Ameresco (AMRC) 2 Mar 212020 Q4 Earnings call transcript

Ladies and gentlemen, thank you for standing by, and welcome to the Q4 2020 Ameresco Incorporated Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. Thank you. I to ado, over the further Ms. to without would hand like conference And Vice Marketing. President, Senior Dillon, Leila Corporate Ma'am, you may begin.

Thank you, joining call. you We everyone. Paul, and us good for afternoon, appreciate today’s

Chief Sakellaris, and President Financial Accounting Officer; Vice Chairman, George Officer. Senior Chiplock, Chief are Mark and here Doran Hole, me President Joining and President Executive and Officer; Vice Ameresco’s Chief

information our and company’s forward-looking projections Before beliefs. materially the to as make to differ to a to actual future I would a on remarks. and made no call obligation of We refer uncertainties differ I discuss to This like the These afternoon turn this cause events expectations from that predictions press in may the statements. today’s issued our factors such caution call over those business. the on any regarding contains company’s performance SEC of statements financial you or to filings. forward-looking results or revise result forward-looking statement call. assume management’s results current materially the statements important George, regarding future forward-looking documents pertain you based We to company. Actual brief are We could release that that and contained risks

as non-GAAP In accepted the George. website. generally accounting I These the available downloaded our to can we of now which our as behind are addition, will turn the be this of the explanation press release measures use in appendix call be to an accordance and George? in financial in with non-GAAP principles. reconciliation financial to is from over will call. not non-GAAP slides, during measures well referring non-GAAP GAAP prepared financial measures A

afternoon. Thank I is healthy and you, good and safe. hope staying Leila, everyone

also our thrives results. like our low rose with in outstanding very difficulties these and while filled this create federal This challenge regardless hard Paris government, top their sure thank or direction but of with revenues person by client new early emphasis opportunities that year make in making We to recent process. and was by we would key administration, base of and EPS party as carbon considerations continue we including increased briefly are also element effectively all steps the XX% to times. the on to like Climate as pleased administration we customers, the and I people D.C. complex additional climate and year the the to the believe in with will with delivering decision future. comment not charge, manage of Washington, on First, work I both through partners Accord we significant by the and XX%. Ameresco to the placed opportunities, XXXX employees, would rejoining and a the some from a our only leadership business become taken changes

Federal led pulling quarter strong came XXXX, needs revenue show if work dynamic the the fourth prepare companies solutions quarter focusing environmental by squirrely comprehensive from markets COVID-XX, when across they as year-over-year in opportunistic together where and and our are initiatives for strategies of results our markets and continue project significant team our neutrality. customers. available a interest challenging some we Group. record across business achieve advanced captured securing the Solutions were delivering have due regions technology The environment serve, our able we to Despite in by carbon commercial to market their levels, industrial driver particularly we possible, executed Even of now to construction and to year performance fourth the While of our all strong growth with on driven them above seeing expectations. segment

took we improved sites year, this access execute to our quarters advantage previous to contracted in work of backlog. on continued As

much fast billion recurring structure particularly estimated growing opportunities which important and revenues long-term we contracted development are with $XXX and like point two with over to and to would Ameresco energy times. operational interest, predictable energy and have in aligned. line asset not a just notably, comprehensive the existing projects have to solutions. but operation energy industrial maintenance especially Our our businesses And of in in with backlog to our We mandates RNG continued maintenance, million. and new pleased construction during seeing assets megawatts. incentives markets is businesses implement as contracted sight also XXX These these large and visibility realizing $X.X as underpenetrated ESG service economics to and our two only customers, out energy sector. provide added commercial revenue, contract with to additional support that We're of increased were assets more I and we to this increase corporate economically a a with uncertain

like service and Ameresco a energy as related infrastructure long-term energy long-term much under under technologies use improvements our of service energy offering, federal end contracts. an many performance to agreement, directly Our a delivers customer savings

capital have by Ameresco and has paid upfront customers savings energy costs the deliverables by other of the determined and each Our customer no are contract.

broad and technologies. flexible conservation only needs. include may assets order spectrum full measures is offering customer or may service renewable a as a of others with to Projects a in range energy include one energy of Our accommodate two

benefit metrics another while Our profitable stream. capacity, credit from revenue on and Ameresco borrowing customers their gains pressure balances recurring long-term reduced

