Q2 2024 New Fortress Energy Inc Earnings Call Transcript
Key Points
- New Fortress Energy Inc (NFE) successfully brought its FLNG 1 asset online in July, which is expected to generate $500 million a year in free cash flow.
- The company has a highly diversified business model with over 90% of expected revenues contracted, providing a stable financial outlook.
- NFE's Nicaragua power plant is 100% complete and ready for operations, with the jetty and pipeline nearing completion.
- The Brazilian terminals are complete, and the CELBA 2 power plant is 70% complete and on track to commence cash flows in the second half of next year.
- NFE has a clear strategy to reduce CapEx significantly in 2025, which will increase free cash flow available for debt service and equity holders.
- NFE's Q2 2024 earnings were significantly below target, with an EBITDA of $120 million compared to the goal of $275 million, primarily due to delays in the FLNG 1 asset deployment.
- The company expects Q3 2024 to also be impacted by the delay, with full production not anticipated until September.
- NFE is in the process of a claim settlement with FEMA for $659 million, which introduces uncertainty regarding the timing and outcome of the settlement.
- The company faces challenges in securing power for its Puerto Rican operations, with regulatory processes still pending for converting mega gens to gas.
- NFE's capital structure includes a significant amount of debt, and the company plans to refinance its 2025 notes soon, which could be challenging in the current market environment.
Good day, and welcome to the NFE second-quarter 2024 earnings call. Today's conference is being recorded. At this time, I would like to turn the conference over to Chance Pipitone. Please go ahead.
Thank you, Samara, and good morning, everyone. Thank you for joining today's conference call, where we will discuss our second-quarter 2024 results. The call is being recorded and will be available by replay on the Investors section of our website under the subheading Events and Presentations. At the same location, you will find a presentation that we will walk through on today's call. Please review this as it includes important information, including disclosures and risk factors.
With that, I'll now hand over the call to our Chairman and CEO, Wes Edens.
Great. Thanks, Chance, and welcome, everybody. Please refer to the slide deck that we posted on our website as well as on this
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