ASPN - Earnings call transcript Q4 2020

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Operator

Ladies and gentlemen, thank you for standing by and welcome to the Aspen Aerogels Inc. Q4 2020 Earnings Call. At this time, all participants are in a listen-only mode. After the speakers’ presentation, there will a question-and-answer session. [Operator Instructions] Please be advised that today’s conference is being recorded. now today hand Mr. would to conference I speaker your Instructions] like the to over [Operator John Fairbanks. ahead go Please sir.

John Fairbanks

of developments John results Financial use operating Thank and President the Young, you. summary housekeeping before Aspen a of release I'm the turning is the press summary joining a for items the reconciliation and management's us measures in Aspen's statistics of compared and financial Good afternoon. a fourth quarter sheet the is like section most Aspen's as over announcing available ended Thank CEO. statement of Aerogels you that I the non-GAAP key to well and of Investors Aspen's financial Included conference The to release a call year measures, There website, operations, www.aerogel.com. as applicable Aspen's are Officer. for a business December XXXX. would for Fairbanks, financial and GAAP few press Chief address balance call. Don on XX, to summary

uncertainties. regarding forward-looking projections, Investors other including addition, forward-looking plans statement our will version a archived fact. discussion are an not note for historical Aspen's will any year. this of These estimates, statements webcast today targets, include In prospects, contain to of approximately statement that beliefs, website any one and section outlook, and the expectations, Please statements, risks business that is subject

also today most statements on reports company's issued release with website. differ and materially be company's found views of of The files forward-looking discussed recent February can Aspen's results These issued as SEC, those XXXX. be company's actual Aspen list press can the in press factors the made in with filings Form more forward-looking detail are in may Aerogel's the affect A the Aspen's today today found release XX-K. the Investors the of XX, the in Report SEC in could in section particularly today Aspen actual and from expressed company's Annual these that represent statements. results

to reflect Aspen to statements obligation events disclaims circumstances. any update or forward-looking these future

to to Generally During including Principles, in U.S. Accounting not These non-GAAP These or financial will are a prepared financial this considered financial as report that shares accordance GAAP. restricted call, to to stock are with to measures EBITDA. two Accepted substitute with not intended isolation withholding GAAP in Incentive measures Don. in we tax us adjusted next refer will statutory I be or with under measures, will issue. reconciliations Program, accordance are the the our that sold or call these now file connection remain to term this, obligation an Aspen be are officers and by form of weeks vesting of for will over not note the the company market long for why discussion of to The like by in I'll equity measures of a SUs. shares are included XX issued and into non-GAAP prepared and related that emphasize want today's measures units present over withheld I financial Section we results press comparable of release. would these financial vesting definitions financial the to turn GAAP. the in satisfy most also non-GAAP the measures directly non-GAAP the the to these

Don Young

earnings our are that significant full recap you investor our and also start I opportunities of comments. strategic John evening, Thank for call. us before QX expands switching and outlining new finish the order Thank uploaded our presentation a comments. of the joining overview upon you, John. John XXXX by John company with for Today XXXX my will company the we a of website us. usual follow up to XXXX. a performance I have by we outlook for and providing the section This with year our will Good our afternoon. of

a will with today's We conclude John, Q&A call session. over you. to

John Fairbanks

XXXX of net our Don. before start indicative and not million, summary or at XX% of a by a Thanks, based compensation income taxes, financial performance. year, to for million, decreased to depreciation, versus define running interest, declined operating $XX.X other in that year to $X.XX core during to per $XX million. $XX.X net level. we amortization, or are EBITDA results and $XXX,XXX loss adjusted I'll or Total revenue do by last or compared EBITDA through expense negative believe share adjusted $XXX.X ago. million loss the XXXX negative reported our year increased share We loss million $X.X Net stock a per as $X.XX items

that to decreased levels, costs emphasize total levels. million want on response the revenue to First from COVID-XX our our impact in by of $XX.X XXXX expenses of and we a

in In addition initiatives COVID-XX of our importantly, in related they compensation and costs. spending with to costs uncertainty, expense response and to by a of we in structure this bill research costs drove decrease our decline, initiatives And reduce and and development expenses to cost in support of in our programs. our discretionary electric reduction material the associated means reduced despite reduce to vehicle our material multi-year an increase revenue

to right annual progress and $XXX that challenges, achieve the million the from $XXX million reduced response estimate strong. business the we required made XXXX. the of COVID-XX that breakeven $XXX for decisions market fundamental million indicates that EBITDA in XXXX in our to and to we between result, a related us in As economics revenue we This remains

electric EBITDA business $XXX revenue to to increase our required million through decision estimate we our that principally million new our $X rise breakeven efforts. by in vehicle support expenses will of Moving approximately to into annual and our achieve to XXXX, initiatives our development

