UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
(Mark One)
EXCHANGE ACT OF 1934
For the quarterly period ended
or
EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number:
(Exact name of registrant as specified in its charter)
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification Number) |
(Address of Principal Executive Offices) |
( |
(Registrant’s telephone number) |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer | ☐ | Accelerated filer | ☐ | ||
☒ | Smaller reporting company | 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.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class | Trading Symbol(s) | Name of Each Exchange on Which Registered |
As of November 5, 2024, the Registrant had
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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q (this “Quarterly Report”), including Management’s Discussion and Analysis of Financial Condition and Results of Operations in Part I, Item 2, contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements contained in this document other than statements of historical fact, including, without limitation, statements regarding future financial performance, business strategies, market size and opportunity, expansion plans, future results of operations, factors affecting EVgo’s performance, estimated revenues, losses, projected costs, prospects, plans and objectives of management, are forward-looking statements. Such statements can be identified by the fact that they do not relate strictly to historical or current facts. When used in this Quarterly Report, words such as “may,” “will,” “might,” “should,” “could,” “would,” “can,” “expect,” “elect,” “plan,” “objective,” “seek,” “grow,” “position,” “possible,” “potential,” “outlook,” “forecast,” “strategy,” “budget,” “target,” “if,” “predict,” “anticipate,” “intend,” “believe,” “estimate,” “continue,” “project” and the negative of such terms or other similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. These forward-looking statements are based on EVgo’s current expectations, estimates, projections and beliefs, as well as a number of assumptions concerning future events, and are not guarantees of performance. These forward-looking statements are subject to a number of risks, uncertainties and assumptions, including the risk factors described in EVgo’s filings with the Securities and Exchange Commission (the “SEC”). Moreover, EVgo operates in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for EVgo to predict all risks, nor can it assess the impact of all factors on its business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements EVgo may make. In light of these risks, uncertainties and assumptions, the future events and trends discussed in this document may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements. Accordingly, you should not rely upon forward-looking statements as predictions of future events. Forward-looking statements in this Quarterly Report may include, without limitation, statements about:
| ● | changes adversely affecting EVgo’s business; |
| ● | EVgo’s dependence on the widespread adoption of electric vehicles (“EVs”) and growth of the EV and EV charging markets; |
| ● | competition from existing and new competitors; |
| ● | EVgo’s ability to meet its targeted or specified metrics, expand into new service markets, grow its customer base and manage its operations; |
| ● | the risks associated with cyclical demand for EVgo’s services and vulnerability to industry downturns and regional or national downturns; |
| ● | fluctuations in EVgo’s revenue and operating results; |
| ● | EVgo’s and the parties’ ability to satisfy certain technical, legal, environmental and financial conditions, enter into definitive transaction agreements and receive loan funding in connection with and to realize any anticipated benefits and growth from, the conditional commitment for a loan guarantee by the U.S. Department of Energy; |
| ● | unfavorable conditions or disruptions in the capital and credit markets and EVgo’s ability to obtain additional financing on commercially reasonable terms, or at all; |
| ● | EVgo’s ability to generate cash, service indebtedness and incur additional indebtedness; |
| ● | any current, pending or future legislation, regulations or policies that could impact EVgo’s business, results of operations and financial condition, including regulations impacting the EV charging market and government programs designed to drive broader adoption of EVs and any reduction, modification or elimination of such programs due to the results of the 2024 Presidential and Congressional elections; |
| ● | EVgo’s ability to adapt its assets and infrastructure to changes in industry and regulatory standards and market demands related to EV charging; |
| ● | impediments to EVgo’s expansion plans, including permitting and utility-related delays; |
| ● | EVgo’s ability to integrate any businesses it acquires; |
| ● | EVgo’s ability to recruit and retain experienced personnel; |
| ● | risks related to legal proceedings or claims, including liability claims; |
| ● | EVgo’s dependence on third parties, including hardware and software vendors and service providers, utilities and permit-granting entities; |
3
| ● | supply chain disruptions, inflation and other increases in expenses; |
| ● | safety and environmental requirements or regulations that may subject EVgo to increased liabilities or costs; |
| ● | EVgo’s climate-related transition plans, related compliance costs, scenario analysis, internal carbon pricing and/or targets and goals; |
| ● | EVgo’s ability to enter into and maintain valuable partnerships with commercial or public-entity property owners, landlords and/or tenants (collectively “Site Hosts”), original equipment manufacturers (“OEMs”), fleet operators and suppliers; |
| ● | EVgo’s ability to maintain, protect and enhance EVgo’s intellectual property; |
| ● | general economic or political conditions, including the conflicts in Ukraine, Israel and the broader Middle East region, and elevated rates of inflation and associated changes in monetary policy; and |
| ● | other factors detailed under the section entitled “Risk Factors” in EVgo’s periodic filings with the SEC. |
EVgo’s SEC filings are available publicly on the SEC’s website at www.sec.gov. The forward-looking statements contained in this Quarterly Report are based on EVgo’s current expectations and beliefs concerning future developments and their potential effects on the Company. There can be no assurance that future developments affecting EVgo will be those that the Company has anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond EVgo’s control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. Should one or more of these risks or uncertainties materialize, or should any of EVgo’s assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. Forward-looking statements in this Quarterly Report and in any document incorporated herein by reference should not be relied upon as representing EVgo’s views as of any subsequent date and the Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.
