PCT - Earnings call transcript Q2 2022 | PureCycle Technologies, Inc.

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Operator

Good day and thank you for standing by and welcome to the PureCycle Technologies Second Quarter 2022 Corporate Update Call. At this time all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today conference is being recorded. I'll now like to hand the conference over to your speaker today, Charlie Place, Director of Investor Relations. ahead. go Please

Charlie Place

the to are can statements These available in set risks this and our be which unknown and are those Harbor information filed Investor Welcome This subject conference further Victor. release Relations Technologies quarter our call filed second PureCycle forward-looking at related known Officer Chief Thank uncertainties, Larry our we our can Form second we SEC will presentation at be and file I'm provides our and also the on corporate found the quarterly to about of Charlie made as will provisions be The update Somma, report management statements end that the in highlighting many and of XX-Q today the update forth press be on with of quarter Safe to our call. on joining Financial Investor beyond corporate forward-looking Olson, Place, found as earnings today our quarter. developments and beliefs may Relations on currently time. Executive other Many reports our our well www.purecycle.com. Officer. that will our at including on of to the control, going you, assumptions Chief and risks me PureCycle Dustin business. website morning, and detail Director for through for of page management's yesterday the statements be based be XXXX for second

we those forward-looking required actual materially to company's the as differ undertake note law, statement. no except and any obligation from Additionally, please update by anticipated may that results

non-GAAP connection forth actual financial quarter between may to material. today company’s and the variation may uncertainties in and including results Our also subject herein preliminary preliminary data and among end with set year-end remarks Any changes others adjustments. are include be risks and estimates the

purecycle.com. our with joining slide you it along by phone follow access to welcome can us on if deck are You or time any at

updates you. to We previous Olson, Officer. now to with the call over Executive PureCycle's turn Dustin? Chief are share quarter Dustin excited will from I the

Dustin Olson

Charlie. Thanks, you my update first to for I'm you thrilled as morning us. joining for with Yes. today CEO. Good corporate be Thank everyone.

operating First opportunity Otworth, for growth off, important publicly thank I dedication strategy. to PureCycle an time seven and expansion previous early the Mike our to concept transition CEO years, during PureCycle want past traded global his excited lead this our for as and company. from the a honored to I'm over taking we

continue facility flagship remains by track Our end. on and Ironton year to expect pellets

our advance to The in Europe. planned facility to first in global capacity XXXX. phase full our ramp Japan expansion of And South to is efforts Korea, Augusta purification and continue

expected XXXX. and in progressing well. coming QX in our Our are to expansion online operations plans commissioning Ironton And PreP are Ironton for very are PreP feed start beyond

are co-located We PreP facilities in Augusta the and on one feedstock one Augusta Central the site. supply Pennsylvania, Eastern Florida, to facility, along purification East Coast developing one in three regional

We will detail later. more discuss in this

acquisition expected for feedstock purification supply Augusta compared supply combined LOIs processing feedstock our our quarter, excess previous additional pounds, that the with brings total approximately XXX LOIs our capacity commitments which facility, feedstock our requirements. purification million to an strategy. we successfully We are feedstock feedstock to to the representing to Augusta continue pounds full In million execute to polypropylene recovered XXX second of yield secured

a and two a venues the allocated for program to XX offtake million Ironton communities We an million remaining negotiations different our lines and one circular the diversify have to two pounds the fill is for from FDA and of from and pounds on continue we is capacity truly and program. contract out. waste pre-notification LNO are quarter to offtake second agency eliminate plastic environment. an streams. final XX% companies, feed of and This Augusta Augusta organizations, opinion in PureZero and two. We events received provide sources expected one XXX sold lines opportunity feedstock their our create through letter to

