Ameresco Reports Fourth Quarter and Full Year 2024 Financial Results

FRAMINGHAM, MA – February 27, 2025 – Ameresco, Inc. (NYSE: AMRC), a leading energy solutions provider dedicated to helping customers navigate the energy transition, today announced financial results for the fiscal quarter ended December 31, 2024. The Company also furnished supplemental information in conjunction with this press release in a Current Report on Form 8-K. The supplemental information, which includes Non-GAAP financial measures, has been posted to the “Investors” section of the Company’s website at www.ameresco.com. Reconciliations of Non-GAAP measures to the appropriate GAAP measures are included herein. All financial result comparisons made are against the prior year period unless otherwise noted.

CEO George Sakellaris commented, “The fourth quarter represented a strong and resilient finish to an excellent year for Ameresco. Our team continued to deliver solid results in a dynamic business environment while positioning the Company for future growth and adding to our multi-year visibility. Our record revenue performance was driven by growth across our business lines, reflecting robust demand for cost effective projects that provide energy savings and resilience. This was also a record quarter in project contract conversions with over $1 billion, bringing our contracted project backlog to over $2.5 billion at year-end, approximately twice 2023 levels. We also placed a record 241 MWe of energy assets into service during the year. These accomplishments have added considerably to our total multiyear revenue visibility which now stands at almost $10 billion. During the quarter, we also successfully divested our AEG business unit allowing us to remain focused on our core businesses and the exciting growth opportunities within our target markets.”

Fourth Quarter Financial Results

(All financial result comparisons made are against the prior year period unless otherwise noted.)

Total revenue increased 20.7% to $532.7 million, with growth across all four of our business lines. Projects revenue grew 20.7% to $418.3 million, driven by our focus on project execution and the conversion of our awarded backlog to contracts. Energy Assets revenue increased 31.2% to $57.6 million, on the strength of record growth in assets placed in service. O&M revenue increased 8.6% to $26.5 million reflecting a solid attachment rate to our growing projects business. Other revenue increased 13.7% to $30.2 million. Gross margin of 12.5% for the quarter was significantly lower than expected. Unanticipated cost overruns on two of our large-scale legacy projects, negatively impacted gross profit by approximately $20 million, or 400 basis points. Operating income of $44.6 million, included a gain recognized on the sale of our AEG business unit of approximately $38.0 million, was partially offset by non-cash impairment charges of approximately $12.0 million taken on certain energy assets and higher depreciation expenses of $8.0 million.  Interest and other expenses, net was $23.4 million, representing an increase of 45.7%. We continued to take advantage of clean energy tax incentives, resulting in an effective tax rate benefit of (58.9)% compared to a benefit of (67.0)% in 2023. Net income attributable to common shareholders was $37.1 million, increasing by 14.6%.  Adjusted EBITDA of $87.2 million, increased 58.7%.

Balance Sheet and Cash Flow Metrics

The Company ended 2024 with $108.5 million in cash. During the fourth quarter the Company executed the planned, strategic divestiture of our energy technology and advisory services business, AEG, which resulted in significant cash proceeds and a higher than expected gain of approximately $38.0 million. The Company used the net cash proceeds from the sale to pay down its corporate term loan, resulting in an improvement in the corporate debt leverage ratio as of December 31, 2024. Our total corporate debt including our subordinated debt, term loans and drawn amounts on our revolving line of credit declined to $243.1 million from $272.5 million. Subsequent to the year-end, we extended and increased this facility, providing further financial flexibility and increased capacity to help fund our growth. During the fourth quarter we successfully executed approximately $237.0 million in project financing commitments to help fund our Energy Asset business. Our Energy Asset Debt was $1.4 billion with an Energy Debt Advance rate of 73% on the Energy Asset Book Value. Our Adjusted Cash from Operations during the quarter was $53.8 million. Our 8-quarter rolling average Adjusted Cash from Operations was $45.8 million.

Project and Asset Highlights

• Ameresco brought 31 MWe of Energy Assets into operation, including the 15.6 MWe Roxana RNG plant.
• Ameresco’s Assets in Development increased 48 MWe during the quarter to 637 MWe with the addition of a number of large battery and PV assets.
• The Southern California Edison projects continue to progress and we expect them to be finalized this year.

Summary and Outlook

“Entering 2025, Ameresco is well-positioned for continued long term profitable growth even in an evolving industry and political landscape. While we expect continued growth in our recurring energy assets and O&M businesses, our projects business, and specifically our federal projects, will be impacted as the new administration determines which projects align with its funding priorities. We expect there to be continued long-term demand for our budget-neutral, cost-saving solutions as energy demand and prices continue to increase. We also expect the growing need for resilient, reliable power and infrastructure upgrades to drive the continued growth of our energy solutions as these drivers align with the new administration’s priorities. Additionally, we foresee growing contributions from our European business, with renewable projects driven by decarbonization and net-zero commitments. These critical market drivers and our proven tailored solutions will continue to bolster our status as a leading global market player.”

Given the current unpredictable political and regulatory environment, we have evaluated our federal government exposure in our 2025 guidance. We are guiding revenue of $1.9 billion and adjusted EBITDA $235 million at the midpoints of our ranges. We have reviewed risks related to project cancellations, pauses and re-scopes and factored that into our guidance. However, if these factors last longer than anticipated, our earnings could be impacted.

We anticipate placing approximately 100-120 MWe of energy assets in service, including 1-2 RNG plants. Our expected capex is $350 million to $400 million, the majority of which we expect to fund with additional energy asset debt, tax equity or tax credit sales.

