Lime Energy Co. Reports Results for Three-Month and Six-Month Periods Ended June 30, 2013

  Lime Energy Co. Reports Results for Three-Month and Six-Month Periods Ended
  June 30, 2013

Business Wire

HUNTERSVILLE, N.C. -- August 19, 2013

Lime Energy Co. (NASDAQ: LIME), a leader in designing and implementing energy
efficiency programs for utilities, today announced its results for the
three-month and six-month periods ended June 30, 2013. “Results for the
quarter were encouraging,” stated John O’Rourke, Lime’s CEO. “Improved
performance in gross margin and revenue growth led the way, providing firm
indication that our efforts to execute against our key initiatives are gaining
traction.”

Results for the three-month period ended June 30, 2013:

  *Consolidated revenue increased $3.6 million, or 35.8% to $13.7 million.
    Revenue for the utility business increased $4.9 million, or 61%.
  *Gross profit increased $2.0 million, or 99.4%, to $4.0 million. The gross
    profit margin improved from 19.6% to 28.8%.
  *Selling, general and administrative expense increased $534 thousand, or
    10.1% to $5.8 million. Second quarter SG&A expense included $287 thousand
    of expenses related to the restatement and ongoing stockholder lawsuits.
    Excluding these $287 thousand of one-time expenses, SG&A increased $247
    thousand, or 4.7%.*
  *The loss from continuing operations declined $1.3 million, or 37.6%, to
    $2.1 million.
  *The loss from discontinued operations declined $1.3 million, or 107.6%, to
    income of $95 thousand.
  *The net loss declined $2.6 million, or 56.3%, to $2.0 million.
  *The basic and diluted loss per share from continuing operations declined
    $0.06 to $0.08 from $0.14. The loss per share from discontinued operations
    declined from $0.05 to $0.00. The total net loss per share declined $0.11
    to $0.08 from $0.19. The one-time expenses of $287 thousand contributed
    $0.01 to the basic and diluted loss per share from continuing operations
    and the total net loss per share.
  *The adjusted EBITDA loss declined $575 thousand, or 29.4%, to $1.4 million
    from $2.0 million. Adjusted for the one-time expenses of $287 thousand,
    the adjusted EBITDA loss declined $862 thousand, or 44.0% to $1.1
    million.*

Results for the six-month period ended June 30, 2013:

  *Consolidated revenue increased $4.1 million, or 18.9%, to $25.7 million.
    Revenue for the utility business increased $7.3 million or 43%.
  *Gross profit increased $2.5 million, or 63.1%, to $6.6 million. The gross
    profit margin improved from 18.6% to 25.6%.
  *Selling, general and administrative expense increased $1.5 million, or
    13.7%, to $12.0 million. SG&A expense includes $1.6 million of expenses
    related to the restatement and ongoing stockholder lawsuits. Excluding the
    $1.6 million of one-time expenses, SG&A expense declined $110 thousand, or
    1.0% to $10.5 million.*
  *The loss from continuing operations declined $747 thousand, or 11.0% to
    $6.1 million. Adjusting for the one-time expenses, the loss from
    continuing operations declined $2.3 million, or 34.0%, to $4.5 million.*
  *The loss from discontinued operations increased $644 thousand, or 31.6%,
    to $2.7 million.
  *The net loss declined $103 thousand, or 1.2%. Adjusting for the $1.6
    million of one-time expenses, the net loss declined $1.7 million, or 18.8%
    to $7.2 million.
  *The basic and diluted loss per share from continuing operations declined
    $0.04 to $0.24. The loss per share from discontinued operations increased
    $0.02 per share to $0.11 from 0.09. The total net loss per share declined
    $0.02 to $0.35. The one-time expenses of $1.6 million contributed $0.06 to
    the basic and diluted loss per share from continuing operations and the
    total net loss per share.
  *The adjusted EBITDA loss, excluding the loss from discontinued operations,
    increased $263 thousand, or 6.1%, to $4.6 million. Adjusted for the $1.6
    million of one-time charges, the adjusted EBITDA loss, excluding
    discontinued operations, declined $1.3 million, or 30.3%, to $3.0
    million.*

* Please see the reconciliation of non-GAAP financial measures and Regulation
G disclosure later in this press release.

