Allego(US:ALLG)2023-08-15 15:44Financial Data and Key Metrics Changes - Total revenue increased by 34.5% to €68.2 million in H1 2023 from €50.7 million in H1 2022, driven by strong charging revenue growth [6][15] - Charging revenue more than doubled to €51.1 million compared to €24 million in the same period of 2022, with a 51% increase in utilization rates and a 17.2% rise in global charging sessions to 5.2 million [6][15] - Operational EBITDA improved to a gain of €11.7 million in H1 2023 from a loss of €1.5 million in H1 2022, reflecting strong management of input costs and improved charging revenue margins [9][16] - Net loss decreased to €38.9 million in H1 2023 from €247.1 million in H1 2022, primarily due to a significant drop in stock-based payment expenses [10][18] Business Line Data and Key Metrics Changes - Sales and services revenue declined by 35.8% to €17.1 million from €26.7 million in H1 2022, attributed to slower deployment of stations for the Carrefour project and delays in new contracts [7][16] - Total energy sold reached over 96.4 gigawatt hours in H1 2023, with total charging sessions remaining at 5.2 million, marking a 17.2% increase [9] Market Data and Key Metrics Changes - The number of ultrafast charging ports grew by over 42% in H1 2023, with a global utilization rate of 13.4% for mature charging ports and 8.9% for new ports installed in H1 2023 [8][9] - The company has secured a backlog of 1,350 sites with signed lease agreements, representing over 60% year-over-year growth [19] Company Strategy and Development Direction - The company is shifting its focus from sales and services revenue to charging revenue, aiming to fulfill 80% of its energy needs through renewable sources by the end of 2023 [10][11] - Allego is expanding its ultrafast charging network and has established partnerships to enhance its footprint in various countries, including a collaboration in Denmark and a long-term agreement for compliance credits in Germany [11][13] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's performance and growth strategy, highlighting the importance of operational excellence and the increasing demand for EV charging infrastructure [22] - The company anticipates annual revenue between €180 million and €200 million for 2023, with operational EBITDA expected to be between €30 million and €40 million [20][21] Other Important Information - General and administrative expenses decreased significantly to €48.3 million in H1 2023 from €271.7 million in H1 2022, mainly due to reduced share-based payment expenses [17] - The company is exploring options for future funding, including potential equity raises and extensions of its debt facility [33] Q&A Session Summary Question: Can you provide more detail on the revenue cadence and the shift towards the lower end of your prior revenue guidance? - Management noted that some contracts expected to pick up earlier have been delayed, particularly in the Carrefour project, leading to a shift in revenue recognition [25][27] Question: How is the company considering entering the North American charging market? - Management indicated that while they are exploring the North American market, their primary focus remains on expanding in Europe due to its maturity and demand for chargers [28][29] Question: Can you elaborate on capital spending and its trajectory? - Management confirmed that they are utilizing existing debt facilities for capital expenditures and are planning for future funding options, including potential equity raises [31][33] Question: Was there a decrease in margins on the charging side relative to Q1? - Management acknowledged that while margins increased due to higher utilization rates, there was some seasonality affecting the margins, with expectations for further improvements [34][35] Question: What is the current utilization rate as of July or early Q3? - Management reported a global utilization rate of over 30% to 35% in July, with expectations for continued growth [37][38]