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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

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CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(D)

OF THE SECURITIES EXCHANGE ACT OF 1934

 

March 3, 2020

Date of Report (Date of earliest event reported)

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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

 

 

 

 

Securities registered pursuant to Section 12(b) of the Act:

 

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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

☒	Emerging growth company

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ☐

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On March 3, 2019, New Fortress Energy LLC (“NFE” or the “Company”) issued a press release announcing the Company’s financial and operating results for its fiscal quarter and year ended December 31, 2019. A copy of the Company’s press release is attached to this Current Report on Form 8-K (the “Current Report”) as Exhibit 99.1 and is incorporated herein solely for purposes of this Item 2.02 disclosure.

 

This Current Report, including the exhibit attached hereto, is being furnished and shall not be deemed to be filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be incorporated by reference into any of the Company’s filings under the Securities Act of 1933, as amended, or the Exchange Act, unless expressly set forth as being incorporated by reference into such filing.

 

 

(d)

Exhibits

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

	NEW FORTRESS ENERGY LLC
March 4, 2019	By:	/s/ Christopher S. Guinta
	Name:	Christopher S. Guinta
	Title:	Chief Financial Officer

 

 

New Fortress Energy Announces Fourth Quarter and Full Year 2019 Results

March 3, 2020

NEW YORK -- New Fortress Energy LLC (NASDAQ: NFE) (“NFE” or the “Company”) today reported its financial results for the fourth quarter and full year ending December 31, 2019.

		For the three months ended,
(in millions, except Average Volumes)		September 30, 2019				December 31, 2019
Revenues		$	49.7			$	69.8
Net Loss		$	(54.4	)		$	(38.4	)
Operating Margin		$	(4.9	)		$	1.3
Average Volumes (k GPD)			329				538

Please refer to our Q4 2019 Investor Presentation for further information about the following terms:

1) “COD” means commercial operations date, as defined in the power purchase agreement between us and JPS, and as defined in the steam supply agreement between us and Jamalco.

2) “First Gas” means management’s current estimate of the date on which natural gas will first be made available to the relevant project. Full commercial operations of such projects will occur later than, and may occur substantially later than, the First Gas date. We cannot assure you if or when such projects will reach the date of delivery of First Gas, or full commercial operations. Actual results could differ materially from the illustration and there can be no assurance that we will achieve our goal.

3) “Cash on hand” means the sum of Cash and cash equivalents and Restricted cash.

4) “Commitment” or “Committed” means that NFE management has made the internal decision to commit NFE to progress a project. This decision does not indicate that all preconditions to construction, commissioning and commercial operations have been met (including permissions or supporting contractual workstreams), and to the extent NFE’s internal decision is made prior to such preconditions being met, there can be no assurance that the construction, commissioning and commercial operations will be possible on the timeline we expect or at all. NFE may in its sole discretion reverse such internal decision due to such preconditions not being met on our expected timeline or at all, or for any other internal or external reason.

6) “In Discussion Volumes” or similar words refer to expected volumes to be sold to customers for which (i) we are in active negotiations, (ii) there is a request for proposals or competitive bid process, or (iii) we anticipate a request for proposals or competitive bid process will soon be announced based on our discussions with the potential customer. We cannot assure you if or when we will enter into contracts for sales of additional volumes, the price at which we will be able to sell such volumes, or our costs to purchase, liquefy, deliver and sell such volumes. Some but not all of our contracts contain minimum volume commitments, and our expected sales to customers reflected in our “in discussion volumes” is substantially in excess of potential minimum volume commitments.

7) Based on Committed Volumes and In Discussion Volumes as of March 2, 2020 in total for all of Jamaica, Mexico, Puerto Rico and other countries with Committed Volumes and In Discussion Volumes.

For additional information that management believes to be useful for investors, please refer to the presentation posted on the Investor Relations section of New Fortress Energy’s website, www.newfortressenergy.com, and the Company’s most recent Annual Report on Form 10-K, which will be available on the Company’s website. Nothing on our website is included or incorporated by reference herein.

Management will host a conference call on Wednesday, March 4, 2020 at 8:00 A.M. Eastern Time. The conference call may be accessed by dialing (866) 953-0778 (from within the U.S.) or (630) 652-5853 (from outside of the U.S.) ten minutes prior to the scheduled start of the call; please reference access code “New Fortress Energy Fourth Quarter 2019 Earnings Call”.