Business Highlights:

  *Revenue for the utility business increased 61% year over year.
  *Consolidated gross profit increased 99.4% year over year.
  *Excluding one-time expenses, SG&A increased only 4.5% year over year.

LIME ENERGY CO.

Condensed Consolidated Statement of Operations

(Unaudited)
                                                                 
                                Three Months Ended
                                June 30,                  Change
                                2013         2012         $           %
                                                                      
Revenue                         $ 13,741     $ 10,120     $ 3,621     35.8   %
Cost of sales                    9,780      8,134      1,646    20.2   %
Gross profit                      3,961        1,986        1,975     99.4   %
                                                                      
Selling, general and              5,798        5,264        534       10.1   %
administrative expenses
Amortization of intangibles      4          71         (67   )   -94.4  %
Operating loss                    (1,841 )     (3,349 )     1,508     -45.0  %
                                                                      
Interest expense, net            (292   )    (67    )    (225  )   335.8  %
                                                                      
Loss from continuing              (2,133 )     (3,416 )     1,283     -37.6  %
operations
                                                                      
Income (loss) from operation of  95         (1,245 )    1,340    -107.6 %
discontinued business
                                                                      
Net loss                        $ (2,038 )   $ (4,661 )   $ 2,623    -56.3  %
                                                                      
Basic and Diluted Loss Per
Common Share From
Continuing operations           $ (0.08  )   $ (0.14  )   $ 0.06      -42.9  %
Discontinued operations          -          (0.05  )    0.05     -100.0 %
             Total             $ (0.08  )   $ (0.19  )    0.11     -57.9  %
                                                                      
Weighted Average Common
Shares Outstanding                25,153       24,470
                                                                      
Adjusted EBITDA                 $ (1,382 )   $ (1,957 )   $ 575       -29.4  %

LIME ENERGY CO.

Condensed Consolidated Statement of Operations

(Unaudited)
                                                                   
                                 Six Months Ended
                                 June 30,                  Change
                                 2013        2012         $           %
                                                                       
Revenue                          $ 25,740     $ 21,645     $ 4,095     18.9  %
Cost of sales                     19,157     17,609     1,548    8.8   %
Gross profit                       6,583        4,036        2,547     63.1  %
                                                                       
Selling, general and               12,040       10,585       1,455     13.7  %
administrative expenses
Amortization of intangibles       10         141        (131  )   -92.9 %
Operating loss                     (5,467 )     (6,690 )     1,223     -18.3 %
                                                                       
Interest expense, net             (595   )    (119   )    (476  )   400.0 %
                                                                       
Loss from continuing operations    (6,062 )     (6,809 )     747       -11.0 %
                                                                       
Loss from operation of            (2,684 )    (2,040 )    (644  )   31.6  %
discontinued business
                                                                       
Net loss                         $ (8,746 )   $ (8,849 )   $ 103      -1.2  %
                                                                       
Basic and Diluted Loss Per Common Share
From
Continuing operations            $ (0.24  )   $ (0.28  )   $ 0.04      -14.3 %
Discontinued operations           (0.11  )    (0.09  )    (0.02 )   22.2  %
            Total               $ (0.35  )   $ (0.37  )    0.02     -5.4  %
                                                                       
Weighted Average Common
Shares Outstanding                 25,157       24,222
                                                                       
Adjusted EBITDA                  $ (4,558 )   $ (4,295 )   $ (263  )   6.1   %

Reconciliation of Non-GAAP Financial Measures and Regulation G Disclosure

We report our financial results in accordance with generally accepted
accounting principles (“GAAP”). However, we believe that certain non-GAAP
financial measures that we use to manage the Company’s business fall within
the meaning of Regulation G (Disclosure of Non-GAAP Financial Measures) by the
Securities and Exchange Commission. We have included these non-GAAP measures,
including certain measures that exclude the cost of the restatement and the
related, ongoing lawsuits, in the press release because we believe they may
provide readers with additional meaningful comparisons to prior reported
results.