This diverse of comprehensive a during always been achieved doing doing also the social achievements, for quarter future. the XX ESG has list ESG we Ameresco to healthy the our defines invest company priority. environmental in with the over in our diversity with key of million in workplace of important always good. report are metric the We by years our ensuring DNA entitled and have and We’ll another components and focus and the create our talent team ESG employees. we highlights first goals by of social for ESG assets. importantly continue XX and our at tons offset heavily part Objectivity Ameresco with COX milestone report publication our and who well top governance, in that projects solutions programs are on best of the policies is a

the our focusing are which our We volunteerism students. commitment we regional in operate, reinforcing month further communities to where expanding on to entrepreneurials programs scholarship in

need management achieve need a ESG for and our to Our solutions ESG ambitious And technology continue awarded look green goals. our everyone contracted is the backlog grid we stability. balanced power on to with update aligned build clients. growing This to in year, our With forward achievements. clean our for for we with

storage, to battery technology solutions storage We in example smart and is other to a infrastructure, microgrid. great project flow clean projects. many and battery integrate with solar, Backlog continue a

We farm first in Wappingers of work of with Housing including school in in City district of LED City of in Oregon, the We’ve the our York Kerry, the County announced several Foothill several Minnesota installations conversions Authority the the Massachusetts. in sites Arizona, Oregon the in also completed smart XX on New Medford across and City Ireland. solar U.S., Bedford including lighting New the and in Transportation Lawrence We City in Massachusetts. Virginia, series California, Department wind within Lanesville County's of Phoenix

with operates Texas. automatic our project on smart of focused in many including infrastructure meter water series project water addition City the Gainesville the In Woodlands and

on comprehensive operator. developer, Ameresco’s All clean tech demonstrate a Microgrids of evolution and through owner I as compelling. renewable economics will now and renewables energy as going distributed call industry a neutrality become integrator into these financial even our the more great carbon more and some energy asset Doran Doran? and prevalent are comments becoming resiliency, The transformation, more the we over performance. resources. to move projects provide is towards turn to

financial fourth financial Please good through refer release performance and the afternoon, posted now information. on our and company’s our George. supplemental you, to quarter outlook. our I’ll Thank for And website slides press go everyone. XXXX additional

revenue the leverage, growth fourth saw continued quarter of increased growth. quarter, operating During to another and strong contributed EBITDA which we

due recall you particularly of revenue federal slippage. had the contract As large QX to may strong XXXX

across and led core growth. performance the sequentially are achieved Federal very our have pleased year-on-year again businesses, we grew So of X% XX% by Group. to with over year-over-year Solutions growth our Revenue strong

execution, permanent Ameresco revenue and navigated We we asset the consistent of prioritize from nature was remain scalable spending Gross continued levels, we And higher the COVID-XX pandemic the performance. our while savings income work. O&M key footprint believe our post and highly expenses in environment. were net work including travel-related investments and of increase our the environment, of to and higher Revenue benefited are drivers a past SGNA EBITDA offset and will continue portion business of shareholders build growth, a expenses in margin will reduce future. to increase million, benefit across growing measure operating a as a increase model. EBITDA, $XX.X backlog our an X%. sites increase $XX.X leverage attributable common growth Adjusted of the utilization our design non-GAAP in year-over-year. income million Net the was of taking contracted to note, margin as advantage XX% our access the to improved

quarter, during significant to on we backlog, executing on revenue. focused the amount mentioned contracted above a As our converting

Our due last contracts year. QX signed backlog contracted four in year-over-year was decline in to federal large

a our approximately to year very end. billion strong had are $X.X awarded XX% awards this as quarter, new increasing year-over-year However, growth we at backlogs

Our backlog stands billion. $X.X at total project

assets. technologies exceeds units development in our megawatts several over that grew to operating business XXX energy megawatts XXX strong assets in with of Our contributions multiple across representing figure

credit $X quarter quarter recurring strong of $XX provide businesses growing come. margin, $XXX and and year. hand. We contracted over revenue development available operations believe cash have streams execute EBITDA. We O&M our business assets. remains in the and high our will pipeline. recurring and million revenue ample for on ended for of asset Adjusted higher billion with cash for long-term approximately our between our liquidity accounted quality XXXX approximately from cash years energy flow the incentives the was and to support we million And revenue Ameresco’s cash with These for and flows us $XX million project with to operating two-thirds

capital, access the we In we financing have assets. tax to ability monetize equity, to project broad and addition to development strong and also have working

and we million sales. secured in project financing quarter, energy $XX generated million the asset over During from $XX

