Excelerate Energy, Inc.

Hello and welcome to the Accelerate Energy third quarter 2023 earnings conference call. My name is Elliot and I'll be coordinating your call today. If you would like to register a question during today's event, please press star followed by one on your telephone keypad. And I'd like to hand over to Craig Hicks, Vice President of Investor Relations and ESG. The floor is yours. Please go ahead.

Good morning, everyone. Thank you for joining Accelerate Energy's third quarter 2023 financial results call. Participating on the call today are Stephen Kobos, President and Chief Executive Officer, and Dana Armstrong, Executive Vice President and Chief Financial Officer. Our third quarter 2023 results press release and presentation were released yesterday afternoon and can be found on our website at ir.accelerateenergy.com. I would like to remind everyone that we will be making forward-looking statements on this call that involve a number of risks and uncertainties. Our actual results may differ materially from those expressed in these forward-looking statements, and we make no obligation to update or revise them. Today's remarks will also refer to certain non-GAAP financial measures. We have provided a reconciliation to the most directly comparable GAAP financial measures at the back of the presentation. Now, I'd like to turn the call over to Stephen Kogos, Chief Executive Officer of Accelerate Energy.

Thanks, Craig. And good morning, everyone. Today, I'm going to talk about our financial and operational performance during the quarter, our recent commercial updates, and our grid strategy. Then I'll pass the call over to Dana, who will provide more detail on our financial results for the quarter. Let's just start by talking about who we are as a company. Accelerate Energy is a leading provider of flexible LNG infrastructure and integrated solutions. We enhance energy security for countries around the world, and we help them to transition to a clean energy future. These fundamental tenants of who we are remain unchanged. We've got a geographically diverse and resilient business model designed to deliver predictable earnings results, which is exactly what we did. Accelerate reported very strong financial results in the third quarter. Our adjusted EBITDA came in at $107 million, and net income was close to $47 million. The results we delivered during the quarter were driven primarily by higher revenues in our core regasification business outperformance of our gas sales contracts in Brazil, and lower than anticipated expenses across the fleet. Our FSRU and terminal services business, which is underpinned by stable, long-term contracts, is the cornerstone of our business model. It consistently generates positive cash flow and gives us the financial flexibility to execute our growth strategy. Our strong performance year to date has given us the confidence to increase our full year adjusted EBITDA guidance to $340 to $350 million. And on November 7th, the Accelerate Board of Directors declared another two and a half cent dividend per share to shareholders of record as of November 28th. In addition to delivering another quarter of strong earnings results, We optimized our near-term and long-term financial position by executing two new commercial agreements. On October 17th, we signed a 10-year contract with Petrobras to charter the FSRU Sequoia. This agreement demonstrates our commitment to help enhance Brazil's energy security. It is an important step in furthering our long-term sustainable growth plan in South America. Earlier this week, we signed a long-term LNG sale and purchase agreement, or SPA, with PetroBangla. This long-term SPA is a significant milestone for Accelerate. It represents the next phase of our plan to integrate our business in Bangladesh. On the operations front, the FSRU Excelsior completed its seasonal service at the Bahia Blanca gas port in Argentina at the end of August. Now the Excelsior is back on hire with the German government. It's currently at the Navantia shipyard in Spain for customer requested technical upgrades. Beyond that, the construction of our new build FSRU, hull 3407 with Hyundai Heavy Industries is making great progress and remains on track for delivery in June 26. Finally, in October, we released our inaugural sustainability report. which highlights our 2022 global sustainability activities and environmental performance results. Accelerate has outsized importance in the global energy landscape. Around the world, geopolitical instability, including the ongoing war in Ukraine and the conflict in the Middle East, has highlighted the importance of having flexible energy infrastructure which is capable both of mitigating the effect of unforeseen events and the intermittency of renewable energy. We are an indispensable energy company in the world we live in. In Finland, the disruption of the Baltic connector pipeline has raised serious concerns about energy security in the region. Subsea pipeline, which connects Finland and Estonia, is expected to be out through the winter. In the meantime, Finland