AEMETIS, INC Q1 FY2025 earnings call

• Dairy RNG: Scaling gas production, expect to reach 550,000 MMBtus this year and 1,000,000 MMBtu by end of 2026; 7 dairy pathways in final review at CARB with approvals expected this quarter, unlocking LCFS revenue in Q3.
• California ethanol: Begun off-site construction of $30 million mechanical vapor recompression system, expected to reduce natural gas use by 80% and add $32 million in annual cash flow by 2026; secured $20 million in grants/tax credits; EPA approval of summer E15 blending provides margin expansion tailwinds.
• India biofuels: Resumed biodiesel deliveries to government oil marketing companies in April; new OMC tenders issued; preparing for IPO of India subsidiary targeting late 2025/early 2026; evaluating expansion into RNG and ethanol production.
• Sustainable aviation fuel: Received permits for 90 million gallon per year SAF and renewable diesel facility at Riverbank site; awaiting clarity on 45Q tax credit and state-level SAF mandates.
• Carbon capture: Completed initial drilling/pipe installation at Riverbank site for CO2 characterization well; data from next phase will support Class VI sequestration permit application, expected to sequester up to 1.4 million tons of CO2 annually.

Revenues were $42.9 million, down from $72.6 million last year primarily due to delayed biodiesel contracts in India. Dairy RNG volumes were up 17% year over year. The Keyes ethanol plant saw a revenue lift of $1.7 million due to stronger ethanol pricing. India biofuels resumed shipments in April and is expected to rebound meaningfully in Q2.

• Revenue to rebound meaningfully in Q2 due to resumed India biodiesel shipments.
• Significant ramp in RNG revenues starting in Q3 driven by LCFS pathway approvals and volume growth.
• Ethanol margins supported by policy tailwinds in near term and MVR project cash flow from 2026.
• Expect multiple revenue streams from India, LCFS credits, and federal tax incentives to ramp up through the year, positioning for stronger back half of 2025.
• Targeting late 2025/early 2026 for IPO of India subsidiary.

• Tariffs on capital equipment for RNG and SAF could have indirect impacts, though RNG value chain is mostly domestic.
• Regulatory uncertainties regarding 45Q tax credit and state-level SAF mandates for project financing.
• Seasonality impacts dairy RNG production, as winter production is lower due to colder temperatures affecting microbes.

Q: How are you looking at the impact of tariffs on RNG production for 2025 and 2026 and on the SAF side?

A: RNG value chain is almost entirely domestic; direct business has no direct tariff impact; SAF operating activity uses domestic feedstocks and sells to California airlines; tariff impacts on capital equipment may vary depending on timing and offshore work.

Q: What is driving the improvement in the balance sheet and debt outlook for 2025?

A: Paid off $15.5 million of debt in Q1; anticipate continuing to pay down debt; benefits from investments (investment tax credits); LCFS revenues expected to increase; 45Z production tax credit starting in 2025 will increase ability to pay down debt.

Q: Impact of tariffs on RNG and SAF production?

A: RNG value chain is domestic, direct business not directly impacted; SAF operating activity is domestic; tariff impacts on capital equipment may be indirect and change daily.

Q: Dairy RNG OpEx trend and long-term target?

A: OpEx per MMBtu has been affected by startup phases; expect dramatic decrease as MMBtus increase; team is scaling up, operating costs will decrease with increased production.

Q: Ethanol margins and EBITDA positive quarter?

A: E15 approval and summer seasonality provide tailwinds; ethanol margins strengthening; combination of seasonality and E15 adoption is positive trend.

Q: India IPO and potential RNG/ethanol expansion?

A: India business is well-established biodiesel facility; looking at RNG and ethanol opportunities in India; IPO target late 2025/early 2026 to help valuation; projects under review for diversified IPO.

Q: Impact of India border trouble on business?

A: No impact on business as operations are far from the affected areas; Indian government working to deescalate.

Q: EB-5 and debt opportunities?

A: Approved for $200 million in EB-5 financing with net interest costs <3%; seeing active EB-5 due to immigration rule enforcement and Indian families' financial capacity; working on closing next round of EB-5 investors.

Q: 45Z progress and timing?

A: Ken Keyes expected to join Treasury soon; he will work on implementing existing law and regulations for provisional emissions rate; significant increase in RNG molecule value expected with approved PER.

Q: Ethanol fundamentals and E15 adoption?

A: E15 approval provides certainty; ethanol exports at record levels; seasonality and E15 adoption positive for margins; MVR system will impact carbon intensity score and cash flow from 2026.

Q: Investment tax credits left to sell in 2025 and carbon intensity look back?

A: Have sales in process for ITCs; expect another couple of ITC sales during 2025; look-back period is one quarter for approved dairies, with revenues from approved pathways monetized in third quarter.

Q: India IPO proceeds plans?

A: Proceeds primarily for building out India business; will have significant cash balance; some proceeds will be used for parent company debt repayment; working on loan refinancings for lower-cost financing