Before quick XXXX. full-year outlook, like XXXX a I’d turning our to to on comment make QX

the result revenue year, the assets, of some This weather onset COVID-XX favorable production to from first discrete Act, energy quarter conditions forward and year a the impacted tax of in saw pandemic. comparisons. benefit weather have last may we first CARES the our less commissioning proactive patterns which of During in response and a pull quarter of favorable

turn All of that now our to outlook. into annual this has full-year our let’s been guidance. factored With

billion year-on-year growth be We expect $X.XX XXXX in representing total $X.X revenue at of the million midpoint. range to X% to the

range the million be to forecasting Non-GAAP in midpoint. million $XXX adjusted the midpoint. which XXXX to of XX% growth adjusting EPS a $XX representing for and between represent for a to XX% EBITDA after is realized items $XX, We one-time expected the at $XXX growth EPS at are be tax

rate year. We approximately expect XX% of to a XX% for effective the tax higher

During investment bulk of through expect anticipate be between we be XX megawatts XXXX, total project million. $XXX of $XXX million The financing. commissioning and energy to to capital expenditures assets XX megawatts and funded this will

Now comments. call turn I’d to to closing the for over George like back

Doran. our In employees thank to to I in you, closing, Thank want again exceptional and customers, minute a for XXXX. efforts their partners take

demonstrated do During its safely execute customers the out finest. work of we our to at to together were challenges, we with and unprecedented on fortunate we time set the resiliency

look of Ameresco the of customers. current this advantage has our for in excitement. with are to focus tremendous Invested the the early environment evolving the to of prospective And positioned in our and energy great become a health transformation. stages is We I take many of opportunities. well so future

is technologies, cities, distributed and Our have for implement new environmentally including advanced batteries built-ins, would energy to us economics to smart enabling to positioned smart transformative technology backlog and I solar Operator, more. XXXX resources, storage, open proposals Ameresco clean We and beyond. integrate believe questions. full call the The changing our now projects. energy microgrids, of shifted are like game well very and

question first Kaye Noah sir. with you, Our is Oppenheimer. [Operator Instructions] Thank from

is line Your open.

and dynamics you in expect and To XXXX the dynamics given the with sustainability Maybe all in remarks backlog on do with the pointed what to side? takes and drivers. contracted associated just commentary appreciate puts then first terms the broad-based the particular seeing of and in around broadly comment of Can dynamics the exit of start administration higher some you backlog your around the contracting year-over-year. about you pipeline any around you're transition

Good try to one. you. take talk It's to Sure. this first to Doran. I'll

Hi, Doran.

the So has the backlog, element conversion that contracted with to key timing, of do right.

the I've crisis, and that really I awarded be quarters we adjusted the and shifted it but so as been quite that's people awarded and of in have up because increasing going. working awards where We prior think backlog RFPs the environment, was that backlog COVID and mentioned substantially. to building expecting weren't built to the this And actually kept

the to contracts. that a it's of Now, something is awards to to contract – get lot converting is way the all hard negotiation work through

And to we theme so I the think, not way overarching terms year there's going see an this conversion. of contract in that

to of kind expect it We at continue pace.

awards backlog see discussed the backlog of basis, again would call hard those course, that, pace throughout the by think we ordinary out lumpiness contracted contracts. pretty but execution our as But building. it has well a the sorry converting I be the than other is and going should executing of on expectation I awarded lumpiness emptied quarter quarter normalized. As because out into think what backlog think of the contracted come look a conversions an year we'll is to to to I revenue, And on or that

Yes.

and does out themes to impact it three actually ultimately great it markets moving, a does activity sector changing executing the the see probably of the take C&I And I picking and like And it it's great, but everything to federal the administration the two contracts. years will But up on that's are because take executed environment. pointed going the contracts, will the to see level, and to the see then creates we it awards comes coming wouldn't in more more in that activity those see firstly And contracts market that contracts. other than from you point but I is the be level. surprised will with you sooner course I the out see expanding top, of from thereby, high and And fruition and time. think, is you some a any of

helpful. you. Thank Very

completion the Just and growth I assets probability turning there, very development. and point one trajectory on we're a to high the is of put energy considering assets think, you your

you line you've added RNG look rate How projects you've terms should What a of portfolio say think projects new year like? RNG got the sight getting two run reasonable to assume expect on the done? can years? next now to of of run projects, per good to many in getting pretty over to three What you So, the here, pipeline we those done. to the rate add is the a is

that's least megawatts Look what about solars year on as we to XX% happening our grow deal to hard we a good this COVID-XX said of that megawatts little been better, trying portfolio year that per situation can the at with because slipped we've bit understand asset interconnect. because of a and had XX you very to is the with but installed XX this and that's XX interconnection

And this and megawatts be most so to so. the XX we second from up quarter last likely will have shifted running year the middle of year, even or which

whole have now our group to country the develop this the to before across assets the we we business, to company federal. that transformed want in able and So be

