Exhibit 99.1
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FOR IMMEDIATE RELEASE
Contact:Media RelationsLeila Dillon, 508.661.2264, news@ameresco.com
Investor Relations
Eric Prouty, AdvisIRy Partners, 212.750.5800, eric.prouty@advisiry.com
Lynn Morgen, AdvisIRy Partners, 212.750.5800, lynn.morgen@advisiry.com

Ameresco Reports Third Quarter 2021 Financial Results

- Diversified Model and Favorable Business Mix Drive Profit Growth -
- Significant Growth in Awarded Backlog -
- Announced Transformational Battery Storage Design/Build Contract -
- Raising FY21 Guidance Ranges -

Third Quarter 2021 Financial Highlights:
Revenues of $273.7 million
Net income of $17.4 million and GAAP EPS of $0.33
Non-GAAP net income of $21.9 million, up 18% year-over-year
Non-GAAP EPS of $0.41, up 8%
Adjusted EBITDA of $40.2 million, up 9%

FRAMINGHAM, MA – November 1, 2021 - Ameresco, Inc. (NYSE:AMRC), a leading cleantech integrator specializing in energy efficiency and renewable energy, today announced financial results for the fiscal quarter ended September 30, 2021. The Company has also furnished supplemental information in conjunction with this press release in a Current Report on Form 8-K. The supplemental information includes non-GAAP financial metrics and has been posted to the “Investor Relations” section of the Company’s website at www.ameresco.com.
“Third quarter results demonstrated the strength and resiliency of our diversified business model, as a favorable business mix resulted in profit growth, despite supply chain disruptions and COVID-19 related delays in our Projects line of business. Our higher margin recurring Energy Asset revenue increased by nearly 30% as we continued to add new assets to our expanding operating portfolio. Together with our O&M business, these groups provide over two thirds of our Adjusted EBITDA along with over $2 billion in long term revenue visibility,” said George P. Sakellaris, President and Chief Executive Officer.

“A key takeaway from our third quarter performance was the acceleration of our business development activities, which we expect to support Ameresco’s continued growth in the periods ahead. Our awarded backlog at the end of the third quarter increased 11% sequentially and 31%




compared to last year, and we experienced robust bidding activity across our entire platform of advanced technology solutions.

In late October, we announced a transformational contract to provide a 537.5 MW / 2.150 GWh multisite battery energy storage system (BESS) for Southern California Edison (SCE). This design/build project will deliver increased grid reliability to areas that have felt the impact of extreme weather in California. It represents the largest contract in Ameresco’s history and is emblematic of the complexity, scope and size of the opportunities that are emerging. It also highlights the demand for more comprehensive projects that utilize advanced clean energy technologies in which Ameresco has deep domain expertise. Past investments in bringing on leading advanced technology experts and our proven track record of executing on highly complex projects provide us with a distinct competitive advantage.”


Third Quarter Financial Results
(All financial result comparisons made are against the prior year period unless otherwise noted.)

Total revenue was $273.7 million, compared to $282.5 million the previous year. Project revenue declined by 10% as approximately $30 million worth of Projects revenue was delayed due to supply chain constraints and COVID-19 related restrictions. We anticipate the COVID-19 and supply chain challenges to continue into 2022 and factored this into our updated guidance below. Conversely, Energy Asset revenue increased 29% reflecting the continued growth of our operating portfolio, increased performance of existing assets and strength in renewable identification numbers (RINs) realized prices. O&M revenue increased 12% as we continue to attach long-term O&M contracts to our project work. Gross margin of 21.5% increased sequentially and year-over-year as our revenue mix continued to shift towards the Company’s higher margin Energy Assets and O&M businesses. Operating income was $23.6 million and operating margin was 8.6%. Net income attributable to common shareholders was $17.4 million and GAAP EPS was $0.33. The GAAP results for 2021 reflect non-cash downward adjustments of $2.9 million related to non-controlling interest activities and $1.9 million related to an energy asset impairment charge. The GAAP results for 2020 reflect a non-cash upward adjustment of $2.3 million related to non-controlling interest activities and a non-cash downward adjustment of $1.0 million related to an energy asset impairment charge. Excluding these adjustments, 2021 Non-GAAP net income was $21.9 million compared to $18.5 million, an increase of 18%. Adjusted EBITDA, a Non-GAAP financial measure, increased 9% to $40.2 million, and Non-GAAP EPS was $0.41 compared to $0.38.