A simultaneous webcast of the conference call will be available to the public on a listen-only basis at www.newfortressenergy.com. Please allow extra time prior to the call to visit the website and download any necessary software required to listen to the internet broadcast.

A replay of the conference call will also be available from 11:00 A.M. Eastern Time on Wednesday, March 4, 2020 through 11:00 P.M. Eastern Time on Wednesday, March 11, 2020 at (855) 859-2056 (from within the U.S.) or (404) 537-3406 (from outside of the U.S.); please reference access code “2566636”.

New Fortress Energy (NASDAQ: NFE) is a global energy infrastructure company founded to help accelerate the world’s transition to clean energy. The company funds, builds and operates natural gas infrastructure and logistics to rapidly deliver fully integrated, turnkey energy solutions that enable economic growth, enhance environmental stewardship and transform local industries and communities. New Fortress Energy is majority-owned by a fund managed by an affiliate of Fortress Investment Group.

Operating margin is not a measurement of financial performance under GAAP and should not be considered in isolation or as an alternative to income/(loss) from operations, net income/(loss), cash flow from operating activities or any other measure of performance or liquidity derived in accordance with GAAP. We believe this non-GAAP financial measure, as we have defined it, provides a supplemental measure of financial performance of our current liquefaction and regasification operations.  This measure excludes items that have little or no significance on day-to-day performance of our current liquefaction and regasification operations, including our corporate SG&A, loss on mitigation sales, and other (income) expense.

As operating margin measures our financial performance based on operational factors that management can impact in the short-term and provides an assessment of controllable expenses, items associated with our capital structure and beyond the control of management in the short-term, such as depreciation and amortization, taxation, and interest expense are excluded.  As a result, this supplemental metric affords management the ability to make decisions to facilitate meeting current financial goals as well as to achieve optimal financial performance of our current liquefaction and regasification operations.

The principal limitation of this non-GAAP measure is that it excludes significant expenses and income that are required by GAAP to be recorded in our financial statements.  A reconciliation is provided for the non-GAAP financial measure to our GAAP net income/(loss). Investors are encouraged to review the related GAAP financial measures and the reconciliation of the non-GAAP financial measure to our GAAP net income/(loss), and not to rely on any single financial measure to evaluate our business.

 

Certain statements contained in this press release constitute “forward-looking statements” including our expected volumes of LNG or production of power in particular jurisdictions; our expected volumes for Committed Volumes and In Discussion Volumes; the expectation that we will continue to capitalize on the depressed LNG market to expand operating margins; our expected timing of First Gas; our expectation that we are able to fund Committed projects using current Cash on hand. You can identify these forward-looking statements by the use of forward-looking words such as “expects,” “may,” “will,” “approximately,” “predicts,” “intends,” “plans,” “estimates,” “anticipates,” or the negative version of those words or other comparable words. These forward-looking statements represent the Company’s expectations or beliefs concerning future events, and it is possible that the results described in this press release will not be achieved. These forward-looking statements are subject to risks, uncertainties and other factors, many of which are outside of the Company’s control, that could cause actual results to differ materially from the results discussed in the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, the risk that our construction or commissioning schedules will take longer than we expect, the risk that our expectations about the price at which we purchase LNG, the price at which we sell LNG, the cost at which we produce, ship and deliver LNG, and the margin that we receive for the LNG that we sell are not in line with our expectations, risks that our operating or other costs will increase and our expected funding of projects may not be possible, and risks that our downstream Committed projects costs are greater than we expect so the expected funding of such projects may not be possible. Accordingly, readers should not place undue reliance on forward-looking statements as a prediction of actual results.

Any forward-looking statement speaks only as of the date on which it is made, and, except as required by law, the Company does not undertake any obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. New factors emerge from time to time, and it is not possible for the Company to predict all such factors. When considering these forward-looking statements, you should keep in mind the risk factors and other cautionary statements included in the Company’s annual and quarterly reports filed with the SEC, which could cause its actual results to differ materially from those contained in any forward-looking statement.