As we with actively their specific our on sales applications. projects brand numerous approach owners operations, is for commercial team product coordinating

to Our allocated finance one project and facilities. support to financing next commissioning with $XXX expectations for execution the investments. Augusta team second Augusta and full has cash million with PreP total in in our three XXXX. $XXX million taken steps for lines Coast quarter ended We've fund the two, efforts East the for and project We the the

this the Slide the operations our and to XXXX on remain facility one in multi-line of up of our focused with Ironton XXXX. phase our mechanical year, four, completing company. remains facility ramp with Moving Augusta for scaling principal the up ramp We completion in strategy

in with deepen we Geocentric relationship Asia. in PureCycle and Additionally, develop to Japan our to facilities SK continue Mitsui Korea, purification in South

team During lines to joint XXXX. visit South Korea two Korean South facility our to to construction full SK as four, European visit R&D three pleasure Phase their future the and venture. Augusta to are opportunity for expected and operation in QX, location the the in this had the as in start both and facility we ramp global our facility and well representing

track. remains Our on Ironton project

is followed year-end. also and two consistent over mechanical This messaging initial expect consistent the our timing fourth pellet in previous XXXX quarter the by production with years with completion established ago. by We

experienced COVID and of is the market during achievement entire pressures. Our disruptions chain supply inflationary proud very downs given this and lock team headwinds

are needed. as and of a nimble There's We and PureCycle into lot this to confirms continue nearing is and underway. startup. is continues in has of our a and strategy for to challenges for successful process, phases and out validate delivered commissioning up and final full are do but adapted we construction modular assumptions we Ironton will work gearing adjust at PreP installation. on build of track during to lifted been recalibrate feed of PureCycle This our construction, XX completion with to the XX modules place. and

right we the the have to right ready and attitude, have go. team, We we're

chain Moving facility across current to activity. improvements and second fully conditions the in projections, is The supply purification startup and our procurement mechanical learned This during XXXX. slight track. team are has key but continued first and to Augusta it's make commenced. place been site has full on project, Ironton quarter ordered the long construction in current which work is previous lessons PureCycle every improve multiline efficiencies expect into Slide lead integrating the and from to due equipment estimates to progress essentially we Longtime our contracts preliminary change anticipating to with Augusta completion, a and construction six at engineering economic from commissioning activities

have coke schedule. been same for Gulfspan, Ironton for several process working We years Augusta Krauss Working with key leveraged and partners Emerson the Maffei our maintaining Denham-Blythe, us systems, facility. modular strategic gives project increased that in in we've confidence with

period benefits. challenges, are yielding partnerships chain this substantial supply our During the

We have efficiency. able been schedule changes cost safety, navigate to and improve increased

East Moving to efficiencies. to is overall to key Slide seven, because our Augusta we the component along are first, locations project developing Coast. three transportation provide This facilities expected regional a the PreP are

Central approximately suppliers. grinding million recycling of anticipate plastic. is create and Second, third, offtake the with reliable pounds of in PureCycle's infrastructure creates feedstock regional first platform the a XX%. facility and for And XXX annual washing. the We Florida valuable PreP mixed overall for the sorting assets partnerships sorting, project necessary capacity

final still a operations year, details early few through are QX commence of construction to expect next and or in We equipment year. but delivery this working

have PreP made on additional Augusta. we supply progress for Additionally, plans to facilities

five Georgia second Georgia our PreP and annually. Xs We PreP base Augusta high as operational or XXX spot on a co-locate us Augusta, also known all bale two polypropylene will one pounds and PreP of to will seven X purification facility. facilities And will the Denver, the PreP purchase XXX to Augusta to be Pennsylvania quality and the XXX waste landing to an bales, facility The to mixed North number annually. sort asset This of five become low bales. a will facility in overall locations approximately be design have have for asset bale site facility to of in in designed also up pounds allow XXXX. capacity selected million America. Pennsylvania, at to to capacity capacity designed sort and we Denver, PreP million We anticipate pounds also of and handlers easy quality half Xs number have Denver, X Pennsylvania is wash number million

go PreP PreP in ago track Moving the Slide commissioning two our assets this Ironton's to eight, into now we're real of QX on strategy. progress on executing to ground. Decisions one in as startup view and for in year. are full are operations coming making made years

the equipment. in one are of being bales the see pictures can that through You commissioning run

end Georgia the facilities facility We nine, its the in relationships in as expect to 'XX. to or XXXX. marketplace. ramp with in to Florida of early year in Slide PureCycle operations half continues be PreP anticipated by PreP QX in up regional up our noted Central this strengthen our start On the Pennsylvania second of and to full And complete are first