(in millions)3Q 20213Q 2020
RevenueNet IncomeAdj. EBITDARevenueNet Income (Loss)Adj. EBITDA
Projects$194.0$9.6$12.6$215.4$10.8$15.5
Energy Assets$39.2$5.5$23.6$30.3$8.1$16.8
O&M$20.0$2.6$3.4$17.9$0.4$2.5
Other$20.4$(0.3)$0.6$18.9$0.7$2.1
Total (1)
$273.7$17.4$40.2$282.5$20.0$36.8
(1) Numbers in table may not foot due to rounding.





(in millions)At September 30, 2021
Awarded Project Backlog$1,586
Contracted Project Backlog$778
Total Project Backlog$2,364
O&M Revenue Backlog$1,115
Energy Asset Visibility * $1,016
Operating Energy Assets319 MWe
Assets in Development407 MWe
* estimated contracted revenue and incentives throughout PPA term on our operating energy assets


Project Highlights
In the third quarter of 2021:

Ameresco was one of eight prime contract awardees selected by the Naval Facilities Command Mid-Atlantic (NAVFAC MIDLANT) for a 5-year $950 million construction contract vehicle.
During the quarter Ameresco announced a number of Smart Water Metering projects including with the Texas cities of El Campo, Mesquite, Bellmead and Seabrook, highlighting the increased demand for advanced water infrastructure solutions.


Asset Highlights
In the third quarter of 2021:

Ameresco brought 4 MWe into operation while adding 35 MWe (gross) to our Assets in Development, bringing our total to 407 MWe.
The Company placed three Massachusetts based solar assets into operation.
We increased our Assets in Development by adding four new RNG plants and a battery storage asset to an operating solar plant.


Summary and Outlook
“Ameresco is exceptionally well positioned for continued growth in the periods ahead. Our strong year-to-date performance and recent contract wins reflect our ability to capture share of an increasingly expanding addressable market.

Given our strong year-to-date performance, our recently announced BESS contract and a lower than expected tax rate, we are pleased to be raising our FY 2021 Guidance Ranges as shown in the table below. This also reflects an increased investment in our people, new resources and growth strategies. The Company anticipates commissioning approximately 30 MW of additional energy assets and plans to invest approximately $70 million to $120 million in additional energy




asset capital expenditures during the remainder of 2021, the majority of which will be funded with project finance debt.

The SCE contract will be an important driver of Ameresco’s 2022 financial results. We also believe it is transformational as it demonstrates the increasing need for climate friendly resiliency and grid reliability. We are looking forward to continued progress in this year’s fourth quarter and to a year of substantial revenue and profit growth in 2022,” Mr. Sakellaris noted.


FY 2021 Guidance Ranges
Revenue$1.19 billion$1.24 billion
Gross Margin19.0%19.5%
Adjusted EBITDA$145 million$155 million
Interest Expense & Other$20 million$21 million
Effective Tax Rate2%7%
Non-GAAP EPS$1.39$1.47

Conference Call/Webcast Information
The Company will host a conference call today at 4:30 p.m. ET to discuss results. The conference call will be available via the following dial in numbers:
U.S. Participants: Dial +1 (877) 359-9508 (Access Code: 9934159)
International Participants: Dial +1 (224) 357-2393 (Access Code: 9934159)
Participants are advised to dial into the call at least ten minutes prior to register. A live, listen-only webcast of the conference call will also be available over the Internet. Individuals wishing to listen can access the call through the “Investor Relations” section of the Company’s website at www.ameresco.com. An archived webcast will be available on the Company’s website for one year.
Use of Non-GAAP Financial Measures
This press release and the accompanying tables include references to adjusted EBITDA, Non- GAAP EPS, Non-GAAP net income and adjusted cash from operations, which are Non-GAAP financial measures. For a description of these Non-GAAP financial measures, including the reasons management uses these measures, please see the section following the accompanying tables titled “Exhibit A: Non-GAAP Financial Measures”. For a reconciliation of these Non-GAAP financial measures to the most directly comparable financial measures prepared in accordance with GAAP, please see Non-GAAP Financial Measures and Non-GAAP Financial Guidance in the accompanying tables.

