AMTX

Financial Inflection

• The company confirmed continued year-over-year improvement across key financial metrics: operating income improved by $16.4 million to a $5.8 million profit (from a $10.7 million operating loss in Q2 2025), net loss shrank by $14 million to $9.4 million, and adjusted EBITDA increased $15.5 million to $9.7 million (from a negative $5.8 million YoY).
• Excluding Section 45C credits, Q2 gross profit still improved more than $8 million YoY, supported by lower corn feedstock prices ($6.07 per bushel vs. $6.42 per bushel YoY).

Dairy RNG Business Update

• Seven biogas digester LCFS pathways with an average negative 380 carbon intensity (CI) score were approved by CARB in 2025, generating substantially higher credit revenue than the default negative 150 CI score. Six additional pathways are nearing approval.
• The company currently operates 12 digesters serving 15 dairies, connected via a 36-mile pipeline to the utility gas network, with more than 50 dairies under total contract. Two new digesters are scheduled for completion within one month, and 10 of 15 planned cleanup/compression units for future digesters have been received.
• Dairy RNG generates four revenue streams: natural gas commodity sales, California LCFS credits, federal D3 RIN credits, and Section 45Z production tax credits. Higher credits are generated for lower CI scores.

California Ethanol Business Projects

• The mechanical vapor recompression (MVR) energy efficiency project at the Keys ethanol plant is on track to be operational by the end of 2026. The project is expected to deliver ~$32 million in annual incremental cash flow: it will cut natural gas use by 80% (direct cost reduction), lower the CI score of the ethanol produced to increase 45Z and LCFS credit values. The project has received ~$19.7 million in grants and tax credits from the California Energy Commission, PG&E, and the IRS.
• Upgraded corn oil separation units: two of three units are already operational, with the third coming online in fall 2026. The upgrade is expected to double corn oil production relative to Q1 2026 levels; recovered corn oil is sold as a low-carbon feedstock for renewable diesel and sustainable aviation fuel (SAF), where demand has strengthened in 2026.

India Biodiesel Business Update

• After receiving the 18 million liter OMC tender allocation in late July 2026, deliveries are now underway. Higher petroleum diesel prices in India have opened a new, large market for biodiesel sales to private commercial customers, where AMETIS can offer a 3-5% discount relative to retail diesel prices.
• India has a stated policy goal to increase biodiesel blending from 1% to 5% by 2030, which would create a 1.2 billion gallon annual domestic market. The company is preparing for a potential minority stake public offering of its India subsidiary, Universal Biofuels, and is expanding into compressed biogas (RNG) and SAF to diversify its product line in the region.

• Two new dairy RNG digesters will be completed within one month, and the third corn oil extraction unit will be operational by late fall 2026, doubling corn oil production relative to Q1 2026.
• The MVR energy efficiency project at the California Keys ethanol plant will be operational by the end of 2026, delivering an expected $32 million in annual incremental cash flow, with upside if LCFS credit prices rise further than current levels.
• Six additional LCFS pathways for dairy RNG are expected to receive CARB approval with customary retroactive look-back treatment.
• The company anticipates the U.S. Department of Energy will issue an updated CI score for 45Z tax credits that accurately reflects the carbon reductions of AMETIS's RNG and ethanol, leading to significant revenue increases from existing production volumes.
• Additional OMC biodiesel orders are anticipated in India before the end of 2026.
• The minority stake IPO of AMETIS's India biodiesel subsidiary is proceeding subject to favorable Indian IPO market conditions, with timing dependent on clearing the existing IPO pipeline backlog.

Consolidated total revenue for Q2 2026 was $62.7 million, a 20% year-over-year increase from $52.2 million in Q2 2025. All three operating segments contributed to growth:

1. California ethanol: Revenue growth was driven by a 12% increase in volume, 9% higher ethanol pricing, and $6.4 million in Section 45C credits. The segment contributed 74.4% of total Section 45C credit revenue.
2. Dairy Renewable Natural Gas (RNG): Revenue grew 38% in volume, with $2.2 million in Section 45C credits, accounting for 25.6% of total Section 45C credit revenue. Growth was supported by approved low carbon fuel standard (LCFS) pathways that increase credit generation per unit of RNG produced.
3. India Biodiesel: Q2 2026 revenue was $2.5 million, down sequentially due to delayed tender allocation processes from India's three government-owned oil marketing companies (OMCs). Following the late July 2026 allocation award, the segment is expected to generate ~$17 million in revenue from the 18 million liter tender over three months starting Q3 2026.

• Uncertainty remains around the final revised CI score for dairy RNG under the federal 45Z tax credit program, with a wide range of possible upside per MMBTU and lack of transparency from the Department of Energy on the timeline and final outcome.
• If LCFS credit prices do not rise as expected, projected incremental revenue from approved low-CI pathways and the MVR energy efficiency project will be lower than forecast.
• The timing of the Indian subsidiary minority IPO is dependent on overall Indian stock market and IPO market conditions, which have been volatile due to higher global energy prices and geopolitical factors, potentially pushing the offering into 2027.
• Liquidity and balance sheet risk exists due to current levels of near-term debt, though the company has a positive relationship with its private credit provider and plans to refinance higher-cost debt to longer tenors at lower rates after expected 45Z catch-up payments later in 2026.
• RNG and LCFS credit revenue depends on timely regulatory implementation of existing statutory requirements, which may be delayed or altered due to industry lobbying of regulators.

Q: What is the expected revenue uplift from 45Z CI score revisions, and is there catch-up value for past production? / A: The expected uplift ranges widely. For RNG, the current CI is negative 42 (giving ~$15.20 per MMBTU), while the correct value could be as low as negative 420 (giving over $75 per MMBTU), with no clarity yet on the final outcome. For corn ethanol, annual net cash improvement is expected to be $6-$12 million, with a one-time 18-month catch-up of $6-$24 million starting in 2025 if the revision is retroactive. A third 45Z adjustment for CO2 reuse could add ~$12 million annually if approved.

Q: What is your outlook for California LCFS credit prices, and what is your progress on accessing the Canadian CFR market? / A: The LCFS market is already in a growing deficit, as constraints on low-carbon feedstock supply and limited diesel market growth mean credit production is declining even as annual required credit volumes increase. This deficit will persist long-term, pushing prices higher toward the $270 per ton regulatory cap, as traders eventually realize the growing shortage. AMETIS is 9 months into the 9-month CFR registration process; the Canadian market offers higher prices for RNG, and widespread participation will likely normalize prices over time.

Q: What is the timing for the Indian biodiesel subsidiary IPO, and how do start-stop operations impact the process? / A: Start-stop operations tied to OMC tender cycles do impact the process, but the bigger constraint is weak Indian stock market conditions earlier in 2026 created a backlog of IPOs. The market has recovered recently, and IPOs are now clearing the backlog. AMETIS has completed all preparatory work, and the IPO will proceed as soon as the company reaches its place in the pipeline, subject to ongoing market conditions. The company is the largest biodiesel producer in India and is well positioned for long-term growth.

Q: How much of the annual benefit from the MVR project comes from cost cuts versus higher credit revenue? How sensitive is that benefit to LCFS pricing? / A: Approximately $8 million of the $32 million expected annual benefit comes from direct natural gas cost reductions, with the remaining $24 million coming from higher 45Z and LCFS credit values from the lower CI ethanol. As LCFS credit prices rise from the current ~$80 per ton toward expected levels above $100 and $150 per ton, the total annual benefit will increase beyond the initial $32 million forecast.