are result, two the supplied a the LOI. Augusta As million polypropylene of with pounds lines for fully facility purification XXX recovered under

for oversubscribed Augusta. in are our two We lines first

focusing and feedstock lines Augusta four. for now three on securing Our teams are

channels. As to different untapped solutions FEU reported efforts on last create streams strategies R&D resin focusing we strategy new and market targeted feedstock are developing quarter, our on waste diversifying across

source management. their helping is Our product. transparency final and customers optimize us Born stakeholders. This of our important This to feed feedstock digital strategy is to also track from being designed our includes level to

build to our developing to lines. time, asset continues various to multi-year The create commitments. At unique through different our commercial purification facility are across grades strategies offtake pipeline. are team also allocated purification this optimization XX% Augusta We EPR

develop consumer with is team brand working for actively to product plans applications. specific owners Our

and the Pure fully at markets UPR offtake the model and have its through the of allocation strong negotiations continuing and interest Augusta full currently acceptance offtake lines final Augusta. Cycle's pounds resin allocate remaining is of We two. Ironton in being Augusta implemented momentum pricing at plus are demonstrated contracting for one seeing We XXX allocation. feedstock million to The

first the a multi-step XX. process Slide Moving the We've step to FDA. in with completed

use on such, grade food of receive E feed we of from This agency materials. through food also materials under an was that receive the FDA collaborative FDA. PureCycle streams. conditions through opinion types objection food As we stadium G condition that grade under with for o The of will all pre-notification the the a The a for letter recycling confirmed effort food received trash LNO recycled use for FDA letter A all a different pre-notification H. confirmed the postconsumer types for will two post-industrial letter

Our process current define required and worked polypropylene approvals. to the for teams together closely future

and PureCycle. methodology sources for the have conduct now additional of feedstock FDA helping and to as a unique We the feedstock product streams. We clear time expand the the with have a PureCycle technology, to This establish to achieve submissions directly FEU spent this make quality. developed an is the polypropylene. great PureCycle technology for recovered approvals. informing to the expanded additional process news achieve for worked FDA. This potential an of to baseline familiarize application on of and purification with about FDA see plans understanding iterative significant further LNO testing And will It's process future also approvals benefits to achieve qualifications superior be additional the to first recycled feed use. we the that testing time we conditions the our opportunity and post-consumer

it incineration. streams I we can technology Somma CFO, our and Larry to for financial so feedstock, will targeted over curbside will our and update. turn reduce other to include leverage now underutilized landfill Our our

Larry Somma

you, XXX turn over just sheet Please second on and million ended in XX. quarter liquidity to liquidity. quarter the balance total our Dustin. We Great. available with Thank slide

Ironton, million. second in we to both we Cash order construction decreased which to significant on the our continued by on for in majority long strategy, multi-line deposits advance That PreP investments. and Augusta that unrestricted PreP quarter equipment $XX.X provided made earlier make presentation. almost the March the and of we $XX the debt the the available quarter, from design from for and PreP our and of the assets. Augusta securities investments updates facilities furthered facilities, accounted million During and purification for came sale lead and lines In

incur as we million also run million costs, fees, and cash had used which other and were normal the which continued $X.X We of our such quarter. and benefit operations professional corporate $X We for means to corporate expenses. insurance, various pre-operational businesses, during second payroll

in additional this this expenses our At project position. that invested mechanical we our unrestricted spent budget. million let are Now, as stage, about me These this plant, million completion and on cash be to the quarter. we later comment year. initial $X.X $XX the are million we this the cash maintaining we are over Previously, project had Ironton expect to funded from nearing $XX disclosed we

Additionally, cash. our are of unrestricted required amounts from certain we bond to Ironton replenish funds

from restrict transferred million And cash. so we $XX.X unrestricted to cash

We also fund. directly XX.X payments from our of made project million

an plastic underway. path turn now PureCycle lines track Central continues to significant are strategic a and fully lines to The later startup Let's XXXX and stadium PreP against FDA opinion letter, the execute Ironton commercial an feed global LNO on number pellet on a on XX% in waste XXXX. we startup Augusta allocated, for early of facility The grade PureCycle Ironton operational use momentum letter to addressing of in trash. Pennsylvania track milestone build two Augusta's its to first with food production, post-consumer operational key feed under offtake intend crisis. stocks XXX% for is two and on PureCycle's of our Slide or materials, XX. build And recycled in agency Augusta in flagship execution first and QX both for marks and Florida growth for momentum the areas. two operational Ironton in LOIs. continues notification pre allocated will construction Augusta and strategy a receive the track I plan. remains of three, post-industrial XXXX XX.X.