A reconciliation of the non-GAAP financial measures to the most directly
comparable GAAP financial measure is as follows:

                            Three Months Ended       Six Months Ended
                             June 30,                  June 30,
                             2013        2012         2013        2012
                                                                    
Net loss                     $ (2,038 )   $ (4,661 )   $ (8,746 )   $ (8,849 )
                                                                    
Interest expense, net          292          67           595          119
Depreciation & amortization    264          470          532          920
Provision for income taxes    -          -          -          -      
EBITDA                         (1,482 )     (4,124 )     (7,619 )     (7,810 )
                                                                    
Share based compensation       195          922          377          1,475
(Income) loss from operation  (95    )    1,245      2,684      2,040  
of discontinued business
                                                                    
Adjusted EBITDA              $ (1,382 )   $ (1,957 )   $ (4,558 )   $ (4,295 )
                                                                    
Costs related to
restatement activities
and defense of stockholder    287        -          1,565      -      
lawsuits
                                                                    
Adjusted EBITDA excluding
one-time
restatement and legal costs  $ (1,095 )   $ (1,957 )   $ (2,993 )   $ (4,295 )

About Lime Energy Co.

Lime Energy is building a new energy future. As a leading national provider of
energy efficiency for small business customers, Lime designs and implements
direct install programs for our utility clients which have consistently
exceeded program savings goals. Our award-winning, integrated services
programs provide utilities with reliable energy efficiency resources while
delivering the highest levels of customer satisfaction. This next generation
approach is helping utilities across the country to go deeper and broader with
the cheapest, cleanest and fastest energy resource that we have – energy
efficiency.

Additional Information

A full analysis of the results for the three-month period are available in the
Company’s Form 10-Q for the period ended June 30, 2013, which will be made
available on the Company’s website at www.lime-energy.com and on EDGAR.

Conference Call Information

The company will hold a conference call with investors on Monday, August 19,
2013 at 4:30 pm ET to discuss these results.

Investors can access the call by dialing toll free (877) 280-4959 and entering
passcode 52153142. International callers can dial (857) 244-7316 and use the
same passcode.

The call will be available for replay immediately following completion of the
call through October 18, 2013 by dialing toll free (888) 286-8010 or (617)
801-6888. The replay will require use of passcode 73461689.

The call can also be accessed through Lime Energy's Investor Relations section
of its website at http://www.lime-energy.com. This call is being webcast by
Thomson/CCBN and is being distributed through the Thomson StreetEvents Network
to both institutional and individual investors. Individual investors can
listen to the call at http://www.fulldisclosure.com, Thomson/CCBN's individual
investor portal, powered by StreetEvents. Institutional investors can access
the call via Thomson's password-protected event management site, StreetEvents
(http://www.streetevents.com).

FORWARD-LOOKING STATEMENTS

This news release includes forward-looking statements within the meaning of
the safe harbor provisions of the Private Securities Litigation Reform Act of
1995 including statements that reflect Lime Energy’s current expectations
about its future results, performance, prospects and opportunities. Lime
Energy has tried to identify these forward-looking statements by using words
and phrases such as “may,” “expects,” “anticipates,” “believes,” “intends,”
“estimates,” “plan,” “should,” “typical,” “preliminary,” “hope,” or similar
expressions. These forward-looking statements are based on information
currently available to Lime Energy and are subject to a number of risks,
uncertainties and other factors that could cause Lime Energy’s actual results,
performance, prospects or opportunities in the remainder of 2013 and beyond to
differ materially from those expressed in, or implied by, these
forward-looking statements. These risks and uncertainties are described in
Lime Energy’s most recent Annual Report on Form 10-K or as may be described
from time to time in Lime Energy’s subsequent SEC filings; such factors are
incorporated herein by reference.

Contact:

Lime Energy Investor Relations
Ashley Conger, 704-892-4442
aconger@lime-energy.com