IR:

Alan Andreini

(212) 798-6128

aandreini@fortress.com

Joshua Kane

(516) 268-7455

jkane@newfortressenergy.com

Media:

Jake Suski

(516) 268-7403

press@newfortressenergy.com

Exhibits – Financial Statements

Consolidated Statements of Operations and Comprehensive Loss

For the three months ended September 30, 2019 and December 31, 2019

(unaudited, in thousands of U.S. dollars, except share and per share amounts)

		For the three months ended,
		September 30, 2019				December 31, 2019
Revenues
Operating revenue		$	35,345			$	52,279
Other revenue			14,311				17,473
Total revenues			49,656				69,752
Operating expenses
Cost of sales			45,832				60,135
Operations and maintenance			8,707				8,290
Selling, general and administrative			40,913				30,091
Loss on mitigation sales			-				5,280
Depreciation and amortization			1,930				2,209
Total operating expenses			97,382				106,005
Operating loss			(47,726	)			(36,253	)
Interest expense			4,974				4,955
Other expense (income), net			1,788				(2,940	)
Loss before taxes			(54,488	)			(38,268	)
Tax expense (benefit)			(64	)			102
Net loss			(54,424	)			(38,370	)
Net loss attributable to non-controlling interest			47,701				31,027
Net loss attributable to stockholders		$	(6,723	)		$	(7,343	)
Net loss per share – basic and diluted		$	(0.30	)		$	(0.30	)
Weighted average number of shares outstanding – basic and diluted			22,692,104				24,330,516
Other comprehensive loss:
Net loss		$	(54,424	)		$	(38,370	)
Unrealized loss on currency translation adjustment			143				76
Unrealized loss (gain) on available-for-sale investment			-				-
Comprehensive loss			(54,567	)			(38,446	)
Comprehensive loss attributable to non-controlling interest			47,825				31,092
Comprehensive loss attributable to stockholders		$	(6,742	)		$	(7,354	)

		For the three months ended,
		September 30, 2019				December 31, 2019
Net loss		$	(54,424	)		$	(38,370	)
Add:
Selling, general and administrative			40,913				30,091
Loss on mitigation sales			-				5,280
Depreciation and amortization			1,930				2,209
Interest expense			4,974				4,955
Other expense (income), net			1,788				(2,940	)
Tax expense (benefit)			(64	)			102
Non-GAAP operating margin		$	(4,883	)		$	1,327

		December 31, 2019				December 31, 2018
Assets
Current assets
Cash and cash equivalents		$	27,098			$	78,301
Restricted cash			30,966				30
Receivables, net of allowances of $0 and $257, respectively			49,890				28,530
Inventory			63,432				15,959
Finance leases, net			1,082				943
Prepaid expenses and other current assets			38,652				30,017
Total current assets			211,120				153,780
Restricted cash			34,971				22,522
Construction in progress			466,587				254,700
Property, plant and equipment, net			192,222				94,040
Finance leases, net			91,174				92,207
Intangibles, net			43,540				43,057
Investment in equity securities			2,540				3,656
Deferred tax asset, net			34				185
Other non-current assets			81,626				35,255
Total assets		$	1,123,814			$	699,402
Liabilities
Current liabilities
Term loan facility		$	-			$	272,192
Accounts payable			11,593				43,177
Accrued liabilities			54,943				67,512
Due to affiliates			10,252				4,481
Other current liabilities			25,475				17,393
Total current liabilities			102,263				404,755
Long-term debt			619,057				-
Deferred tax liability, net			241				-
Other long-term liabilities			14,929				12,000
Total liabilities			736,490				416,755
Stockholders’ equity
Members’ capital, no par value, 500,000,000 shares authorized, 67,983,095 shares issued and outstanding as of December 31, 2018			-				426,741
Class A shares, 23,607,096 shares, issued and outstanding as of December 31, 2019;0 shares issued and outstanding as of December 31, 2018			130,658				-
Class B shares, 144,342,572 shares, issued and outstanding as of December 31, 2019;0 shares issued and outstanding as of December 31, 2018			-				-
Accumulated deficit			(45,823	)			(158,423	)
Accumulated other comprehensive loss			(30	)			(11	)
Total stockholders' equity attributable to NFE			84,805				268,307
Non-controlling interest			302,519				14,340
Total stockholders' equity			387,324				282,647
Total liabilities and stockholders' equity		$	1,123,814			$	699,402