you the to cash converters to quarter of PureCycle board importantly, continue plan, ended a We further the process resin will as we'll soon And in most on talent forward relevant updating continue We now today. end to top Thank information We questions. specialty are the and and organization. we market recruit the look we for which to with on with applications $XXX we investments. our second us strategic the Augusta how broaden executing to of joining experience compounds. debt million dollars broaden additional And we through total with update able. respect the include our the open as are and for call raise

Operator

Thank Instructions]. [Operator you.

Alembic from comes Ahmed from question Global First Advisors. line Hassan of

Hassan Ahmed

feedstock A feedstock in and good sort a very as you Augusta explaining quick one to us two availability. for as lines question around Obviously, job guys that that, oversubscribed. well did of pricing is

with the all mind hear issues of mind keeping sort in to regards with sort be seeing, lines, guys pricing the you and particularly inflationary the of to are wanted we're Just what environment regards in there discussions, of for seeing be terms that other to logistical like? availability in keeping there the

Dustin Olson

Yes, It's thanks a lot, Hassan. Dustin.

I think that's a good question.

use that I think ability in technology our wider opened a market. the really to differentiator our of the for is swath feedstock up

doesn't we pretty illustrate product of number some that market action while bales, the of that stream. so active And pricing for in for outside the agreed that really availability that's five spot of the there's

position. feel we like in really And good so we're

us number feedstocks the that insulates that others On allows side, bale. one in can't technology hand, effectively dig to variability feedstock we've five a got the touch. we on pricing the program have plus But the other that from a us into

one Augusta lines very for quite details prepared not share four, two, to a shape and excited three about the three, to we've the that yet, to be going in we speak so but for four were discussions for we're in and and got lines active And feedstock with good future. few and we're

Hassan Ahmed

capital I so, for quarters. fair guys And the the side obviously, up, the maybe last says raising on changed rising as over of a abound seeing rates it, bit mean, helpful. like and Very you do Larry, world's obviously, couple follow recessionary of what a the

be around, appreciated? color of that sort any but would So

Larry Somma

a several the ago, rates months Yes. in looking has release, points. every process that and you moved see at at up we treasury we've XXX we underway. XX-year the this started everybody that's least We day, at Since can as have look press that mentioned basis

pretty that So that's over time, an we are tight the treasuries models, spread give fund that projects very real. to same we cash the projects strong But to relative. the opportunity at flow keep look -- the which us

pressures it well, not material. It's really is in uptrend from rates. So an

plan. good like doesn't we we impact And in So feel our we're shape. future

And are. so that's where we

Operator

Oppenheimer. question from Noah of the next from comes Kaye line Our

Noah Kaye

zooming much playing from and industrial you're specifically, approval picture process getting qualifies post give see feedstock how on that Particularly the helpful here. out you that of feedstock start a really this trash We'd is the getting for in and I category. for got how like stadium through by to how a FDA kind investors is of you of Ironton well, important us those for And important maybe the already how to then into falls source letter approval or talk playing process.

Dustin Olson

the progress We're FDA. the Thanks we with lot, about Yes. a made excited Noah. very

step think set, was bit order understand forward. say this it's so discussion us really a into to see let's initial I little with what to FDA important understood and they And in that technology. to needed our the they we the process to process level for move

lot in for one a there's we better, good do many advise scenarios, discussion. process, so efficiently seen this were polypropylene tighter And in like more another in some FDA able the to and technology collaboration hasn't a future. ways of how the And and this on to

we So in slide time with to they I forward partners think able polypropylene for of When to in to With channels. they different lots a across information efficient have, appetite And general. about we more sell question. pretty that to respect the specific we'll spent shorter you on a of that I offtake big them going a understand FDA. way. the be your have looking lot market we'll think for, is the getting another. a know And first think see point, just cycle what I Because what one time there's the think that they're like now and

with we the approvals that have. more full more we're and more And we to as interim, approvals, to them say their gain be the out fit get do And FDA source able portfolio. in able that we'll to to widen then applications so that is then work what to, and into

now, So lanes with see that approval that they any our the flexibility I getting Ironton move really quickly. contracts LNOs the months in more it a see don't feedstocks into more adoptions the the use just see lines. got to go think lane more for our importantly, to quarters, think then, additional order really more in we've across coming gives product offtake position and risk approvals that more us wider more that current fit. think and of of different application I I we've and because get to and got And over you'll But I a product

