8-K: Altus Power Announces Fourth Quarter and Full Year 2024 Financial Results; Acquisition by TPG Pending

Altus Power reports a 26% increase in full-year 2024 revenue and announces a pending acquisition by TPG.

Summary

• Altus Power announced its financial results for the fourth quarter and full year 2024.
• Full year 2024 revenues reached $196.3 million, a 26% increase compared to 2023.
• The company reported a GAAP net loss of $10.7 million for the full year 2024, compared to a net loss of $26.0 million in 2023.
• Adjusted EBITDA for the full year 2024 was $111.6 million, a 20% increase compared to the previous year.
• The adjusted EBITDA margin for the full year 2024 was 57%, compared to 60% in 2023.
• Altus Power surpassed 1 GW in operating assets.
• The company completed approximately 56 MW of new-build assets and added approximately 96 MW of assets in operation.
• Altus Power successfully structured an innovative tax equity transaction and partnership model.
• The year-ending cash balance was $123 million.
• On February 5, 2025, Altus Power signed a merger agreement to be acquired by TPG through its TPG Rise Climate Transition Infrastructure strategy for $5.00 per share in an all-cash transaction valuing the company at approximately $2.2 billion, including outstanding debt.
• Fourth quarter 2024 operating revenues totaled $44.5 million, a 30% increase from $34.2 million in the same period of 2023.
• Fourth quarter 2024 GAAP net loss totaled $56.5 million, compared to a net loss of $40.0 million for the same period last year, primarily driven by a $7.1 million non-cash loss from remeasurement of alignment shares and income tax expense of $35.5 million.
• Adjusted EBITDA for the fourth quarter of 2024 was $23.8 million, a 37% increase from $17.3 million in the fourth quarter of 2023.

Sentiment

Score: 7

Explanation: The sentiment is moderately positive due to strong revenue and EBITDA growth, offset by a net loss and pending acquisition uncertainties.

Positives

• Full year revenue increased by 26% to $196.3 million.
• Adjusted EBITDA for the full year increased by 20% to $111.6 million.
• Altus Power surpassed 1 GW in operating assets.
• The company successfully structured an innovative tax equity transaction and partnership model.
• Fourth quarter revenue increased 30% year-over-year.
• Fourth quarter adjusted EBITDA increased 37% year-over-year.

Negatives

• The company reported a GAAP net loss of $10.7 million for the full year 2024.
• The adjusted EBITDA margin decreased from 60% in 2023 to 57% in 2024.
• Fourth quarter 2024 GAAP net loss totaled $56.5 million, compared to a net loss of $40.0 million for the same period last year.
• The fourth quarter net loss was primarily driven by a $7.1 million non-cash loss from remeasurement of alignment shares and income tax expense of $35.5 million.

Risks

• The completion of the acquisition by TPG is subject to stockholder and regulatory approvals.
• Disruptions from the pending transaction may harm the company's business.
• The company faces the risk of not retaining and hiring key personnel.
• Potential adverse reactions or changes to business relationships may result from the acquisition announcement.
• The company is subject to continued availability of capital and financing and rating agency actions.
• Business uncertainty during the pendency of the transaction could affect the company's financial performance.
• Restrictions during the pendency of the transaction may impact the company's ability to pursue certain business opportunities or strategic transactions.
• The company faces risks related to litigation and/or regulatory actions related to the transaction or the proposed acquisition of solar assets.
• Altus Power may be adversely affected by other economic, business, legislative, regulatory, credit risk and/or competitive factors.

Future Outlook

Altus Power will not be providing a financial outlook for 2025 due to the pending acquisition by TPG.

Management Comments

• To support our ongoing growth opportunities, we've continued to focus on efficient capital markets execution as demonstrated by the new credit facility and innovative tax partnership we executed in 2024, said Gregg Felton, CEO of Altus Power.
• As we move toward our pending acquisition by TPG through its the TPG Rise Climate Transition Infrastructure strategy and transition to a private company, we are positioned to deliver even greater value to our customers and partners with the flexibility and resources to accelerate deployment, drive innovation and expand access to clean energy at scale.

Industry Context

Altus Power operates in the commercial-scale solar energy sector, which is experiencing growth driven by increasing demand for clean energy solutions. The acquisition by TPG, a climate-focused investment firm, reflects the growing interest and investment in the renewable energy sector.

Comparison to Industry Standards

• Without specific competitor data, it's difficult to provide a precise comparison.
• However, a 26% revenue growth and 20% adjusted EBITDA growth are generally positive indicators in the renewable energy sector.
• Companies like SunPower and Enphase Energy are key players in the broader solar industry, and their financial performance can serve as a benchmark.
• The adjusted EBITDA margin of 57% is a key metric to compare against industry peers to assess profitability.

Stakeholder Impact

• Shareholders will vote on the proposed acquisition by TPG.
• Customers and partners may benefit from the increased flexibility and resources under TPG's ownership.
• Employees face potential uncertainty during the transition period but may benefit from new opportunities under private ownership.

Next Steps

• The company will seek stockholder approval for the acquisition by TPG.
• The company will work to satisfy customary closing conditions, including regulatory approvals, to complete the acquisition.
• The company will transition to a privately-held company upon completion of the transaction.

Key Dates