will continue to rely primarily on our FSRU, the exemplar, to meet its natural gas needs. Given the disorder that countries around the world are facing, the need for energy security and the essential services that Accelerate provides has never been greater. We believe this will be so for decades to come. has a legacy of using its FSRU fleet to strengthen the energy security for customers across its global footprint. As the needs of our customers change, the flexibility of our fleet allows us to offer a variety of integrated services to meet best their needs. On one hand, our FSRUs are used as cost-effective insurance. for countries looking to stabilize their energy system or advance their transition to renewable energy. On the other hand, in some markets, our FSRUs operate at close to maximum send-out regas capacity to deliver base load natural gas supply to our customers. For example, this is how our FSRUs are used by our customers in Pakistan and Bangladesh. where future demand for LNG and natural gas is expected to be robust. This shouldn't be a surprise to anyone given that the combined population of these two countries is over 400 million people. Higher utilization markets are an important part of our growth strategy. They create opportunities for long-term infrastructure uplift from LNG and gas sales through our terminals. Regardless of how our customers utilize our services, the fixed fee revenues from our FSRUs and terminals create an exceptionally strong foundation for sustainable growth. Our recently announced long-term charter agreement with Petrobras is a great example of how valuable security of supply can be for our customers. Last month, we signed a 10-year contract with Petrobras to charter the FSRU Sequoia to enhance Brazil's energy Under the agreement, which will commence on January 1st, Accelerate will deploy the Sequoia to provide regasification services in Brazil at the Bahia regas terminal. The deployment of the Sequoia, which is one of the most modern FSRUs in the global fleet, will help ensure the operational continuity of the Bahia terminal after the expiration of the current terminal lease agreement on December 31st of this year. Petrobras was one of the world's earliest adopters of FSRUs. They know the asset class extremely well. We appreciate the fact that Petrobras selected Accelerate to be their preferred partner for FSRU services in Brazil. Financially speaking, this is a great deal for Accelerate. After purchasing the Sequoia term contract for the vessel at the high end of the range of current market rates for FSRUs. We did what we said we would do. Importantly, the deal expands our core regas business, which allows for even stronger visibility to predictable near term and long term cash flows. Another good example of how our flexible FSRUs are utilized is our recently announced LNG SPA with Petro Bangla. Under this 15-year agreement, Petro Bangla has agreed to purchase from Accelerate 0.85 million tons per annum of LNG in 26 and 27 and 1 million tons per annum from 28 to 2040. The SPA volumes, which we expect to be back-to-back on the supply side, will be delivered through Accelerate and the Summit LNG in Bangladesh. Long-term LNG offtake agreements like this SPA are an essential part of our integrated growth strategy to lock in rateable economic uplift on our existing infrastructure. We are focused on optimizing our FSRU fleet and evaluating strategic investments and new assets and infrastructure to further our growth. The sustained tightness of the FSRU market should create new opportunities for Accelerate to connect LNG to downstream customers. To capitalize on these incremental opportunities, we plan to invest in additional FSRUs and LNG infrastructure that will position the company to expand our presence in markets with a growing demand for LNG. This includes regions such as Sub-Saharan Africa, in countries such as India, Pakistan, Vietnam, and Bangladesh. Our Pira LNG project is a great proof point of the strategy. Pira LNG is a critical part of Bangladesh's plan to support its ever-growing economy by providing natural gas to new and existing customers in the southern and western regions of the country. The project scope includes an offshore EFIT LNG import terminal and a 270-kilometer, 1 billion cubic feet per day onshore pipeline to Coolnet. Coolnet is the country's third largest city. We recently signed a non-binding term sheet with Petro Bangla for Pyro. The term sheet, which details the broad commercial parameters and framework for the deal, represents an important milestone in the development of the project. We are now positioned to advance several critical work streams for the project, including our ongoing discussions with potential equity partners and lenders and the negotiations of the definitive agreements. In summary, we expect this focused approach to expanding our presence in markets with growing demand for LNG will result in more near-term earnings and cash flow growth while we continue to develop are longer-term organic capital projects. With that, I'll now turn the call over to Dana.