Larry Somma

Noah, it’s almost supply to post-industrial. are Larry. all further of just that wanted I add for the thing. one Ironton And is

I just as that, Dustin but think to I clarify said wanted well.

Noah Kaye

Right.

So you're sure to the that the want and I tin, I to was just on that feedstock, covered be point by going iron effectively everyone. make understood do have

little So of sure about update, just we as bit Ironton year. turn but the you currently the congratulations cadence November the operational of next the on place could of revisit you The that. into ramp, in that kind last of a this need to fall how get call, are to then, And kind talk of about thinking pieces maybe first I'm into for the some online. here half

Dustin Olson

that's Yes, great.

the parts. of scale because moving stay appreciate by daily partners relationships and happy I'm lot can So us pain are allowed of putting But in, really I'll size. to parts very, reiterate, of because to the nice industry, I&E, rest a felt I areas just a our like it's the in on moving battle the lot us hold of very bypass track, of first. construction that the a that's a on schedule, we strategic that operating there's the again, we're have key you environment we've made some with this partners, space, a And given lot that's really the mean, there's project electrical, in

that charging And And that really with really we've standing able And that that's a be we need. started. then, to things very before you we've you get in activities This the got partners and almost up get because to got and behind for that close you're to of really, of going us so those components honestly, end punch Ironton. everything done. are been proud one where schedule forward the you you've of we're hold of battle reasons can one can to list

fine. so continue going the feedstock start to to up and to people up XXX% applications ramp operational solid, work will but QX -- material, And to, ramp actively but about thing the the have go path to will schedule, that for mean, up and most we're work up suppliers don't with everything can to do that the say everything The we've we zero that the so, more by fine. through ramp that we scale mechanical okay? very about I'll that the every be critical think work that more a continue activities, that. and assume things with to continue offtakers go we'll to with have that with plan there up, as we're that's talk zero ramp to are and same of that's on up ramp, don't continue end people that which that making the work all not. respect hold the tell technology ramp With that things Ironton. have multiple that certainty month, and scale things in well. pellets start our feedstock in that let's people people that with offtake, say assume people lanes plan When have our are to working, you, go QX, let's we're this, think It's the assume from and to The to we ensure on the to stated in we we feedstock to that linear the most grow is up technology plan feedstock effectively will do really that and confident with the nine-month taking most I and to completion about

And c, is pivoting three reliable, nine on with pellets to ramp up and taking the Ironton really getting up tuned the offtakers, then, feedstock making up running the operations plans, than up our Augusta. plan and material. month ramping things, reliably the a, getting for it our longer and comfortable pushing to contractual b, them it's and the And so running

that So made three across with those pictures, of the Ironton of in we're having say this take on. feedstock about, I progress the we're product, want just great three pounds all fronts, it's to now, we've things working detailed X saw starting equipment. we're with discussions And some you I'll million in okay, take into practice, to but offtakers piece to theory, of got to as go

least And on the working so happy right I progress up we're track the we're we're through details at and think stated. plan we've that those ramp now, to -- very and with meet

Operator

next from question of Craig-Hallum. line Stine from Eric Our the come will

Eric Stine

So if classifications more your would maybe I I is. don't know, how set have bit whatever just can got this the deep any and mean, supply just little ultimately, those a take full goal I FDA, because, customer. of you covered, be asked on you've And classification in that then of all knowledge feedstock

what to goal, the you so there mean, meet your today? far you about market to can does this a I is with So, mean, I that get that just announced think how ultimate opportunity? way fully you

Dustin Olson

to goal, feedstock A goal classifications have at I our mean, our is let's all flexibility Well, we're with ultimate not through say, final so H.

