ASPN - Earnings call transcript Q3 2021

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Operator

Welcome and thank you for attending the Aspen Aerogels Q3 2021 Earnings Call. All lines will be muted during the presentation portion of the call with an opportunity for questions and answers at the end. I would now like to pass the conference over to your host, Laura Guerrant with Aspen Aerogels. Thank you.

You may proceed, Ms. Guerrant.

Laura Guerrant

and the evening Aerogels management's of you the reconciliation Guerrant, www.aerogel.com. conference President a of summary measures, Investor Good summary for nine months non-GAAP third joining press few Aspen's results a before the statement available housekeeping to as release as and Sarah. Aspen's are and a of Aspen There operations, well ended the Investors business the website, September call call. compared measures use the Relations address sheet, you, and for release thank of XX, most us is press Young, turning a CEO. Don financial Vice is developments, a and items Thank Included Communications. summary XXXX. Corporate in I'm financial Aspen's The would and for GAAP to applicable section announcing quarter to balance I President key that like on and over of statistics Aspen's the financial of Laura operating

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

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

company's views October the XX, represent today made as XXXX. today, statements Forward-looking of

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

with refer adjusted to in in we financial with or intended prepared accordance accounting to financial non-GAAP or are GAAP this of measures definitions including comparable the press measures not considered non-GAAP turn financial not directly discussion are The today's as in in financial now prepared a measures accepted of measures a Don. and GAAP. present Don? and U.S. measures principles, generally non-GAAP we these reconciliations release. to most be why non-GAAP During GAAP. measures, I'll over accordance call substitute financial financial for call, included These the These isolation will EBITDA. are these results to

Don Young

investment we XXXX goals. since community. for with towards Laura our outreach recap our updated highlights will of we near-term Today, as in performance our the we John the went QX and then moonlighting will business role longer-term key XXXX. our for broaden as note Thank professional in should experience Thanks, and Good ago just you that a earnings QX nick couple Relations VP I of XXXX has and us joining years John Corporate and joining is of the Investor time. afternoon, and outlook to finish our in been Laura. Communications. the She and I describe months public call. Laura have achieving for our us everyone. joined Guerrant welcome XX I progress us an of

we We raised and Plant the have business strong are be cover XXXX intend key both points estimate. will two of Q&A XXXX revenue for times now time The on to and investments believe to this for the our the we full for year Battery to and session. outlook, PyroThin sets our I key revenue today's developments progress The the year. our Aspen related which PyroThin thermal barrier Materials. for call revenue more business, technical or which drivers and stage a expansion third original X conclude The QX with acceleration

that of has pent-up the increase as towards pandemic. out and as fact subsided, the to quarter shipments. our gross our seeing maintenance-related grew rates. to with $XX.X The This materialized. revenue PyroThin infrastructure especially strong we begin the business key COVID important the both positive guidance, as year. as contributing higher in third increased thermal impact emerging we expectations which activity, have manufacturing of increasing leverage We vaccination the our this especially is been our raised high to business an plant. profit top-line in of is for third was to our our predicted are with This Revenue reflecting in we countries we hope with utilization in of demand The driven associated XX% would the worst growth levels levels indicator the be year-over-year pre-pandemic of pandemic exceeding recovery energy barrier energy XXXX expectations case infrastructure million with infrastructure time energy line our and XX% what come of by countries factor –

XXXX. one are positioned key to revenue believe later no achieve nearly to XXXX million that to which our our As revenue, is this We well the of XXXX of recapture $XX XXXX. components a energy averaged pre-pandemic goal from reminder, double we per quarter than goal infrastructure to during

which such this in we into advancing resiliency, the and yet upper thermal comments, single-digit low to barriers. carbon than our single-digit decade initially millions our the as technology for we come that goals. customers infrastructure And new anticipated. business. in be growth own PyroThin see become our believe opportunities our John they to thermal sustainability infrastructure energy over be pace markets, previously said their emerging based important PyroThin more when attain earlier term, business particularly my is potential a we and significant mentioned the infrastructure In capture, safety, XXXX to to shipments years hydrogen that barrier consider efficiency, aerogel you and faster safety, leveraging is at I value have as This of strive energy expect and platform of mid Over PyroThin products, of XXXX millions. will dollars the revenue in of to to resource we our on fire longer revenue asset I the

of PyroThin sets of leading global expectations revenue two a to on more said $X our with barrier During initial million earnings exceeded On we major we cusp high Asia-based basis acceleration revenue a or a year-to-date be contract platform. exceed of we call, now a that $X times This revenue PyroThin of believe million. to XXXX our last with the and QX, OEM millions. expect for revenue single-digit winning QX we automotive thermal on were we the to stage mid alone

electric first OEMs Asian, We have received our in offered in orders vehicle for be will and that first fact North American European that all markets.

QX, be are battery Asian We another noted has OEM that it the offerings. OEM in modules its production EV large should electric to delivering customer this partnered that the this and parts same power to first with use would

The increasing a and prototype as will business very and OEMs are to prototyping first our are and funnel our want parts two business U.S. the as a development QX launches. technology discussed to delivering EV accelerating these automotive milestone soon. and parts existing with production to also QX for the of the new production is from major scope funnel There to moment, customers we commercial and production I parts a pre-loading first I supplying deliveries move represents revenue, EV seeing earlier quarter. to We where as OEM announcing major to explain OEMs, transition an discuss the which of establish these active partner to and several with to companies. importance in EV drivers parts more of work fourth cases pipeline our transition our a are during two a These barrier the revenue. technology the PyroThin development enhancing signifies ourselves production but being milestone the also importance do Aspen barrier partner. in including hope thermal in QX customers, The depth, are parts parts, of viewed for I the prerequisite we thermal destined we these names first

threefold. is Our approach

in thermal industry and be PyroThin standard Aspen Our industry intent expert management agnostic. is thermal for to OEM to to the for be battery Aspen for barriers the be

