Ameresco, Inc. Q4 FY2025 earnings call

• George mentioned Q4 results were a great finish to a strong year with annual results in mid to high end of revenue and profit guidance. Key drivers were execution by team and recurring revenue from energy asset and O&M businesses. Converted $1.5 billion of project backlog to revenue, awarded backlog over $2.5 billion (+13% YOY). Europe was a strong contributor with growth through acquisitions and partnerships, and opportunities in southern and eastern Europe. Highlighted industry growth drivers like growing electricity demand, increasing energy costs, and stress on aging energy infrastructure. - Mark noted Q4 record revenue of $581 million (+9% YOY) with growth across core business lines. Projects revenue up 11%, energy asset revenue up 5%, O&M revenue up 11%. Project backlog over $5 billion, energy assets in operation 838 MW, O&M backlog ~$1.5 billion, over $10 billion in long-term revenue visibility. Gross margin 16.2%, operating expenses $50.9 million. Net income $18.4 million, adjusted EBITDA $70 million (12% margin). Balance sheet had $72 million cash, $300 million corporate debt, leverage 2.7 times.

Projects revenue grew 11%, driven by strong backlog conversion and European joint venture performance. Energy asset revenue increased 5% due to growth in operating asset portfolio. Recurring O&M revenue increased 11% reflecting long-term service agreements. Other line of business (excluding AEG sale) had gross margin of 16.2%. Project backlog remains above $5 billion, energy assets in operation total 838 megawatts, O&M revenue backlog ~$1.5 billion, and over $10 billion in long-term revenue visibility.

2026 guidance: ~$2.1 billion revenue (9% growth) and $283 million adjusted EBITDA (19% growth) at midpoints. Expect to place ~100 - 120 MW of energy assets into service including two RNG plants. Second half of year to represent ~60% of total revenue. Q1 revenue and adjusted EBITDA generally consistent with Q1 last year, but lower YOY EPS due to higher interest and depreciation expenses and investment scaling. Adjusted EBITDA and EPS reflect Amoresco's ownership share of consolidated entities.

Potential differences between actual results and forward-looking statements due to risks and uncertainties discussed in earnings materials, SEC filings, and safe harbor language. Impact of weather on project execution timing. Tariff landscape fluctuations and their potential impact on contracts and margins.

Q: Asked about shaping on energy assets, revenue trajectory, and margin profile.

A: Majority of assets placed in service in back half of year, margins similar to historical, assets placed in previous years impact later years.

Q: Commented on first quarter shaping and weather impact.

A: Weather impacted project timing, revenue expected to come in Q2 as timing issue.

Q: Focused on Europe scaling, organic vs acquisitions.

A: Looking at opportunistic acquisitions, partnerships, success in Romania.

Q: Asked about data center momentum and backlog timing.

A: Strong pipeline for data centers, need to de-risk gating items before entering backlog.

Q: Followed up on data center backlog timing and labor/equipment tightness.

A: Pipeline strong but need to de-risk, supply chain challenges but improved.

Q: Asked about margin drivers and project backlog sub-segments.

A: Margin improvement due to discipline in project selection, pricing, and cost management; larger complex projects bring higher margin profile.

Q: Inquired about RNG market and M&A.

A: Backlog has 10+ RNG facilities in development, open to acquisitions but disciplined.

Q: Asked about tariff landscape and hyperscaler resource mix.

A: New contracts have tariff protections, hyperscalers interested in firm power, renewable solar plus storage, speed to power.

Q: Asked about operating cash flow and guidance milestones.

A: Operating cash flow lumpy, evaluate on rolling multi-quarter basis; guidance top end depends on execution and cost management.

Q: Asked about company evolution.

A: More infrastructure projects, growth in Europe, adding engineering, development, and construction management people, focus on data centers and industrial resiliency