4
FREQUENTLY USED TERMS
Unless the context indicates otherwise, the following terms have the following meanings when used in this Quarterly Report:
“Board of Directors” means the board of directors of EVgo Inc.
“Business Combination Agreement” means that business combination agreement entered into on January 21, 2021 by and among CRIS, Thunder Sub and the EVgo Parties, as may be amended from time to time.
“Class A common stock” means Class A common stock of EVgo Inc., par value $0.0001 per share.
“Class B common stock” means Class B common stock of EVgo Inc., par value $0.0001 per share.
“Code” means the U.S. Internal Revenue Code of 1986, as amended.
“common stock” means Class A common stock and Class B common stock.
“Company” means EVgo Inc. and its subsidiaries.
“Company Group” means EVgo Inc., Thunder Sub or any of their subsidiaries (other than EVgo OpCo and its subsidiaries).
“CRIS” means Climate Change Crisis Real Impact I Acquisition Corporation.
“CRIS Business Combination” means the transactions contemplated by the Business Combination Agreement.
“CRIS Close Date” means the closing of the CRIS Business Combination on July 1, 2021.
“DCFC” means direct current fast charging.
“EV” means electric vehicle.
“EVgo” means, prior to the CRIS Close Date, EVgo Holdings and its subsidiaries and, following the CRIS Close Date, EVgo Inc. and its subsidiaries.
“EVgo Holdco” means EVgo Holdco, LLC, a Delaware limited liability company.
“EVgo Holdings” means EVgo Holdings, LLC, a Delaware limited liability company.
“EVgo Member Holdings” means EVgo Member Holdings, LLC, a Delaware limited liability company.
“EVgo OpCo” means EVgo OpCo, LLC, a Delaware limited liability company.
“EVgo OpCo A&R LLC Agreement” means the amended and restated limited liability company agreement of EVgo OpCo entered into on July 1, 2021.
“EVgo OpCo Units” means the equity interests of EVgo OpCo.
“EVgo Parties” means EVgo OpCo, EVgo Holdco and EVgo Holdings.
“EVgo Services” means EVgo Services LLC, a Delaware limited liability company.
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
“GAAP” means accounting principles generally accepted in the United States, consistently applied, as in effect from time to time.
5
“GWh” means gigawatt hour, a unit of energy that represents one billion watt-hours and is equal to one million kilowatt-hours.
“Initial Public Offering” means CRIS’s initial public offering of units consummated on October 2, 2020.
“JOBS Act” means the Jumpstart Our Business Startups Act of 2012, as amended.
“kWh” means kilowatt-hour.
“LS Power” means LS Power Equity Partners IV, L.P. and its affiliates, unless the context otherwise requires.
“OEM” means original equipment manufacturer.
“PlugShare” means PlugShare LLC, a California limited liability company.
“Private Placement Warrants” means the 6,600,000 warrants purchased by the Sponsor in a private placement simultaneously with the closing of the Initial Public Offering, each of which is exercisable for one share of Class A common stock at $11.50 per share, at a price of $1.00 per warrant, generating gross proceeds of $6,600,000.
