Total revenues in the first quarter of 2024 were $38.8 million, an increase of $19.6 million (102.5%) compared to $19.2 million in the first quarter of 2023. The increase is primarily related to an increase in self-monetized RINs in the first quarter of 2024 as a result of our strategic decision in the first quarter of 2023 to not self-market a significant amount of RINs from 2023 RNG production due to 2023 D3 RIN index price volatility. Additionally, an increase in realized RIN pricing of 61.7% during the ...

PITTSBURGH, April 25, 2024 (GLOBE NEWSWIRE) -- Montauk Renewables, Inc. ("Montauk” or “the Company") (NASDAQ: MNTK), a renewable energy company specializing in the management, recovery and conversion of biogas into renewable natural gas (“RNG”), will host a conference call and webcast on Thursday, May 9, 2024, at 5:00 p.m. Eastern time to discuss its financial results for the first quarter ended March 31, 2024. The Company will issue a press release reporting the financial results after the close of regular ...

MONTAUK RENEWABLES, INC. Incorporated in the United States of America Company number: 85-3189583 NASDAQ share code: MNTK JSE share code: MKR ISIN: US61218C1036 ("Montauk Renewables" or the "Company") AUDITED CONSOLIDATED RESULTS FOR THE YEAR ENDED 31 December 2023 Dollar amounts presented herein are in United States Dollars | SALIENT FEATURES | | 2023 | 2022 | Percentage Change | | --- | --- | --- | --- | --- | | Revenue | ($'000) | 174 904 | 205 559 | (15%) | | EBITDA | ($'000) | 45 277 | 65 734 | (31%) | ...

Financial Data and Key Metrics Changes - Total revenues in 2023 were $174.9 million, a decrease of $30.7 million or 14.9% compared to $205.6 million in 2022, primarily driven by a decrease in realized RIN pricing and natural gas index pricing [79][80] - Adjusted EBITDA for 2023 was $46.5 million, a decrease of $24.0 million or 34.0% compared to adjusted EBITDA of $70.5 million for 2022 [15] - Net income for 2023 decreased $20.3 million or 57.7% compared to net income for 2022, primarily due to price-driven reductions in revenues [42] Business Line Data and Key Metrics Changes - Renewable Natural Gas (RNG) segment produced 5.5 million MMBtu in 2023, flat compared to 2022, with production increases at some facilities offset by quality issues at others [29] - Revenues from renewable electricity facilities in 2023 were $18.4 million, an increase of $1.2 million or 7.4% compared to 2022, driven by timing of generation and monetization of RECs [31] - Operating profit in 2023 for RNG was $59.3 million, a decrease of $35.1 million or 37.2% compared to 2022 [32] Market Data and Key Metrics Changes - Average realized pricing on RIN sales during 2023 was $2.71, a decrease of 16.6% compared to $3.25 in 2022 [11] - Average commodity pricing for natural gas for 2023 was 58.7% lower than the prior year [80] - The average price of D3 RINs through the end of February was approximately $3.06 [61] Company Strategy and Development Direction - The company continues to expect capital investment for development projects to range between $140 million and $160 million for the first phase in North Carolina [7] - The company announced plans for a landfill gas to RNG project in Irvine, California, expected to process large volumes of biogas [53] - The strategic decision to exit a facility was influenced by the expiration of an above-market power purchase agreement and the sale proceeds exceeding the carrying value [78] Management's Comments on Operating Environment and Future Outlook - Management acknowledged ongoing weather anomalies impacting production and expressed cautious optimism for recovery in Q1 [37][87] - The company expects RNG production volumes for 2024 to range between 5.8 million and 6.1 million MMBtu, with corresponding revenues between $195 million and $215 million [85] - Management noted that profitability is highly dependent on market prices for RINs and environmental attributes [81] Other Important Information - The company recorded impairments of $0.9 million in 2023, a decrease of 81.4% compared to 2022 [13] - Cash and cash equivalents as of December 31, 2023, were approximately $73.8 million [15] - The company entered into a loan agreement extending the maturity date to December 31, 2033, with a balance of approximately $10 million [14] Q&A Session Summary Question: Long-term outlook regarding D3 RIN pricing and LCFS pricing - Management did not provide specific guidance on forward prices for environmental attributes but noted a 30% increase in demand for those attributes as per EPA guidance [65] Question: Insights on Q4 production and outlook for Q1 - Management indicated that Q4 RNG production was impacted by weather issues and expressed hope for a bounce back in Q1 [44][87] Question: 2024 spending plans and drivers for increase year-over-year - Management confirmed capital expenditures for 2024 are expected to be approximately $150 million to $167 million, driven by larger projects [89]