development from items. and phase additional technology, this provide XXXX to I’ll of fabrication barrier progress towards development rich establish We PyroThin to among high Silicon on will Carbon value Aerogel materials our additional other battery components use the to for of now phase leading detail to the identify Aerogel results. industry investment business our capability accelerate the thermal commercialization our markets

and or of $XX.X from revenue decreased worker to energy to time in materials limit business our operations shuttering start infrastructure growth infrastructure in to and COVID-XX This both temporarily by decrease of delay due time to the driven in small X% to our $X.XX building by Total million, per down base projects shipments million of in threat in market, installers feet offset party due work First, part decreased while XX% global project was XXXX the wind the I'll third to million related to in decline broad decision square services year. XX% discuss aerogel revenue. impact the of to for sustainable million maintenance the XX.X principally energy their and research foot. our by was from our outbreaks, seeking in average decrease increased blanket the a square last energy interruptions. response year of by in $XXX.X Total our revenue business insulation number to to selling market. The customers, in by reduce facilities COVID the density, price $XXX.X

the XX% profit. material reduction XX% during during driven the Next, by sales X% Gross the or XX% in profit in or in selling versus million, $XX.X in in million, principally was $XX.X research and XXXX a to I'll expense, profit in reduction increase was decrease by gross and XXXX. services gross price, in manufacturing reduction This decrease volume a contribution, part costs. average offset discuss

Next we'll discuss operating expenses.

and expense in $XX.X in XXXX research vehicle the response year despite operating result last operating controls expense decreased to instituted or principally $X.X million an was to million Our of support of by development Decrease cost increase pandemic. we COVID-XX our the electric XX% versus in in the initiatives.

from working principally capital repay in million. capital net million of November year. raised including used million our on inventory result used reflected totaled $X.X we're the expenditures cash in our of during is a Bank. negative public We an operations finished May, through This employee balance during and of $X.X in our we'll in efficiency for a investments facility. during and year. transactions Valley $X.X XXXX a the during EBITDA year. the $X.X approximately $X.X goods of total the outstanding facility year credit flow million our sheet million and million And Next, $X.X increase activities, $X.X February, million to year. We adjusted equity the under of proceeds million manufacturing our Cash revolving discuss in reliability the increase million improving million in in and of of and in offering our December, loan and a Capital our of $X.X during the $X.X Silicon the focused Providence borrowings increase PPP working through financing million $XX.X East under $XX.X ATM our

of equity of with $XX.X shareholders’ result, net million. a million under of XXXX and cash, assets million, As borrowings no revolving our $XX.X we ended credit current facility, $XX.X

We additional our also had quarter credit $X.X access to million available an facility at end. revolving under

the XXXX, that will Looking demand forward we to market. to our products COVID-XX energy in related the restrictions for continue contractor project impact access infrastructure

reduce year currently assuming that result, our product initiatives XXXX our productivity also in margin help full raw revenue full a improve line will gross to in for remain projecting that approximately We're to with enhance XXXX. XX% to costs manufacturing XXXX As we are the our XX% will results. year levels material and to our from

silicon additional progress for aerogel our we'll high barrier in platform thermal the business phase increase leading from our technology to our technology. $X to Again, aerogel of to value XXXX. an establish this carbon million industry intend and toward fabrication materials market development and by capability, to vehicle phase use the battery we development markets However, identify investment the in accelerate PyroThin aerogel investment to commercialization rich electric

improve to technology the the these optimal to to We operating efforts new our on us fundamentals that continue In resume strong. high growth of growth leverage to position operational our our market to impact characterize we and advantage Aspen the COVID-XX and significant today businesses. the actions effectiveness of addition, ensure remains – the and platform business to take initiatives to develop will believe to available vehicle electric of aerogel in performance intend opportunities XXXX strong underlying

Our current full outlook XXXX year as follows. is

and expect shares and a between $XX a assumes of between $X.XX weighted negative share. Adjusted $XXX $X and $X.XX of for million. and $XX $XXX of EBITDA million. million revenue total year. outstanding between per between loss of loss the average million outlook a This Net EPS of of loss $XX million We XX.X million. negative EPS million of

full price of per average of square of XXXX approximately outlook between $X.X foot. and depreciation XX% This addition, gross based In this expense compensation assumes and $XXX,XXX. interest of year also million, $X.XX selling margin and million outlook of expense stock a $X.XX projects $X

capital on expenditures we million capital support build-out for a Turning and our of to full operations approximately fabrication to We’ll we're the our targeting these initial cash to barrier $X million hand thermal to expected and of plant will cash total focus our $XX XXXX. have the Providence throughout year. of maintain minimum East expenditures

