Capstone Green Energy (NASDAQ:CGRN) Reports First Quarter Fiscal 2022 Financial Results

Total Revenue Grew 13% Year-Over-Year

Cash and Cash Equivalents of $49.2M

Book-to-Bill Ratio of 1:1 for the Quarter with New Gross Product Orders of $8.2M

Webcast to be Held Today, August 11, 2021 at 1:45 PM PT; 4:45 PM ET

VAN NUYS, CA / ACCESSWIRE / August 11, 2021 / Capstone Green Energy Corporation (NASDAQ:CGRN), formerly Capstone Turbine Corporation (NASDAQ:CPST) (“Capstone,” the “Company,” “we” or “us”), a global leader in carbon reduction and on-site resilient green energy solutions, today announced financial results for its fiscal year 2022 first quarter ended June 30, 2021.

Financial Highlights of Fiscal Year 2022 First Quarter:

• Total revenue in the quarter was $16.1 million, up 13%, compared to $14.2 million in the first quarter last year as orders and shipments gradually started to rebound despite continued negative impacts from the ongoing COVID-19 global pandemic.
• The book-to-bill ratio was 1:1 for the quarter, and new gross product orders were $8.2 million despite continued negative global impacts from the ongoing COVID-19 global pandemic in key markets like Europe, Latin America, Asia, and Australia.
• The long-term microturbine rental fleet increased 1.5 megawatts (MWs) to 12.1 MWs from 10.6 MWs during the quarter as the Company continues to execute against its plan to increase the fleet to 21.1 MWs by March 31, 2022.
• Total cash and cash equivalents as of June 30, 2021, were $49.2 million, a decrease of $0.3 million, compared to $49.5 million as of March 31, 2021.
• Cash provided by financing activities was $11.0 million during the quarter, as the Company continued to focus on strengthening liquidity as it accelerates the expansion of the long-term rental fleet.
• Net loss of $2.2 million for the quarter, compared to a net loss of $1.8 million in the first quarter of fiscal 2021.
• Adjusted EBITDA of negative $2.3 million, compared to Adjusted EBITDA of $0.1 million in the first quarter of fiscal 2021.

“I am pleased that we were again able to drive year-over-year revenue growth as the global recovery from the COVID-19 global pandemic continued to evolve, and we executed upon our revenue growth strategy,” said Darren Jamison, President and Chief Executive Officer of Capstone Green Energy. “We also announced during the quarter that we expanded our long-term rental fleet from 10.6 megawatts to 12.1 megawatts as we march towards our goal of growing the fleet to 21.1 megawatts by the end of our fiscal year. This remains a key driver in our long-term strategy, as rental-related revenue drives a much higher margin than a typical product sale. This, along with our Factory Protection Plan program, are important supporting pillars in growing our Energy as a Service business,” added Mr. Jamison.

“We also took steps during the quarter to expand our direct solutions sales team as their effort in the field is creating a robust project pipeline. We are excited for the second half of the year as we expect to start to close on potential projects deploying not only our existing microturbine technology, but the new energy products and service offerings we added on the back of our evolution into Capstone Green Energy Corporation, announced on Earth Day in April 2021,” concluded Mr. Jamison.

Financial Results for Fiscal Year 2022 First Quarter

Total revenue for the quarter increased $1.9 million to $16.1 million, compared with total revenue of $14.2 million in the year-ago quarter. The increase in revenue was the result of higher MWs shipped, as the year-ago quarter was more negatively impacted by the global COVID-19 pandemic.

Gross margin decreased $0.8 million, to $2.6 million in the first quarter compared to $3.4 million in the same period last year, primarily due to lower overhead expenses in the prior period as a result of the Company’s COVID-19 Business Continuity Plan, which consisted of pay cuts, furloughs, and other cost-cutting measures.

Gross margin as a percentage of revenue decreased to 16% in the first quarter, compared to 24% in the same period last year, primarily due to lower overhead expenses in the prior period as a result of the Company’s COVID-19 Business Continuity Plan. Additionally, Factory Protection Plan margins were higher in the prior-year period primarily due to site shutdowns caused by the pandemic, which delayed servicing events.

Operating expenses in the first quarter of fiscal year 2022 were $6.2 million, an increase of $2.3 million from $3.9 million in the year-ago quarter, as the year-ago quarter had reduced expenses from the COVID-19 Business Continuity Plan, which reduced operating expenses and increased working capital during the pandemic.

Net loss was $2.2 million for the first quarter of fiscal year 2022, compared to a net loss of $1.8 million in the year-ago quarter. Net loss per share improved to $0.16 cents per share compared to $0.17 cents in the year-ago quarter. Adjusted EBITDA was negative $2.3 million for the first quarter of fiscal year 2022, compared to an adjusted EBITDA of $0.1 million in the year-ago quarter.

Cash and cash equivalents were $49.2 million as of June 30, 2021, compared to $49.5 million as of March 31, 2021.

Conference Call and Webcast

Capstone will host a live webcast on August 11, 2021, at 1:45 PM Pacific Time (4:45 PM Eastern Time) to provide the results of the fiscal year 2022 first quarter ended June 30, 2021. Capstone will discuss its financial results and will provide an update on its business activities. At the end of the conference call, Capstone will host a question-and-answer session to provide an opportunity for financial analysts to ask questions. Investors and interested individuals are invited to listen to the webcast by logging on to Capstone’s investor relation’s webpage at www.CapstoneGreenEnergy.com. A replay of the webcast will be available on the website for 30 days.