About Ameresco, Inc.
Founded in 2000, Ameresco, Inc. (NYSE:AMRC) is a leading cleantech integrator and renewable energy asset developer, owner and operator. Our comprehensive portfolio includes energy efficiency, infrastructure upgrades, asset sustainability and renewable energy solutions delivered to clients throughout North America and the United Kingdom. Ameresco’s sustainability services in support of clients’ pursuit of Net-Zero include upgrades to a facility’s energy infrastructure and the development, construction, and operation of distributed energy resources. Ameresco has successfully completed energy saving, environmentally responsible projects with




Federal, state and local governments, healthcare and educational institutions, housing authorities, and commercial and industrial customers. With its corporate headquarters in Framingham, MA, Ameresco has more than 1,000 employees providing local expertise in the United States, Canada, and the United Kingdom. For more information, visit www.ameresco.com.

Safe Harbor Statement
Any statements in this press release about future expectations, plans and prospects for Ameresco, Inc., including statements about market conditions, pipeline and backlog, as well as estimated future revenues, net income, adjusted EBITDA, Non-GAAP EPS, other financial guidance and other statements containing the words “projects,” “believes,” “anticipates,” “plans,” “expects,” “will” and similar expressions, constitute forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by such forward looking statements as a result of various important factors, including the timing of, and ability to, enter into contracts for awarded projects on the terms proposed; the timing of work we do on projects where we recognize revenue on a percentage of completion basis, including the ability to perform under recently signed contracts without unusual delay; demand for our energy efficiency and renewable energy solutions; our ability to arrange financing for our projects; changes in federal, state and local government policies and programs related to energy efficiency and renewable energy; the ability of customers to cancel or defer contracts included in our backlog; the effects of our recent acquisitions and restructuring activities; seasonality in construction and in demand for our products and services; a customer’s decision to delay or cancel our work on, or other risks involved with, a particular project; availability and cost of labor, including in response to vaccine mandates; availability and cost of equipment, as impacted by ongoing supply chain disruptions; the addition of new customers or the loss of existing customers; market price of the Company's stock prevailing from time to time; the nature of other investment opportunities presented to the Company from time to time; the Company's cash flows from operations; and other factors discussed in our Annual Report on Form 10-K for the year ended December 31, 2020, filed with the U.S. Securities and Exchange Commission (SEC) on March 2, 2021 and in our Quarterly Report on Form 10-Q for the quarter ended June 30, 2021, filed with the SEC on August 3, 2021. Currently, one of the most significant factors, however, is the potential adverse effect of the current COVID-19 (and its variants) pandemic on our financial condition, results of operations, cash flows and performance and the global economy and financial markets. The extent to which COVID-19 impacts us, suppliers, customers, employees and supply chains will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the scope, severity and duration of the pandemic, the actions taken to contain the pandemic or mitigate its impact, and the direct and indirect economic effects of the pandemic and containment measures, among others. Moreover, you should interpret many of the risks identified in our Annual Report as being heightened as a result of the ongoing and numerous adverse impacts of COVID-19. In addition, the forward-looking statements included in this press release represent our views as of the date of this press release. We anticipate that subsequent events and developments will cause our views to change. However, while we may elect to update these forward-looking statements at some point in the future, we specifically disclaim any obligation to do so. These forward-looking statements should not be relied upon as representing our views as of any date subsequent to the date of this press release.





