“2022 was a transitional year for Enviva, as we executed a major change in our corporate structure by evolving from a master limited partnership to a corporation. At the same time, Enviva was exposed to the tough macroeconomic backdrop impacting industries globally, requiring us to navigate severe supply chain disruptions, Covid and labor-related challenges, and inflationary pressures in our cost tower. Despite these headwinds, we achieved record setting production and delivery levels, exceeded our sales price per ton sold expectations, and generated significant cash, especially in the fourth quarter, which sets the stage for solid growth in 2023 and beyond,” said Thomas Meth, President and Chief Executive Officer.
Meth continued, “As we look forward, we see an immense growth opportunity for Enviva. In addition to the nine new long-term agreements we announced during 2022, I am very pleased to announce three new industrial, take-or-pay off-take contracts today. While our growth is underpinned by the strength of our $24 billion contracted revenue backlog, and we are making solid progress in converting our more than $50 billion customer pipeline into fully executed contracts, I am most focused on improving operational performance and cost management in our plants and ports. In 2023, we expect to drive increased output from these assets, and together with procured volumes, we aim to sell close to 7 million metric tons at higher prices than we have seen historically, and at a meaningfully lower cost position, achieved by higher plant utilization, a stable and fully staffed workforce, and improved supply chain conditions relative to the challenges of 2022."
BETHESDA, Md.--Enviva Inc. (NYSE: EVA) (“Enviva,” the “Company,” “we,” “us,” or “our”) today released financial and operating results for fourth-quarter and full-year 2022, provided financial guidance for 2023, and announced three new take-or-pay contracts with industrial customers.
Key Takeaways:
- Delivered record volumes of approximately 1.5 million metric tons during fourth-quarter 2022 at higher-than-expected average sale prices; volumes delivered were 35% higher for fourth-quarter 2022 compared to third-quarter 2022
- Announced three new industrial contracts which reflect the favorable pricing environment:
- 10 to 15-year take-or-pay off-take contract signed with new European industrial customer converting from coal to wood pellet usage; deliveries to ramp to up to 500,000 metric tons per year (“MTPY”), with initial deliveries expected to commence in 2024
- 10-year take-or-pay off-take contract signed with new European industrial customer converting from coal to wood pellet usage; deliveries of 60,000 MTPY expected to commence in 2025
- 10-year take-or-pay off-take contract signed with existing global customer related to production in the U.S. of biofuels for blending into sustainable aviation fuel (“SAF”) and other renewable fuels; deliveries of approximately 60,000 MTPY expected to commence in 2025
- Reported certain accretive sales transactions in fourth-quarter 2022 which required different accounting treatment as compared to our guidance assumptions, resulting in a deferral of gross margin (the “Deferred Gross Margin Transactions”); cash has been collected in full for these transactions
- Entered 2023 with substantial liquidity, with available funds to support capital expenditures and operations of approximately $384 million
- Reaffirmed 2023 adjusted EBITDA preliminary outlook disclosed during 2022, and provided 2023 dividend guidance of $3.62 per common share, consistent with 2022 payout
Source: Enviva
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