About Capstone Green Energy

Capstone Green Energy (NASDAQ:CGRN) is a leading provider of customized microgrid solutions and on-site energy technology systems focused on helping customers around the globe meet their environmental, energy savings, and resiliency goals. Capstone Green Energy focuses on four key business lines. Through its Energy as a Service (EaaS) business, it offers rental solutions utilizing its microturbine energy systems and battery storage systems, comprehensive Factory Protection Plan (FPP) service contracts that guarantee life-cycle costs, as well as aftermarket parts. Energy Conversion Products are driven by the Company’s industry-leading, highly efficient, low-emission, resilient microturbine energy systems offering scalable solutions in addition to a broad range of customer-tailored solutions, including hybrid energy systems and larger frame industrial turbines. The Energy Storage Products business line designs and installs microgrid storage systems creating customized solutions using a combination of battery technologies and monitoring software. Through Hydrogen Energy Solutions, Capstone Green Energy offers customers a variety of hydrogen products, including the Company’s microturbine energy systems.

For customers with limited capital or short-term needs, Capstone offers rental systems; for more information, contact: rentals@CGRNenergy.com. To date, Capstone has shipped over 10,000 units to 83 countries and estimates that, in FY21, it saved customers over $217 million in annual energy costs and approximately 397,000 tons of carbon. Total savings over the last three years are estimated to be approximately $698 million in energy savings and approximately 1,115,100 tons of carbon savings.

For more information about the Company, please visit: www.CapstoneGreenEnergy.com. Follow Capstone Green Energy on Twitter, LinkedIn, Instagram, Facebook, and YouTube.

Cautionary Note Regarding Forward-Looking Statements

This release contains forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995, including statements regarding expectations for green initiatives and execution on the Company’s growth strategy and other statements regarding the Company’s expectations, beliefs, plans, intentions, and strategies. The Company has tried to identify these forward-looking statements by using words such as “expect,” “anticipate,” “believe,” “could,” “should,” “estimate,” “intend,” “may,” “will,” “plan,” “goal” and similar terms and phrases, but such words, terms and phrases are not the exclusive means of identifying such statements. Actual results, performance and achievements could differ materially from those expressed in, or implied by, these forward-looking statements due to a variety of risks, uncertainties and other factors, including, but not limited to, the following: the ongoing effects of the COVID-19 pandemic; the availability of credit and compliance with the agreements governing the Company’s indebtedness; the Company’s ability to develop new products and enhance existing products; product quality issues, including the adequacy of reserves therefor and warranty cost exposure; intense competition; financial performance of the oil and natural gas industry and other general business, industry and economic conditions; the Company’s ability to adequately protect its intellectual property rights; and the impact of pending or threatened litigation. For a detailed discussion of factors that could affect the Company’s future operating results, please see the Company’s filings with the Securities and Exchange Commission, including the disclosures under “Risk Factors” in those filings. Except as expressly required by the federal securities laws, the Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, changed circumstances or future events, or for any other reason.

Financial Tables to Follow

To supplement the company’s unaudited financial data presented on a generally accepted accounting principles (GAAP) basis, management has presented Adjusted EBITDA, a non-GAAP financial measure. This non-GAAP financial measure is among the indicators management uses as a basis for evaluating the company’s financial performance as well as for forecasting future periods. Management establishes performance targets, annual budgets and makes operating decisions based in part upon this metric. Accordingly, disclosure of this non-GAAP financial measure provides investors with the same information that management uses to understand the company’s economic performance year-over-year.

EBITDA is defined as net income before interest, provision for income taxes, and depreciation and amortization expense. Adjusted EBITDA is defined as EBITDA before gain on debt extinguishment, additional PPP loan forgiveness and stock-based compensation and other expense. Gain on debt extinguishment and additional PPP loan forgiveness relates to the Paycheck Protection Program loan forgiveness. Stock-based compensation and other expense includes expense related to stock issued to employees, directors, and vendors.

Adjusted EBITDA is not a measure of the company’s liquidity or financial performance under GAAP and should not be considered as an alternative to, net income or any other performance measure derived in accordance with GAAP, or as an alternative to cash flows from operating activities as a measure of its liquidity.

While management believes that the non-GAAP financial measure provides useful supplemental information to investors, there are limitations associated with the use of this measure. The measures are not prepared in accordance with GAAP and may not be directly comparable to similarly titled measures of other companies due to potential differences in the exact method of calculation. Management compensates for these limitations by relying primarily on the company’s GAAP results and by using Adjusted EBITDA only supplementally and by reviewing the reconciliations of the non-GAAP financial measure to its most comparable GAAP financial measure.

Non-GAAP financial measures are not in accordance with, or an alternative for, generally accepted accounting principles in the United States. The company’s non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP financial measures and should be read only in conjunction with the company’s consolidated financial statements prepared in accordance with GAAP.

CONTACT:
Capstone Green Energy
Investor and investment media inquiries:
818-407-3628
ir@CGRNenergy.com

SOURCE: Capstone Green Energy Corporation

Dr. Chris Ryan and Lynn Smull to Participate in a Water Tower Research Fireside Chat on Wednesday, August 18, 2021 at 4:00 pm EDT

ENGLEWOOD, Colo., Aug. 11, 2021 (GLOBE NEWSWIRE) — Gevo, Inc. (NASDAQ:GEVO), announced today that Dr. Chris Ryan, President, Chief Operating Officer, and Lynn Smull, Chief Financial Officer, will participate in a Water Tower Research Fireside Chat on Wednesday, August 18, 2021 at 4:00 pm EDT.
 

Topic: Progress Report on Net-Zero 1 Capex Scope & Financial Projection

Investors and other persons interested in participating in the event must register using the link below. Please note that registration for the live event is limited but may be accessed at any time for replay after the presentation ends on August 18, 2021, utilizing the same registration link.