		Year Ended December 31,
		2019			2018				2017
Revenues
Operating revenue		$	145,500		$	96,906			$	82,104
Other revenue			43,625			15,395				15,158
Total revenues			189,125			112,301				97,262
Operating expenses
Cost of sales			183,359			95,742				78,692
Operations and maintenance			26,899			9,589				7,456
Selling, general and administrative			152,922			62,137				33,343
Loss on mitigation sales			5,280			-				-
Depreciation and amortization			7,940			3,321				2,761
Total operating expenses			376,400			170,789				122,252
Operating loss			(187,275	)		(58,488	)			(24,990	)
Interest expense			19,412			11,248				6,456
Other income, net			(2,807	)		(784	)			(301	)
Loss on extinguishment of debt, net			-			9,568				-
Loss before taxes			(203,880	)		(78,520	)			(31,145	)
Tax expense (benefit)			439			(338	)			526
Net loss			(204,319	)		(78,182	)			(31,671	)
Net loss attributable to non-controlling interest			170,510			106				-
Net loss attributable to stockholders		$	(33,809	)	$	(78,076	)		$	(31,671	)
Net loss per share – basic and diluted		$	(1.62	)
Weighted average number of shares outstanding – basic and diluted			20,862,555
Other comprehensive loss:
Net loss		$	(204,319	)	$	(78,182	)		$	(31,671	)
Unrealized loss on currency translation adjustment			219			-				-
Unrealized loss (gain) on available-for-sale investment			-			2,677				(1,303	)
Comprehensive loss			(204,538	)		(80,859	)			(30,368	)
Comprehensive loss attributable to non-controlling interest			170,699			106				-
Comprehensive loss attributable to stockholders		$	(33,839	)	$	(80,753	)		$	(30,368	)

		Year Ended December 31,
		2019				2018				2017
Cash flows from operating activities
Net loss		$	(204,319	)		$	(78,182	)		$	(31,671	)
Adjustments for:
Amortization of deferred financing costs			5,873				4,023				696
Depreciation and amortization			8,641				4,034				3,214
Loss on extinguishment of debt, net			-				3,188				-
Deferred taxes			392				(345	)			521
Change in value of investment in equity securities			1,116				-				-
Share-based compensation			41,205				-				-
Loss on mitigation sales			2,622				-				-
Other			131				439				1,342
(Increase) in receivables			(19,754	)			(9,516	)			(3,114	)
(Increase) in inventories			(50,345	)			(4,807	)			(3,496	)
(Increase) in other assets			(39,344	)			(28,338	)			(21,738	)
Increase (Decrease) in accounts payable/accrued liabilities			3,036				12,232				(110	)
Increase in amounts due to affiliates			5,771				2,390				894
Increase (Decrease) in other liabilities			10,714				1,655				(1,430	)
Net cash used in operating activities			(234,261	)			(93,227	)			(54,892	)
Cash flows from investing activities
Purchase of investment in equity securities			-				-				(1,667	)
Capital expenditures			(377,051	)			(181,151	)			(28,727	)
Principal payments received on finance lease, net			887				724				536
Acquisition of consolidated subsidiary			-				(4,028	)			-
Net cash used in investing activities			(376,164	)			(184,455	)			(29,858	)
Cash flows from financing activities
Proceeds from borrowings of debt			347,856				280,600				-
Payment of deferred financing costs			(8,259	)			(14,026	)			-
Repayment of debt			(5,000	)			(76,520	)			(5,828	)
Proceeds from IPO			274,948				-				-
Repayment of affiliate note			-				-				(120	)
Capital contributed from Members			-				20,150				20,100
Payment of stock issuance costs			(6,938	)			-				(192	)
Collection of subscription receivable			-				50,000				-
Net cash provided by financing activities			602,607				260,204				13,960
Net (decrease) in cash, cash equivalents and restricted cash			(7,818	)			(17,478	)			(70,790	)
Cash, cash equivalents and restricted cash – beginning of period			100,853				118,331				189,121
Cash, cash equivalents and restricted cash – end of period		$	93,035			$	100,853			$	118,331
Supplemental disclosure of non-cash investing and financing activities:
Changes in accounts payable and accrued liabilities associated with construction in progress and property, plant and equipment additions		$	(48,150	)		$	74,280			$	7,997
Cash paid for interest, net of capitalized interest			6,765				7,515				5,725
Cash paid for taxes			28				-				5