Looking XXXX. optimal an the an select markets will the a infrastructure EV rebound size silica and end beyond effort the XXXX, growth thermal blanket the to to in that identify our of expect of the We're stages financing we fund early of the by in post barrier to in COVID manufacturing capacity structure business to project. energy site engaged appropriate and required our expansion, aerogel strong necessitate expansion our

to thermal battery materials among other fabrication operation, planning we're addition, In enhance our and automated items. to capability barrier an establish

XXXX expenditure capital Don. announce to year. As plans call back investments. result, to additional as a these the incur turn and support we investment during finalize these details related financing We'll I'll electric the during may now additional needs vehicle we

Don Young

you, John. Thank Great.

as continue is Aspen a we development full the potential of company. Aerogel the realize and significant in at to value its juncture

and way make to is vision a better contribution Our more to of life. an important sustainable

is Aerogel Aerogel energy it electric priorities envision whether safety, efficiency, We solutions resiliency. to us as true pressing and our global infrastructure will Our vehicles, in asset challenges. technology or technology, enables buildings, hold sustainable that on these energy deployed centered future

high value technology for platform to technology matter. idea the leads that to in battery technology to and growth, our in innovation. work societal decade. the and imperative change in is multibillion and sustainability, that core diverse our runaway a global with electric barriers in to design are and single platform by customer team big to very at resulted contribute thermal that be believes creating a this on with that leveraged generate focus our have Oue the Aerogel $X the areas; leader defined. business creating by on of products motivated focus dollar of on embrace vehicles The high We over opportunities value revenue is is our broadly often a address Today, four enterprise. PyroThin being and valuable challenges creativity the in is Aspen our proprietary, and by billion time with wins meaningful And now. conviction transformations substantial strategy thermal date important markets Aerogel a from We potential

Aspen remains It Pyrogel important untapped Cryogel aerogel for we design asset the four is carbon where battery installed with Aerogel the anode have for billion. will and an that sustainable infrastructure safety facilities, lithium efficiency, firesafety cost of target high resiliency law technology our areas. Space batteries to these materials seeks and resource to and business of power deploy address in And that remember EV the low technology potential and global $X efficiency in beyond platform energy cathode critical. the products construction market are materials the rich applications performance building products megatrend. over base ion fire and energy

continues explore significant. the the infrastructure emerging Aspen trends, new business sustainability the -- and thermal materials for opportunities intersection mega are energy PyroThin thermal [Indiscernible] The Our the the battery creation technology team to platform. for businesses and and own of barrier, Aerogel themes, our

of barriers and of used be contract ion pack vehicles. thermal to a thermal a substantial designed are will the generation thermal allow electric of manufacturers at impede release lithium the on levels lithium to ion multiple propagation runaway cell where tack are coming recent runaway platforms. across can result has to both our thermal PyroThin PV a the battery battery designed and sudden runaway PyroThin is Our manage energy Thermal in phenomenon and that the when in fire. cell barriers the based

a OEMs we awarded U.S. our technology PyroThin major call, offers enable In battery range. platform. a and automotive of sacrificing achieve millions announced modules. a Aspentech earnings OEM combination use goals barriers PyroThin EV year for that without expect thermal XXXX digit consistent generate each supply dollars in of We critical for in initial -- to performance and contract single barriers commercial thermal XXXX EV Aspen’s launches with EV safety projection started unique revenue attributes drive the this last upon to its customer supply in of we the to Aspen that XXXX, to manufacturers to based its

XXXX see to potential $XXX with customer alone than During decade per a ramp and of substantial revenue the throughout XXXX, we year. million more expect this from in revenue in

succeed. important Battery point to is is are is market the levels safety mobility. companies manufacturers. well of the thermal $X challenge dependent EV decade, of alone transformation this Over customer all for to We global maximum in success our this runaway positioned acknowledge engineer for pivotal acceptance electric It potential from participating likely Aspen. a coming revenue customer’s customer ultimate on for that billion again represents vehicle contract is an believe value vehicles. universal this electric of to to a our The this in the opportunity at to

We Europe and opportunity this $XX estimate pressure fire are in billion from safety decade. America. We thermal and on our EV North seen focused have Asia, the PyroThin issues recalls barriers a resulting over regulatory of course and commercial already

more our Aspen to to thermal be a combined a broadly safe barriers make big is We and a are has to participating issue and scales. global successful solution very winner believe generation, PyroThin storage and to We distributed companies that home other for e-Mobility RFQs the and after Aerogels. number Thermal to in attributes of with EV transformation and the for single of producing manage. systems a runaway significant a include a grid list energy manufacturers, in challenging will contributor electrification expanded

in carbon initiative utilize is our materials aerogel Our our second technology. battery that EV

the centers Our and unique efforts carbon manufacturing nanomaterials at our attributes two leveraging on aerogels, aerogel of of experience both our decades scale.

energy Our goal used density is EVs. in the improve batteries lithium of ion the to