Registration Link:

https://globalmeet.webcasts.com/starthere.jsp?ei=1483592&tp_key=bddd6d026f

About Gevo

Gevo’s mission is to transform renewable energy and carbon into energy-dense liquid hydrocarbons. These liquid hydrocarbons can be used for drop-in transportation fuels such as gasoline, jet fuel and diesel fuel, that when burned have potential to yield net-zero greenhouse gas emissions when measured across the full life cycle of the products. Gevo uses low-carbon renewable resource-based carbohydrates as raw materials, and is in an advanced state of developing renewable electricity and renewable natural gas for use in production processes, resulting in low-carbon fuels with substantially reduced carbon intensity (the level of greenhouse gas emissions compared to standard petroleum fossil-based fuels across their life cycle). Gevo’s products perform as well or better than traditional fossil-based fuels in infrastructure and engines, but with substantially reduced greenhouse gas emissions. In addition to addressing the problems of fuels, Gevo’s technology also enables certain plastics, such as polyester, to be made with more sustainable ingredients. Gevo’s ability to penetrate the growing low-carbon fuels market depends on the price of oil and the value of abating carbon emissions that would otherwise increase greenhouse gas emissions. Gevo believes that its proven, patented technology enabling the use of a variety of low-carbon sustainable feedstocks to produce price-competitive low-carbon products such as gasoline components, jet fuel and diesel fuel yields the potential to generate project and corporate returns that justify the build-out of a multi-billion-dollar business.

Gevo believes that the Argonne National Laboratory GREET model is the best available standard of scientific-based measurement for life cycle inventory or LCI.

Learn more at Gevo’s website: www.gevo.com

Investor and Media Contact

+1 720-647-9605

IR@gevo.com

Dr. Chris Ryan and Lynn Smull to Participate in a Water Tower Research Fireside Chat on Wednesday, August 18, 2021 at 4:00 pm EDT

ENGLEWOOD, Colo., Aug. 11, 2021 (GLOBE NEWSWIRE) — Gevo, Inc. (NASDAQ:GEVO), announced today that Dr. Chris Ryan, President, Chief Operating Officer, and Lynn Smull, Chief Financial Officer, will participate in a Water Tower Research Fireside Chat on Wednesday, August 18, 2021 at 4:00 pm EDT.
 

Topic: Progress Report on Net-Zero 1 Capex Scope & Financial Projection

Investors and other persons interested in participating in the event must register using the link below. Please note that registration for the live event is limited but may be accessed at any time for replay after the presentation ends on August 18, 2021, utilizing the same registration link.

Registration Link:

https://globalmeet.webcasts.com/starthere.jsp?ei=1483592&tp_key=bddd6d026f

About Gevo

Gevo’s mission is to transform renewable energy and carbon into energy-dense liquid hydrocarbons. These liquid hydrocarbons can be used for drop-in transportation fuels such as gasoline, jet fuel and diesel fuel, that when burned have potential to yield net-zero greenhouse gas emissions when measured across the full life cycle of the products. Gevo uses low-carbon renewable resource-based carbohydrates as raw materials, and is in an advanced state of developing renewable electricity and renewable natural gas for use in production processes, resulting in low-carbon fuels with substantially reduced carbon intensity (the level of greenhouse gas emissions compared to standard petroleum fossil-based fuels across their life cycle). Gevo’s products perform as well or better than traditional fossil-based fuels in infrastructure and engines, but with substantially reduced greenhouse gas emissions. In addition to addressing the problems of fuels, Gevo’s technology also enables certain plastics, such as polyester, to be made with more sustainable ingredients. Gevo’s ability to penetrate the growing low-carbon fuels market depends on the price of oil and the value of abating carbon emissions that would otherwise increase greenhouse gas emissions. Gevo believes that its proven, patented technology enabling the use of a variety of low-carbon sustainable feedstocks to produce price-competitive low-carbon products such as gasoline components, jet fuel and diesel fuel yields the potential to generate project and corporate returns that justify the build-out of a multi-billion-dollar business.

Gevo believes that the Argonne National Laboratory GREET model is the best available standard of scientific-based measurement for life cycle inventory or LCI.

Learn more at Gevo’s website: www.gevo.com

Investor and Media Contact

+1 720-647-9605

IR@gevo.com

Wednesday, August 11, 2021

Flotek Industries (FTK)
June Quarter Results – A More In Depth Look

Flotek Industries, Inc. creates solutions to reduce the environmental impact of energy on air, water, land and people. Flotek Industries, Inc. is a technology-driven, specialty chemistry and data company that helps customers across industrial, commercial and consumer markets improve their Environmental, Social and Governance performance. Flotek’s Chemistry Technologies segment develops, manufactures, packages, distributes, delivers, and markets high-quality cleaning, disinfecting and sanitizing products for commercial, governmental and personal consumer use. Additionally, Flotek empowers the energy industry to maximize the value of their hydrocarbon streams and improve return on invested capital through its real-time data platforms and green chemistry technologies. Flotek serves downstream, midstream and upstream customers, both domestic and international. Flotek is a publicly traded company headquartered in Houston, Texas, and its common shares are traded on the New York Stock Exchange under the ticker symbol “FTK.” For additional information, please visit Flotek’s web site at www.flotekind.com.

Michael Heim, Senior Research Analyst, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Revenues hurt by loss of two large customers.  Flotek reported revenues of $9.2 million below 2021-1Q revenues of $11.8 million and our forecast of $12.6 million due to the loss of two significant customers due to merger combinations. Management indicated that absent the loss of these two clients, business would have been up 22% and ahead of internal sales and EBITDA projections. Meanwhile, customer growth has been strong with energy chemical technology customers increasing 26% sequentially.


Management offset lower revenues with lower costs.  Operating costs (excl. DDA) were $12.1 million down from 2021-1Q costs of $13.8 million and our estimate of $14.8 million. SG&A costs were $2.9 million versus $4.4 million in the previous quarter, which was also our estimate. By lowering costs, the company was able to report adjusted EBITDA of ($6.7) million roughly in line with previous quarters …

This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary.  Proper due diligence is required before making any investment decision. 

