1Q22 Results: RNG Plant to Kickstart Revenue; Key Tie-Ups with Top Airlines to Supply SAF; Net-Zero 1 Project on Track



KEY POINTS
  • On May 9, 2022, Gevo announced its 1Q22 earnings results. While Gevo is in the pre-revenue stage, it expects the bulk of revenues to begin in late 2022, mostly from its RNG factory.
  • Revenues were at $0.2 million for the quarter compared with $0.1 million in 1Q21. Cash position was $429.6 million (includes restricted cash and marketable securities), down from $475.8 million in 4Q21, attributable to RNG and Net-Zero 1 plant construction.
  • Gevo inked an MOU with Farmers Edge to integrate Edge’s 18 million+ acres of agricultural production data with Gevo’s Verity Tracking platform. This collaboration is expected to support the sustainable development and full carbon lifecycle tracking of carbon intensity (CI) score from low-carbon grain through renewable fuels production.
  • Gevo extended a supply agreement with Delta Air Lines to provide 75 million gallons of sustainable aviation fuel (SAF) annually. On the back of the airline industry’s commitment to low-carbon SAF, Oneworld alliance members, including Alaska Airlines, American Airlines, British Airways, Finnair, Japan Airlines, and Qatar Airways, have announced their intention to purchase up to 200 million gallons per year of SAF beginning in 2027.
  • On January 31, the company announced the successful completion of its RNG plant on time and within budget. It is designed to produce 355 billion BTUs of RNG, which BP will sell as a transportation fuel to the California market. Gevo expects the RNG project to generate ~ $16-22 million EBITDA per year by 2023.
  • The Net-Zero 1 project is on track and the company has received conditional use permits for the plant and the wind turbines that will help power the project. Gevo anticipates Net-Zero 1 to be completed in late 2024 and operational in 2025, with expected annual EBITDA of $150-200 million.
  • Our prior content on GEVO can be accessed here.

EARNINGS SNAPSHOT

On May 9, 2022, Gevo announced its 1Q22 earnings results. While Gevo is in the pre-revenue stage, it expects the bulk of revenues to begin in late 2022, mostly from its RNG factory.

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