“Public Warrants” means the 11,499,988 redeemable warrants sold as part of the units in the Initial Public Offering.
“SEC” means the U.S. Securities and Exchange Commission.
“Sponsor” means CRIS’s sponsor, Climate Change Crisis Real Impact I Acquisition Holdings, LLC, a Delaware limited liability company.
“Tax Receivable Agreement” means the tax receivable agreement, entered into on the CRIS Close Date, by and among CRIS, Thunder Sub, EVgo Holdings and LS Power Equity Advisors, LLC, as agent.
“Thunder Sub” means CRIS Thunder Merger LLC, a Delaware limited liability company and wholly owned subsidiary of EVgo Inc.
USE OF TRADEMARKS
This Quarterly Report includes trademarks, trade names, and service marks owned by EVgo. EVgo’s trademarks include Connect the Watts™, EVgo®, EVgo Advantage®, EVgo Basic™, EVgo eXtend™, EVgo Inside™, EVgo Optima™, EVgo PlusMAX™, EVgo ReNew™, EVgo Reservations™, EVgo Rewards®, Pay with PlugShare™, PlugShare®, and PlugShare® Premium™. EVgo’s trademarks are either registered or have been used as common law trademarks by EVgo. This Quarterly Report may contain additional trademarks, trade names, and service marks of others, which are, to EVgo’s knowledge, the property of their respective owners. Solely for convenience, trademarks, trade names, and service marks referred to in this Quarterly Report appear without the ®, ™ or SM symbols, but such references are not intended to indicate, in any way, that EVgo will not assert, to the fullest extent under applicable law, its rights or the rights of the applicable licensor to these trademarks, trade names, and service marks. EVgo does not intend its use of other parties’ trademarks, trade names, or service marks to imply, and such use or display should not be construed to imply, a relationship with, or endorsement or sponsorship of EVgo by, such other parties.
AVAILABLE INFORMATION
As soon as reasonably practicable after they are filed electronically with the SEC, EVgo’s annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports are available without charge on EVgo’s website, investors.evgo.com, which EVgo also uses to announce material information to the public. EVgo is providing the address to EVgo’s website solely for the information of investors. EVgo does not intend the address to be an active link or to otherwise incorporate the contents of the website into this Quarterly Report.
6
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements.
EVgo Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
September 30, | December 31, | |||||
2024 | 2023 | |||||
(in thousands) | (unaudited) | |||||
Assets | ||||||
Current assets | ||||||
Cash, cash equivalents and restricted cash |
| $ | |
| $ | |
Accounts receivable, net of allowance of $ | | | ||||
Accounts receivable, capital-build | | | ||||
Prepaid expenses and other current assets | | | ||||
Total current assets | | | ||||
Property, equipment and software, net | | | ||||
Operating lease right-of-use assets | | | ||||
Other assets | | | ||||
Intangible assets, net | | | ||||
Goodwill | | | ||||
Total assets | $ | | $ | | ||
Liabilities, redeemable noncontrolling interest and stockholders’ deficit | ||||||
Current liabilities | ||||||
Accounts payable |
| $ | |
| $ | |
Accrued liabilities | | | ||||
Operating lease liabilities, current | | | ||||
Deferred revenue, current | | | ||||
Other current liabilities | | | ||||
Total current liabilities | | | ||||
Operating lease liabilities, noncurrent | | | ||||
Earnout liability, at fair value | | | ||||
Asset retirement obligations | | | ||||
Capital-build liability | | | ||||
Deferred revenue, noncurrent | | | ||||
Warrant liabilities, at fair value | | | ||||
Total liabilities | $ | | $ | | ||
Commitments and contingencies (Note 9) | ||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
7
EVgo Inc. and Subsidiaries
Condensed Consolidated Balance Sheets (continued)
September 30, | December 31, | |||||
2024 | 2023 | |||||
(in thousands, except share data) | (unaudited) | |||||
Redeemable noncontrolling interest |
| $ | |
| $ | |
Stockholders’ deficit | ||||||
Preferred stock, $ | ||||||
Class A common stock, $ | | | ||||
Class B common stock, $ | | | ||||
Additional paid-in capital | — | | ||||
Accumulated deficit | ( | ( | ||||
Total stockholders’ deficit | ( | ( | ||||
Total liabilities, redeemable noncontrolling interest and stockholders’ deficit | $ | | $ | | ||
The accompanying notes are an integral part of these condensed consolidated financial statements.
