~Company sees continued growth in sales
pipeline in addition to 40% growth in sales backlog~
Greenlane Renewables Inc. (“Greenlane” or the
“Company”) (TSXV: GRN), today announced its interim
financial results for the first quarter ended March 31, 2020. For
further information on these results, please see Greenlane’s
Condensed Consolidated Interim Financial Statements and Management
Discussion and Analysis. All amounts are in Canadian dollars and in
accordance with IFRS.
First Quarter Highlights
Include:
- Revenue of $2.9 million, which is in line with the stage of
completion on active and announced projects.
- Gross profit of $1.3 million or 44% of revenue. The strong
gross profit reflects a higher proportion of aftercare service
revenue in the quarter combined with the expiry of project
warranty.
- Sales order backlog (note one) of $22.6 million, a 40% increase
from the $16.2 million reported on December 31, 2019. The increase
reflects the movement of sales pipeline opportunities into sales
contracts.
- Sales pipeline (note two) valued at over $700 million as at
March 31, 2020, representing an increase of 3% (from $680 million
as at December 31, 2019), reflective of expansion of the project
bid universe and the movement of successful contract wins into the
sales order backlog.
- Net loss of $1.1 million and Adjusted EBITDA loss of $0.7
million* in the three month period ended March 31, 2020.
- Cash and cash equivalents of $6.7 million compared with $2.3
million as at December 31, 2019. The cash balance reflects the
recently completed financing and payment toward outstanding
debt.
- Advancing strategy to Build, Own and Operate: In January 2020,
the Company signed an agreement in principle with SWEN Capital
Partners based in Paris, France to create a joint venture company
to accelerate deployment of Greenlane’s biogas upgrading systems by
providing an innovative finance solution for customers in Europe
using a build, own and operate model.
- Completion of public offering: In February 2020 the Company
completed an underwritten public offering issuing 23,000,000 units
(the “Units”) at a price of $0.50 per Unit for gross proceeds of
$11.5 million ($10.3 million net).
“Our company and our industry continue to grow despite the
backdrop of unprecedented global conditions,” said Brad Douville,
President and CEO of Greenlane. “We expect revenue will continue to
build throughout 2020 as new contract wins move out of our sales
order backlog and into the revenue line.”
“In 2020, we are taking a more aggressive strategy to build, own
and operate biogas projects and have partnered with SWEN Capital
Partners in Europe. This approach will allow the Company to take
advantage of project specific return on capital while providing
potential customers with a complete turnkey biogas upgrading
solution from financing and design to construction and operation.
We have begun marketing this new offer with the aim of completing
discussions with a number of new customers to add recurring revenue
and profit streams to the business. The Company is currently in
negotiations to create a similar arrangement with a partner for the
North American market.”
As a reminder, the Company’s revenues are largely derived from a
relatively small number of large biogas upgrader orders accounted
for on a stage of completion basis over typically a nine to
eighteen-month period. Timing of new contract awards varies due to
customer-related factors such as finalizing technical
specifications and securing project funding, permits and RNG
off-take and feedstock agreements. Some projects have built-in
pause periods to allow customers to complete concurrent activities
such as civil work. As a result, the Company’s revenue varies from
month to month and quarter-to-quarter.
COVID-19
The Company continues to operate at full staffing levels at this
time as it has since the start of the COVID-19 pandemic. Government
imposed lockdowns have impacted the supply of a small number of
components in the Company’s biogas upgrading systems, but as of now
all of the Company’s suppliers that were impacted have resumed
operations. As a normal course of business, the Company’s supply
chain has built-in redundancy where its procurement procedures
identify alternative sources of supply for major components and
sub-system fabricators that are essential to the Company’s business
operation.
The Market Outlook
As the world embarks on a cautious recovery from the COVID-19
pandemic, there is a growing movement to focus fiscal recovery
packages on climate-positive policies and target investment in
green energy technology. According to a recent paper from two of
the world’s leading economists, Joseph Stigletz and Lord Nicholas
Stern, a survey of more than 200 global finance leaders from 53
countries highlighted a strong long-term return on government
investment in climate-positive policies. This movement supports a
promising growth outlook for RNG globally.
Use of RNG in transportation fuel remains a viable and proven
alternative to fossil fuels due to its relative price stability and
low carbon footprint, with several recent industry announcements of
both commercial and public fleet conversions to RNG. According to
the trade associations Natural Gas Vehicle America (NGVA) and
Natural Gas Vehicle Association Europe (NGVA Europe), RNG continues
to see strong uptake. In 2019, the NGVA estimates that 39% of all
natural gas used as an on-road fuel in the United States was RNG,
and NGVA Europe’s data reveal that the current RNG market share of
the natural gas transportation market in Europe is 17%.
Outside of the transportation sector, there is a growing trend
of natural gas utilities adopting RNG as an energy source for
customers in a move to reduce the carbon footprint of their fossil
natural gas networks. In response to new policy, Oregon state’s
largest natural gas utility, NW Natural Gas, recently announced
plans to displace 5% of its fossil gas with RNG by 2024, while the
Oregon Department of Energy estimates biogas could offset 10% to
20% of the state’s current natural gas use. As a leading industry
provider of biogas upgrading solutions, Greenlane remains excited
with the current and future market opportunities in 2020 and
beyond.