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the performance management on improved runaway, and We operation. battery’s for continue normal the remaining to during battery as of work course developing as safety several for well solutions mechanical EV OEMs thermal of event with the the for of improved in battery thermal solutions

increased expanding size plant. to work second the intensity manufacturing of the commercial In broader profile, opportunity of mandate and on battery order our aerogel demand around accelerating the we're safety, and With is of our the our on also and the megatrend expediting expanding. is EV work capitalize pace our aggressively performance the

are twice a the parcel our future. anticipate to in The site United Plant our of local announcement second office XXXX. Board, a of the to We public operational gives arrangements. have zoning near the have X. of Plant a the approvals selection working us approval We Governor's capacity finalize plan and the and as Southeastern of second closely we of the to XX-acre the incentive space officials plant with than provide joint States in Subject with site Phase and half design selected during to making to more Plant X X of the X site state

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team We engaged our Koch strategic projects drawn experience. project vast have outstanding its support solutions with from resources additional own to capital

We continue and opportunities the additional leadership for expect to the this of optimization support areas of purchasing phase. in and construction of from fabrication logistics. includes will project, the Koch are which teams such thermal during providing Koch the with the barrier onsite There parts project us Mexico work duration as for in

With double for achieve decade, all revenue to imperative potential. use throughout us it every XX opportunity the the our possible to full is resources months to

said decade. months again, share beginning safety overall celebrating creation. to double silicon that the easily financial recognize an engineers, targets. lithium-ion the for enable safety, we that which battery address areas host call, move of throughout we will The led to we have investments the cycle attributes of are approach company, in will technology This for XX-year or our batteries. start the structural allows that expansion confident carbon technology believe year, partner that in and performance platform to of of partners. facilities achieving XXXX silicon provide by we double leverageable we and helps lithium of developing In said our through also target quarter. preserving of aerogel resiliency Aspen's are specific for the events strength at to material the aerogel With be infrastructure carbon people protective creates of progress carbon ideal, market. to density technology technical design to opportunity commercially take would are our aerogel milestones will our believe ABM adoption and also ABM, broadest deliver Aspen from this outlet we resource moment in as in solutions be which The our technical the I our ions production revenue are charge significant revenue driven energy and from of The by When value for and of every we aerogel during increased Battery the PyroThin scaffold what extending an to to optimized integrity scaling targets our last posed to to and $XX and simultaneously nearly and and Materials, capacity materials and of to significant we're course asset set anniversary, making of technology, XXXX, of challenges collection of earnings XX The we low-cost, of business EV At XXXX our drive closing, that And by while quickest cycle. scientists, more silicon-rich we our to the the want this XXXX we in million the barriers assess the we we high-performance, XXXX outstanding cycle team Moving accelerating anodes significant towards aerogel key to easily to silicon an resulting refer and more these in thermal have plays achieve design life. and the XXXX. anode Aspen's the larger life. will and in ability capacity to important samples believe energy the business to efficiency, are rich battery engagement commercial to carbon across each a

transforming XX who work way. us, have that, are for of support we the and We beginning. and with to greatest is important and wisdom to as to our company value executed our to the along have for a have a And deep create years those and provided collective feel contributions vision just strategy that gratitude John, society as company, over a us all customers the whole. taken our you. behind Even with We a

John Fairbanks

third this to Adjusted EBITDA XXXX. million EBITDA third of was negative $X.X million gain the on Thanks, interest, this our compensation versus our $X.X $X.X at other additional loss increased $XX.X of year, the or negative the define $X.X quarter adjusted core year Total of items debt. highlight third stock-based of reflected we quarter on million depreciation, indicative of a third this start share these the of amortization, and as this through income per million the of million expense, from year, running now per million gain are Net $X.X believe compared last items in Don. by want our $XX.X third not in performance. to I'll components $X.XX for operating XXXX. grew included results the quarter XX% XXXX that other a on $X.XX summary level. to extinguishment the I net loss financial before that revenue In to of results. million a do provide net or taxes, or We quarter quarter share net debt. loss the $X.X extinguishment I’ll details year year. million loss the in

nearly First, or barrier part and chemical the incremental I'll price revenue. $X.XX million. increased to million project. post-COVID continuation X-millimeter States $X.X the of reflected discuss increase foot. to market, aerogel $X square X our decreased of selling increased and conclusion of square EV a feet quarter an for lower of the quarter United This the driven by market, stages XX% recovery in a initial in revenue the price blankets, to by million shipments the PTT The while due principally third in refinery in work this revenue of by versus particularly XX% quarter average X% LNG Total average by decrease global in in by decrease Total the project the revenue selling of increase was to the mix third the thermal in of per $XX.X price products year million in XXXX. offset

year in was principally discuss million manufacturing increase by the part $X.X the X% in shipment X% third offset XX% costs, gross XX% increase decrease of XXXX. during $X.X quarter versus by of this during in average third I'll or in million expense and Gross quarter gross was Next, profit. This profit in or material the driven in an profit volume selling increase and decrease price. the

Next, I'll operating expenses. discuss

we've discussed are vehicle market investment As opportunities. prior in in strategically calls, we electric increasing our our

technical, our our supporting increased of opportunity, XXXX resources spending uncertainty compensation during includes supporting commercial legal year and and and in response this the capabilities with investment teams our battery to company defend our team expand the development enhance portfolio. contrast, levels and the our the IP material carbon throughout strategic barrier Our reduced to the COVID-XX thermal purposely and business, we aerogel operational research associated spending pandemic. In to

third quarter operating $XX.X versus million $X last As a result, year expenses million. by to increased