8
EVgo Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(unaudited)
Three Months Ended | Nine Months Ended | |||||||||||
September 30, | September 30, | |||||||||||
(in thousands, except per share data) | 2024 | 2023 | 2024 | 2023 | ||||||||
Revenue | ||||||||||||
Charging, retail |
| $ | |
| $ | |
| $ | |
| $ | |
Charging, commercial | | | | | ||||||||
Charging, OEM | | | | | ||||||||
Regulatory credit sales | | | | | ||||||||
Network, OEM | | | | | ||||||||
Total charging network | | | | | ||||||||
eXtend | | | | | ||||||||
Ancillary | | | | | ||||||||
Total revenue | | | | | ||||||||
Cost of sales | ||||||||||||
Charging network | | | | | ||||||||
Other | | | | | ||||||||
Depreciation, net of capital-build amortization | | | | | ||||||||
Total cost of sales | | | | | ||||||||
Gross profit | | | | | ||||||||
Operating expenses | ||||||||||||
General and administrative | | | | | ||||||||
Depreciation, amortization and accretion | | | | | ||||||||
Total operating expenses | | | | | ||||||||
Operating loss | ( | ( | ( | ( | ||||||||
Interest income | | | | | ||||||||
Other (expense) income, net | ( | | ( | | ||||||||
Change in fair value of earnout liability | ( | | ( | | ||||||||
Change in fair value of warrant liabilities | ( | | ( | | ||||||||
Total other (expense) income, net | ( | | | | ||||||||
Loss before income tax expense | ( | ( | ( | ( | ||||||||
Income tax expense | ( | — | ( | ( | ||||||||
Net loss | ( | ( | ( | ( | ||||||||
Less: net loss attributable to redeemable noncontrolling interest | ( | ( | ( | ( | ||||||||
Net loss attributable to Class A common stockholders | $ | ( | $ | ( | $ | ( | $ | ( | ||||
Net loss per share to Class A common stockholders, basic and diluted | $ | ( | $ | ( | $ | ( | $ | ( | ||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
9
EVgo Inc. and Subsidiaries
Condensed Consolidated Statements of Stockholders’ Deficit
For the Nine Months Ended September 30, 2024
(unaudited)
Additional | Total | |||||||||||||||||||
Class A Common Stock | Class B Common Stock | Paid-In | Accumulated | Stockholders’ | ||||||||||||||||
(in thousands) | Shares | Amount | Shares | Amount | Capital | Deficit | Equity (Deficit) | |||||||||||||
Balance, December 31, 2023 |
| |
| $ | |
| |
| $ | |
| $ | |
| $ | ( |
| $ | ( | |
Share-based compensation | | | | | | | | |||||||||||||
Issuance of Class A common stock under share-based compensation plans | | | | | ( | | | |||||||||||||
Net loss¹ | | | | | | ( | ( | |||||||||||||
Redeemable noncontrolling interest adjustment to fair value | | | | | | | | |||||||||||||
Balance, March 31, 2024 | | | | | | ( | | |||||||||||||
Share-based compensation | | | | | | | | |||||||||||||
Issuance of Class A common stock under share-based compensation plans | | | | | | | | |||||||||||||
Net loss² | | | | | | ( | ( | |||||||||||||
Redeemable noncontrolling interest adjustment to fair value | | | | | ( | | ( | |||||||||||||
Balance, June 30, 2024 | | | | | | ( | | |||||||||||||
Share-based compensation | | | | | | | | |||||||||||||
Issuance of Class A common stock under share-based compensation plans | | | | | | |||||||||||||||
Net loss³ | | | | | | ( | ( | |||||||||||||
Redeemable noncontrolling interest adjustment to fair value | | | | | ( | ( | ( | |||||||||||||
Balance, September 30, 2024 | | $ | | | $ | | $ | | $ | ( | $ | ( | ||||||||
1 | Excludes $ | |||||||||||||||||||
2 | Excludes $ | |||||||||||||||||||
3 | Excludes $ | |||||||||||||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
10
EVgo Inc. and Subsidiaries
Condensed Consolidated Statements of Stockholders’ Deficit
For the Nine Months Ended September 30, 2023
(unaudited)
Additional | Total | |||||||||||||||||||
Class A Common Stock | Class B Common Stock | Paid-In | Accumulated | Stockholders’ | ||||||||||||||||