And on what for. for. that's we're, we're our what we're track so Okay, that's that's going goal,

nine how a we've last okay. to FDA, for is done over the path the get really charted what months, Okay, with there,

how works be purification an LNO. it's got really And the process, unprecedented, and get level technology the an is have relative we're product, using that molecule, quite before. to so with comfortable to And of this before, because this they'll gone with FDA going others that that you're frankly, how comfortable to bringing get to iterative is your technology the just

go part there's path to a of a more. The we important FDA. that that have were and we able at And with the an the get initial happen has is LNO to education get to lot classifications, most so

I So is that the the learnings us very the FDA lead feel going confident with to rest. to

Eric Stine

Okay.

that to the is lot this for pathway entirety get confidence A the G, is of it. a to H, gives For the ultimate LNO, E to you got a goal you've of

Dustin Olson

there's which it procedures where And I operational reasons of FDA feed And procedural, built will polypropylene. we from protocol of performance. been part we'll followed several improve some it they Other were the has much that. and Yes. adjust just molecules, that mean, future, that some for for testing is, so first it's tested. to overall have we the the not other for

more is indistinguishable, get And test quality additional so product feeds that feedstocks then LNOs different as more and FDA to prove the further the between we'll we for and feedstocks.

in great to this short the circuit path so organizations. And And got. between a that continue I was to future there's is we've understanding open to get most good thing the discussion and what the a a there's step first move the very think an important forward. two and There's dialogue,

Eric Stine

Yes.

are more just they I into have being that a I on I helpful. waiting turn how then that's you mean, some a offtakes know, on this objection? now, of play And offtakers? XX% beyond Were There's Okay, behind a to that that allocated of the Augusta. that. but laid those activity lot Maybe does pipeline that no letter get out. it position? And finalized. think things into in of I mean, closing potential any full potentially offtake

Dustin Olson

helpful. it's think I

give confidence to our it'll LNO. the moving that FDA to think for get path I forward

think theoretical. until was this, I the it up very of LNO, getting point

is the and like been so But don't mean, lot a at in point LNO to find offtake I FDA to that the for that who widen say, of I'll automotive, it a fact of FDA we far. quality customers, what our customers there's for more portfolio, there's And customers, as more so indication product. also But lot all. has our of need don't LNO. need appreciation instance, product definitely to yes, the of continue an we achieved and an introduce

need so value and consumer allocations And channel. that or the discussion regardless as a will entire it. we're And seeing different on Augusta, certainly the across don't broadening good we But products, different frankly, good help very LNO into our in products that discussions. across beyond interest we're quite spectrum, get of the into offtake applications market

Eric Stine

involved that just has where Korea Maybe a Ironton looking plus that ideal of lot a it. in But location even were involved back noticed the last year I you've on offtakers South got Europe. Got the been in know and at Europe. for me, named I one are go and partners, Japan, Europe in

helpful where I you So market? the stands. European be here then And LNO, maybe that, would in that just thought terms know getting into of

Dustin Olson

question. a Yes, great that's

that got there So, the I'm going would with be who was of just to anytime for confidential future about around and prepare a get subject But that'll a very into say that that work and a discussions for it. this at different worked to discussions be moment, your with keep there's level partners, into to lot you of always or as do need with and we you announcement. Europe, own JVs, partnerships, a discussion on

mind, And we this so the of so opportunity really choose. in with the others to front the on future, with with kind for case building in independence European but what we're doing is activity, partner if the

Okay.

cannot the a in same and potential feedstock to to at we that applying by may Europe, of not are the in There's Europe Europe in I'm say to feedstock Europe, U.S. be traditional too looked partners much more process, not would we used that have lot as recyclers. in the So going or available may in speak that I discussions but

in And as us to That's it target. U.S., is the Europe. for same an in active field the so that's