Our is on and performance cost, safety. focus

to in performance meet Our gained potential materials both our anode and confidence partners. and targets has ability current set on work our intensified have as we by the cost silicon-rich

both we our team result, expanded our a battery test and As and facilities. have lab materials related

have larger our equipment. and be silicon-rich valuable on work supported material our our to is cost and our sample are capabilities attractive that anode generation demand testing term production which target density, an on and current in IP to active believe the our partners products. partners in owners quantities our potential lower for low order to focus and current performance in their strategy COVID-XX scale by to to expanding facility We provide that leaders and worker other Switching to to our We high will battery infrastructure term short of gears to business, has revenue on contractors reduced technology. continues energy near for our number inhibit limited pandemic response site

Our is density assume reality. in continue of million that outlook underlying per vicinity the work assumption the revenue for sites our we be lower to Therefore, will levels remain XXXX will $XX quarter.

contract and restocks, these the and expect that lay over we maintenance strong next significant a move soon infrastructure energy and the Looking and have operating XXXX. period for there PyroGel forward. whole. as revenue platform is opportunity petrochemical presentation, the we And have strategic In if we channel our pent the both We see and described LNG out from we COVID-XX distribution of that breadth Cryogel company and projects. rebound we forward, up the to to company significant or revenue specified and milestones with new believe projects to as facilities And emerge momentum targets positioned for the a decade company believe for we project that the opportunities increased improves. believe been access when as several will Aspen have demand.

Thermal technology be an the EV ESG this opportunity months markets. by while decade revenue EV focused have hand. and based we XXXX by In two PyroThin, we in billion at unique development multibillion XX our the dollar We driven represents yet the earlier the multi-year double can a stage materials of through first larger. opportunity technology. and which have our protected of to platform is deployed believe Aerogel in businesses on And $XX alone, potentially sustainability barriers are We every platform where opportunities opportunity wins and

grow confident technology establish targets of outlook. as revenue our for sustainability. We its we in more fuel growth. course leader respect to With to the aim significantly XXXX We will milestones and decade, for XXXX XXXX, this this are margin will a revenue of our reputation Aspen over that continued and times of gross drive than help XX% believe million, $XXX two a and target

Our energy of XXXX revenue with belief XXXX target fact revenue of barrier when the CAGR will in XXXX that we major our infrastructure, believe thermal and And to alone. only to level first, XXXX part XX% not grounded also have the we North This two of peak we comprised in is XX% parts, a our over to principally revenue ends, revenue contracts grew PyroThin add a derived North is predominantly with OEM. from pandemic American automotive regain and revenue will that but second, opportunity XXXX, the business. grow continue the that our from

companies have is evaluation as replacement The lithium and the graphite position. anodes expertise, And In expand a lithium adoption widely produce similar scale with and value know costs partners, such proven a best us in have and boost first that to significant our believe approaches. with with that set We capital term We that be as viewed a our low for focus an apart at anode on of adoption for different competitive valuations. know significant XXXX anode and market relationships experience, at for our two expect with ability technology, have position but and a material. puts dual milestone to our ion, other relationships us EV We we significant over companies near high decades existing in we rich ion silicon also very now would our Aspen approach advance battery. the revenue Between materials attracted that Aerogel battery investment batteries. performance a driver believe of materials We XXXX, other these Aspen. a to for defined success. us leaders. our our focus, We silicon believe to and

on sustainability, will business Elaine we way in considering value on for to multibillion materials are technology we to we from that, for goal to technology that believe and The battery leader high creating our as and the call Aspen dollar We term enterprise. direct of models turn manufacturing With business I now session. global opportunities be well high to licensing. Overall, diverse long in becoming like are the span proprietary, the growth, maximize that Q&A would very to valuable a back focus on value a markets, company.

Operator

[Operator Stine from Eric Instructions] And line your first Craig-Hallum. the question comes of from

Eric Stine

Hi, Don and John.

Don Young

are how you? Hi, Eric

Eric Stine

well. Doing

if know what first application. that thermal win hand mean, give it I see as you this the what based in I of and the now, there, the hand the So But see was just on you standard for some in win have at could with barrier this competitive industry can that competitive. business I'm environment think this that application? on do -- side you guess become I you this getting this why is I'm in curious out in you thoughts

Don Young

number solution. Again, that of they're products the beginning on two surprised One, address go company the that application this playing to to product table this at And that caught process. to development there the rigorous to And the an then issue. three-part ways. with RFQ process through took chose a our would is approximately products, a the a thinking industry. issue. process them address here. help catch were in up I of intensity this I think me our potential I that and quite that the said that went a before, rigorous. through of we technology Well, has was Clear of this I've forward a the that the not product answer very issue year aspects comes Again, over to technology quality to do companies RFQ were the we thermal and we be determined and believe only as funnel. worked that with me, companies through RFQ technology, procurement contract. way all engineering, XX when industry We process, we that this But is of best to automotive one represent leader will Those the our incumbent have the the business in development we've the at standard it impacts and And won that the we that industry. have process. our companies, an issue customer funnel, because in whom the when is -- we players the new clear look barriers.