$X.X final manufacturing the work for of our expense on million, the during equity East of facility ATM focused generated $X.X our by employee our we're of balances. efficiency sales and expenditures initial comprised $XXX,XXX and discuss improving cash EBITDA reflected our million the exercises. of accrued option of million from working during quarter. capital I'll offset balance part and in our $X.X was the of receivable broad-based operations increases $X.X flow working in Cash in and sheet used included adjusted Next, a decreases in accounts negative for payable in capital the financing quarter our by Providence Cash million decrease quarter. investment provided was and The decrease and Capital investment plant facility. through $XXX,XXX reliability $X.X million of accounts second and engineering in activities by

facility we million. of $XX.X no million, $XXX.X with shareholder's equity ended cash, under of credit assets million quarter current As of $XX.X our borrowings revolving a and the result, net

to under $X.X at facility forgiveness our highlight credit access to end. the of to XXXX $X.X an we I for applied received and that quarter had outlook. full year from also loan the million our additional our Turned business full We administration. during want small PPP available revolving quarter million

associated materials initial green We expect stages demand the the with energy post-COVID in continued year market growth recovery solid infrastructure revenue this building growth global European in and a the market. of

million we're year. barrier $X of by addition, outlook million between $X a for $X million total our revenue the thermal for increasing In PyroThin to and

to and aerogel center, assets carbon battery on our planned second advanced of support manufacturing fabrication includes result we're operational million related increasing equivalent by barrier to and aerogel design commercial that and thermal This than materials million battery fire between establish plant. expand opportunities. our properties includes $XXX As our capitalize Don enhance resources to a and battery design to for In discussed our growth construct growing to barriers our operations, XX% in thermal PyroThin stability expense the to people this provided our to and $XX and scope barrier enhance for our capital barrier to EV more planned XXXX. and is XXXX revenue protection our increased expanded construct thermal of outlook outlook materials also an barrier and management, to and e-mobility XX% as thermal investment technical, expenditures, total, safety. and testing facilities, This mechanical thermal compared rapidly by our thermal continuing invest production, fabrication year We're to opportunities. silica $XXX between incremental and million capabilities performance investment and and

of second the be plant greater proportion we and thermal half during accelerating barrier bring opportunities increasing the will – of on our for XXXX. a capacity scale assets for will of and target PyroThin anticipate second the our the plant pace Given

project. capital stages to expenditures expect we of the result, the incur greater a a required of proportion in earlier As the

costs. suppliers twice focused capacity facility material with a chain than Providence supply materials more of lower Our also on considering the our engineers establishing operating critical of raw and few greener and with are dependable to our costs. shorten East our reduce unit of We're production raw and fence-line our plant designing principal more per

PyroThin our facility to in fully have of establish to leverage growth next to have position XXXX. place detail financing the growth facility opportunities the electric platform and XXXX. new Aspen established our progressed Mexico second early of barrier believe operational additional investments planning businesses. opportunity. investments We'll quarters. planning and half develop We during beginning expect provide operations a planning in significant high We thermal the fabrication technology support in advantage aerogel facility in available likely vehicle We're to during to the also associated few of will play in today on in strategic our the to these these take and efforts the as us mid-XXXX strategic market, We're automated to arrangements

year is Our as follows. revised outlook XXXX full

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

million, $X.XX In $X.X of of interest selling of foot. XXXX gross $X.X addition, approximately an and the This of year average outlook assumes square of stock-based the net and $X.X per this expense compensation of outlook debt projects also in low-to-mid $XXX,XXX. depreciation on price margin extinguishment million, teens gain full a expense million,

million approximately currently we full cash, for outlook our the to $XX projected year. of capital for expenditures Turning first

quarters, efforts aerogel with next our our during multi-year capital to planning the provide second facilities. our progressed manufacturing we'll investors expenditure projections include As few

Our Mexican electric fabrication opportunities. operations and business our other support required vehicle capital to assets

these the capital, of people fund pace our raise opportunities. expanding equipment to scale facilities, want will with keep and to with the We [indiscernible]

call the Importantly to our our credit be near-term cash confident requirements. for sufficient available over capital balance our expenditure and under Q&A. will facility I'll we're SVB $XX.X operating though to fund Sarah and million turn

Operator

We question Stine first Eric line our take with from Instructions] now of the will [Operator Craig-Hallum.

You may proceed.

Eric Stine

John. Hi Don. Hi

John Fairbanks

Hi Eric.

Don Young

you? are How Eric. Hi

Eric Stine

Doing well.

go and into to I XXXX. of detail little on in activity and XXXX a acceleration know all is maybe just volumes hear but the and content, is is mean, two for should revenues that that? in thanks also good detail bit? part you about the think about So, Wondering hand? could that if the we How visibility more I is that the just customers curious with – additional increased have that into that customers? you that of

Don Young

It a principally what it's to asked But content Eric, in for us with more number and battery vehicles issue, consistent more the think aerogels that of been as about role can have is been broadly content more safety. pretty earlier is expectations. of we've broadly performance

some – well thermal So, mechanical issue two. PyroThin we've on past that so year we performance these batteries beyond that things in addressing include broader And have thermal the that as been things these things these certain runaway or focused the are thermal with management challenges that our barrier. and

we're those the say things to estimating, should that's and we're up per suggested were XXXX. So revenue added I have projecting that the And large where in additional or we QX, for content that that we're of revenue reason a X more we that would have degree anticipating and we kind to the vehicle. having that times

Eric Stine

both that the with it the in platform that? the is Is is is the for on longest know that versus OEMs being time content? that other? versus And or to the it. one had curious the one additional skewed vehicle, but you've I'm hand one I other Got one

