Ameresco(US:AMRC)2024-02-29 02:27Financial Data and Key Metrics Changes - The company reported total revenue of $441 million for Q4 2023, representing a 33% increase year-over-year [13] - Adjusted EBITDA grew 33% to $54.9 million in the quarter, with non-GAAP EPS nearly doubling from the previous year [15] - Gross margin for the quarter was 17%, which dipped due to project mix impacts [15] Business Line Data and Key Metrics Changes - Each of the four business lines experienced double-digit revenue growth, with the projects business showing particularly strong performance [13] - Energy asset revenue grew by 12%, driven by an increase in operating assets and higher RIN prices [14] - The O&M business and other lines of business grew by 13% and 12%, respectively [15] Market Data and Key Metrics Changes - The total project backlog reached a record $3.9 billion at the end of 2023, up approximately 50% from 2022 [9] - New awards for the year totaled $2.2 billion, with proposal activity at record levels [9] - The European revenue accounted for over 10% of total revenue, with growth exceeding 150% year-over-year [14] Company Strategy and Development Direction - The company aims for a 20% growth in its energy asset portfolio and plans to place approximately 200 megawatts of energy assets into service during 2024 [21] - The focus for 2024 is on executing the project backlog and generating cash flow [23] - The company is adapting to industry challenges by optimizing operational structures and focusing on larger opportunities in core markets [10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in 2024, citing strong demand for energy efficiency and renewable solutions, supported by favorable macro factors [8] - The company is focused on timely conversion and execution of its project backlog, which is expected to yield results [11] - Management noted that the IRA legislation continues to support demand for their services, regardless of the political landscape [12] Other Important Information - The company anticipates a CapEx of $350 million to $400 million for 2024, primarily funded through energy asset debt and tax equity [22] - The corporate debt at year-end was $280 million, with a leverage ratio of 3.3 times, below the bank covenant level [19] Q&A Session Summary Question: Can you talk about the energy asset portfolio planning for 2024? - The company plans to retain the entire 200 megawatts on the balance sheet, with CapEx figures also retained [26] Question: Can you discuss the 2024 EBITDA guidance? - The guidance reflects a more conservative approach and includes a $40 million revenue pull into Q4 [34] Question: What is the normal quarterly cadence of your business? - Q1 is typically the lowest quarter, with a steady ramp-up expected through Q3 and Q4 [36] Question: Can you talk about the growth in Europe? - The company expects significant organic growth in Europe, particularly with new technologies [40] Question: What is the plan for debt raise? - The process is underway, with strong interest from lenders [47] Question: Can you clarify the expected timing around the SoCal projects? - The company is working on substantial completion checklists, with cash flow expected 60 days after completion [54] Question: What gives you confidence in meeting Q1 expectations? - Over 75% of total revenue is already contracted, providing visibility for Q1 [62] Question: How do you see the economics of energy efficiency currently? - The economic rationale for energy efficiency investments is stronger than ever due to rising energy prices [96]