AMERESCO, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share amounts)
September 30,December 31,
 20212020
 (Unaudited)
ASSETS
Current assets:  
Cash and cash equivalents$57,115 $66,422 
Restricted cash25,075 22,063 
Accounts receivable, net112,893 125,010 
Accounts receivable retainage, net39,404 30,189 
Costs and estimated earnings in excess of billings213,468 185,960 
Inventory, net8,329 8,575 
Prepaid expenses and other current assets24,796 26,854 
Income tax receivable4,945 9,803 
Project development costs16,166 15,839 
Total current assets502,191 490,715 
Federal ESPC receivable498,080 396,725 
Property and equipment, net8,692 8,982 
Energy assets, net828,678 729,378 
Deferred income tax assets, net3,873 3,864 
Goodwill, net58,629 58,714 
Intangible assets, net687 927 
Operating lease assets40,355 39,151 
Restricted cash, net of current portion11,588 10,352 
Other assets15,405 15,307 
Total assets$1,968,178 $1,754,115 
LIABILITIES, REDEEMABLE NON-CONTROLLING INTERESTS AND STOCKHOLDERS' EQUITY
Current liabilities:  
Current portion of long-term debt and financing lease liabilities$74,901 $69,362 
Accounts payable196,480 230,916 
Accrued expenses and other current liabilities41,960 41,748 
Current portion of operating lease liabilities6,258 6,106 
Billings in excess of cost and estimated earnings28,018 33,984 
Income taxes payable1,299 981 
Total current liabilities348,916 383,097 
Long-term debt and financing lease liabilities, net of current portion and deferred financing fees325,335 311,674 
Federal ESPC liabilities487,248 440,223 
Deferred income tax liabilities, net5,061 6,227 
Deferred grant income8,259 8,271 
Long-term portions of operating lease liabilities, net of current36,373 35,300 
Other liabilities43,202 37,660 




September 30,December 31,
 20212020
Commitments and contingencies
Redeemable non-controlling interests, net$44,948 $38,850 
Stockholders' equity:  
Preferred stock, $0.0001 par value, 5,000,000 shares authorized, no shares issued and outstanding at September 30, 2021 and December 31, 2020— — 
Class A common stock, $0.0001 par value, 500,000,000 shares authorized, 35,661,255 shares issued and 33,559,460 shares outstanding at September 30, 2021, 32,326,449 shares issued and 30,224,654 shares outstanding at December 31, 2020
Class B common stock, $0.0001 par value, 144,000,000 shares authorized, 18,000,000 shares issued and outstanding at September 30, 2021 and December 31, 2020
Additional paid-in capital277,502 145,496 
Retained earnings410,553 368,390 
Accumulated other comprehensive loss, net(7,436)(9,290)
Treasury stock, at cost, 2,101,795 shares at September 30, 2021 and December 31, 2020(11,788)(11,788)
Total stockholders’ equity668,836 492,813 
Total liabilities, redeemable non-controlling interests and stockholders' equity$1,968,178 $1,754,115 





AMERESCO, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share amounts) (Unaudited)
 Three Months Ended September 30,Nine Months Ended September 30,
 2021202020212020
Revenues$273,682 $282,507 $799,804 $717,956 
Cost of revenues214,869 231,133 640,760 588,628 
Gross profit58,813 51,374 159,044 129,328 
Selling, general and administrative expenses35,168 26,859 95,651 82,403 
Operating income23,645 24,515 63,393 46,925 
Other expenses, net4,557 3,726 13,679 13,167 
Income before income taxes19,088 20,789 49,714 33,758 
Income tax (benefit) provision (1,192)3,100 (883)597 
Net income20,280 17,689 50,597 33,161 
Net (income) loss attributable to redeemable non-controlling interests(2,857)2,313 (8,345)(2,593)
Net income attributable to common shareholders$17,423 $20,002 $42,252 $30,568 
Net income per share attributable to common shareholders:  
Basic$0.34 $0.42 $0.83 $0.64 
Diluted$0.33 $0.41 $0.81 $0.62 
Weighted average common shares outstanding: 
Basic51,464 47,788 50,599 47,597 
Diluted52,839 49,101 52,013 48,785 





