or minus interest expense or
income, net, plus depreciation and amortization expense, plus or minus the
foreign currency losses or gains on the Company’s notes issued as part of its
acquisition of IMW, plus stock-based compensation charges, net of related tax
benefits, and plus or minus any mark-to-market losses or gains on the
Company’s SeriesI warrants. The Company’s management believes that Adjusted
EBITDA provides useful information to investors for the same reasons discussed
above for Non-GAAP EPS. In addition, management internally uses Adjusted
EBITDA to determine elements of executive and employee compensation.

The table below shows Adjusted EBITDA and also reconciles these figures to the
GAAP measure net loss attributable to Clean Energy Fuels Corp.:

                      Three Months Ended June 30,  Six Months Ended June 30,
(in 000s)                2012        2013        2012       2013    
Net Loss
Attributable to        $  (11,294  )   $ (11,943 )   $ (43,199 )   $ (15,814 )
Clean Energy Fuels
Corp.
Income Tax Expense        172            293           418           2,098
Interest Expense,         3,321          6,282         7,023         11,353
Net
Depreciation and          8,907          10,777        17,051        20,935
Amortization
Foreign Currency
Loss on IMW Purchase      452            249           50            441
Notes
Stock Based
Compensation, Net of      5,768          5,451         10,448        11,663
Tax Benefits
Mark-to-Market
(Gain) Loss on           (8,899   )    39          4,607       505     
Series I Warrants
Adjusted EBITDA        $  (1,573   )   $ 11,148      $ (3,602  )   $ 31,181

Gallons Delivered

The Company defines “gallons delivered” as its compressed natural gas (CNG),
liquefied natural gas (LNG), renewable natural gas (RNG) and the gallons
associated with providing operations and maintenance services delivered to its
customers during the period.

Today’s Conference Call

The Company will host an investor conference call today at 4:30p.m. Eastern
time (1:30p.m. Pacific). Investors interested in participating in the live
call can dial 1.877.407.4018 from the U.S. and international callers can dial
1.201.689.8471. A telephone replay will be available approximately two hours
after the call concludes, through Sunday, September 8, 2013, which can be
reached by dialing 1.877.870.5176 from the U.S., or 1.858.384.5517 from
international locations, and entering Replay Pin Number 418094. There also
will be a simultaneous, live webcast available on the Investor Relations
section of the Company’s web site at www.cleanenergyfuels.com, which will be
available for replay for 30 days.

About Clean Energy Fuels

Clean Energy Fuels Corp. (Nasdaq: CLNE) is the largest provider of natural gas
fuel for transportation in North America. We build and operate compressed
natural gas (CNG) and liquefied natural gas (LNG) fueling stations;
manufacture CNG and LNG equipment and technologies for ourselves and other
companies; and develop renewable natural gas (RNG) production facilities. For
more information, visit www.cleanenergyfuels.com.

Safe Harbor Statement

This press release contains forward-looking statements within the meaning of
Section27A of the Securities Act of 1933 and Section21E of the Securities
Exchange Act of 1934 that involve risks, uncertainties and assumptions, such
as statements regarding America’s Natural Gas Highway, the transition of the
heavy-duty trucking industry to natural gas, market acceptance of natural gas
as a vehicle fuel, future growth and sales opportunities in all of the
Company’s markets, which include trucking, refuse, airport, taxi and transit,
the availability of natural gas engines and natural gas heavy-duty trucks, the
benefits of natural gas relative to diesel and gasoline, and the recognition
of revenue attributable to the VETC. Actual results and the timing of events
could differ materially from those anticipated in these forward-looking
statements as a result of several factors including, but not limited to,
changes in the prices of natural gas relative to gasoline and diesel, the
Company’s failure to recognize the anticipated benefits of building America’s
Natural Gas Highway, the availability and deployment of, as well as the demand
for, natural gas engines that are well-suited for the U.S. long-haul,
heavy-duty truck market, future availability of equity or debt financing
needed to fund the growth of the Company’s business, the Company’s ability to
source and supply sufficient LNG to meet the needs of its business, the
Company’s ability to effectively manage its current LNG plants and the
construction of new LNG plants, the Company’s ability to efficiently manage
its growth and retain and hire key personnel, the acceptance of natural gas
vehicles in the Company’s markets, the availability of natural gas vehicles,
relaxation or waiver of fuel emission standards, the Company’s ability to
capture a substantial share of the anticipated growth in the market for
natural gas fuel and otherwise compete successfully, the Company’s failure to
manage risks and uncertainties related to its international operations,
construction and permitting delays at station construction projects, the
Company’s ability to integrate acquisitions, the availability of tax and
related government incentives for natural gas fueling and vehicles, compliance
with governmental regulations and the Company’s ability to manage and grow its
RNG business. The forward-looking statements made herein speak only as of the
date of this press release and the Company undertakes no obligation to update
publicly such forward-looking statements to reflect subsequent events or
circumstances, except as otherwise required by law. Additionally, the
Company’s Form10-Q filed on August 8, 2013 with the SEC (www.sec.gov),
contains risk factors that may cause actual results to differ materially from
the forward-looking statements contained in this press release.