(in thousands) | Shares |
| Amount |
| Shares |
| Amount |
| Capital |
| Deficit |
| Deficit | |||||||
Balance, December 31, 2022 |
| |
| $ | |
| |
| $ | |
| $ | |
| $ | ( |
| $ | ( | |
Share-based compensation | | | | | | | | |||||||||||||
Issuance of Class A common stock under share-based compensation plans | | | | | | |||||||||||||||
Net loss¹ | | | | | | ( | ( | |||||||||||||
Redeemable noncontrolling interest adjustment to fair value | | | | | ( | ( | ( | |||||||||||||
Balance, March 31, 2023 | | | | | | ( | ( | |||||||||||||
Share-based compensation | | | | | | | | |||||||||||||
Issuance of Class A common stock under the equity offering, net of issuance costs | | | | | | | | |||||||||||||
Issuance of Class A common stock under the ATM, net of issuance costs | | | | | | | ||||||||||||||
Issuance of Class A common stock under share-based compensation plans | | | | | | |||||||||||||||
Net loss² | | | | | | ( | ( | |||||||||||||
Redeemable noncontrolling interest adjustment to fair value | | | | | ( | | | |||||||||||||
Balance, June 30, 2023 | | | | | | ( | ( | |||||||||||||
Share-based compensation | | | | | | | | |||||||||||||
Issuance of Class A common stock under share-based compensation plans | | | | | | |||||||||||||||
Net loss³ | | | | | | ( | ( | |||||||||||||
Redeemable noncontrolling interest adjustment to fair value | | | | | | ( | | |||||||||||||
Balance, September 30, 2023 |
| |
| $ | |
| |
| $ | |
| $ | |
| $ | ( |
| $ | ( | |
1 Excludes $ | ||||||||||||||||||||
2 Excludes $ | ||||||||||||||||||||
3 Excludes $ | ||||||||||||||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
11
EVgo Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(unaudited)
| Nine Months Ended | |||||
| September 30, | |||||
(in thousands) | 2024 |
| 2023 | |||
Cash flows from operating activities |
|
|
| |||
Net loss | $ | ( | $ | ( | ||
Adjustments to reconcile net loss to net cash provided by (used in) operating activities |
| |||||
Depreciation, amortization and accretion |
| | | |||
Net loss on disposal of property and equipment, net of insurance recoveries, and impairment expense |
| | | |||
Share-based compensation |
| | | |||
Change in fair value of earnout liability | | ( | ||||
Change in fair value of warrant liabilities | | ( | ||||
Other | | | ||||
Changes in operating assets and liabilities |
| |||||
Accounts receivable, net |
| ( | ( | |||
Prepaid expenses, other current assets and other assets |
| ( | ( | |||
Operating lease assets and liabilities, net | | | ||||
Accounts payable |
| | | |||
Accrued liabilities |
| | | |||
Deferred revenue | | | ||||
Other current and noncurrent liabilities |
| | ( | |||
Net cash provided by (used in) operating activities |
| | ( | |||
Cash flows from investing activities |
| |||||
Capital expenditures | ( | ( | ||||
Proceeds from insurance for property losses | | | ||||
Net cash used in investing activities |
| ( | ( | |||
Cash flows from financing activities |
| |||||
Proceeds from issuance of Class A common stock under the ATM | | | ||||
Proceeds from issuance of Class A common stock under the equity offering | | | ||||
Proceeds from capital-build funding |
| | | |||
Payments of deferred debt issuance costs | ( | | ||||
Payments of deferred equity issuance costs | | ( | ||||
Net cash provided by financing activities |
| | | |||
Net decrease in cash, cash equivalents and restricted cash |
| ( | ( | |||
Cash, cash equivalents and restricted cash, beginning of period |
| | | |||
Cash, cash equivalents and restricted cash, end of period | $ | | $ | | ||
Supplemental disclosure of noncash investing and financing activities |
| |||||
Fair value adjustment to redeemable noncontrolling interest | $ |
|