my material I which we RFQs the systems said, many handful stationary small that now As has opportunities issues that a as responded those provided generation, in come funnel, as notes, in around a in out. we're well We same well intense. at pretty -- distributed also. to of runaway have and has seeing engaged thermal In

another. in we're handful RFQ form we're the with or with with business so, one virtually engaged -- that processing in everyone And small again, of And with companies.

we're in a a think we challenging It’s middle again, we of right And product. unique again, have issue So the resolve. very to that.

Eric Stine

to us, going you did that, of with current in you the you the -- will Do long of do RFQ mean, RFQs lifting you're take mean, that on front process months. actually you end through versus be didn't these the the accelerated development hand. that a have the lot which the OEM that, I given that going but eight heavy you're I think expected through

looks you customers? on what going with this curious think new that like Just

Don Young

the and that Yes. this that the the new four both serving players to thinking quarters. the resolve about we're We will incumbent the will platform be in way it. battery That's do next two, six need and think

we And for a resources is it of moved we're lot now. front unique us a being we business. technology, our to center very So when and to Again, that sure unique think into comes competing that engaged. win to very and solution for the a time we've are we have

to that's and out So, over do this Eric, two, timeframe, believe that I is six play going of the course quarters. something four

Eric Stine

I And on side. at then it. options. one capacity me. know just it's looking for you're for last early Got And the

You did automated mention for the PyroThin the line product.

the capacity? Does facility? capacity what wondering think Just we does Providence that? about that Or current the East expand should to how it of

Don Young

which of it on and So, part John that as the battery capability center, aerogel reference relates advanced the is This and a focused East Tier in as also from X But not others -- customers the production and for but production only manufacturing the has the showcase just the will the the thermal our well, technology prototyping parts industry. for these platforms. or of into well. the go production Providence, various to not battery being

it revenue for So our enhance does sure.

we ourselves talked capacity out bit it this, -- mix. say I But revenue to million But this revenue focused a also us. opportunity And XX a play statement want it's of just capacity. level. having that, And additional manufacturing every a that made $XXX heavily will, on that out, let's depends we a of that clear double to XXXX. need long $XXX know, months we million about on to revenue you through have that partners. we We have does this past if are facility items Having manufacturing or in a said with We're now. that's to important time the have whether build today. enhance would whether the to for as parts those we We've I we exploring it approximately about our capability you if talked additional manufacturing, capability.

Eric Stine

you. Okay. Thank

Don Young

Thanks, Eric.

Operator

Jed Dorsheimer comes Canaccord. from your next from question And

Don Young

Hi, Jed.

John Fairbanks

Hi, Jed.

Operator

if see your mute. to on Check line maybe

Jed Dorsheimer

guess pulled Sorry. I Days zoom, the [Indiscernible] of on I mute.

guys. that, about Sorry

So anyways.

clarify. want So the and the strategy. thanks of to layout just I the visibility for

space for runaway. But would Asian the not originally talked that the be So not you the in have player that thermal or said? that the about. this had you customer That's first domestic win EV is a

John Fairbanks

be to But simply contractually now. a hopping We're We OEM. do automotive for have North the American have as not company major identified named that. company the able to

Jed Dorsheimer

I at Thanks. anode the look I it. Maybe hear. away give the Got pivoting I you thermal Did just just it. we the missed for side? That's helpful. silicon update an guess the -- runaway, if particles And of from on didn't development

John Fairbanks

We just website. onto on on Yes, about bit. which But you'll notice me expand we've Investor let company an presentation, words the uploaded And a few our we of it. say our a did. this Section

engaged. progress in the in And both fact in potential potential product. partners we're front excellent of our and our with us hitting partners, We that the say have is that and the of say have development laid is whom Jed, to that I cost made partners by when partners we're and out current targets that been performance

for So that's our laboratories, I is expanded talent, enabling -- made And a material at our bringing team potential This would test quantities to enabled happening provide that so us -- is production more also technical larger the we've real quantities, they test production so level, good progress. time facilities. provide. We've sample to our and equipment. and us partners, in scale we've expanded can current here, to

so, very focused. we're And

I to our come the from that we on thing for repeat that a our partner we Jed, this goal battery. EV -- our work have and based think with again, this goal did -- next adoption ion lithium will is is our and is XXXX first

definitive very so, timeline And there.

