Montauk Renewables' 2026 Q2 Earnings Call: RIN Price Signals Clash, GreenWave Revenue Clarity Falters

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Date of Call: Aug 6, 2026

Financials Results

• Revenue: $54.0M, an increase of $8.9M, or 19.7%, compared to $45.1M in Q2 2025

Guidance:

• RNG production volumes for full year 2026 expected to range between 5.8 and 6.0 million MMBtus, with corresponding RNG revenues between $175 and $190 million.
• Renewable electricity production volumes expected to range between 185,000 and 195,000 megawatt hours, with corresponding revenues between $23 and $26 million.

Business Commentary:

RNG Production and Revenue Outlook:

• Montauk Renewable's RNG production volume for Q2 2026 was 1.5 million MMBtu, a 3% increase compared to Q2 2025.
• The company expects its full-year 2026 RNG production to range between 5.8 and 6 million MMVTUs, with corresponding RNG revenues between $175 million and $190 million.
• The increase in production is attributed to operational enhancements at existing facilities and additional feedstock collection.

Financial Performance and Environmental Attribute Revenues:

• Total revenues for Q2 2026 were $54.0 million, a 19.7% increase from Q2 2025, primarily driven by environmental attribute revenues from RINs.
• The company's RNG commodity revenue decreased by 63.7% due to the expiration of fixed floor price contracts.
• The growth in total revenues was offset by a significant decrease in RNG commodity revenue, but was supported by a 29.1% increase in RIN sales.

Renewable Electricity Generation:

• Montauk Renewable produced 44,000 megawatt hours of renewable electricity in Q2 2026, a 4.8% increase from Q2 2025.
• The increase in production was primarily due to improved gas flows at the Bowerman facility from landfill host wellfield improvements.
• The company expects to consistently generate power and RECs from all available feedstock volumes following programming modifications by mid-August.

Operational and Maintenance Expenses:

• Operating and maintenance expenses for the R&G facilities decreased by 8.2% in Q2 2026 compared to Q2 2025, primarily due to timing adjustments in maintenance activities.
• The company recorded an operating loss of $75,000 for Q2 2026, a significant decrease from an operating loss of $2.4 million in Q2 2025.
• The reduction in operating loss was largely due to operational improvements and decreased expenses at several facilities.

Balance Sheet and Capital Expenditures:

• As of June 30, 2026, $155 million was outstanding under the new senior credit facility, with the company in compliance with all financial covenants.
• Capital expenditures for the first six months of 2026 totaled $61.3 million, with significant portions allocated to the Montauk Ag Renewables and Bowerman R&G facility developments.
• The company had $17.3 million in capital expenditures included in accounts payable, reflecting ongoing investments in development projects.

Sentiment Analysis:

Overall Tone: Positive

• Management cited progress on operations and financials, including a 144.5% increase in adjusted EBITDA YOY, a move from net loss to net income, and reaffirmed production guidance. The tone was optimistic about operational developments and market stability.

Q&A:

• Question from Tim Moore (Clear Street): RIN pricing seems to have stabilized over the past six or seven months. Is there improved transparency in the marketplace compared to last year, and what are you seeing in terms of behaviors around RIN purchases?
  Response: Stability is attributed to the completion of the 2025 vintage settlement and an increase in obligated parties purchasing earlier in the compliance year.

• Question from Tim Moore (Clear Street): Does the reiterated RNG revenue guidance of $175 million to $190 million for full year 2026 include GreenWave-related revenue?
  Response: Yes, the guidance includes expectations for RIN revenues from the GreenWave joint venture.

Contradiction Point 1

Attribution of RIN Price Stability

Different primary reasons given for RIN price stability.