Energy Industry – Exploration and Production: 2021 2Q Review and Outlook

Noble Capital Markets Energy Sector Review – August 2021

Source: Capital IQ as of 06/30/2021

Source: Energy Information Administration as of 06/30/2021

ENERGY INDUSTRY OUTLOOK

Exploration and Production: 2021-2Q Review and Outlook

Oil Prices

Oil prices continued their upward trend in the first quarter with WTI prices crossing $75/bbl. at the end of the quarter. Oil prices have reached levels not seen since 2018 and show no signs of letting up. Brent prices are trading closer to $76/bbl. The spread between WTI and Brent prices has narrowed as U.S. producers have been slower to accelerate drilling than other parts of the world. We would attribute the delays to transmission issues in the Permian Basin during extremely cold temperatures in Texas in February. The delay also reflects the impact that low oil prices in 2020 have had upon the health of smaller domestic producers.

OPEC, which initiated supply reductions last year, has maintained those reductions through the first half of 2021 despite the improved demand outlook. A tentative agreement between Saudi Arabia and Russia will gradually increase production by 2 million barrels/day over the rest of the year. We believe the increase will offset growing demand associated with post-pandemic global economic expansion and that it will not have an adverse impact on oil prices. The oil futures curve shows oil prices declining on the out months but staying above $70/bbl. through December.

Meanwhile, domestic producers have been slow to react to higher oil prices but have begun to accelerate drilling in recent months. There are 77% more than half the number of active oil rigs in the United States versus this time last year (470 verses 265). That said, there are only half the number of active rigs in the United States as compared to pre-pandemic levels. The figure below shows the contrast in rig count and oil prices over the last three years. The lack of a supply response to higher prices has meant, and will most likely continue to mean, that oil prices could stay at levels above what we consider to be the long-term normalized price for quite some time.

High oil prices, combined with improved operating efficiencies mean that production companies are facing very favorable returns on their investment. We look for companies to start reporting strong positive cash flow and to use cash flow to increase drilling and improve balance sheets. We do not expect companies to raise dividend payments given the cyclical nature of recent oil price trends but would not rule out share repurchases if stock prices do not rebound further.

Source: Capital IQ as of 06/30/2021

Natural Gas Prices

Natural Gas prices have also been exceptionally strong in recent months climbing above $3.60/mcf. Recent heat waves across much of the country has meant that gas-fired turbines are running at full speed. Storage levels, which exited the winter heating season below historical averages, have returned to normal levels. Drilling activity has started to pick up but remains well below pre-pandemic levels. There were 98 natural gas rigs drilling in the United States, up 30% from a year ago. As is the case with oil, we believe the lack of a supply response could mean that natural gas prices remain at elevated levels for several quarters. The gas futures curve is flat, dipping only a few cents into the fall months but then rising back above $3.60/mcf. during the winter months.

Longer-term Energy Trends 

Energy sources in the United States are undergoing a significant transformation away from carbon-based fuels. While this should not be a surprise to anyone, it is worth taking a long-term view of energy consumption to highlight how the transformation has acerated in recent years. The chart below energy sources over the last 250 years. As one might expect, coal consumption has fallen sharply in the last ten years. Coal consumption has been replaced by renewable, nuclear, and natural gas. Worth noting, petroleum consumption, which grew dramatically in the last 50 years, has maintained the levels reached at the end of the century. We believe this trend will continue with petroleum providing a smaller portion of the overall energy picture, but not necessarily declining in absolute value.

Outlook 

The rebound in oil and natural prices came faster than expected and is staying higher than we would have expected. We have been adjusting our models to reflect higher prices but are maintaining our long-term oil price forecast of $50 per barrel and $2.50 per mcf. Energy companies should start reporting positive cash flow at these prices and increasing drilling budgets. Our near-term outlook for energy stocks remains positive. We expect companies to report favorable results for the next few quarters. Longer-term, we have concern that oil demand will be constrained by power generation competition from renewable energy and decreased demand for gasoline and diesel due to a growth in electric vehicles. At the same time, increased supply from OPEC and continued drilling productivity will mean lower energy prices. We recommend investors stay focused on energy companies with solid balance sheets, low operating costs and protected prices.

Source: Michael Heim 07/02/2021; Energy Information Agency (EIA)

Oil & Gas – Comparable Tables 

Source: Capital IQ as of 06/30/2021

Oil & Gas – LTM Equity Performance 

Source: Capital IQ as of 06/30/2021

Oil & Gas – YTD Global M&A Activity 

Source: Capital IQ as of 06/30/2021

Power Generation – Comparable Tables 

Source: Capital IQ as of 06/30/2021

Power Generation – LTM Equity Performance 

Source: Capital IQ as of 06/30/2021

Power Generation – YTD Global M&A Activity 

Source: Capital IQ as of 06/30/2021

Energy Services – Comparable Tables 

Source: Capital IQ as of 06/30/2021

Energy Services – LTM Equity Performance 

Source: Capital IQ as of 06/30/2021

Energy Services – YTD Global M&A Activity 

Source: Capital IQ as of 06/30/2021

Mineral Energy – Comparable Tables 

Source: Capital IQ as of 06/30/2021

Mineral Energy – YTD Global LTM Equity Performance 

Source: Capital IQ as of 06/30/2021

Mineral Energy – YTD Global M&A Activity 

Source: Capital IQ as of 06/30/2021

Mineral Energy – YTD Energy Industry M&A Summary 

Source: Capital IQ as of 06/30/2021

NOBLE QUARTERLY HIGHLIGHTS

Gevo, Inc. – Nasdaq: GEVO

Industry: Energy – Green energy

CGevo’s mission is to transform renewable energy and carbon into energy-dense liquid hydrocarbons. These liquid hydrocarbons can be used for drop-in transportation fuels such as gasoline, jet fuel and diesel fuel, that when burned have potential to yield net-zero greenhouse gas emissions when measured across the full life cycle of the products. Gevo uses low-carbon renewable resource-based carbohydrates as raw materials, and is in an advanced state of developing renewable electricity and renewable natural gas for use in production processes, resulting in low-carbon fuels with substantially reduced carbon intensity (the level of greenhouse gas emissions compared to standard petroleum fossil-based fuels across their life cycle).