that. about excited we're So

our accelerate again, pilot I this laboratory facility be fairly road provide that not building the larger with sampling et for cetera. capability just is called rapidly quantities, material, down a expanded think and greater a coming more here that iterate is the enable will us other to scale, the soon work thing will an but partners

Jed Dorsheimer

gas. in I'm oil a prices to healthy just there? That's oil scenario at seen wondering that production, start We're the are in just trigger great. Thank the a terms insulation back curious in pivot of look pricing. like to demand pretty I'd business increase to at terms I'm commodity look gas us customers so sort of if at where your or rise. and could to we're and reinvestment -- midstream of if for I the we you. core --

Don Young

a It’s great question. Yes.

consistent the So, after with saying in been obviously, XXXX of we've of brakes put on really XX% because COVID. we've the been, XXXX growth, were over that terrific course revenue over

We was in market also energy down knew simultaneously pricing. coming

out $XX no $XX LNG environment we engagement the there's as And was it COVID. related seeing. feeling $XX, lot were us. energy then COVID. predominantly that better we and oil that's was How trying how question, our much was much question side for seeing in impact. of current sort We're prices. that that There's $XX, I And were So we of and prices, would to rather related $XX have no And well. a to that a the $XX, these which think was of to decrease on

As revenue you and focused know, have in XX% that ago, since LNG over we on a we XXXX. years five we, of CAGR the

COVID, said, those both and -- we am when I project side other the get recapture good. been believe -- we maintenance question And level we're have up purposes that that activity our of -- on the in that our focus XXXX. side outlook see our of has confident we on when? to part side. investment real So and pent in demand resume the think to that we're will I going growth is XXXX that. of not pretty is that And the And that I that win for business. see And we until

around little is, make assumption But set plays kind out. our a XXXX. here we're lower, that right see guidance XXXX. way are some higher, into quarters a level, We'll quarter we that little again, how million but So $XX our per John for of quarters it to some going out be in the

Jed Dorsheimer

I question, just last yes, if could, it. though. Got one last One --

to In think related the should that that have that, is terms I is of in thought of production historically to downstream. - business, of that hitting -- more be terms mid that that going on of more I in so, is

shifted versus offshore in will? and terms the pipes production So has you of if that of should way? to we out think same business domestic building the And in that refiners

Don Young

of business for still is steady share. performer petrochemical the real receiving terminals. we're been that upstream The parts and No, -- we we million, that's LNG the really our that a and terms a the the work long but the pipe-in-pipe that or a time. it. with called that refiners it. -- with course, in kind it's typically in it's the we market plus a comes high say, of LNG of minus it's in for given is solid But guys business for in year, refinery And of we with big us. side, $XX a on have We're our It's range for so have very $X only a we have. million side a And good any at been business. subsea But programs side, petrochemical both are business liquefaction time, long not very these Yes. refiners the our like of focus these and most about area, growth that

Jed Dorsheimer

I'll the queue. back in Thanks. Thank it. jump Got you.

Don Young

you, Jeff. Thank

Operator

comes B. line from of Riley from And Securities. Tom your the question Curran next

Tom Curran

evening. Good

John Fairbanks

Tom. Hi,

Tom Curran

does point given support RFQs that at in each the new from could new conversations the on of from any in result contract? hand, RFQ as you're BYD this just likely China based second what's all them And stages, of the Don, come currently in third who -- award earliest your just to for production customer? volume and where at where OEM seem a it is more partner if PyroThin

Don Young

over at technical are year that even into we this expert, into this but the -- these and that in this -- the step leader, referenced that course XXXX. my focused the come year to scale feel this manufacturers, second the with calendar really this that don't half the in design very will suppliers, that believe OEMs, year. first the are to of Tier-X resource battery place course will I and of I with month, development technical And XXXX. the early year. conversation I additional or that fruition stationary be with RFQs much will do both to of of the believe Tom, this saying, on I with focused course over battery take want supplies, and of of week But of a that of over grid the say the current half part a of the also home year the also I the half first companies go well. comfortable addition determine being their believe, as part RFQs and and And solving I that on automotive issue for

over So out the the will two, time and play period this of over quarters. course course that of four -- of stages six in

Tom Curran

structure set might partnership over you into to to some the how into then they been material XXXX year SK a of Innovation? provide ruling Group and against impacted And then ITC carbon Could SK aerogel type evaluation for Innovation. the having an last designed or be of goals side. target update development to new by week's carbon battery SK of two aerogel at relationship on objectives existing deal. surmised speak had this agreement those And joint convert were to with I've your shifting your for your that

Don Young

sure. Yes,

Our in focus working group the the with And team is team, we're that's development most the with. Korea. closely that