AMERESCO, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands) (Unaudited)
 Nine Months Ended September 30,
 20212020
Cash flows from operating activities:
Net income$50,597 $33,161 
Adjustments to reconcile net income to cash flows from operating activities:
Depreciation of energy assets, net31,449 28,496 
Depreciation of property and equipment2,397 2,492 
Accretion of ARO liabilities90 64 
Amortization of debt discount and debt issuance costs2,085 1,849 
Amortization of intangible assets241 528 
Provision for (recoveries of) bad debts29 (1,089)
Loss on disposal / impairment of long-lived assets1,901 2,146 
Net loss from derivatives1,892 971 
Stock-based compensation expense4,280 1,380 
Deferred income taxes, net(1,834)5,146 
Unrealized foreign exchange loss (gain)124 (43)
Changes in operating assets and liabilities:
Accounts receivable27,721 (21,178)
Accounts receivable retainage(9,214)(7,422)
Federal ESPC receivable(187,984)(160,231)
Inventory, net246 155 
Costs and estimated earnings in excess of billings(22,166)24,824 
Prepaid expenses and other current assets3,771 3,916 
Project development costs15 (2,557)
Other assets(3,595)1,050 
Accounts payable, accrued expenses and other current liabilities(17,677)(2,942)
Billings in excess of cost and estimated earnings(5,856)9,019 
Other liabilities(155)1,972 
Income taxes payable, net5,299 (5,496)
Cash flows from operating activities
(116,344)(83,789)
Cash flows from investing activities:
Purchases of property and equipment(2,133)(1,968)
Capital investment in energy assets(147,967)(125,504)
Contributions to equity investment— (130)
Cash flows from investing activities
(150,100)(127,602)
Cash flows from financing activities:  
Proceeds from equity offering, net of offering costs120,084 — 
Payments of financing fees(2,650)(3,955)
Proceeds from exercises of options and ESPP4,883 6,531 
Repurchase of common stock— (6)
(Payments on) proceeds from senior secured credit facility, net(38,073)6,000 
Proceeds from long-term debt financings118,160 40,604 
Proceeds from Federal ESPC projects114,185 194,586 
(Payments on) proceeds for energy assets from Federal ESPC(174)1,435 
Investment fund call option exercise(1,000)— 
Proceeds from redeemable non-controlling interests, net1,468 2,854 
Payments on long-term debt financings(55,616)(42,550)
Cash flows from financing activities
261,267 205,499 
Effect of exchange rate changes on cash118 (465)
Net decrease in cash, cash equivalents, and restricted cash(5,059)(6,357)
Cash, cash equivalents, and restricted cash, beginning of period98,837 77,264 
Cash, cash equivalents, and restricted cash, end of period$93,778 $70,907 





Non-GAAP Financial Measures (In thousands) (Unaudited)
Three Months Ended September 30, 2021
Adjusted EBITDA:ProjectsEnergy AssetsO&MOtherConsolidated
Net income (loss) attributable to common shareholders$9,617 $5,548 $2,550 $(292)$17,423 
Impact from redeemable non-controlling interests— 2,857 — — 2,857 
Plus (less): Income tax provision (benefit)398 (1,942)298 54 (1,192)
Plus: Other expenses, net475 4,013 14 55 4,557 
Plus: Depreciation and amortization581 10,861 383 328 12,153 
Plus: Stock-based compensation1,535 310 158 163 2,166 
Plus: Energy asset impairment— 1,901 — — 1,901 
Plus: Restructuring and other charges25 253 287 
Adjusted EBITDA$12,631 $23,555 $3,405 $561 $40,152 
Adjusted EBITDA margin6.5 %60.0 %17.0 %2.7 %14.7 %
Three Months Ended September 30, 2020
Adjusted EBITDA:ProjectsEnergy AssetsO&MOtherConsolidated
Net income attributable to common shareholders$10,769 $8,113 $448 $672 $20,002 
Impact from redeemable non-controlling interests— (2,313)— — (2,313)
Plus (less): Income tax provision (benefit)2,102 (961)1,081 878 3,100 
Plus: Other expenses, net1,300 2,220 159 47 3,726 
Plus: Depreciation and amortization875 8,480 731 466 10,552 
Plus: Stock-based compensation397 56 33 35 521 
Plus: Energy asset impairment— 1,028 — — 1,028 
Plus: Restructuring and other charges16 138 160 
Adjusted EBITDA$15,459 $16,761 $2,453 $2,103 $36,776 
Adjusted EBITDA margin7.2 %55.3 %13.7 %11.1 %13.0 %