Revenue and Financial Performance - Total operating revenues for 2023 were $174.9 million, a decrease of approximately 15% from $205.6 million in 2022[419] - Operating income for 2023 was $23.6 million, down from $44.6 million in 2022, reflecting a decline of about 47%[419] - Net income for 2023 was $14.9 million, compared to $35.2 million in 2022, indicating a decrease of approximately 58%[419] - The company reported a total of $151.3 million in operating expenses for 2023, down from $161.0 million in 2022[419] - The company’s cash and cash equivalents decreased to $73.8 million in 2023 from $105.2 million in 2022, a decline of about 30%[416] - Total cash provided by operating activities for 2023 was $41,053,000, a decrease from $81,066,000 in 2022[425] - Capital expenditures for 2023 amounted to $(63,091,000), significantly higher than $(22,277,000) in 2022[425] - The company reported a net cash used in investing activities of $(63,087,000) for 2023, compared to $(20,794,000) in 2022[425] - Cash and cash equivalents at the end of 2023 were $74,242,000, down from $105,606,000 at the end of 2022[425] Project and Revenue Concentration - Approximately 68.4% of operating revenues in 2023 were derived from five project sites, down from 72.4% in 2022[144] - RNG production at McCarty, Rumpke, Atascocita, and Apex facilities accounted for approximately 16.2%, 18.8%, 21.0%, and 9.9% of RNG revenues in 2023, respectively[144] - Bowerman facility contributed approximately 89.7% of Renewable Electricity Generation revenues in 2023[144] - In 2023, projects located on Waste Management operated landfills represented 37.3% of the company's revenue, while projects on Republic Services operated landfills accounted for 22.2%[228] - Sales to Valero, GE Warren, and HF Sinclair represented approximately 22.0%, 11.7%, and 11.7% of operating revenue in 2023, indicating significant customer concentration[231] Operational Risks and Challenges - The company has experienced operational risks, including potential asset impairment charges due to lower than expected output from renewable energy projects[142] - The concentration of projects in Texas and the Northeast increases vulnerability to regional events affecting production and transmission[145] - The company faces intense competition in the renewable energy and waste-to-energy markets from various other companies[150] - The company faces significant competition from larger competitors with more resources, which may hinder its ability to maintain or expand its business[151] - The company may experience delays and cost overruns in converting existing facilities from Renewable Electricity to RNG production, adversely affecting financial performance[164] - The company may not be able to secure long-term contracts for power sales on favorable terms, impacting its ability to develop and finance projects[158] - The company may experience delays in obtaining necessary regulatory permits, which could hinder project construction and operation[195] - The company may face challenges in obtaining building permits if local populations mobilize against renewable energy projects, potentially leading to project cancellations[202] Regulatory and Compliance Risks - The company faces risks related to regulatory changes that could affect the demand for Environmental Attributes and the prices thereof[161] - The U.S. Supreme Court restricted the EPA's authority to regulate GHG emissions from existing power plants, impacting future regulations and potential demand for renewable energy[199] - The EPA is expected to publish a final rule in the first half of 2024 regarding GHG emissions, which may face legal challenges similar to previous regulations[199] - The market for renewable energy is influenced by continuously modified U.S. federal, state, and local government regulations, which could significantly reduce demand for renewable energy credits[206] - The Inflation Reduction Act of 2022 imposes a fee on GHG emissions from certain facilities and appropriates significant federal funding for