Don Young

in our development to to is This of would companies is a like is think funnel. idea applied. that are that of we're say, serving and I applied being view that – Eric, confidentiality what the that, are from just I this point several both being

opportunity a this universal So, for pretty us. is

with this of battery idea technology again, course issues, these engaged operation. opportunity companies As at very that level. the address And to of take issues several the of giving a partner. during We're a including place it's strive more normal we us to the design just become

Eric Stine

like the announced entire this the level that they're thoughts your about but with one because that it sticking winning know But starting time under maybe Asian it? soon And who the is OEM, in with sounds where it. of rest some Got is. platform, confidence I curious you're getting potentially just and lies constraints, the

Don Young

its parts here we battery We take in position very rather closely. delivering few to into over we're more worked We've with broadly, continue course for platform coming work partner company production very be the the Again, quarters? which place the first to closely of vehicle. Yes. a the the think strong

Eric Stine

then it the I engagement And buckets, continue just the you about gotten always whether characterize kind it. it's for OEMs it of and are are? trend or levels next similar the just mean, Got fair things same three is closer pretty mentioned last it's talked to well level those, engagement an me, you've one of to just to number of that of in resolution, award what steps there,

Don Young

I think say become it's level sense engagement, in I that the some is way formal. would the of more

comments said, many more and engaged I requests for requests for As my of in quotation, seeing we are more. We're with kinds information, many these things.

it's would Eric. more So, just, that advanced it's sense the that formal I in in way,

Eric Stine

Okay. Thank you.

Don Young

Thank you very much.

John Fairbanks

Thanks, Eric.

Operator

Colin Rusch Thank The you, Mr. of with Oppenheimer. line Stein. next question the comes from

proceed. may You

Colin Rusch

guys. much Thanks

just matter? reacting are earlier we And the meter working within more overall looks problems out had total programs scale that of I'm you then other their structural So, issues an can parts or around from – that you're the the a field. I'm engagement like it of look that to number what or in that if you stage just proactively get perspective to customers like pipeline, the material wondering the revenue using about scope vehicle way some question trying avoiding at beyond they've customers? with pipeline square looks as is, in potentially and potentially a around support that second narrower

Don Young

Thanks, Col.

really a impact XXXX these because XXXX. on and longer have you us somewhat really situation to projections for fast-moving enormous is this in things each can term wow, the, one on pretty several are binary of our will. give So, revenue And if out you

to of coming – the lot made handful a very quarters very, but here be are so, the And these most. decisions of over at going

and a there very so, deck, that And we opportunity point we've are that there at in size and outlined the in it's time. in some we're investor projections large confident

of So, revenue a it in for one each beyond we the our is with it's opportunity really movement; that, contract. long-term usually much way not definitely a at that multi-billion-dollar again, a that defined brings chunk fairly that us. but win, large we're And projecting

of… terms In

John Fairbanks

we say what but I terms the in battery platforms extend is at the focused transportation principally are your focus I arrive really we themselves. scope to that historically battery me, the at second point in we're, us, automobile trains themselves, the us sales in be interesting that sometimes Yes. and additional drivers going is this revenue work different I platforms But work discussions sometimes I of would of time. there the our real battery around battery them around is in transportation let's themselves think principle for the types call of have platforms excuse mean, wouldn't our and sales, we're to beyond had question, vehicles, have around, our on again, and platforms vehicles.

Colin Rusch

you're in speak then ability just going material And on things perspective, customers? pass that, a quarter to to there's perspective, happening a terms can you I from with to guess, starting any your cost costs of with seeing materials and the on Awesome. that October, concerns logistics adjustments like end those since cost basic obviously lot the that are or availability structure, of

Don Young

the frankly chain now, Right have different – customers and we're companies. not have our the we it's not lot or Good. around around our globe Very than of topical, and stretched are a – supply we we're globe.

with and practice to it pass the there's these to along expenses, inflationary in column serve to able say energy there business, kinds increases. be example infrastructure associated industry a in expenses increasing about for an want are we in type our been – So, has challenges it past, largely is of of I lot have What it.

seems that same that particular And especially that case quite it in this we so, apparent XXXX. it the will in into extend now expect think I I will would – particular do this

shape pricing with think view of of I that you to we're serve if take from in we're so, good will. just And not trying just We're Again, this point trying situation. hold we're – to power basically. advantage

Colin Rusch

much, so Thanks Perfect. guys.

Don Young

Colin. you, Thank

Operator

next question you, with Rusch. Sandler. comes of Alex Piper Thank the Potter Mr. from line The

proceed. may You

Alex Potter

Are logistical could the up wondering two. result supply for question anything what that or plant particularly as chain for have or Thanks to to less guys. as asking you you're that? any one, the you're Maybe down on a more Great. like time of pieces Colin of and on any slowed result night there follow I the there, on just lead delay that supply pandemic the a long going keep guess what making number chain equipment now to of be of that whether Did at project problems? was these

Don Young

Yes.

second We With of not are items, time and to are that vendors for be lead by our the we XXXX. right expecting very with in engaged startup that we the an good the plant are of shape Alex, half issue now. long X for

up our materials materials It's just night think keeping more moving are us just around logistics I our more that, day in current supply both is team. around challenge. particular, at a challenges of products and our chain raw our

Alex Potter

which around or to know management in scope upward – guess characteristics structural, is great. comments PyroThin but on of runaway? sounds obviously And cells these of it the elaborate maybe revenue I extent great, for sort to some what then prevent thermal to modules sounds or you thermal you that that is the that in that mentioned PyroThin using Great. Okay. kind specific encasing other I the PyroThin. than But more exactly, you'll packs all for, just of comfortable of around or be terms this revision using general can expanded you're slightly work don't guidance all talking, purposes exactly

Don Young

Yes.

that pressure give, you that maybe module in have keep and material When between example me durability, constant to Let a that the performance and cell would them typically be on an think you about wall. helpful. the know mechanical cells mechanical place in them

cells the as each material, a compressible of the as so, and it so, – material. has it's are with material, you think if about And our contraction think and it kind a blanket charge expanding a cycle, as of like