importance selection we it's lot that today. what logistics, okay, on have we a that. maximize overall separate the the the We labor because doing way and for we long-term, is kind that think to separate EFSA in by done will are like process a be some about a we're and sure different. EFSA. customers through to separately. It's we where which go important for infrastructure. future efficiencies Europe force, sites with then not the same impression qualification mean, in of of to need And where process it's that of will FDA on with facility called on a equivalents there. a FDA kind EFSA. it's FDA frankly, a now feed like discussion that Augusta, facility process get I -- Europe. for you in results, did our mentioned And path So processes we're Europe Europe. respect so FDA the believe as process as good They site efficiency, And like is operation means, go. on of Europe, focused there's Europe. there It's and the was FDA work, they our follow we're managed in completely lot right work access the specific are This FDA rules the Augusta of will also well operational But that both Augusta regulations that can approvals good the with into discussions did the quite just EFSA first But put to on good in will energy, With of qualifications, the announcements I through the to underway where the what a release site selection. of publicly good for place good We've overall to in

we're steps what so from our on so just approval. get learn them to-date, watching the we should it's not And totally And can to be that clear.

that we're that activity. very, EFSA track And for about confident feel end an the day, for still the we're up. watching on perspective, FDA in ramp the waiting Europe, support at FDA from and we're doing like, Europe. we're very So then confident that the we of And I work XXXX think will to

Larry Somma

only I'd appropriately be staffing are we the to will of what for required that also other Europe. needs add, meet Eric, The is thing

critical the doing we are in from place not finding just in U.S., we that we're putting Europe resources a achieve few we're we that the this, that have. goals So so can

Operator

the Sweeney comes from question Gerry next ROTH Our Capital. from of line

Gerry Sweeney

rates. to this explain to one of question. And polypropylene to additional you're about And Can exactly questions, the what from value Is talked different the to this convert? a an working standpoint? UPR value compound. opportunity you think longer do talked term, a But term. some remarks, and Two you does also bit working even going shorter you about maybe this on I little further? the going add be with longer In on term one's prepared that

Dustin Olson

Yes.

the our that -- think let's space. I do into we So clear, be compounding to not move intend

our polypropylene. ultra-pure business a [indiscernible] not of our an to It's plan become plan is part be So resin to it business compounder. recycled

value build establishing we're the needed And what's is order to, today right doing brands so what in compounders know the market, in the create recipes and because let's final market. most relationships with the in the say, they the understand ultimately

Okay.

I With to comments came we're recycled, done the product with new in market. be market I this okay? in produced do thing as a fantastic we respect for their interest to of looking to same relationships segments. was there's waste in that's to plastic other the about to the in start that made plastic of chain, we've if take brands good of beginning segments in us their more -- market about a any show again, the the that turn there's the back we're some creating with well, to just to show be think new of the want transparency But of when to well. things the true do I lot lot by at container others And able segment, product be developing market. market into circularity and So to you to a applications. opportunities the say, that back with market respect as feed say certain going really to So they that consumer circularity through think that's really high-level let's able that channel really think mean, be going I channels value product, full unique really that they to

to. And so we're that's what really speaking

of going able specific without brands going we're been really that into think I and end details create, some the otherwise the sustainability, haven't targeting, many really showcase at on about the I too to of the that. frankly, excited And the super streams and Augusta is day, think market of that or So nice quite to in the for story a create to it's show circularity. getting that it's lines three feed four

Gerry Sweeney

obviously, that the be shorter some Got sense. makes when view term, question, and months produced commissioning are and several track the then, in next are gave to ramp probably once very some plan. critical for to And -- that the track them us Ironton. the are up that steps Or run other on Ironton view more the process give the or facilities cross you it. is you this visibility on going But that, a time. maybe better they'll you on That pellets way there major

Dustin Olson

Yes.

I think question, fair a that's Gerry.

when all et be process, no I solvents of our to will completion, reach I big specific would a when operation, capacity, timeline, out think going you going methodically, ramp on in big that, day. go records I that through and steps tell into have start then are hundreds safe, And there's I of the say, up here. to introduce lot commissioning, the we'll the rush reliable are we're mean, break day pellets, we the I reliably of all that, those as that's making an Gerry, I won't milestones. do steps of ensure it it literally, in we the cetera. to the back details far then, That's are, there's to go comes, a the that end for and as and we're to of And to right, get a come we after able Ironton us, startup. safely circulating the it do process But But as when mechanical way process three through. think that's big the that we into a those some going

that But the mentioned ramp depend And on feedstock up three and Getting out. the offtake so ramps things ramped reliable and we're getting also will going proven the and getting I to then that up and be before, very activity. that thoughtful and purposeful for reliable. tech