Nine Months Ended September 30, 2021
Adjusted EBITDA:ProjectsEnergy AssetsO&MOtherConsolidated
Net income attributable to common shareholders$24,087 $12,286 $5,759 $120 $42,252 
Impact from redeemable non-controlling interests— 8,345 — — 8,345 
Plus (less): Income tax provision (benefit)264 (2,028)437 444 (883)
Plus: Other expenses, net1,853 11,534 44 248 13,679 
Plus: Depreciation and amortization1,781 29,978 1,305 1,023 34,087 
Plus: Stock-based compensation3,056 586 311 328 4,281 
Plus: Energy asset impairment— 1,901 — — 1,901 
Plus: Restructuring and other charges178 37 36 318 569 
Adjusted EBITDA$31,219 $62,639 $7,892 $2,481 $104,231 
Adjusted EBITDA margin5.5 %57.2 %13.6 %4.0 %13.0 %
Nine Months Ended September 30, 2020
Adjusted EBITDA:ProjectsEnergy AssetsO&MOtherConsolidated
Net income attributable to common shareholders$15,061 $12,428 $2,283 $796 $30,568 
Impact from redeemable non-controlling interests— 2,593 — — 2,593 
Plus (less): Income tax provision (benefit)1,299 (2,661)1,081 878 597 
Plus: Other expenses, net3,284 8,915 849 119 13,167 
Plus: Depreciation and amortization2,556 25,431 2,155 1,374 31,516 
Plus: Stock-based compensation999 168 102 111 1,380 
Plus: Energy asset impairment— 1,028 — — 1,028 
Plus: Restructuring and other charges894 167 65 184 1,310 
Adjusted EBITDA$24,093 $48,069 $6,535 $3,462 $82,159 
Adjusted EBITDA margin4.6 %55.1 %12.3 %6.0 %11.4 %
Three Months Ended September 30,Nine Months Ended September 30,
2021202020212020
Non-GAAP net income and EPS:
Net income attributable to common shareholders$17,423 $20,002 $42,252 $30,568 
Adjustment for accretion of tax equity financing fees(27)(91)(89)(91)
Impact from redeemable non-controlling interests 2,857 (2,313)8,345 2,593 
Plus: Energy asset impairment1,901 1,028 1,901 1,028 
Plus: Restructuring and other charges287 160 569 1,310 
Less: Income tax effect of Non-GAAP adjustments(569)(309)(642)(608)
Non-GAAP net income21,872 18,477 52,336 34,800 
Diluted net income per common share$0.33 $0.41 $0.81 $0.62 
Effect of adjustments to net income0.08 (0.03)0.20 0.09 
Non-GAAP EPS$0.41 $0.38 $1.01 $0.71 
Adjusted cash from operations:
Cash flows from operating activities$(19,861)$(10,195)$(116,344)$(83,789)
Plus: proceeds from Federal ESPC projects44,026 60,988 114,185 194,586 
Adjusted cash from operations$24,165 $50,793 $(2,159)$110,797 





Other Financial Measures (In thousands) (Unaudited)
Three Months Ended September 30,Nine Months Ended September 30,
2021202020212020
New contracts and awards:
New contracts$190,500 $227,600 $451,500 $439,800 
New awards (1)
$346,200 $237,000 $718,200 $490,700 
(1) Represents estimated future revenues from projects that have been awarded, though the contracts have not yet been signed