And situation normal relates thermal there it sometimes with runaway, materials in of the – which to can that. play And as happen, the of that a so, does. extreme be as one roles know doesn't we are life for materials well but role battery's course opposed other hopes the to, ever our to there to

the today. we're – kind we of are that's that that So thing exploring

Alex Potter

Interesting.

of quality guess, are inbound That's number of – them ordering Thanks. people maybe you are as all own there Thanks. the of then with result, less I own I well your or on or head, you can more number limit And of I And the rank capacity, there your the Are natural in maybe of you there. as the second, with? and that's last your that order guess, funnel customers And question requests that be a the all entertain? long-term is Okay. kinds you perception treating equal? helpful. companies a types maybe revenue potential, in as of dealing inbound buried very to customer? limit these to natural guess a I maybe then is that the inquiries the two can questions dealing of in

Don Young

Yes.

– regular, of terms being probably but really those sorts we people in well important of the are others prowess important of of of kinds in their to because the are, successful, groups. some us the of companies their breadth everyone's technical draw engage of of or teams, scale, And than programs, because those things them with us, some very with those likelihood sense, with some So, kinds more in.

I think. think you would as on natural there So, prioritization going some is

area; We view aviation areas can three to lot absorbed and and breadth they it's areas of including the some compete But of of hard are our or multiple of you. OEMs largest one world efforts. automotive point of a with from really interested them, or the what five a of storage energy in a have stationary or in and variety just four or other

correctly. if In take your of question sort many sort terms the; and part understand that I on, of can of of how you

I it's I is, think I said comments, what taught comments. in in John would my and say and his

the Plant to significant on initial the rapidly and through way similar We more us RFI, X. And confidence within incrementally We having as capacity do development of demand increases. progressing three as funnel are kind about the of X. in careful the looking were it to translate and when very processes the thoughts bringing way very sort a business build in we're as basically. Plant described at that did And talked X phases business. we that through and RFQ comes you success in out it our this built our down we Plant we've – profile we've And lock

than I during that coordinate to It's – those not building one, and they sort We the of in of – the they than just chunks are suspecting, hard we're but in less know, driven. comes successful they're working – more to and are real and be say and going going to at are chunks things. it's contracts success be looking so And and them demand come. And going of of vehicles. building sort then going at than more least all let to rollout Alex, business come most, some be driven phase their of plant sort more me and to they're successful demand said, we some as suspecting. We're hope be

is PyroThin us. a barriers so, strategy agnostic in our the why – to our And be intent here our for that's OEM as just critical is And thermal industry around important being really to us. really standard

question, hope business. I of the but So, multipart way we're answers thinking that about the that's sort your

Alex Potter

helpful. super That's John. much. very thanks Thanks Don, Yes,

Operator

comes from with The you, Potter. question of Mr. the Jed line Genuity. Dorsheimer Canaccord Thank next

proceed. may You

Jed Dorsheimer

and job Thanks guys. on nice the details all Hi, the for quarter.

Don Young

Thanks, Jed.

John Fairbanks

Thanks, Jed.

Jed Dorsheimer

First facility the for second changed. that the Georgia Statesboro, I correct, – in guess, the question Georgia, state hasn't down is you, that

Don Young

at southeastern it the States referring United the We're in as to moment.

Jed Dorsheimer

previously a terms is be? may at incentives Ks the or in is where it you're of in – that sort of I your it that guess, with facility location municipalities? between but Q – for Georgia? you the Are the negotiations breaking in and Okay. stage in you've Is announced the ground the in of Or what

Don Young

Jed, I can clarify.

Carolina. of at announced selected facility, Georgia that Georgia at and but we Statesboro, southeastern Georgia, but States. just So have not a a Statesboro, Carolina. reconsidered. back in We've XXXX, had for location we now, have We're the multiple time, we and we Georgia, looking second – is had And or selected site we've it haven't United South booked said we locations that South through

Jed Dorsheimer

do it. yes, – really That's helpful. And announce assuming Got when ahead. go Thanks. you I'm

John Fairbanks

just Oh, no, headed. no. where you're going you say was it's – I – think I to

future. with we'll jointly announce and do properly, the say, office governor's We let's will this in the not-too-distant

Jed Dorsheimer

And the that Understand with for good too. great. luck incentives

Don Young

you. Thank

Jed Dorsheimer

On I the production sounds there. Mexico facility, targeted you're location, you say when a guess, it along further like have one, you that

should think curious curious facility? a, location have and I'm there about just settled the square or about that we output have – on production details some then if from footage you So, of I just how

Don Young

Yes.

fabrication as of been And barriers, parts of So, millions a what equal we're we've multi-part parts, PyroThin it's that is, our automated in described Mexico the doing we're in those doing thermal system. can Mexico.

industries We in there also advisor and We they is have do in country at team guiding different has leaned sites. an looking have that facilities on had a that the us. We've have resources Mexico. substantial coke fabrication

progress. we lessons So, operation smart this we as have the we're to and good all trying XXXX. to expect learn there about end by would are can making get of the And an as we and

that process – yet. moving So, with it's not a along we right that the location we're have picked quite

have do have that size, don't you In John, – I really. terms of

John Fairbanks

planning part It's present. of at Yes, not. our all we're

the the way aerogel in So, engaged we're an also our size Jed, fabrication facility. same sizing plant southeastern once effort – to in the We're U.S.

least it’s building. actually going pick think the lead equipment not available. we at we'll a we're extended much have capital I facility, the an to plants – And less would is into and to readily part important time intensive get that a so we'll lease more into put the

demand to And pace is meet our allow so, get barriers. automated in facility into months. to the maybe absolutely with year. PyroThin for fabrication time time will a measured place a the lead to and And thermal it in keep lead us needs is operations have And