- our best. So of people I think one put at and

last this we a these where we think the marketplace will you assets pickup, are add? RNG we to what good I was see into And call when the do getting you in we addition development assets. gave good I very to Doran, very of place pretty quarter. although some happy see point traction develop want to of and over the might in X a it And -

both the technologies. pretty asset well think I as is healthy actually correct. The RNG other as you're No, funnel that side on energy

it caught say the to that cadence I plants service three expecting the two $XXX we're this can assets press And I that that year. we CapEx after aiming that - in into give think then that more for, we're is whole a XXXX. mentioned would call two to lot more beyond years color. in million million being cadence I on think $XXX placed don't we but we're

two Right, you're going another do… in then or XXXX two are getting actually year this plants and so you done to

this year, one It's one this year.

okay. year, this One

now and next mechanical two Yes, December, one year. commissioning be there'll we're but completion that in

from is question next Stine Our with Craig-Hallum. Eric

Your line is open.

line the you think play think break maybe pipeline you question about mean, following out more or is to credits just I there, going down much the valuable landfill versus or up the dairy things especially question forward, of So on RNG it there any when about how might RNG thinking just way how LCFS? are,

activity nothing looking side, relationship to have a couple dairy we've with that the our seeing there. Yes, say but sure. I of at, fair We've think, the we're been in and on our what is based evaluating we mean, that's focus the megawatts XXX is and the early landfill things I got companies. that it's we're stage opportunities included on historical

operation and on plants obviously construction, maintenance our where on trying the We for have the the landfills come the that wastewater the will we're pipeline the from. at development, bulk these of that's expertise and plants and treatment to capitalize and

side, we're I evaluating think, the however, sure. ag it for on

in previous year-over-year. about year, And that then to impressive gave you growth pull mean, the is you pretty substantial backlog maybe a guidance but just the this you were for pretty forward, think yet about back continue you results XXXX, work talking expectations but questions to I

results the wondering called in are just of some C&I, XXXX? think that you what you other but will So areas lead

is as XXXX, Well, XX our month sitting starting around point, a contracted million… $XXX backlog

it last than better is year. which Right, was

the – a we which say helps will projection that And contracted build bring the contracted it's PTA And can't have cetera, revenue there. in that Yes. that additional et sector rest it then I particular O&M, us then up revenue, growth. of

and in you if George, put believe we in I the the industry based what drives business think, of see However, that don't know I kind funnel is have? broad to forward. the numbers we our and behind us the momentum what

No, and picking customer rest the the basically say the will of it's segments segments, across faster that than it’s pace the up CMI uniform as across one the regions as market. the it's good I is

and we were design is the course, of move a leverage well up those starting The they level ended they fast, very as the they a top-line, the profitability as but course, with smaller of activity thereby people with, to most pipeline Of we the is they oil, begin to through good. otherwise with the faster in only lot helped drawback they the but base projects built, organization. and go move of but that

some things inflection COVID. curious as other out recovering Ameresco’s why to you mean, really come administrative like business. you’ve And you why capabilities be is sounds just point it because it mentioned or about improvement an backdrop CNI is on we that thoughts customers realize in mentioned focused increasingly more, they of I going that XXXX now

talking companies their and of sustainability Many they those now ESG themselves. are reports about

driven In I’ve mean from remarks, addition And message a the top beginning the But to tried to so to and what that, economics. talk the out the it. is listen administration point to in and react to that, addition about people at once it. my that’s I in

exhibit For generation. example energy solar

reliable a resiliency stolen customers, end of lot one country resource think them some the take because largest of probably In energy of and and the money to the now distributed where energy economic I industrial commercial of across that Then situations concerned getting will economics that think a have and economy in save installations right we commercial developing in becoming of the that Solar up while dominant sense Kentucky the be are it future concerned for many on become The reliability. a forward issues, you storage, driving Pennsylvania resiliency and lot I industrial they they some about And can and market a might move issue. customers, they're projects. if that's people this the resources battery customers force. big makes them.

question is B. from of next the Riley. line Souther Our Chris with

open. is line Your

you like I the Thanks in weaker. starting kings just two improve at been based the for be this of able to here. a what's be touch congrats on the to sounds and Would is point will - taking contracted weather just the Maybe could stuff last quarter the the my quickly improving bit going guess question year. for on, the year, the week for on here to provide a bit here? over or outlook be a and more It what visibility first you might've with color on how some results

a that course result commercial a of plant Yeah. be our I look And the may year, we little weather energy in be obviously bit you et that half think can towards back-ended at this yes, that will terms I date year. about pickup putting later service of somewhat the in the the other going that's production, installation, the tend the going energy in will assets, a talk to lot ended. assets ended. the the I does mean, prior impact cetera. have assets, think business be as operation years, is completing Furthermore, as And of be appreciated I energy the we’re from - of back RNG bit back the also of to will to

see might have kind I’m in additional up pick additional year, comments Mark, sure on any you you later beyond So seasonality. if there of the not that. some