2nd Quarter News Highlights:

June 8, 2021: Gevo announced that it expects to join the broad-market Russell 3000 Index at the conclusion of the 2021 Russell indexes annual reconstitution, effective after the US market opens on June 28, 2021, according to a preliminary list of additions posted June 4, 2021, by FTSE Russell.

encore Energy Corp. – OTCQB: ENCUF

Industry: Energy – Mineral energy; Uranium; Rare earth minerals and metals

enCore Energy Corp. is a U.S. domestic uranium developer focused on becoming a leading in-situ recovery (ISR) uranium producer. The Company is led by a team of industry experts with extensive knowledge and experience in the development and operations of in situ recovery uranium operations. enCore Energy’s opportunities are created from the Company’s transformational acquisition of its two South Texas production facilities, the changing global uranium supply/demand outlook and opportunities for industry consolidation.

2nd Quarter News Highlights:

April 6, 2021: The company announced a strategic acquisition of physical uranium with the objective of de-risking future uranium deliveries. The purchase consisted of 200,000 pounds at a spot market price of $29.65 per pound of U3O8.

Indonesia Energy Corporation – NYSE: INDO

Industry: Energy – Oil and gas; Exploration and production

Indonesia Energy Corporation Limited (NYSE American:INDO) is a publicly traded energy company engaged in the acquisition and development of strategic, high growth energy projects in Indonesia. IEC’s principal assets are its Kruh Block (63,000 acres) located onshore on the Island of Sumatra in Indonesia and its Citarum Block (1,000,000 acres) located onshore on the Island of Java in Indonesia. IEC is headquartered in Jakarta, Indonesia and has a representative office in Danville, California.

2nd Quarter News Highlights:

June 4, 2021: Indonesia Energy announced the successful completion of drilling at its first new well “Kruh Block” (also known as “Kruh 25”) to its absolute depth. Frank Ingriselli, President, commented on their positive outlook for shareholder value and cash flow growth after reaching this important milestone.

Source: Company Press Releases

DOWNLOAD THE FULL REPORT (PDF)

Noble Capital Markets Energy Newsletter Q2 2021

This newsletter was prepared and provided by Noble Capital Markets, Inc. For any questions and/or requests regarding this newsletter, please contact >Francisco Penafiel

DISCLAIMER

All statements or opinions contained herein that include the words “ we”,“ or “ are solely the responsibility of NOBLE Capital Markets, Inc and do not necessarily reflect statements or opinions expressed by any person or party affiliated with companies mentioned in this report Any opinions expressed herein are subject to change without notice All information provided herein is based on public and non public information believed to be accurate and reliable, but is not necessarily complete and cannot be guaranteed No judgment is hereby expressed or should be implied as to the suitability of any security described herein for any specific investor or any specific investment portfolio The decision to undertake any investment regarding the security mentioned herein should be made by each reader of this publication based on their own appraisal of the implications and risks of such decision This publication is intended for information purposes only and shall not constitute an offer to buy/ sell or the solicitation of an offer to buy/sell any security mentioned in this report, nor shall there be any sale of the security herein in any state or domicile in which said offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or domicile This publication and all information, comments, statements or opinions contained or expressed herein are applicable only as of the date of this publication and subject to change without prior notice Past performance is not indicative of future results.

Please refer to the above PDF for a complete list of disclaimers pertaining to this newsletter

Tuesday, August 10, 2021

Flotek Industries (FTK)
Second Quarter Results – Initial Thoughts

Flotek Industries, Inc. creates solutions to reduce the environmental impact of energy on air, water, land and people. Flotek Industries, Inc. is a technology-driven, specialty chemistry and data company that helps customers across industrial, commercial and consumer markets improve their Environmental, Social and Governance performance. Flotek’s Chemistry Technologies segment develops, manufactures, packages, distributes, delivers, and markets high-quality cleaning, disinfecting and sanitizing products for commercial, governmental and personal consumer use. Additionally, Flotek empowers the energy industry to maximize the value of their hydrocarbon streams and improve return on invested capital through its real-time data platforms and green chemistry technologies. Flotek serves downstream, midstream and upstream customers, both domestic and international. Flotek is a publicly traded company headquartered in Houston, Texas, and its common shares are traded on the New York Stock Exchange under the ticker symbol “FTK.” For additional information, please visit Flotek’s web site at www.flotekind.com.

Michael Heim, Senior Research Analyst, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Revenues were disappointing. Flotek reported revenues of $9.2 million below 2021-1Q revenues of $11.8 million and our forecast of $12.6 million due to the loss of two significant customers. The loss offset a 26% sequential increase in energy chemical tech customers and 58% increase in service customers.


Management offset lower revenues with lower costs.  Operating costs (excl. DDA) were $12.1 million down from 2021-1Q costs of $13.8 million and our estimate of $14.8 million. SG&A costs were $2.9 million versus $4.4 million in the previous quarter, which was also our estimate. By lowering costs, the company was able to report adjusted EBITDA of ($6.7) million roughly in line with previous quarters …

This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary.  Proper due diligence is required before making any investment decision. 

Flotek Announces Second Quarter 2021 Results

HOUSTON, Aug. 9, 2021 /PRNewswire/ — Flotek Industries, Inc. (“Flotek” or the “Company”) (NYSE: FTK) today announced second quarter results for the three months ended June 30, 2021.

John W. Gibson, Jr., Chairman, President, and Chief Executive Officer stated, “Two of our most significant customers changed ownership on accelerated timelines in the second quarter, and both buyers suspended our forecasted business immediately following their closings. Excluding these events, customer growth and diversification was strong, with a 26% sequential increase of new customers in our energy chemistry technologies business. Additionally, our Data Analytics segment improved slightly, experiencing the third sequential improvement in sales and representing our highest performing quarter since our acquisition of JP3 last year.” 