Jed Dorsheimer

didn't there. on it. just developing, anode. silicon gears, any that comments Got hear any And Maybe update curious shifting just I the project is how

Don Young

the we to engagement us mention larger $XX roughly, of announced allowed that better materials, our we're well, I and engineers entities it's with in did deepen working year in invested other our of partners Yes, it do produce material, with. course as quantities partners what over or and in other is No, scientists, thanks. we will XXXX, And facilities. – million in have this

unique the in silicon of really protection on aspect our its focus, so, And carbon of leveraging remains life the the cycle. Jed, aerogel our through

keep faster with now made And pace and so, didn't just them – these full true we we're And large progress. that very it's quarter now. this good before enough about work really these we to we're and for material has And been one at that. other have doing to iterating making investments scale a been We're companies. enough satisfy just

work. little for for pace quickened, when committed time –both score keep at and the to what is So, our better a year, point help commercial guys you has really the And the guidance in the bit milestones Materials year we some just Battery throughout XXXX. to technical Aspen XXXX we excited provide about we're and add we've that will that

Jed Dorsheimer

watching Great. Great, well, look progress. looking forward the to guys. Thanks

Don Young

Thanks, Jed. I appreciate it.

John Fairbanks

Thanks, Jed.

Operator

the you, of comes Amit H.C. Thank Dayal with next line from The Mr. question Dorsheimer. Wainwright.

proceed. may You

Amit Dayal

Thank afternoon, you. everyone. Good

Don Young

Hi, Amit.

Amit Dayal

Hi.

additional in – for other PyroThin, coming the visibility year Just Or runaway from you're customers – doubling are orders expectations are customers have that on hand? you quickly from this you thermal of Is expecting really working from revenue you next with? from expectations.

Don Young

So, have, coming customers Amit. from this we really additional content the from is

winning parts that XXXX contracts from in delivering production upside. entities think as that – coming was so and was that necessarily not more of not confidence other – from And derived

have one I Our comments U.S. from really to based. major content automotive related John per we Asia that based, and two that provided vehicle one OEMs the

Amit Dayal

So, you you that demand the if will have in do with capacity to potentially additional meet get able customers, other from hand? orders you be

Don Young

do. we Yes,

to up millions of today capacity mid-XXXs have We reach into the dollars.

in And to so, for this was XXX John's the XXX year. guidance

we've some can out XXXX we we with here of XXXX have we believe today. so, to run capacity the we got run And revenue room before that capacity. And double to from that

X. run, said, Plant expediting So, work we our are, we but got on room to as we've

Amit Dayal

Yes.

to business to a similar give least capture have I any the fully up for don't question necessarily energy XXXX. infrastructure So, you opportunity EV was had at

Don Young

infrastructure distributors, play that we And idea if continue as to this that I that we we that us. go to contractors, to business believe can our important look you the energy is on industry, business subscribe our And well rely That's of and even important the very nature our end achieve role, an the for five safety at that think, or users traditional to product. might our try the own in correct. We grow these And those our companies become efficiency, decades. coming believe will that goals next some sustainability more just sideways given here our their XX of three the of as important asset to only resiliency and they over attributes products years. least course resource energy

do are continue so, that business. have And to we room grow and we that anticipating we'll

Amit Dayal

much. all Understood. have Thank so I That's you guys.

Don Young

Amit. you, Thank

John Fairbanks

Amit. Thanks,

Operator

Mr. you, Dayal. Souther Riley. Chris B. comes Thank The next the question from of line with

proceed. may You

Chris Souther

Hi, guys.

but planning. that later or you something the year one size, next about the full is a on comes facility, We're Just talking or facility governor announcement second the scope the something? size get out are of think, current the than going quick that a we more or two – picture and like of to times cost with

Don Young

yes. John, go – Look ahead, Yes.

John Fairbanks

about come Yes, talk investment. you we – about give hi. on you. by we tell we want way the governor. announcement to it return governor that investment the internally to We the of we need the It think is the the know definitely time is when with will the And what to the that

within capacity, out few public make to so, the And you And understand in scope, the scale, sure efficiency plant. we'll we're the targeting next operating the have that the that of months.

Chris Souther

in be there, Q should lead? think – the of we the – we the fourth long then be the Okay. That's that CapEx in but quarter, of any just starting maybe kind great. in And to are cadence will looking I K order kind of quarter third the at

John Fairbanks

the although to put of expenditures should be full would – for CapEx lead long cash the actually most flow that guidance equipment in recognized as We of in that $XX of XXXX. starting orders we're and cash million capital Yes, XXXX. give did it for time year

Chris Souther

it. Got

vehicle upside. year brushed Okay. before potential just just And wanted to a essentially when of months kind sense was you the new get next few wins then a on launched. I for

after kind for folks? timeline launches? stage at of looking So, what kind fair vehicle beyond more XXXX of Or for you're launch the late-stage it Is the and some it is XXXX of three is vehicles more… potentially

Don Young

the between and during begin in the first XX contracts now wins pattern and That's that we've to and we or typically half seen in have in Yes. XXXX get all will think as these XXXX materialize models Chris, really X, following even and will launches consistent projections XXXX, that And what more typically companies in revenue it's X XXXX. terms with much XXXX of that the the even in we number won. X, really And as then late that kick I read about we've of really XXXX. frankly year. substantially scheduled that the of

parts of we So, today. think XXXX. will and sort switching majority revenue have nice the entities have sets really look, XXXX of acceleration we XXXX, a production come two of some latter from of these customers with but over – the I part the the stage to the in that in And again, for