I we No, one fall of patterns. to seasonal would it in the think expect

QX from of the cadence a just identified out I the pattern. year-over-year, items play in some over normal unusual the but So seasonal a of we think should year

backlog the year there. ago. fourth the when like contract down federal next of the the of where order, could see the compared can here at through side on your provide to see looking kind more just any pieces were see kind I’m contracted kind and mix of curious thoughts federal that, waiting in the backlog administration do Maybe kind of just kind for commercial, wanted the of weeks, in any federal color kind like Was and things And year year-over-year, this or a of there. you can to award, walk executive large within obviously that, couple that between contracted of last months the anything then the backlog election And over year quarter with of a moving being there? what having the different with slowdown kind what based to new the to of we just the you pickup from

of $XX Couple out. they because and this them signed actually to soon billion quarter, large quarter, very that COVID-XX, we large that fourth were top but total of as of the got And they things were that's take quarter. huge the from were the line federal last executed contracts, as we will were there signed year, expecting good were could way, likely the we Good. pointed full be They but contracts, contracts three they profitability, this Mark be large they on had contracts year, most by those slipped now but this last the by couple a to contracts executed - themselves, to it signed. be to had

the this all And started last year So the driving and the this numbers executed the XX-month very at higher even we we do quarter we pick COVID-XX that's some the slippers did the we think contract and contracts backlog. backlog But level up, it force have constraints, is indicates though awarded I year, on a for the telling. situation. for started of and because that's that XX-month

the revenues assets of to O&M, addition a any operate. from course that, hired we at In coming higher we have backlogs

see or drivers get you COVID-XX strong middle what has out that I of good as the year. think pretty So and we it the have will And enough we a time pickup, the later. away been I market on are year of for the goes by COVID-XX, a let's if say it goes think

you some you Okay. might things Texas, bring Texas, impacts solutions in your That's from maybe activity are to helpful. to very any seeing the just the increased them curious forefront, California, resiliency, able interest around you be provide places other I'm And recent, so that obviously, see, that. are have? seeing just to of we like

it. No question about

we Woodland to a pointed the for delivered remarks, in his equipment weeks. of a lost I weather, time us out we XX few the project time site. long affected list we due getting cold to the days, got Actually, the it this think year, center As some few weather weather, but hard cold

into So we but that had took we by the of year, some impact metrics. up in catch we the account weather, the because will end our of

but the So about this why we distributed energy the market are worrying excited that, where about is am not going. resources is I so and

I the that cause the what so festivals, resiliency, I the weather estimated resiliency just For of some we is, the wind megawatts. whole which example, universities, up And down, we now take out we saw which on. because can all be is They're farms we that's a single picture driving contingency, you forces, see what use more. in and the call some to see is grid. something Texas, do have of do the when one about XX,XXX years more what's the to New they happened the all think about scores, base we fires - we we of Mississippi distributed colleges, a mean, you're two to why Jersey If and to in those why look, be California generation up and to distributed have obligated. XXXX don't have block we're trouble, backup some every of kind forget, holiday occurrences of storage, to right and do big kind I saw come a unless concerned the pass in some see the energy And sold And back. and That's few going feel. New be will York going so that's you here we it. often in

Dorsheimer is question from Our Canaccord. Jon from next

open. is line Your

fantastic on guys, quarter Hi see. just Year. in congratulations Nice New a to

Jon. you, Thank

OpEx and think virus to guess duplicative kind that work in of keep just how to the a couple we different redundancies asked, of of So the way of a through of safe? but Dorn about get terms in the, questions. terms maybe I I lot a your should just employees on the been you of place mean COVID that side. Once we other needs in occur can

So I duplication element. really about any it in been terms of haven’t particular to thinking be of honest,

emerge work of going of call I and we whole who employees continued, at I look see our way engagement certainly with the from make that have of of make, and all at and the people there’s just offices to that with as but company of not they that's the home, think OpEx I’ll field, at And I an more what potentially productivity hyper think element I associated is going to people more through. in businesses the to frankly, everybody the technological kind look kind a reacting we savviness productive. more company, when as is carry come the start productivity

think we'll that I something that finger up it’s on nevertheless, see number. budgets will back not my putting the be I think travel necessarily I’m in a But some that creep necessary. which