“We remain focused on engaging with the industry to demonstrate the strategic benefits of our green chemistry solutions to support their ESG and operational goals. We are encouraged by the increased interest we are seeing in our value proposition; and to further accelerate these efforts, we have structurally realigned to reallocate resources to expand our sales team. This will support our strategy to diversify our customer base and expand our channels-to-market across the energy life cycle. Additionally, we are pleased that we have secured our first international sale for JP3 with a supermajor energy company in Southeast Asia, measuring hydrocarbons in their offshore operations – an exciting new frontier for our technologies.”

“We also continued to improve our liquidity, supported by recent actions. We have completed a lease agreement for our Waller facility with Resolute Oil, converting it into a more marketable, income-generating property. Further, we are pleased we have attained full forgiveness of our JP3 PPP loan. Additionally, we are exploring a number of credit-enhancing options, including an asset-based line of credit.”

Second Quarter Financial Results

• Consolidated Revenues: Flotek generated second quarter 2021 consolidated revenue of $9.2 million, up 3.4% from $8.9 million in the second quarter 2020, and was down 22.0% versus $11.8 million in the first quarter 2021. The sequential decline in sales was driven by the loss of revenue associated with two major energy customers through M&A activity. The year-over-year increase in revenue was driven by the acquisition of JP3 in May 2020.
• Consolidated Operating Expenses: Consolidated operating expenses (excluding depreciation and amortization) were $12.1 million in the second quarter 2021, a 12.3% decline from $13.8 million in the first quarter 2021 driven by a continued reduction in costs of sales, as well as lowering operating expenses. Year over year, consolidated operating expenses (excluding depreciation and amortization) rose 4.1% and were flat as a percentage of revenue.
• Corporate General & Administrative Expenses (CG&A): Corporate general and administrative expenses for the second quarter of 2021 were $2.9 million, compared to $5.4 million for the second quarter of 2020 and $4.4 million for the first quarter of 2021. The declines were primarily driven by lower personnel costs and the Employee Retention Credit (“ERC”) recorded in the second quarter.
• Adjusted EBITDA:  Adjusted EBITDA for the second quarter 2021 was a loss of $6.7 million, slightly higher than the $6.5 million loss in the first quarter of 2021 and flat with the loss of $6.7 million last year. 
• Net Loss: The Company reported a net loss for the second quarter 2021 of $6.5 million, or a loss of $0.09 per basic/diluted share, an improvement over the net loss in the second quarter 2020 of $9.6 million, or a loss of $0.14 per basic/diluted share. Net loss for the second quarter 2021 improved compared to the net loss for the first quarter of 2021 of $8.3 million, or a loss of $0.12 per basic/diluted share.

Balance Sheet and Liquidity
As of June 30, 2021, the Company had cash and equivalents of $27.8 million which were impacted by operating losses and partially offset by the ERC taken in the quarter. Flotek also had a combined $4.8 million of loans outstanding pursuant to the Paycheck Protection Program (“PPP”) related to the “Cares Act.” In the second quarter 2021, JP3 was given full forgiveness of its $881,000 loan, and recently, Flotek filed for forgiveness of its PPP loan. The Company has also completed a term sheet for an asset-based line of credit.

Chemistry Technologies Segment: Energy Chemistries and Professional Chemistries
In the second quarter 2021, sales in the Chemistry Technologies segment declined 3.4% year-over-year to $7.7 million. The decrease was primarily a result of the loss of sales from two energy customers impacted by M&A activity in the second quarter. Professional Chemistries improved sequentially driven by sales of degreasers and disinfectants.

Highlights from the quarter include:

• Entered into a multi-year lease agreement with Resolute Oil, a leader in high-quality white mineral oil. The agreement will generate other income while offsetting costs for Flotek and will allow Resolute to utilize the Company’s chemical blending facility in Waller, Texas to manufacture and globally distribute USP-NF-grade white mineral oil. Additionally, the collaboration between Flotek and Resolute will enable the companies to leverage their expertise in adjacent market verticals for mutual benefit. The agreement includes options to renew until 2036.
• In support of the Company’s efforts to accelerate its ESG (Environmental, Social & Governance) solutions for domestic and international E&P operators and service companies across the energy life cycle, Flotek realigned and reallocated resources to build out its sales and marketing talent. The reallocation will result in a net, annualized cost savings of more than $1 million in salaries and benefits, while doubling the headcount in the sales force.
• Following a successful field trial for a customer in the Permian Basin, the customer expanded its green, reservoir-centric chemistry technologies to new unconventional basins and technology applications.
• Secured multiple remediation treatment applications of its Complex nano-fluid^® technologies, the Company’s bio-based, high-performance chemistry built upon non-toxic, plant-based solvents. The technology is enabling Flotek’s customers to cost effectively remove the use of BTEX (benzene, toluene, ethylbenzene and xylene) and other harmful solvents thus reducing the environmental risk of their remediation and production programs.
• Following its strategic focus to rebuild its indirect sales channel relationships, the Company grew its customer base and domestic revenue associated with service companies by 58% and 68%, respectively, over Q1 2021.
• Partnered with a major customer to begin an ESG scorecard assessment of their chemistry usage, identifying new opportunities to support their ESG goals.
• Increased sales in the Professional Chemistries business, driven by strength in janitorial disinfectants and cleaning products, as well as establishing new contractual relationships with leading large-scale distributors and redistributors.

Data Analytics Segment
In the second quarter 2021, Data Analytics’ (“JP3”) sales were flat with first quarter 2021. Second quarter 2021 revenue was driven by the addition of new customers and new purchases by existing customers. Flotek acquired JP3 in May 2020, and as a result full quarter year-over-year results are not available for comparison. Highlights include:

• In the second quarter 2021, JP3 completed the specifications and manufacturing of the international Verax analyzer prototype.
• JP3 is currently undergoing the extensive process to secure the approvals from multiple international certifying bodies to ready the equipment for deployment.
• JP3 received its first international purchase order supporting a supermajor energy company in Southeast Asia. This order also represents JP3’s first offshore deployment, expanding both its application use cases and geographical footprint.
• International pilot programs that began in the first quarter remain on-track. 