Chris Souther

it. of cadence How Got million? $XXX that lines we of modules would sense the Yes, at be many over than about on? how and $XXX you of launching get facility? coming facility we online. the stages We a bigger on timeframe different about to should kind the want expect much if million don't to think that in when should back say come a half, second the of kind XXXX, we have you're What do size particular talking of sense the just here of of kind

John Fairbanks

ultimately be point next our to obviously pace are XXXX what facility, And no provide capacity months to of out guidance to will size we'll the that kind talk costs exactly few of well. those in. the will we going you – and that how the revenue the call. the later facility we about as give when it's within QX Yes, to keep overall CapEx earnings expect what get incur of our we're that We'll that's with time detail the in than costs phasing hope at

you cost, investment at want forward. to that we're you business seeing the the once of the but the so on can give we what not So, understand the return dynamics and moving whole picture, just the and investment

Don Young

too John’s small. call big, they the don't want don't think, it I contracts. too longer this the deliver. These of to right, we add would are so I we too time thing started and is the contracts, Goldilocks term thing before kind get time thing, We small want Chris, of that to build the capacity because is to we're win these out certainly this comment, this

so, be to got And you've capable.

here. market. first really of demand so, match And bigger again, John size of from that up to And we're towards beginning the with in trying leaning says, focus And that's course, phase. because our we're our that's getting as what the profile the building we're

John Fairbanks

coming, opportunities accelerated larger it's above quarter coming the at what pace a we ago. it's an expected even Yes, and

Chris Souther

it. Got

Okay. that's Thanks Well, guys. helpful.

Don Young

Chris. Thanks

John Fairbanks

Thanks Chris.

Operator

Thank you, Mr.

question the Research Curran line Tom Souther. Partners. Seaport from The next of with comes

proceed. may You

Tom Curran

left. similar front Hey multi-model be wide number over the to contract, a platform ink And to likely Could at at for three to the we're guys. now. you customer? we or what's earnings squeezing juncture, an apparent I've third see hour model, might thermal the runner I'll to you that on before call one. seem earliest customer EV single most Thanks only in, secure Don for extend customer a you the number design soonest? announcement this even got quick. potentially the that does become barriers though XQ

Don Young

be will it platform in So, more battery nature.

product that. of anticipating So, and validation there's multiple notable I'm that a the or ones today. level anticipating activity platform-oriented there sort in I'm little a RFI, roster, I'm more here most this are RF, RFQ, OEMs are bit, speculating

so of announcement pretty February, earnings that's period late our a short So, is time.

to timeframe. going and we the well. again quarters announcements as that be in of And say companies of though this talk made next So, some set continue a over are that think in way, I we about kind to as the and but the some expectations want in don't we'll position I of very course funnel strong make would win just the newcomers them. we're largest to with of There with decisions some two-quarter the of couple

Tom Curran

when you've number Does it helpful when of you incremental outlay $X.XX in And just half to Phase revenue that dollar comes pause it CapEx hold to a tuned. per X revenue, staying John, plant previously the production work could an update far, might X production you've expected see incremental you on Phase done of based expect additional or be transition eagerly that the CapEx capacity, We're investment do of in be the of does heuristic you would that comes two, then phases? between just second of you'd adding revisit in comes seamless plant be the to thus two? it still dollar per when provided very capacity? that Great. or for XXXX, a number to we

John Fairbanks

answer question We phases. yes, So, see between your first. pause could I'll second potentially a

coming I revenue. think when were that these the alone, real capacity out additional plant, metrics question, you about content, aerogel for had the thermal add of got but products talk we that revenue multipart we've traditional now because additional barriers

on are are and this steel every like is in there, a part I being up the I'm overall revenue revenue. inflation a we the really that And business workers. withhold is that would going And just aerogel costs out to to that high demand to dependent there out the are however, having plant to companies just up get of pay of so, other say, until is of barriers present building with a steel. construction through be going then in at it comment big construction upon component order resources get making thermal cost there,

is barrier talk we on it and all the the the working make. it barriers we comes what's aggregate investment the thermal the make we'll capacity, and additional capacity, when capacity clear, revenue from content together about is what's very us. put So, when inflation aerogel working asset, against the we'll thermal that And us. our The investment what's for

more so, in we'll package detail we few plant the and talk provide the all that fully we that months. And about next make when sure

Tom Curran

Sounds my questions fair. guys. for Makes Thanks sense. taking

John Fairbanks

Thanks, Tom.

Operator

of question from Curran. Thank Moore next Mr. Hutton. with EF the you, Chip comes line The

may proceed. You

Chip Moore

the question. Good Thanks evening. taking for

Don Young

Chip. Hi,

Chip Moore

subsea on touched the can guys, don't side terms then in update pipeline you trends? infrastructure I we on the and on quickly the there Just on energy LNG. anything Maybe side, think a of

Don Young

been Europe in the Well, we've reading and center I the as and production about LNG importance a of Asia think United. here all in

maintenance think The a activity are slowdown come the workforce a that lot, insecurity on pent-up I project work to high. nicely think, as did is, about executing people for maintenance we've that general caused it So, work project demand quite levels talked pandemic that well. slowdown. pull project. on around seeing has are I back And We're that of work to in frankly, some work Project a sure. the continuity major and hesitant still little to cause trigger

having we that, win So said our of type to LNG we share of chemical and staying and projects in projects we'll fair of refinery specifications those are think, a And them. close number we're well. the again, projects. as Both

us. And look Again, there that us of pipeline in fall would out of continue work our of when sort has be and expect come it really that it's XXXX somewhere our years, of an $X million in place $XX range business XXXX. in projects here for business again of could important keep size, million between and infrastructure a are we projects sort that been kind we of back the on our will for million always years dating most So, a of been energy sort a of to to $XX handful you to niche our that XX in we nice And million solid it's been our in sort The feel been to strongly I materialize, about business, pipeline, into come. I I in subsea has about think, $X and a proposed in think XXXX. three-year business typically subsea. at

relatively just So consistent. again,

Chip Moore

high speak battery to set, bit though are advanced battery at as more Wondering could supply material Canada, from they here bit U.S., maybe fill day, no, out well opportunities, profile the geographic for of implications of a maybe Yes, chains seeing in Obviously, Europe. a every as things in a your number if some the helpful, opportunity out horizon? we're a announcements Don. you of terms that's of perspective, further even