it think gives OpEx. comfort me the our in stability of I of terms

was assuming I’m the it. done post issue Texas. ERCOT Got in guidance

And as George just wondering both maybe for think of I’m you. about and you so

probably figure 'XX, and trying that, just fair fallout of into seeing on I'm kind As you about you the baked to out think that that say, were expectations. is or in you're to how of on of probably exactly terms of just still much went Is market? process the in heels in that what the

deep dive online. all where what to you deep how get and might takes was people going quickly we think reaction did in a we quick the impacted? of puts to And plants. We pretty ground, elements, dive. What the expect, operating on impacted, Well out we out have and wasn’t be. are, as come a it's these of pretty finding we figured I terms different because quick we’re where pretty the we, going a we did

we've into So of all account here. taken that

opposed. mentioned which George, probably two are it. topic, Got then versus you and resiliency paradoxically if the - I is you efficiency And mean, favorite my

been we’ve so systems. just, to and about talking so the move And efficiency more much efficient I’m

the idea I at is that mistake cost that the think many move of resiliency.

of of you we And any versus moving that the that terms essence, reflect in of on in major our of up point a great centralized about So efficiency in a in role trade level policies of understanding. don't resiliency we're to want bring these what distributed, now distributed right in has But sort that. which the the of means terms think how systems office and cost to what

wondering, they kind you’re where those of discussions terms trusted And of you guess start of of just help able is create assuming to versus my able you do up? to customers. is go through how question I’m as they thinks the want that that partner the project I in I’m really a end So much where what customer the see value - you're in versus sort you

that Yeah. they of Very, you the favor, on to And call what will some so the continue with state very some renewable good agree of I policies large development. I asset programs and would energy and question.

that the megawatts. along all For example, ice resource scores, which down and estimate farms wind hurricane the XX,XXX time develop is up an or to have it’s Every used a great storm But at a the the realize I with resources that end economic of storage would much of whatever energy the distributed that be all the battery day, out. those make more will people think sense. will we

XX% think more it. the you to about have otherwise thing of that's well up. their bringing consumption attitude you with you have well, efficiency, I because And the too efficiency particular resiliency, they related. the reduce back very distributed energy And actually, energy other Well, facility change we XX% by by policies. tackle of - energy less have though, demand XX%, the the you if many their I her think see back and by why see anything to up now will people thing a started the resources. you on So And the will would up, not

why And have today. that, we grid the to is addition micro with In important. controls the and so smart that's

as as shut can off, some critical. laws Now, not the are you of

what to than less even that. you back up, So it's have

because single new very but planner we to megawatts double very, system contingency. with back then contingency, one of the what's hours, single happened And be we England I to had, otherwise a for XXXX electric you're largest a continuously, we lose to power brokerage focusing for unit. now used when People agree couple interrelated, before are then yet plants after of turn the they're was went system, but I a used you. not So the

Its market You develop it's to the only going much and It's work. of is evolve a of take the to because than market way resiliency XX% load faster not off. people going develop. and anticipated

go Yes, ahead.

That's that energy I've put puzzle, been puzzle. storage, going transformation this missing the That's energy is to storage. saying work effective to what

Irwin Craig from is ROTH question next with Our Capital.

is line Your open.

thanks and evening Good questions. for taking my

operating So little I to the bit. expenses a wanted discuss

basis, you on over a full-year levels. XXXX down thousand hundred were actually couple in So XXXX a

leverage development lot revenue other expenses? COVID in of imagine business some they that the I for a So you and the travel operating But can of to XXX saw on contributed the coming turn off. you expenses basis probably describe maybe point what and

think Greg, we're travel the Well, related a it. portion COVID savings of definitely I

the you items The largest operating staff. the with look one utilization across when the our of other do all thing, of line to expenses, has at items

human working being our up at projects look those ends we if of in you on folks when capital the costs or proposals projects. costs actually are capitalized on folks So awarded projects, up when contracted utilization, that kind working OpEx, ended into have

I proposal XXXX, down, activity up. contracted was in all because as think the was and So construction we of but backlog COVID, know, execution

saw that on So number. of I most I little the expenses, that's maybe accounts think bit travel that of would with a shift suspect for you of that reduced kind the of a exception

driver primary is The the shift.