SK are testing that, SKC, company development very They European was technology They a Our of agreement their because middle is and with Korea, an States, in market. are market. with course, That right focused Innovation, the of on in certainly which the Asian for battery ruling called for capability. company. it SKI is the developing United sister large the market, a is important of

to -- other I look see certainly who put have much at companies companies place. the but in this Ford we think, like when like just and ourselves would that And larger Aspen, result. I VW and not

single And hope who And, that pre noticed haven't outcome lot time, short and are SKI they per noticed is at our are SKC We we I times resolve there again, period change a all. on. cheering that that. any can difference between think been multiple Again, the that teams of week. with We're but the it's and post people announcement. haven't engaged have

Tom Curran

us? million as incremental captured hear. tell within Yes. entirely of million. $X to R&D? to that. Should XXXX And spending. this turning $X of of I trying what sounds that guidance, $X John, for to would And million reassuring. that partner good range, be million That's then we think same adjusted negative in you're just EV-related the to $XX reflective Is will EBITDA It expect that

Don Young

Actually yes.

million $X in So guidance, million million to $XX all not It the negative is is guidance. $X the included in R&D.

is Some in of of battery build sales the of thermal facility. captured advanced actually associated cost out it fabrication the with

with people, with run need so, North And fabrication hire have equipment fabricators, that contract we EV that American the associated principle and expenses that associated operating we with we operation, have to manufacturer. need to we

Tom Curran

my questions. sense. for fielding That makes Thanks Got it.

John Fairbanks

Thank you, Tom.

Operator

from And your from question Wainwright. comes Amit next Dayal H.C.

Amit Dayal

question. you. for Thank Hi, guys. taking Appreciate the

Don Young

you? are How

Amit Dayal

Thank you. Good.

side segment can On the might infrastructure for anticipating story, that versus are margins you EV implications? for what talk of potentially generating be you the the you EV about

Don Young

want take John, that? to Yes. you do

John Fairbanks

revenue aerogel materials. back about for that that PyroThin call, contract with Well, in we our third associated announced will talked Yes. at quarter the we earnings contract the time of at our XX% be

seeing anything component with on that the if high at a energy on They Our And range. that revenue are infrastructure of are we're in what margins the the of bit strong. line end side.

other margin. component, the for XX% and is lower fabrication, other its the much The fabrication,

capacity that EBITDA of I And would slightly business. I in as to in so out that business. in generate $XXX plant Providence expect that we about the still it $XXX East a we think margin out All Don will adjusted and East changes, to best expect generate million. gross the higher as profitability, alluded of could aggregate, about from it full The at at hasn't around way lower really generate But but million. up margins, Providence that $XX is, on think million increases to of XX% capacity earlier, the will think to the close East by capacity facility, generation we changed still cash Providence to plant. And see would the been revenue plan

Amit Dayal

digit it. for how some millions to you two us years. you just XX? getting the are of first please? sort XXXX that roughly between Give digit single to Thank with Or in the out, revenues EV used color XX. Really And Understood. and on in opportunity Is and flying that. that getting appreciate from there XXXX you're plays single million growth

Don Young

one It basically does. another, still but year It digit to from doubles single million.

this with And look, OEMs industry, starting for when keep consistent market. talked So player. the entirely coming XXXX, in some on of see vehicle XXXX to I and models, new electric models the most want And models, we're but perspective. particular XXXX about XXXX, the across of that really, I've it's the look to to really, rollout you

ultimately, then six, or and launch XX three, one XX, you four, vehicles of of and off vehicles, five to coming lines. XX know, So, sort their year having electric in from and their two

with our And had we that design that win ramp of American projections entity. so, North the from with consistent exact is the the

up range. still And digits there rest in halfway move we year, of as thing it $XXX of numbers. substantial much of ramp. And single maybe for being kind say, that, in decades, single we XXXX, the think XXXX, as is the as in getting doubling through So said, digits ultimate the and as Kind but that just ramp of in higher XXXX the kind XXXX. million of to in those I

Amit Dayal

Understood. much. Thank all you all asked. That's question. I have. were My so That's my questions Yes. other

John Fairbanks

Thanks, talk We'll you later. Amit.

Operator

question And your Capital. from from comes Becker Northland Doug next

John Fairbanks

Doug. Hi,

Doug Becker

context revenue was I and the get hoping $XXX just to a on target little more Thanks. margin. million XX% the in gross

margin? alluding that Just to Or that, is the visibility -- of top And in based down what opportunity? were fabrication of it number? type that's to as of more a clear there at assessment is a a the included just lower revenues you are on

Don Young

and maybe me then Let talk can level, bit to one it John detail. more go little about a

XXXX, energy North it's entity, infrastructure in comprised again, OEM. XXXX we One in way really it. projections case. and from this using level automotive revenue our And, we, we're assumption business. their we are thinking the is in components about that And we're is the these American then is principle So other single recapture major make two our the that of that

level. put you up those you that million to very $XXX get close together, two things when so And

small also are We out talking, of sustainable a the of that have two that that components I building revenue. sort variety was activity, of portion those you when But be and a would XXX. of John, other figure fabrication? did materials sources principal of that the