Clean Energy Fuels Corp. and Subsidiaries

Condensed Consolidated Balance Sheets

December 31, 2012 and June 30, 2013

(Unaudited)

(In thousands, except share data)

                                                 December 31,  June 30,
                                                   2012         2013      
Assets
Current assets:
Cash and cash equivalents                         $ 108,522      $ 86,020
Restricted cash                                     8,445          8,568
Short-term investments                              38,175         62,238
Accounts receivable, net of allowance for
doubtful accounts of $905 and $811 as of            57,594         50,535
December 31, 2012 and June 30, 2013,
respectively
Other receivables                                   17,808         30,049
Inventory, net                                      38,152         35,950
Prepaid expenses and other current assets          16,002       16,041    
Total current assets                                284,698        289,401
Land, property and equipment, net                   428,177        456,144
Restricted cash                                     13,208         33,378
Notes receivable and other long-term assets         71,389         70,010
Investments in other entities                       2,581          —
Goodwill                                            75,865         89,086
Intangible assets, net                             99,282       84,436    
Total assets                                      $ 975,200     $ 1,022,455 
Liabilities and Stockholders’ Equity
Current liabilities:
Current portion of long-term debt and capital     $ 30,389       $ 28,439
lease obligations
Accounts payable                                    39,216         22,931
Accrued liabilities                                 30,794         42,306
Deferred revenue                                   13,521       14,800    
Total current liabilities                           113,920        108,476
Long-term debt and capital lease obligations,       300,636        339,691
less current portion
Other long-term liabilities                        14,014       15,576    
Total liabilities                                   428,570        463,743
Commitments and contingencies
Stockholders’ equity:
Preferred stock, $0.0001 par value. Authorized
1,000,000 shares; issued and outstanding no         —              —
shares
Common stock, $0.0001 par value. Authorized
149,000,000 shares; issued and outstanding
87,634,478 shares and 89,318,022 shares at          9              9
December 31, 2012 and June 30, 2013,
respectively
Additional paid-in capital                          837,367        871,443
Accumulated deficit                                 (300,814 )     (316,628  )
Accumulated other comprehensive income             6,151        —         
Total Clean Energy Fuels Corp. stockholders’        542,713        554,824
equity
Noncontrolling interest in subsidiary              3,917        3,888     
Total stockholders’ equity                         546,630      558,712   
Total liabilities and stockholders’ equity        $ 975,200     $ 1,022,455 


Clean Energy Fuels Corp. and Subsidiaries

Condensed Consolidated Statements of Operations

For the Three Months and Six Months Ended June 30, 2012 and 2013

(Unaudited)

(In thousands, except share and per share data)

                  Three Months Ended               Six Months Ended
                   June 30,                          June 30,
                    2012          2013           2012          2013       
Revenue:
Product revenues   $ 57,705         $ 78,375         $ 123,481        $ 161,858
Service revenues    12,137         9,741          19,995         19,301     
Total revenues       69,842           88,116           143,476          181,159
Operating
expenses:
Cost of sales:
Product cost of      43,691           58,925           95,593           105,739
sales
Service cost of      4,839            3,016            8,823            6,943
sales
Derivative
(gains) losses:
Series I warrant     (8,899     )     39               4,607            505
valuation
Selling, general
and                  27,916           35,187           52,766           68,063
administrative
Depreciation and    8,907          10,777         17,051         20,935     
amortization
Total operating     76,454         107,944        178,840        202,185    
expenses
Operating loss       (6,612     )     (19,828    )     (35,364    )     (21,026    )
Interest             (3,321     )     (6,282     )     (7,023     )     (11,353    )
expense, net
Other expense,       (1,177     )     (1,103     )     (336       )     (1,493     )
net
Income (loss)
from equity          72               —                163              (76        )
method
investment
Gain from sale
of equity method     —                —                —                4,705
investment
Gain from sale      —              15,498         —              15,498     
of subsidiary
Loss before          (11,038    )     (11,715    )     (42,560    )     (13,745    )
income taxes
Income tax          (172       )    (293       )    (418       )    (2,098     )
expense
Net loss             (11,210    )     (12,008    )     (42,978    )     (15,843    )
Loss (income) of
noncontrolling      (84        )    65             (221       )    29         
interest
Net loss
attributable to    $ (11,294    )   $ (11,943    )   $ (43,199    )   $ (15,814    )
Clean Energy
Fuels Corp.
Loss per share
attributable to
Clean Energy
Fuels Corp.:
Basic              $ (0.13      )   $ (0.13      )   $ (0.50      )   $ (0.17      )
Diluted            $ (0.13      )   $ (0.13      )   $ (0.50      )   $ (0.17      )
Weighted-average
common shares
outstanding:
Basic               86,625,655     93,985,438     86,155,678     93,561,302 
Diluted             86,625,655     93,985,438     86,155,678     93,561,302 


Included in net loss are the following amounts (in millions):

                                 Three Months Ended    Six Months Ended
                                  June 30,               June 30,
                                   2012    2013      2012     2013  
Construction Revenues             $ 7.5      $ 12.1      $ 22.6      $ 15.0
Construction Cost of Sales          (6.8 )     (10.0 )     (21.1 )     (12.7 )
Fuel Tax Credits                    —          6.0         —           32.2
Stock-based Compensation            (5.8 )     (5.5  )     (10.4 )     (11.7 )
Expense, Net of Tax Benefits

Contact:

Clean Energy Fuels Corp.
Investor Contact:
Tony Kritzer
Director of Investor Communications
949.437.1403
or
News Media Contact:
Gary Foster
Senior Vice President, Corporate Communications
949.437.1113
 
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