Yes.

when calls months came did customers about a look, down access XX COVID-XX did having to the so into the okay, the basically evolve slow they until we we and and see internet, X Because pass the and said, on zoom on COVID-XX. an to the to into

did anymore. saw developing to a And the last those so more work good why shift revenue concerned in year, people. we lot we helped the a execution like, and I'm that's of of the that way in And people I chunk that I'm will we projects refocusing, and they pickup okay, the call had, her. the we our And you it said, execute projects. some

that's think Yep. I right.

on obviously strong work. or just, working activity continues work follow there dynamics is that from then distancing of us that, to very least fair So most home it similar As at Yes. social and out just up see we at XXXX? and in

Okay.

plan last the player to the in start that. this developing we a to months a developing pipeline have pickup but we've of felt that business. about and saw a become dominant the bit thought refocusing continued about to marketplace and when the that's the that awards beyond, couple pipeline again, were we and We ago why we year for this Look, and the we this quarter, we and make and we of little investments developing have in the want

understood. Understood,

last looked very and any range implied So the middle the deterioration range saw $XX middle gross sequentially you you execution Last this finish versus million about range, this were different the there you the points. quarter. for the year, fourth sequentially quarter contributions that $XX the end improvements you your margin top be of then the this year. year margin sort business may or Is mix gross a actually And an we this really you in guidance, of of gross Can outs number margin to talk at above of what's change in the and you XX.X% is component where project quarter, printed? nice year? basis so or million right, there about if saw were XX

outs. No, go Mark. It a it was change year, because wasn't broad project last ahead, quietly

RIN of very last if margins year so Yes, deteriorated at QX, adjustments - related prices. had end you in year, the some we because the we the to remember,

I So we through items, looks of as really characterize the the the just low, was I one-time think - had. QX I obviously it function think, look I mix were like that unusual but you projects a think XXXX, there of margins if would quite no what

- think the mix but this of projects design federal that some we've is build So talking advanced pretty a technology that and by been of of some about, of in I projects. our some is offset our good as projects,

normalized bit of there little And of the to the prices with come that because simply just improvement of to during contribute into RIN time some out XXXX, I prices. you So was think end year RIN the of certainly when in coming yes, last improvement course it over was a margin. then XXXX, more helped the gradual a

last and you right? too plus look to at for what operating? talk pipeline. you're us and I minus, think my longer nice to those do either to the Can wants hedged, key then have everybody if or But Do prices to go items RIN question could projects And for whether excellent. your about the exposure? are taken my you approximate of in the the other more should most express congratulations the Okay, in And maybe I risk projects ahead the spot or term you you where you've the market, we important away three update on much exposure that lock question DX-RIN opportunity renewable is rebound new the not side, that? need is to on guess with gas

prices up, into point then can last it if up to XX%. bucks up color we will we that shot recall, XXX the out add to year, more came then I quarter some give it. had way a last XX%. of hedged and Doran And should almost probably to right you hedged RIN Look, have but we are now we

think the still this those where's to a RIN prices. the because end is watched administration, The be day and a going takes I new out in thereby conservative because don't happened. And, to year, markets get watched but the the bit equity little of bit than is that to hedge little seven of way, this to wait us a we projects. there, I And plus, business otherwise we very help the overall a for very, our one go. point - are And for contracts, developing, have what's considered we the are particular than impacts more see by able large and more And hedge. be the profitability so great this closely. discounts further will contract long-term assets to market we think we try the it we we'll it time, So opportunities And a but of We a as put hopefully and other few have or years and carefully. are at we longer the sufficient But course carefully of it's much lot immediate of to the as very doing. market, watch months would we project it's financing the we think, leverage very better evolving. wanted it's term

want it's - everything. address key to But but some a might add color So, Doran that. to issue, we more

the couple had what I kind George pattern the long-term think I over Yes. that about years, continue between last that the think, we've because discounts of for. mean, I looking the mentioned to it of gap likely of the are contracts we're

on or term So hedge year take I it rest we'll contracts basis been off hedged to as continue continue short some medium of to we and sort be monetize partially have a a partially or we'll the one think on watching. term of

for in RIN for the the not to should be Washington move et activity You the next see might RVO, cetera. just price the well what as imagine

hear to you're only today XX% happy was number RIN. closing very We're for Excellent. XXX hedged, the XXXX

XXXX. So we a solid last that year. for Congratulations out price where on started robust close after really is a

Your team executed. really

next Our with Shahriar from question Guggenheim partners. Pourreza is

open. Your is line

on speed currency thoughts Just of of sort given up about to on your the mean, solar that are set the the assets new - and right not cadence out opportunity given sort sort of COVID there, what side, a XXXX the as follow-up RNG thinking on about especially of the increase own beyond and Any where energy that's now? projects. impacts? of this both the trading cadence we're kind would governor using I shares

this mean, side So I on I'll the is - energy just… Doran, assets

Hi, Doran.

speaking of second. kind just for a Just

you a to thing assets. have that where don't the to projects that today So for basis. is probably is gotten do we it seen activity, as has ability on to one I energy market want think the assets strong develop the overpay on actually company side Greenfield some without don't

of develop kind on allows as continue construction particularly we things solar that So and would do side. these out and foremost, CapEx say the to us to I actually as our development That's ourselves. we're is as what that as well first on going needed map to

at very careful be looking very, inorganic right. situations, when to you're You have

that then have So, of and financing, the terms tap. financing sources in can multitude we of we obviously