Operator

comes next the from of Our from question Cowen. Boyes line Thomas

Thomas Boyes

that talk about feedstock a said was that XX% transition pricing? And Just talking quick some you ones. XXX I that's Is of more know, that the phase? a really acceptance two is the the there already bit maybe you the for portion there. about contracting that's customer in Or that's Could allocated? the to

Dustin Olson

at look That's Augusta approximately and But to way that's now. we're estimate portfolio targeting. the it feedstock is really be think an where right plus I pricing. XX% will

majority in of with the signed, we that on, in category. of well have negotiations legacy that virgin based and of based are those pricing, or plus pricing. the as customers let's we're have the original, are plus Some that virgin our those with bringing say type as we stakeholders that's are we that some contracts final offtake in, feedstock But

Thomas Boyes

spend, indoor should it. is R&D additional that things Got landfilled that kind of And we think feedstock then, we goal about are maybe how just, adding for streams, incinerated? and/or the being

Dustin Olson

talk would come to Yes, are we're we will to insightful other about and I is a is. think was really process -- educational could it -- materials instrument we that look, polypropylene technology. the of say potential I with material it's say learning spend some and what technology the that respect our very that's premature the others for we what that, very R&D to that us about on materials in

have we're we areas. that an different say moment, R&D think line for that, on focused clear this But currently really polypropylene could the and and at new go. FEU into so not we with where focused conditions we're outside feedstocks. on, on do we what this not the Outside of And of branching testing stream, sight really different of

think keep able three could to up XX in also have next it But always the think remain beginning, right, focused And our really, to an producing. Getting share important this granularity to as open the started could getting to keep But on immediately. the has the we about committed months, been for I also to on activity. right, do focus that. eye where stay an we future. what it's getting important think the and need six over and Ironton. about to to very I schedule, That's think more our that since And we and been go focus, be to tech with us it's everyone go. we where to we'll I eye

Operator

Arora Vivek Jefferies. of line from from comes question next Our

Vivek Arora

mentioned the you. Thank who FDA please you from LNO on negotiate that discuss some to the seeing Can require non-packaging you're you're on applications pricing, demand able don't us all. give offtake You customers strong at agreements? you these when color

Dustin Olson

we really appreciate Hey, Yes. the question. Vivek,

there FDA with to respect [ph] bit with to to that up and non-FDA pricing material no get difference a keep the right roll. think ready you between I the see pricing is market, required customers. the we're Ironton can closer we I that get Augusta that we little in to going and tell we now, until [west] running, required customers

more to being and what use adopted more said. this replacement. get products, And is along mean, by all test we've think products. a of And market overall the to exposed to I stream forward, get the our get going look, in we've channels really product product, how terms different in with our about kind exciting in interest channels like said lots are watching channels. revenue modeling virgin say our that not that I product perspective. difference really would of the from there's of the a material our let's think or to quality, I So say, -- we and a our What's is that

more I just that that are in is many usable we that applications. the many, think making polypropylene market the proves

Operator

over to Thank like you. for our any Olson, closing remarks. not to any I'm further the call back questions CEO, showing in queue. the I Dustin turn

Dustin Olson

Yes.

everybody, dialing thank in for of First you, all, today.

PureCycle that we about and plan. set watershed service. a for that years there and quarter-over-quarter, many edges. are minor see really fairly us. that execution to really for And just our the ready large, built strategy an us get excited We on changes to I exciting be look, is and the plan ago, share executing near-term and that PureCycle. to forward XXX% be talked And that to are for big follow that the see for the steel on it's today going I very by developed, And takeaway the the to And think of And plan I we've about the in we it's projects those news are here consistent. committed to are But ground, our mark to think us phase. very really think we've future that's go all the staying was

thank great you. and following So this questions. more we with updates Thank in execution path the the and look far for of And forward future. to continuing all the you you

Operator

Thank call. participating. you conference today's for concludes This

have disconnect. great You now Everyone may a day.

PureCycle (PCT) 12 Aug 222022 Q2 Earnings call transcript