Don Young

battery carbon very belief the We you sort would we talk that on on then consortiums engaged of in And to with the battery significant carbon when sort we're the and join aerogel play will And aerogels our the of side, OEMs engaged sure of say in battery And Xs, be also comprised next mandate we're battery those carbon to our the also of over have of about that newcomers the the companies. OEMs be to with companies but look, come programs, barriers, our you those sort switch I OEM we automotive goal I import see automotive batteries. large but about No, OEMs, OEMs thermal battery that Yes. chemistry and programs talk side mostly these again, some on have of, Tier with aerogel. side, of Aspen know today. is but battery together consortiums. going generation material the guess that some we're themselves

So, small, big I the some think and automotive you'll see, with with pairing of like ours up large let's pairing battery call up OEMs. it a OEM, a company materials

you're sort are believe that play find our again, So, activities. And And see some to aerogels we we'll think daylight out of in I that carbon special. those here. going

that data battery convey get value further item some revenue as or in So, be do well. third-party I it other but able want us, that have we we worked this that's what to with don't can generating XXXX we working is think of a for material XXXX we're Again, to validation as begin be the companies hard and compare space our the for our that to work, towards.

Chip Moore

watching it. it. Got forward Thanks, Look to

Don Young

Hey, thanks Jeff. Appreciate it.

Don Young

Jeff. Thanks

Operator

Thank line Cowen. you, question The with Jeff the next comes Osborne Mr. of from Moore.

proceed. may You

Jeff Osborne

Excuse me. Thanks for squeezing me in.

couple had quick Just ones. a

Can like on you think an content to might higher give vehicle. should I bit to us sounds per talked now. a $XXX be? $XXX It that where the in update be you past that had about a

Don Young

a beyond cases cases. the end battery operation, normal performance with to playing at construction, runaway. you role some the other a I opposed we're during battery Yes. challenges range we're be It the again, in think extend some its critical if is will that of thermal the or safety. will a and around mission valid And number of battery course the broader for of Where part we as the of where module around addressing range that higher some

So, when us for be to content and we principal seeing level. get those greater is expecting the vehicle into reason that seeing expectations it why you're per we're increase XXX to than situations, XXX XXXX XXXX. And

Jeff Osborne

both helpful. of and the two? the scope Asian is customer it's expanded one North American just it That's And the it. the Got or that

Don Young

are. Again, just – XX soon say, were if who to I get well, revealed going I it's would maybe but to… of of we'd rather, not here companies these there pretty them, like And would I this mean, say, them, three is

Jeff Osborne

Don the other platform. might desire a the is time Don of expand a award on just quick one ones customer, you or two an it for given there for like be or the out literally model just OEM? to that using now, vehicle interest there's one for ambition Maybe Understood. of party that a you Asian secondary you is but one mentioned Is that one for have just potentially that, John.

Don Young

a Asia – responsible be has base in is our win that responsible Europe for team one battery – of the most our vehicle marketed But Yes. has the that's and another that's included the platform and the overall. Asia, engagement for in With will for team been company and model responsible specific with America. team that's North

launch made was the And before that to so, designed. commitments completely platform they vehicle

teams. again with won platform so, win we And believe shape vehicle we're longer engaged those We've the and excellent of obviously both term. with we to the

Jeff Osborne

need a guys that But OpEx bit these Got margins last million invest mentioned incremental John, in of of path utilization. on to and you $XX get in the in of profitability, it. lot is as A we a of the to you result how question a That's clear is incremental it's additional flow And sort through initiatives. common is question XXXX. there much then obviously of I investment all the helpful. had

drop a $XX XXXX that you you you there incremental levels? XXXX? to I it pretty expect what's initiatives, each at hockey million or guidance, and say sharp the And investment stick of to is it relates or be for would do a substantive is say new as XXXX but these flattish in are that these of needed So, know not giving bucket of

John Fairbanks

from general the that $XX $XX Xx, just We've I in put OEMs said makes digit think, it sense. initial we next year single updated that two range. profile, we customers, our million Yes, in million which between and somewhere

million when XXXX the very get XXXX a that, in business potential into timeframe. more the something than leading think But expansion XXXX generate you revenue or even EV $XX investment and a in about significant you operating expense to of is significant going and So, losses XXXX.

from into that coming will So, profit increases ultimately losses XXXX clearly resulting see beginning but then contribution business definitely, in XXXX. and the in we EV in sharp profitability business from and in XXXX,

the when profile. So give that the sense the we about general we as that's the a though try give talk to to much we'll We'll path ramp XXXX well. the sizing specific when good profitability revenue time for of plant, be you also more and at guidance, really

Jeff Osborne

Perfect. for That's all squeezing Thanks me so had. in. much I

Don Young

John. Thanks,

Operator

additional are to Osborne. provide this Mr. management so you, no pass team the will time, there questions, At Thank it remarks. back to I closing

Don Young

Hey, Thank Thanks reporting look results in a And late your you, Be quarter it. to to February. appreciate have appreciate Sarah. our much. XXXX Aspen you fourth Aerogels good interest we well. so and forward evening. I in

Operator

XXXX enjoy participation the you of Aspen call. the your earnings rest QX for Aerogels’ Thank concludes and That your day.

Aspen Aerogels (ASPN) 29 Oct 212021 Q3 Earnings call transcript