New Fortress Energy (NFE) Financial Report Summaries

Risks

• Our ability to implement our business strategy may be materially and adversely affected by many known and unknown factors.
• We are subject to various construction risks.
• Operation of our infrastructure, facilities and vessels involves significant risks.
• We depend on third-party contractors, operators and suppliers.
• Failure of LNG to be a competitive source of energy in the markets in which we operate, and seek to operate, could adversely affect our expansion strategy.
• We operate in a highly regulated environment and our operations could be adversely affected by actions by governmental entities or changes to regulations and legislation
• Failure to obtain and maintain permits, approvals and authorizations from governmental and regulatory agencies and third parties on favorable terms could impede operations and construction.
• When we invest significant capital to develop a project, we are subject to the risk that the project is not successfully developed and that our customers do not fulfill their payment obligations to us following our capital investment in a project.
• Failure to maintain sufficient working capital could limit our growth and harm our business, financial condition and results of operations.
• Our ability to generate revenues is substantially dependent on our current and future long-term agreements and the performance by customers under such agreements.
• Our current lack of asset and geographic diversification could have an adverse effect on our business, contracts, financial condition, operating results, cash flow, liquidity and prospects.
• Because we are currently dependent upon a limited number of customers, the loss of a significant customer could adversely affect our operating results.
• We may not be able to convert our anticipated customer pipeline into binding long-term contracts, and if we fail to convert potential sales into actual sales, we will not generate the revenues and profits we anticipate.
• Our contracts with our customers are subject to termination under certain circumstances.
• Competition in the LNG industry is intense, and some of our competitors have greater financial, technological and other resources than we currently possess.
• Cyclical or other changes in the demand for and price of LNG and natural gas may adversely affect our business and the performance of our customers.
• Our risk management strategies cannot eliminate all LNG price and supply risks. In addition, any non-compliance with our risk management strategies could result in significant financial losses.
• Any use of hedging arrangements may adversely affect our future operating results or liquidity.
• We are dependent on third-party LNG suppliers and the development of our own portfolio is subject to various risks and assumptions.
• LNG that is processed, transported and/or stored on FSRUs and transported via pipeline is subject to risk of loss or damage.
• We rely on tankers and other vessels outside of our fleet for our LNG transportation and transfer.
• Hire rates for FSRUs and LNG carriers may fluctuate substantially. If rates are lower when we are seeking a new charter, our earnings may decline.
• We may not be able to fully utilize the capacity of our FSRUs and other facilities.
• The operation of our vessels is dependent on our ability to deploy our vessels to an NFE terminal or to long-term charters.
• Vessel values may fluctuate substantially and, if these values are lower at a time when we are attempting to dispose of vessels, we may incur a loss.
• Maritime claimants could arrest our vessels, which could interrupt our cash flow.
• We seek to develop innovative and new technologies as part of our strategy that are not yet proven and may not realize the time and cost savings we expect to achieve.
• Technological innovation may impair the economic attractiveness of our projects.
• Our business is dependent upon obtaining substantial additional funding from various sources, which may not be available or may only be available on unfavorable terms.
• We have entered into, and may in the future enter into or modify existing, joint ventures that might restrict our operational and corporate flexibility or require credit support.
• The swaps regulatory and other provisions of the Dodd-Frank Act and the rules adopted thereunder and other regulations, including EMIR and REMIT, could adversely affect our ability to hedge risks associated with our business and our operating results and cash flows.
• We may incur impairments to long-lived assets.
• Weather events or other natural or manmade disasters or phenomena, some of which may be adversely impacted by global climate change, could have a material adverse effect on our operations and projects, as well as on the economies in the markets in which we operate or plan to operate.
• Existing and future environmental, social, health and safety laws and regulations could result in increased or more stringent compliance requirements, which may be difficult to comply with or result in additional costs and may otherwise lead to significant liabilities and reputational damage.
• We are subject to numerous governmental export laws, and trade and economic sanctions laws and regulations, and anti-corruption laws and regulation.
• Our charterers may inadvertently violate applicable sanctions and/or call on ports located in, or engage in transactions with, countries that are subject to restrictions imposed by the U.S. or other governments, which could adversely affect its business.
• Increasing transportation regulations may increase our costs and negatively impact our results of operations.
• Our chartered vessels operating in certain jurisdictions, including the United States, now or in the future, may be subject to cabotage laws, including the Merchant Marine Act of 1920, as amended (the “Jones Act”).
• We may not own the land on which our projects are located and are subject to leases, rights-of-ways, easements and other property rights for our operations.
• We could be negatively impacted by environmental, social, and governance (“ESG”) and sustainability-related matters.
• Information technology failures and cyberattacks could affect us significantly.
• Our insurance may be insufficient to cover losses that may occur to our property or result from our operations.
• Our success depends on key members of our management, the loss of any of whom could disrupt our business operations.
• We may experience increased labor costs and regulation, and the unavailability of skilled workers or our failure to attract and retain qualified personnel, as well as our ability to comply with such labor laws, could adversely affect us.
• Our business could be affected adversely by labor disputes, strikes or work stoppages.
• We are subject to the economic, political, social and other conditions in the jurisdictions in which we operate.
• Our financial condition and operating results may be adversely affected by foreign exchange fluctuations.
• The market price and trading volume of our Class A common stock may be volatile, which could result in rapid and substantial losses for our stockholders.
• A small number of our original investors have the ability to direct the voting of a significant amount of our common stock, and their interests may conflict with those of our other stockholders.
• Our Certificate of Incorporation and By-Laws, as well as Delaware law, contain provisions that could discourage acquisition bids or merger proposals, which may adversely affect the market price of our Class A common stock and could deprive our investors of the opportunity to receive a premium for their Class A common stock.
• Our By-Laws designate the Court of Chancery of the State of Delaware as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers, employees or agents.
• The declaration and payment of dividends to holders of our Class A common stock is at the discretion of our board of directors and we do not expect to pay dividends for the foreseeable future.
• The incurrence or issuance of debt which ranks senior to our Class A common stock upon our liquidation and future issuances of equity or equity-related securities, which would dilute the holdings of our existing Class A common stockholders and may be senior to our Class A common stock for the purposes of making distributions, periodically or upon liquidation, may negatively affect the market price of our Class A common stock.
• We may issue additional preferred stock, the terms of which could adversely affect the voting power or value of our Class A common stock.
• Sales or issuances of our Class A common stock could adversely affect the market price of our Class A common stock.
• An active, liquid and orderly trading market for our Class A common stock may not be maintained and the price of our Class A common stock may fluctuate significantly.
• We are a holding company and our operational and consolidated financial results are dependent on the results of our subsidiaries, affiliates, joint ventures and special purpose entities in which we invest.
• We may engage in mergers, sales and acquisitions, divestments, reorganizations or similar transactions related to our businesses or assets in the future and we may fail to successfully complete such transaction or to realize the expected value.
• A change in tax laws in any country in which we operate could adversely affect us.
• We have been and may be involved in legal proceedings and may experience unfavorable outcomes.
• If we fail to develop or maintain an effective system of internal controls, we may not be able to accurately report our financial results or prevent fraud. As a result, current and potential stockholders could lose confidence in our financial reporting, which would harm our business and the trading price of our Class A common stock.
• If securities or industry analysts do not publish research or reports about our business, if they adversely change their recommendations regarding our Class A common stock or if our operating results do not meet their expectations, our share price could decline.
• We are unable to predict the extent to which global pandemics and health crises will negatively affect our operations, financial performance, nor our ability to achieve our strategic objectives. We are also unable to predict how a global pandemic may affect our customers and suppliers.