renewable energy initiatives, potentially accelerating the transition away from fossil fuels[213] - The company is required to register RNG projects with the EPA, and delays in obtaining RIN qualification could adversely affect cash flow and project profitability[207] - Changes in regulatory requirements and unknown site conditions could negatively impact the financial success of renewable energy projects[203] Strategic Growth and Development - The company aims to expand its business by developing RNG recovery projects at landfills and livestock farms, but may struggle to identify suitable locations[171] - The company has identified 463 landfills as candidates for biogas projects, with only 38 producing sufficient quantities of LFG for commercial-scale projects[171] - The company plans to pursue future acquisitions as part of its growth strategy, but may encounter challenges in identifying suitable candidates and securing financing[176] - The company relies on technological innovation to maintain a competitive position in the renewable energy industry, but lacks exclusive rights to key technologies[153] Financial Structure and Capital Management - The senior credit facility consists of an $80.0 million term loan, with $64.0 million outstanding as of December 31, 2023, and a $120.0 million revolving credit line that is undrawn[232] - The company has a significant concentration of ownership, with stockholder affiliates controlling approximately 52.3% of common stock as of February 28, 2024[248] - The company may issue additional capital stock in the future, which could dilute existing stockholders' ownership interests[251] - The company has a fixed charge coverage ratio requirement of at least 1.20 to 1.00 and a total leverage ratio not exceeding 3.25 to 1.00 until June 30, 2024[235] - The company will transition to Term SOFR plus a SOFR Adjustment after the cessation of BSBY, which could increase interest expenses if Term SOFR rises[237] Customer and Market Dynamics - The company has experienced customer concentration, with five customers accounting for approximately 70.7% of accounts receivable as of December 31, 2023[231] - The company is exposed to risks associated with selling RNG at current market prices if off-take agreements are not renewed, potentially leading to lower revenues[180] - The company relies on Environmental Attributes, which are subject to regulatory changes, and any reduction or elimination of these incentives could adversely affect revenues[185] - The company faces credit risk from a limited number of significant customers who do not post collateral, which could adversely affect financial results[184] Human Resources and Management - The management team has extensive experience in business and financial management, with key executives having over 25 years of relevant experience[134] - The company may face challenges in attracting and retaining highly skilled personnel, which could adversely affect its business strategy[253] Miscellaneous - The company recorded impairment charges of $0.9 million in 2023, with $0.8 million related to non-operational RNG machinery and feedstock processing equipment[238] - The company recorded impairment charges of $2.1 million in 2022 related to a Renewable Electricity facility and ongoing development projects[238] - The company benefits from federal and state incentives, including Renewable Identification Numbers (RINs) and Renewable Energy Credits (RECs), to enhance revenue[432] - The company relies on third-party vendors for IT and data security, exposing it to risks related to cybersecurity threats and potential disruptions[218] - The company expects to incur significant additional costs related to the assessment and disclosure of climate-related matters due to the SEC's new rules[214] - The company is currently assessing the impact of the SEC's new rules, which may face legal challenges from state attorneys general[214] - The company may face increased litigation risks related to disclosures made pursuant to the SEC's new rules[214]