John Fairbanks

Yes.

just -- on. we'll math just the think I do

this indicative. and -- is just So

which and held be want XXX, I we peak to XXX saw this. XXXX. infrastructure revenue to So the the just was in back energy don't But

capacity Thermal the XX% the of $XX I And the subtract the the have above they PyroThin in revenue margin to expect capacity. of and that line, silicon fabrication. the that somewhere worth in If sale at aerogel product, at plant. right XX% to it's see Providence $XX blankets of been down earlier gives gross Barrier business. that million to and generate EV changed, that of XXXX, plant in on order said worth that economics, blankets our we as which million $XX would And, But aerogel that -- EBITDA along gross to be silica -- you remainder alluded of capacity be up you're we've of million think able all us million be be profit east would against a essentially of of out would XXX, $XXX

And so that's essentially breakdown. the

a in at you time. that to we'd at aerogel XXXX, close be So XXX plant full very million,

Don generating We quite a little as of closer million very have time. $XXX that to a good alluded room little a but to full have grow. to, plant, get we'd that a cash bit at

Don Young

to an add add one It's let interesting And me Doug, -- thing me let question. just that.

revenue XX% what's course as of XXXX of that period. tell from and post energy earlier, also not grow just we Again, me believe will infrastructure that XXXX, XXXX number. over alone. XXXX the we business. our COVID. And And recapture are in that that in said And that we level business. we're a assuming XXXX from you my continue XX%, over assumes we Let CAGR it Again, level grew revenue believe that comments we'll to that I XXXX, to in

plays that how see we'll out. So

that companies with on there, Another are not RFQ won thing from one extent, the already. par that's of that is in we to additional that any great wins sort

say going be playing we And, today. we to one and than if would we're the in me be weren't technical we the more platforms so just these believe that to going disappointed leader, we so, standard battery And have industry the be Thermal let in hand we're in Barriers.

Doug Becker

some gross XX% that's because achievable -- I very the imply a to utilization? seems fabrication in gross around to capacity XX%. And with just And margin of make of want incremental components incremental sure margins coming margins minimal just margin, Understood. even of

Don Young

incremental anticipate gross long Yes, for revenue. dollar things. the talked two XX% aerogel get incremental profit a per absolutely. blanket about the as of We'll we time that We

material to percentage as a We sales. ongoing we also improve have effort -- continued anticipate our of cost bill of

margin offset fabrication there with component that. So revenue. would from margin we'd a the a that degradation in enhancement expect it of bit associated And of

Doug Becker

it. Got

Don Young

in last it’s years. economics with we've line for five discussed So and the the achievable basic easily

Doug Becker

Got it. Thank you.

John Fairbanks

Thank you, Doug.

Operator

And question you from have follow-up Jed Dorsheimer from Canaccord.

Jed Dorsheimer

guys. Thanks Hey.

Just one a quick here. real

Biz application? me hydrogen gas. on convince of the why can your wouldn't things, used used you just that's being insulation So Dev a And oil be and for side in reaffirmation

John Fairbanks

We put into thoughts any And our it that to before get we are alive we exploring issue. presentation. wanted

area. use work obviously that we for in a potential work very as materials. the hydrogen There between that looking that great our do are similarity other industrial We and are

standby on role in carefully focusing sure and topical want we be We'll make on I could express know it’s way that. very it we think to what So question that, the we're our a definitely do really right space. that and

Jed Dorsheimer

it. Got

high rephrase insulation just but questions thermodynamic your is properties get either would it is the perspective, also to From of -- slightly. give me going Let temperature be temperature going a terms beneficial heat, to in low too.

below properties, operating your which then lack it correct? will, So thermodynamic if I'm degrees phone the having hermeticity benefits penetration, [ph] beneficial same Fahrenheit at you still XXX of air and the of the have

John Fairbanks

be road. hydrogen focused we in we that well exactly and reason that I reasons the down right You're the very do right. and are remove the LNG the the side why today coming reasons the -- think well equation. of -- in might we're perhaps for cold And in now space space doing -- The

Jed Dorsheimer

Thank you.

John Fairbanks

Jed. you, Thank Yes.

Operator

Don at And back to this And there Young. are would no the further I over queue in call time. questions like to turn

Don Young

interest for Thanks to seeing we XXXX you then, forward late to Hey, to everyone's you. look look in We Aspen We Take joining April. our appreciate care. forward us results reporting QX, well. you in Thank Aerogels. Be tonight.

Operator

today's participating. conclude you does This conference for Thank call.

You disconnect. now may

Aspen Aerogels (ASPN) 19 Feb 212020 Q4 Earnings call transcript