We anticipate that first quarter revenue and Adjusted EBITDA will be similar to Q1 last year.  Because the first quarter is our seasonally lowest revenue quarter, and due to the generally linear nature of depreciation and interest expenses, we expect to have negative EPS.  With respect to the cadence of revenue, we expect revenues in the second half of the year to represent approximately 60% of our total revenue for 2025. This is consistent with our performance from the past couple of years.

Our 2025 guidance does not include the potential impact of a change in accounting principle related to sale-leaseback arrangements that is currently being assessed. If implemented, this change could result in lower annual interest and other expenses with an estimated impact of approximately $20 million in 2025.

The Company’s Adjusted EBITDA and Non-GAAP EPS guidance excludes the potential impact of redeemable non-controlling interest activity, one-time charges, energy asset and goodwill impairment charges, changes in contingent consideration, restructuring activities, as well as any related tax impact.

Conference Call/Webcast Information

The Company will host a conference call today at 4:30 p.m. ET to discuss fourth quarter 2024 financial results, business and financial outlook, and other business highlights. To participate on the day of the call, dial 1-888-596-4144, or internationally 1-646-968-2525, and enter the conference ID: 4966851, approximately 10 minutes before the call. A live, listen-only webcast of the conference call will also be available over the Internet. Individuals wishing to listen can access the call through the “Investors” section of the Company’s website at www.ameresco.com. If you are unable to listen to the live call, an archived webcast will be available on the Company’s website for one year.

Use of Non-GAAP Financial Measures

This press release and the accompanying tables include references to adjusted EBITDA, Non- GAAP EPS, Non-GAAP net income and adjusted cash from operations, which are Non-GAAP financial measures. For a description of these Non-GAAP financial measures, including the reasons management uses these measures, please see the section following the accompanying tables titled “Exhibit A: Non-GAAP Financial Measures”. For a reconciliation of these Non-GAAP financial measures to the most directly comparable financial measures prepared in accordance with GAAP, please see Non-GAAP Financial Measures and Non-GAAP Financial Guidance in the accompanying tables.

About Ameresco, Inc. 

Founded in 2000, Ameresco, Inc. (NYSE:AMRC) is a leading energy solutions provider dedicated to helping customers reduce costs, enhance resilience, and decarbonize to net zero in the global energy transition. Our comprehensive portfolio includes implementing smart energy efficiency solutions, upgrading aging infrastructure, and developing, constructing, and operating distributed energy resources. As a trusted full-service partner, Ameresco shows the way by reducing energy use and delivering diversified generation solutions to Federal, state and local governments, utilities, educational and healthcare institutions, housing authorities, and commercial and industrial customers. Headquartered in Framingham, MA, Ameresco has more than 1,500 employees providing local expertise in North America and Europe. For more information, visit www.ameresco.com.

Safe Harbor Statement

Any statements in this press release about future expectations, plans and prospects for Ameresco, Inc., including statements about market conditions, pipeline, visibility, backlog, pending agreements, financial guidance including estimated future revenues, net income, adjusted EBITDA, Non-GAAP EPS, gross margin, effective tax rate, interest rate, depreciation, tax attributes and capital investments, as well as statements about our financing plans, the impact the IRA, the impact of policies and regulatory changes implemented by the new U.S. administration, supply chain disruptions, shortage and cost of materials and labor, and other macroeconomic and geopolitical challenges; the impact from a possible change in accounting principle; our expectations related to our agreement with SCE including the impact of delays and any requirement to pay liquidated damages, and other statements containing the words “projects,” “believes,” “anticipates,” “plans,” “expects,” “will” and similar expressions, constitute forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by such forward looking statements as a result of various important factors, including: demand for our energy efficiency and renewable energy solutions; the timing of, and ability to, enter into contracts for awarded projects on the terms proposed or at all; the timing of work we do on projects where we recognize revenue on a percentage of completion basis; the ability to perform under signed contracts without delay and in accordance with their terms and the potential for liquidated and other damages we may be subject to; the fiscal health of the government and the risk of government shutdowns and reductions in the federal workforce; our ability to complete and operate our projects on a profitable basis and as committed to our customers; our cash flows from operations and our ability to arrange financing to fund our operations and projects; our customers’ ability to finance their projects and credit risk from our customers; our ability to comply with covenants in our existing debt agreements; the impact of macroeconomic challenges, weather related events and climate change; our reliance on third parties for our construction and installation work; availability and cost of labor and equipment particularly given global supply chain challenges, tariffs and global trade conflicts; global supply chain challenges, component shortages and inflationary pressures; changes in federal, state and local government policies and programs related to energy efficiency and renewable energy; the ability of customers to cancel or defer contracts included in our backlog; the output and performance of our energy plants and energy projects; cybersecurity incidents and breaches; regulatory and other risks inherent to constructing and operating energy assets; the effects of our acquisitions and joint ventures; seasonality in construction and in demand for our products and services; a customer’s decision to delay our work on, or other risks involved with, a particular project; the addition of new customers or the loss of existing customers; market price of our Class A Common stock prevailing from time to time; the nature of other investment opportunities presented to our Company from time to time; risks related to our international operation and international growth strategy; and other factors discussed in our most recent Annual Report on Form 10-K and our quarterly reports on Form 10-Q. The forward-looking statements included in this press release represent our views as of the date of this press release. We anticipate that subsequent events and developments will cause our views to change. However, while we may elect to update these forward-looking statements at some point in the future, we specifically disclaim any obligation to do so. These forward-looking statements should not be relied upon as representing our views as of any date subsequent to the date of this press release.