Non-GAAP Financial Guidance
Adjusted earnings before interest, taxes, depreciation and amortization (adjusted EBITDA):
Year Ended December 31, 2021
LowHigh
Operating income(1)
$92 million $99 million
Non-GAAP charges$2 million $3 million
Depreciation and amortization$45 million $46 million
Stock-based compensation$6 million $7 million
Adjusted EBITDA$145 million $155 million

(1) Although net income is the most directly comparable GAAP measure, this table reconciles adjusted EBITDA to operating income because we are not able to calculate forward-looking net income without unreasonable efforts due to significant uncertainties with respect to the impact of accounting for our redeemable non-controlling interests and taxes.

Exhibit A: Non-GAAP Financial Measures
We use the Non-GAAP financial measures defined and discussed below to provide investors and others with useful supplemental information to our financial results prepared in accordance with GAAP. These Non-GAAP financial measures should not be considered as an alternative to any measure of financial performance calculated and presented in accordance with GAAP. For a reconciliation of these Non-GAAP measures to the most directly comparable financial measures prepared in accordance with GAAP, please see Non-GAAP Financial Measures and Non-GAAP Financial Guidance in the tables above.
We understand that, although measures similar to these Non-GAAP financial measures are frequently used by investors and securities analysts in their evaluation of companies, they have limitations as analytical tools, and investors should not consider them in isolation or as a substitute for the most directly comparable GAAP financial measures or an analysis of our results of operations as reported under GAAP. To properly and prudently evaluate our business, we encourage investors to review our GAAP financial statements included above, and not to rely on any single financial measure to evaluate our business.

Adjusted EBITDA and Adjusted EBITDA Margin
We define adjusted EBITDA as operating income before depreciation, amortization of intangible assets, accretion of asset retirement obligations, contingent consideration expense, stock-based




compensation expense, restructuring and asset impairment charges. We believe adjusted EBITDA is useful to investors in evaluating our operating performance for the following reasons: adjusted EBITDA and similar Non-GAAP measures are widely used by investors to measure a company's operating performance without regard to items that can vary substantially from company to company depending upon financing and accounting methods, book values of assets, capital structures and the methods by which assets were acquired; securities analysts often use adjusted EBITDA and similar Non-GAAP measures as supplemental measures to evaluate the overall operating performance of companies; and by comparing our adjusted EBITDA in different historical periods, investors can evaluate our operating results without the additional variations of depreciation and amortization expense, accretion of asset retirement obligations, contingent consideration expense, stock-based compensation expense, impact from redeemable non-controlling interests, restructuring and asset impairment charges. We define adjusted EBITDA margin as adjusted EBITDA stated as a percentage of revenue.

Our management uses adjusted EBITDA and adjusted EBITDA margin as measures of operating performance, because they do not include the impact of items that we do not consider indicative of our core operating performance; for planning purposes, including the preparation of our annual operating budget; to allocate resources to enhance the financial performance of the business; to evaluate the effectiveness of our business strategies; and in communications with the board of directors and investors concerning our financial performance.

Non-GAAP Net Income and EPS
We define Non-GAAP net income and earnings per share (EPS) to exclude certain discrete items that management does not consider representative of our ongoing operations, including restructuring and asset impairment charges and impact from redeemable non-controlling interest. We consider Non-GAAP net income and Non-GAAP EPS to be important indicators of our operational strength and performance of our business because they eliminate the effects of events that are not part of the Company's core operations.

Adjusted Cash from Operations
We define adjusted cash from operations as cash flows from operating activities plus proceeds from Federal ESPC projects. Cash received in payment of Federal ESPC projects is treated as a financing cash flow under GAAP due to the unusual financing structure for these projects. These cash flows, however, correspond to the revenue generated by these projects. Thus we believe that adjusting operating cash flow to include the cash generated by our Federal ESPC projects provides investors with a useful measure for evaluating the cash generating ability of our core operating business. Our management uses adjusted cash from operations as a measure of liquidity because it captures all sources of cash associated with our revenue generated by operations.