Tim Moore (Clear Street) - Tim Moore (Clear Street)

2026Q2: The stability in RIN prices is believed to be due to the completion of the 2025 vintage settlement and the move into the 2026 compliance year. - Sean McClain(CEO)

Can you comment on the stabilization of RIN pricing and improved market transparency over the past six to seven months, and what behaviors are you observing in RIN purchases? - Tim Moore (Clear Street)

2026Q2: While we have seen some RIN stability... we think some of that stability was coming through the, there was an extended year settlement for 2025... Now, I believe getting on the other side of completing the 2025 vintage period and moving into 2026 with... a settled RVO and obligated parties getting into their 2026 obligated purchases. - Kevin Van Asdalan(CFO)

Contradiction Point 2

Timing of Obligated Party Purchases

Contradiction on whether obligated parties are buying earlier/regularly or only starting now.

Tim Moore (Clear Street) - Tim Moore (Clear Street)

2026Q2: There has been an increase in obligated parties purchasing earlier in the compliance year, which contributes to the reduced volatility observed in 2026. - Sean McClain(CEO)

Can you comment on improved market transparency and purchasing behaviors around RINs over the past six to seven months? - Tim Moore (Clear Street)

2026Q2: We believe that’s contributed to the historical path of RIN lack of volatility here in 2026. Sean McClain: ...I do see an increase in the predominance of those obligated parties stepping into the marketplace and buying more regularly earlier on in the compliance year than we’ve seen in previous years. - Sean McClain(CEO)

Contradiction Point 3

GreenWave Revenue Inclusion in Guidance

Contradiction on whether GreenWave RIN revenues are included in the RNG guidance.

Tim Moore (Clear Street) - Tim Moore (Clear Street)

2026Q2: Yes, the RNG revenue guidance includes RIN revenues from the GreenWave joint venture. - Kevin Van Asselen(CFO)

Does the RNG revenue guidance of $175-$190 million include GreenWave-related revenues from RINs distribution, writing, and sales? - Tim Moore (Clear Street)

2026Q2: Yeah, it’s a contribution. We include GreenWave in our forecasts for what we expect to receive from the third-party volumes that we’re distributing through that pathway. - Kevin Van Asdalan(CFO)

Contradiction Point 4

Strategy for RIN Sales and Contract Management

Inconsistent messaging on sales strategy and contract renewals affecting RIN pricing and margins.

Tim Moore (Clear Street) - Tim Moore (Clear Street)

2026Q2: The stability in RIN prices is believed to be due to... the increase in obligated parties purchasing earlier in the compliance year, which contributes to the reduced volatility observed in 2026. The company's strategy focuses on selling RINs to obligated parties to ensure compliance retirements. - Sean McClain(CEO)

How have improved market transparency and purchasing behaviors impacted RIN pricing stability over the past six to seven months compared to last year? - Matthew Blair (TPH&Co.)

2026Q1: The roll-off of the fixed price contract is consistent with the company's strategy to move RNG volumes into the transportation market. It aligns with a reduction in RINs shared through the pathway and an increase in RINs sold in 2026 compared to 2025. - Kevin Van Asdalan(CFO)

Contradiction Point 5

RIN Pricing Outlook and Settlement Timeline

Contradiction on the timeline and certainty of RIN pricing for the 2026 compliance year.

Tim Moore (Clear Street) - Tim Moore (Clear Street)

2026Q2: The stability in RIN prices is believed to be due to the completion of the 2025 vintage settlement and the move into the 2026 compliance year. There has been an increase in obligated parties purchasing earlier in the compliance year, which contributes to the reduced volatility observed in 2026. - Sean McClain(CEO)

How has improved market transparency and evolving RIN purchase behaviors impacted RIN pricing stability over the past six to seven months? - Ryan Pfingst (B. Riley Securities, Inc.)

2025Q4: The company has already committed and transferred its 2025 RINs but expects an elongated 2026 period for settlements related to the 2025 vintage due to a government shutdown. Most 2026 RINs are not yet committed at pricing, so the range accommodates different price scenarios. - Kevin Van Asdalan(CFO)

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