Conference Call Details
Flotek will host a conference call on Tuesday, August 10, 2021, at 8:30 am CDT (9:30 a.m. EDT) to discuss its second quarter results for the three months ended June 30, 2021. Participants may access the call through Flotek’s website at www.flotekind.com under “Webcasts” or by telephone at 844-835-9986.

About Flotek Industries, Inc.
Flotek Industries, Inc. creates solutions to reduce the environmental impact of energy on air, water, land and people. A technology-driven, specialty green chemistry and data company, Flotek helps customers across industrial, commercial, and consumer markets improve their Environmental, Social, and Governance performance. Flotek’s Chemistry Technologies segment develops, manufactures, packages, distributes, delivers, and markets high-quality cleaning, disinfecting and sanitizing products for commercial, governmental and personal consumer use. Additionally, Flotek empowers the energy industry to maximize the value of their hydrocarbon streams and improve return on invested capital through its real-time data platforms and green chemistry technologies. Flotek serves downstream, midstream, and upstream customers, both domestic and international. Flotek is a publicly traded company headquartered in Houston, Texas, and its common shares are traded on the New York Stock Exchange under the ticker symbol “FTK.” For additional information, please visit www.flotekind.com.

Forward-Looking Statements
Certain statements set forth in this press release constitute forward-looking statements (within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934) regarding Flotek Industries, Inc.’s business, financial condition, results of operations and prospects. Words such as will, continue, expects, anticipates, intends, plans, believes, seeks, estimates and similar expressions or variations of such words are intended to identify forward-looking statements, but are not the exclusive means of identifying forward-looking statements in this press release.  Although forward-looking statements in this press release reflect the good faith judgment of management, such statements can only be based on facts and factors currently known to management.  Consequently, forward-looking statements are inherently subject to risks and uncertainties, and actual results and outcomes may differ materially from the results and outcomes discussed in the forward-looking statements.  Further information about the risks and uncertainties that may impact the Company are set forth in the Company’s most recent filing with the Securities and Exchange Commission on Form 10-K (including, without limitation, in the “Risk Factors” section thereof), and in the Company’s other SEC filings and publicly available documents.  Readers are urged not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company undertakes no obligation to revise or update any forward-looking statements in order to reflect any event or circumstance that may arise after the date of this press release.

SOURCE Flotek Industries, Inc.

Flotek Announces Second Quarter 2021 Results

HOUSTON, Aug. 9, 2021 /PRNewswire/ — Flotek Industries, Inc. (“Flotek” or the “Company”) (NYSE: FTK) today announced second quarter results for the three months ended June 30, 2021.

John W. Gibson, Jr., Chairman, President, and Chief Executive Officer stated, “Two of our most significant customers changed ownership on accelerated timelines in the second quarter, and both buyers suspended our forecasted business immediately following their closings. Excluding these events, customer growth and diversification was strong, with a 26% sequential increase of new customers in our energy chemistry technologies business. Additionally, our Data Analytics segment improved slightly, experiencing the third sequential improvement in sales and representing our highest performing quarter since our acquisition of JP3 last year.” 

“We remain focused on engaging with the industry to demonstrate the strategic benefits of our green chemistry solutions to support their ESG and operational goals. We are encouraged by the increased interest we are seeing in our value proposition; and to further accelerate these efforts, we have structurally realigned to reallocate resources to expand our sales team. This will support our strategy to diversify our customer base and expand our channels-to-market across the energy life cycle. Additionally, we are pleased that we have secured our first international sale for JP3 with a supermajor energy company in Southeast Asia, measuring hydrocarbons in their offshore operations – an exciting new frontier for our technologies.”

“We also continued to improve our liquidity, supported by recent actions. We have completed a lease agreement for our Waller facility with Resolute Oil, converting it into a more marketable, income-generating property. Further, we are pleased we have attained full forgiveness of our JP3 PPP loan. Additionally, we are exploring a number of credit-enhancing options, including an asset-based line of credit.”

Second Quarter Financial Results

• Consolidated Revenues: Flotek generated second quarter 2021 consolidated revenue of $9.2 million, up 3.4% from $8.9 million in the second quarter 2020, and was down 22.0% versus $11.8 million in the first quarter 2021. The sequential decline in sales was driven by the loss of revenue associated with two major energy customers through M&A activity. The year-over-year increase in revenue was driven by the acquisition of JP3 in May 2020.
• Consolidated Operating Expenses: Consolidated operating expenses (excluding depreciation and amortization) were $12.1 million in the second quarter 2021, a 12.3% decline from $13.8 million in the first quarter 2021 driven by a continued reduction in costs of sales, as well as lowering operating expenses. Year over year, consolidated operating expenses (excluding depreciation and amortization) rose 4.1% and were flat as a percentage of revenue.
• Corporate General & Administrative Expenses (CG&A): Corporate general and administrative expenses for the second quarter of 2021 were $2.9 million, compared to $5.4 million for the second quarter of 2020 and $4.4 million for the first quarter of 2021. The declines were primarily driven by lower personnel costs and the Employee Retention Credit (“ERC”) recorded in the second quarter.
• Adjusted EBITDA:  Adjusted EBITDA for the second quarter 2021 was a loss of $6.7 million, slightly higher than the $6.5 million loss in the first quarter of 2021 and flat with the loss of $6.7 million last year. 
• Net Loss: The Company reported a net loss for the second quarter 2021 of $6.5 million, or a loss of $0.09 per basic/diluted share, an improvement over the net loss in the second quarter 2020 of $9.6 million, or a loss of $0.14 per basic/diluted share. Net loss for the second quarter 2021 improved compared to the net loss for the first quarter of 2021 of $8.3 million, or a loss of $0.12 per basic/diluted share.