Executive Compensation Disclosure
Greenlane will be relying on the exemption provided in BC
Instrument 51-516 – Temporary Exemptions from Certain Requirements
to File or Send Security holder Materials (and similar exemptions
provided by other relevant Canadian securities regulators) to delay
the filing of its executive compensation disclosure. Greenlane
expects to include its executive compensation disclosure in the AGM
information circular to be sent to shareholders and filed on SEDAR
later this year.
RSU and Option Grants
The Company has granted to officers of the Company incentive
share options to purchase up to an aggregate of 586,000 common
shares of the Company pursuant to the Company’s share option plan,
with an exercise price equal to the greater of $0.50 and the
closing share price on Thursday May 28, 2020. All aforementioned
grants of options shall vest 1/3 on each of the first three
anniversaries from May 26, 2020. Additionally, the Company has
adopted a restricted share unit plan (an “RSU Plan”) and has
granted to officers and non-executive directors an aggregate of
911,000 restricted share units (“RSUs”) pursuant to such RSU Plan.
The RSU Plan is subject to disinterested shareholder approval and
TSX Venture Exchange acceptance. All aforementioned grants of RSUs
shall vest one year from May 26, 2020 for non-executive directors
and 1/3 on each of the first three anniversaries from May 26, 2020
for officers, and the aggregate RSU grant is subject to
disinterested shareholder approval and TSX Venture Exchange
acceptance.
The RSU Plan is to enable directors, officers, employees and
consultants to participate in the long-term success of the Company
and to promote a greater alignment of their interests with the
interests of the Company’s shareholders. Under the RSU Plan,
eligible persons may, at the discretion of the Board, be allocated
a number of RSUs as the Board deems appropriate, with vesting
provisions also to be determined by the Board. Each RSU will
entitle the holder to acquire one common share subject to the terms
and conditions of the RSU Plan. Pursuant to the RSU Plan, the
maximum number of RSUs that may be granted is 2,500,000. Further
details of the RSU Plan will be set out in the information circular
for the Company’s AGM to be held later this year at which
disinterested shareholders will be asked to consider the approval
of the RSU Plan and RSU grants.
Pre-QT Financial Statements Signatories Clarification
The financial statements for the period from February 15, 2018
(date of incorporation) to December 31, 2018 for Creation Capital
Corp. (prior to its Qualifying Transaction and name change to
Greenlane Renewables Inc. in June 2019) were approved by the then
board of directors and the balance sheet was signed by two of the
directors, Wade Nesmith and David Blaiklock. Their signatures on
the financial statements filed on SEDAR were inadvertently not
included in conformed formatting.
NON-IFRS FINANCIAL MEASURES
Management evaluates the Company’s performance using a variety
of measures, including “operating profit” and “Adjusted EBITDA”.
The non-IFRS measures should not be considered as an alternative to
or more meaningful than revenue or net loss. These measures do not
have a standardized meaning prescribed by IFRS and therefore they
may not be comparable to similarly titled measures presented by
other publicly traded companies and should not be construed as an
alternative to other financial measures determined in accordance
with IFRS. The Company believes these non-GAAP financial measures
provide useful information to both management and investors in
measuring the financial performance and financial condition of the
Company. Management uses these and other non-IFRS financial
measures to exclude the impact of certain expenses and income that
must be recognized under IFRS when analyzing consolidated
underlying operating performance, as the excluded items are not
necessarily reflective of the Company’s underlying operating
performance and make comparisons of underlying financial
performance between periods difficult. From time to time, the
Company may exclude additional items if it believes doing so would
result in a more effective analysis of underlying operating
performance. The exclusion of certain items does not imply that
they are non-recurring.
*Reconciliation of net loss to Adjusted EBITDA loss
Three months ended
March 31, 2020
$’000s
Net loss
(1,093)
Add back:
Share based compensation
22
Depreciation and amortization
380
Finance expense
166
Foreign exchange gain
(144)
Adjusted EBITDA loss
(669)
Note one - Order backlog refers to the balance of unrecognized
revenue from contracted projects, where such revenue is recognized
over time as completion of the projects progress.
Note two - Greenlane maintains a sales pipeline of prospective
projects that it updates regularly based on quote activity to
ensure that it is reflective of sales opportunities that can
convert into orders within approximately a rolling 24 month time
horizon. Not all of these potential projects will proceed or
proceed within the expected timeframe and not all of the projects
that do proceed will be awarded to Greenlane. Additions to the
amount in the sales pipeline come from situations where the Company
provides a quote on a prospective project and reductions to the
sales pipeline arise when the Company loses a prospective project
to a competitor, a project does not proceed or, where a quote in
the pipeline is converted to Greenlane’s active order book.
All filings related to the first quarter ended March 31, 2020
are available on SEDAR at www.sedar.com.