As we consider We financing of inpatient. not certainly have a markets capital about we're tax talked to options, but and are friendly. about being talked equity, ourselves the lot project

opportunity other the into and New the opportunities How RFPs shaping Got it. the sort the Norfolk project over do of strong And maybe the cadence for Newport of DOD like the and of course then just O&M Year News we win. year? about just look the heading think maybe lastly, like the a

proposals, that, more. upgrades, think to I going They renewable in even it federal but pick that of ideal previous need having and solar, so in some it's I achieve more because you the and only administration, of battery and government. rest XX% healthy think locate it's maybe a very you where biomass, in in get basis administration the up carbon this storage you and up and see kind happen biogas, that will the the we on carbon the order number think infrastructure the request would continue see aspects I for resiliency otherwise efficiency on. not for to more become issue energy will reduction, projects whether the are will And neutrality I of one to renewable see with you that, with a resource more

and great establish So I drive market example the think they great, in can way. that a

out the I we're energy long-term is opportunities smooth that a being service out next moves years you project being what business. to to government over there's the There's you're the what funnel and it's were the terms opportunities look whole, to way might We the those including to as point cadence Canada, year a the going all those multitude occasionally the the And past of can you, generated that of itself, the generated Ameresco federal regions. looking illustrates you any United will business. quarter they're that means is, operating like with and proposal all UK, particular just regions, and pretty in very growing. go. federal across or kind projects the throughout of going whether it of large States way think comfortable and funnel of diversified opportunities, but good lumpy plus in is the the that that steady looking progression pool there's energy a from I regions, of that is And or we quarter year see so don't of have have pattern diverse at The otherwise one thing highly you when at about of think of appreciate with that on - backlog diverse small kind we're asset

Our last Raymond question James. is from Pavel with Molchanov

open. Your line is

for the question. Thanks taking

started curious And State the how So the may the landscape been legislation out, evaluate if because about RNG recently Washington has I in opportunity? to in next is be guess you've course, And headlines indeed RNG. any potential epicenter California if LCFS. that were Washington one that the of LCFS. And to pass? more scope Traditionally, of you establishing locations I'm an of

good question. a that's No,

specific scope Yes, on in we where at not house jurisdictions. markets moves particulars LCFS is that's non-LCFS markets opportunities. say the I pro consider and what anticipate Washington and a fair be similar don't looking funnel everything here, the It's - by megawatts XXX markets there, can good sorry watching what's talk the go and in run about but the news other for or to question. what's formas we we to think development mean, in multiple that in I We made. the the move closely we great to development obviously very potential

pipeline distance the to right, many the revenue But the right, is if LCFS. the great So, the might distance circumstances, the right, these you an add-on of to a LCFS is landfill is if to not is the certainly need stack. in design if

kind the So of developing across board. we're

which So to Washington situations we're arise I think exciting. to they when advantage But think come their they all of hoping these nicely pretty us when I yes, situates or it's quite take that conclusion, will.

thoughtful great And this get of where developed that Ameresco. we take in we advantage the is

Let's the and the project, keep right presence. good telling with gives program why that's our we effective a Basically we be presence It's I you we now. what and say, on, order else so say that's can platform that leverage. state these them and in we as have I Ameresco the a do comes, to resources, green deliver local get the organization in have And a local call gaining maximizes across same particular have when we gas have to local have presence. great country. incentives, on. the this great the let's up, And the develop various, solar Colorado, opens so We great, in

about the financials? curious, realized other your extended but obscure How to it's little solar December, deduction. Washington State, efficiency asked wind the guys recognize back about you it do Having I Washington in compared XXX I'm do on the And corporate XXXD more your also financials? their I'll a Congress that works? section credits, section customers ask Or and recognize does in

to Yes, projects. our federal that benefits Mark. realize benefit for they non-taxpayer. municipal time over have that be our allocated Yes, them as there the that on great see forward. cannot that for with a to customers, And This have we think work to the time. yes, they do question. be since that's a I certain yes, get - going of permanent certainly we a Yes, we- deduction provision that then now where recognize and And is We benefit extended been nice most have having it's certainly we've within to fortunate some to allocated deduction.

moved into yes, So, tax rate. that's our certainly

see happen. to We were this very pleased

thank That's you the call. and This today's conference end our of Q&A participation Ladies your concludes session. gentlemen, for today.

a may now You and day Have great stay disconnect. safe.

Thank you.

you. Thank