Balance Sheet and Liquidity
As of June 30, 2021, the Company had cash and equivalents of $27.8 million which were impacted by operating losses and partially offset by the ERC taken in the quarter. Flotek also had a combined $4.8 million of loans outstanding pursuant to the Paycheck Protection Program (“PPP”) related to the “Cares Act.” In the second quarter 2021, JP3 was given full forgiveness of its $881,000 loan, and recently, Flotek filed for forgiveness of its PPP loan. The Company has also completed a term sheet for an asset-based line of credit.

Chemistry Technologies Segment: Energy Chemistries and Professional Chemistries
In the second quarter 2021, sales in the Chemistry Technologies segment declined 3.4% year-over-year to $7.7 million. The decrease was primarily a result of the loss of sales from two energy customers impacted by M&A activity in the second quarter. Professional Chemistries improved sequentially driven by sales of degreasers and disinfectants.

Highlights from the quarter include:

• Entered into a multi-year lease agreement with Resolute Oil, a leader in high-quality white mineral oil. The agreement will generate other income while offsetting costs for Flotek and will allow Resolute to utilize the Company’s chemical blending facility in Waller, Texas to manufacture and globally distribute USP-NF-grade white mineral oil. Additionally, the collaboration between Flotek and Resolute will enable the companies to leverage their expertise in adjacent market verticals for mutual benefit. The agreement includes options to renew until 2036.
• In support of the Company’s efforts to accelerate its ESG (Environmental, Social & Governance) solutions for domestic and international E&P operators and service companies across the energy life cycle, Flotek realigned and reallocated resources to build out its sales and marketing talent. The reallocation will result in a net, annualized cost savings of more than $1 million in salaries and benefits, while doubling the headcount in the sales force.
• Following a successful field trial for a customer in the Permian Basin, the customer expanded its green, reservoir-centric chemistry technologies to new unconventional basins and technology applications.
• Secured multiple remediation treatment applications of its Complex nano-fluid^® technologies, the Company’s bio-based, high-performance chemistry built upon non-toxic, plant-based solvents. The technology is enabling Flotek’s customers to cost effectively remove the use of BTEX (benzene, toluene, ethylbenzene and xylene) and other harmful solvents thus reducing the environmental risk of their remediation and production programs.
• Following its strategic focus to rebuild its indirect sales channel relationships, the Company grew its customer base and domestic revenue associated with service companies by 58% and 68%, respectively, over Q1 2021.
• Partnered with a major customer to begin an ESG scorecard assessment of their chemistry usage, identifying new opportunities to support their ESG goals.
• Increased sales in the Professional Chemistries business, driven by strength in janitorial disinfectants and cleaning products, as well as establishing new contractual relationships with leading large-scale distributors and redistributors.

Data Analytics Segment
In the second quarter 2021, Data Analytics’ (“JP3”) sales were flat with first quarter 2021. Second quarter 2021 revenue was driven by the addition of new customers and new purchases by existing customers. Flotek acquired JP3 in May 2020, and as a result full quarter year-over-year results are not available for comparison. Highlights include:

• In the second quarter 2021, JP3 completed the specifications and manufacturing of the international Verax analyzer prototype.
• JP3 is currently undergoing the extensive process to secure the approvals from multiple international certifying bodies to ready the equipment for deployment.
• JP3 received its first international purchase order supporting a supermajor energy company in Southeast Asia. This order also represents JP3’s first offshore deployment, expanding both its application use cases and geographical footprint.
• International pilot programs that began in the first quarter remain on-track. 

Conference Call Details
Flotek will host a conference call on Tuesday, August 10, 2021, at 8:30 am CDT (9:30 a.m. EDT) to discuss its second quarter results for the three months ended June 30, 2021. Participants may access the call through Flotek’s website at www.flotekind.com under “Webcasts” or by telephone at 844-835-9986.

About Flotek Industries, Inc.
Flotek Industries, Inc. creates solutions to reduce the environmental impact of energy on air, water, land and people. A technology-driven, specialty green chemistry and data company, Flotek helps customers across industrial, commercial, and consumer markets improve their Environmental, Social, and Governance performance. Flotek’s Chemistry Technologies segment develops, manufactures, packages, distributes, delivers, and markets high-quality cleaning, disinfecting and sanitizing products for commercial, governmental and personal consumer use. Additionally, Flotek empowers the energy industry to maximize the value of their hydrocarbon streams and improve return on invested capital through its real-time data platforms and green chemistry technologies. Flotek serves downstream, midstream, and upstream customers, both domestic and international. Flotek is a publicly traded company headquartered in Houston, Texas, and its common shares are traded on the New York Stock Exchange under the ticker symbol “FTK.” For additional information, please visit www.flotekind.com.

Forward-Looking Statements
Certain statements set forth in this press release constitute forward-looking statements (within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934) regarding Flotek Industries, Inc.’s business, financial condition, results of operations and prospects. Words such as will, continue, expects, anticipates, intends, plans, believes, seeks, estimates and similar expressions or variations of such words are intended to identify forward-looking statements, but are not the exclusive means of identifying forward-looking statements in this press release.  Although forward-looking statements in this press release reflect the good faith judgment of management, such statements can only be based on facts and factors currently known to management.  Consequently, forward-looking statements are inherently subject to risks and uncertainties, and actual results and outcomes may differ materially from the results and outcomes discussed in the forward-looking statements.  Further information about the risks and uncertainties that may impact the Company are set forth in the Company’s most recent filing with the Securities and Exchange Commission on Form 10-K (including, without limitation, in the “Risk Factors” section thereof), and in the Company’s other SEC filings and publicly available documents.  Readers are urged not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company undertakes no obligation to revise or update any forward-looking statements in order to reflect any event or circumstance that may arise after the date of this press release.