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2023 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-39919 MONTAUK RENEWABLES, INC. (Exact name of registrant as specified in its charter) Delaware 85-3189583 ...

Montauk Renewables, Inc. (NASDAQ:MNTK) Q2 2023 Earnings Call Transcript August 9, 2023 5:00 PM ET Company Participants John Ciroli - Chief Legal Officer & Secretary Sean McClain - Chief Executive Officer & President Kevin Van Asdalan - Chief Financial Officer Conference Call Participants Manav Gupta - UBS Craig Shere - Tuohy Brothers Matthew Blair - TPH Ryan Pfingst - B. Riley Operator Good afternoon, everyone, and thank you for participating in today's conference call. I would like to turn the call over to ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2023 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-39919 MONTAUK RENEWABLES, INC. (Exact name of registrant as specified in its charter) Delaware 85-3189583 (IRS ...

Financial Data and Key Metrics Changes - Total revenues in Q1 2023 were $19.2 million, a decrease of $13 million or 40.5% compared to $32.2 million in Q1 2022, primarily due to the strategic decision not to self-market RINs from 2023 RNG production [53] - EBITDA for Q1 2023 was a loss of $9 million, a decrease of $12.8 million from EBITDA of $3.8 million in Q1 2022 [36] - Net loss for Q1 2023 increased by $2.7 million compared to the previous year, primarily due to reduced revenues from the decision not to sell RINs [36] Business Line Data and Key Metrics Changes - Renewable Natural Gas (RNG) segment revenues in Q1 2023 were $14.8 million, a decrease of $17.9 million or 54.7% compared to $32.7 million in Q1 2022 [56] - RNG production was 1.4 million MMBtu in Q1 2023, unchanged from Q1 2022 [26] - Revenues from renewable electricity facilities in Q1 2023 were approximately $4.4 million, an increase of $0.4 million or 10% compared to $4 million in Q1 2022 [32] Market Data and Key Metrics Changes - Average realized RIN price in Q1 2023 was $2.01, down 41.9% from $3.46 in Q1 2022 [57] - Average commodity pricing for natural gas in Q1 2023 was $3.42 per MMBtu, 30.9% lower than in Q1 2022 [56] - The average D3 RIN index price for Q1 2023 was $2.03, approximately 37.5% lower than the average in Q1 2022 [57] Company Strategy and Development Direction - The company made a strategic decision to delay the transfer of D3 RINs from 2023 RNG production until Q2 2023 due to expected volatility in pricing [48] - The company is focused on expanding its capacity, including the development of a new landfill gas-to-RNG facility in South Carolina expected to be operational in 2025 [19] - The company is also in late-stage negotiations to develop an RNG facility alongside its existing renewable electric generation facility in Irvine, California [52] Management's Comments on Operating Environment and Future Outlook - Management believes the reduction in RIN prices is temporary and has strategically chosen not to transfer any D3 RINs generated from 2023 production during Q1 2023 [31] - The company expects RNG production volumes for 2023 to range between 5.7 million and 6.1 million MMBTUs, with corresponding revenues between $137 million and $145 million [66] - Management expressed excitement about the potential of carbon utilization and developments in the transportation space [5] Other Important Information - The company incurred capital expenditures of approximately $13.3 million in Q1 2023, with significant investments in ongoing projects [35] - General and administrative expenses for Q1 2023 were $9.5 million, an increase of 12.6% compared to the previous year, primarily due to stock-based compensation [54] - The company reported an impairment loss of approximately $0.5 million in Q1 2023 related to a feedstock processing machine component [33] Q&A Session Summary Question: Impact of holding back RINs on EBITDA - Management confirmed that holding back RINs had an estimated impact of approximately $3 million on EBITDA for the quarter [40] Question: Confidence in future RIN prices - Management stated they do not provide guidance on future attribute prices but acknowledged the volatility impacts revenue and EBITDA expectations [41] Question: Views on developments in RNG space, particularly regarding Cummins - Management expressed excitement about the potential of eRINs and the developments in natural gas engines for transportation [70]

6.71 Balance Sheet (in thousands, except share data): | --- | --- | --- | --- | --- | |---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------|-------------------------------|-------|-----------------------------------| | ASSETS \nCurrent assets: | | as of March 31, 2023 \n78,043 | | as of December 31, 2022 \n105,177 | | Cash and cash equivalents Accounts and other re ...