About Greenlane Renewables
Greenlane is cleaning up the two largest and most
difficult-to-decarbonize sectors of the global energy system: the
natural gas grid and the transportation sector. As a leading global
provider of biogas upgrading systems, Greenlane’s solutions create
clean, low-carbon-footprint renewable natural gas (RNG), suitable
for injection into the natural gas grid and for direct use as
vehicle fuel. Our systems, marketed and sold under the Greenlane
Biogas™ brand, remove impurities and separate carbon dioxide from
biomethane in the raw biogas created from organic waste at
landfills, wastewater treatment plants, farms and food waste
facilities. With multiple core technologies, more than 100
installations in 18 countries and counting, and 30+ years’
experience, Greenlane finds the right solution, whatever the
specific project requirements. Whether we’re working with waste
producers, gas utilities, or project developers, we’re doing more
with biogas, helping to turn a low-value product into a high-value
renewable resource. For further information, please visit
www.greenlanerenewables.com.
FORWARD-LOOKING INFORMATION – This news release contains
“forward-looking information” within the meaning of applicable
securities laws. All statements contained herein that are not
historical in nature contain forward-looking information.
Forward-looking information can be identified by words or phrases
such as “may”, “expect”, “likely”, “should”, “would”, “plan”,
“anticipate”, “intend”, “potential”, “proposed”, “estimate”,
“believe” or the negative of these terms, or other similar words,
expressions and grammatical variations thereof, or statements that
certain events or conditions "may" or "will" happen. The
forward-looking information contained in this press release,
includes, but is not limited to, the continued growth in sales
pipeline and sales backlog, the creation of a joint venture company
with SWEN Capital Partners to accelerate deployment of Greenlane’s
biogas upgrading systems, the continued revenue growth throughout
2020 as new contract wins move out of sales order backlog and into
revenue, the taking advantage of project specific return on capital
while providing potential customers with complete turnkey biogas
upgrading solutions, the completion of discussions with new
customers to add recurring revenue and profit streams, the strong
long-term return on government investment in climate-positive
policies, the promising growth outlook for RNG globally, the
growing movement to focus fiscal recovery packages on
climate-positive policies and target investment in green energy
technology, and the growing trend of natural gas utilities starting
to offer customers the option of choosing RNG as an energy source.
The forward-looking information contained herein is made as of the
date of this press release and is based on assumptions management
believed to be reasonable at the time such statements were made,
including management's perceptions of future growth, results of
operations, operational matters, historical trends, current
conditions and expected future developments, as well as other
considerations that are believed to be appropriate in the
circumstances. While we consider these assumptions to be reasonable
based on information currently available to management, there is no
assurance that such expectations will prove to be correct. By their
nature, forward-looking information is subject to inherent risks
and uncertainties that may be general or specific and which give
rise to the possibility that expectations, forecasts, predictions,
projections or conclusions will not prove to be accurate, that
assumptions may not be correct and that objectives, strategic goals
and priorities will not be achieved. A variety of factors,
including known and unknown risks, many of which are beyond our
control, could cause actual results to differ materially from the
forward-looking information in this press release. Such factors
include, without limitation: risks relating to the Company's
ability to execute its business strategy and the benefits
realizable therefrom, risks related to the Company’s contracts,
risks related to the Company’s expected growth phase, risks
specifically related to the Company’s international operations, and
risks relating to the market price of the Common Shares. Additional
risk factors can also be found in the Company's filing statement
and prospectuses, which has been filed under the Company's SEDAR
profile at www.sedar.com. Readers are cautioned not to put undue
reliance on forward-looking information. The Company undertakes no
obligation to update or revise any forward-looking information,
whether as a result of new information, future events or otherwise,
except as required by applicable law. Forward-looking statements
contained in this news release are expressly qualified by this
cautionary statement.
FINANCIAL OUTLOOK INFORMATION – This news release contains
“financial outlook information” regarding Greenlane’s prospective
revenue and results, which is subject to the same assumptions, risk
factors, limitations, and qualifications as set forth in the above.
Revenue and other estimates contained in this news release were
made by Greenlane management as of the date of this news release
and are provided for the purpose of describing anticipated changes,
and are not an estimate of profitability or any other measure of
financial performance. Investors are cautioned that the financial
outlook information contained in this news release should not be
used for purposes other than for which it is disclosed herein. THE
COMPANY QUALIFIES ALL THE FORWARD LOOKING STATEMENTS AND FINANCIAL
OUTLOOK INFORMATION CONTAINED IN THIS NEWS RELEASE BY THE FOREGOING
CAUTIONARY STATEMENTS.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release or has in any way approved or disapproved
of the contents of this news release.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20200526005841/en/
Incite Capital Markets Eric Negraeff / Darren Seed Greenlane
Renewables Inc. Brad Douville, President & CEO, Ph:
604.493.2004 Email: IR@greenlanerenewables.com
Greenlane Renewables (TSXV:GRN)
Gráfica de Acción Histórica
De Dic 2024 a Ene 2025
Greenlane Renewables (TSXV:GRN)
Gráfica de Acción Histórica
De Ene 2024 a Ene 2025
