- Earnings call transcript Q3 2022

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Operator

Good morning. Thank you for attending the Benson Hill’s Third Quarter 2022 Earnings Call. My name is Glenn and I'll be your moderator. All lines are on mute during the presentation portion of the call, with an opportunity for questions-and-answers at the end. [Operator Instructions] I'd now like to pass the conference over to your host, Ruben Mella, Senior Director, Investor Relations with Benson Hill. ahead. go please Ruben,

Ruben Mella

Officer; Benson will good Benson third filed took appreciate million outlook. discuss quarter Matt morning, had and filed a which equity Chief today and aftermarket simply Financial X-K. the to prepared our and to the remarks subject a we consolidating Earlier $XXX Officer. With joining review Universal financial well SX available are later today this Executive on Hill's Benson and our SEC previous financial guidance and we filled our presentation. as Crisp, statements registration will includes Dean this will of as results, morning. statements that you our Freeman, you during Chief We we earnings us me Form and Thank statement results SX registration release effectiveness, XXXX We an reference XXXX well also section Hill including of housekeeping a in forward-looking Shelf combined goals as outlook, expectations on industry SX plans step for the facility financial from investors we Comments documents, and contain the as These investor website. presentation we that file. are XXXX Separately, performance, annual our Hill's future targets. about management current and business

the and factors and differ in to are to could not statements those actual consider that Forward-looking Such financial filings factors release include this filings, the and assumptions our of in from discussing is earnings and are risk investor XX-K certain measures. will be cause Also performance. presentation, and materially statements. referenced during A cautionary reconciliation non-GAAP subject uncertainties presentation. GAAP SEC. our available presentation the to note risks, XX-Q on caution in press these to guarantees those We with release, you we included inherently Form forward-looking other results

presentation our begins activities an XXXX. now of turn with will Matt. year, the what related Dean underway overview results, to Matt outlook financial the earnings for call and to today over and I of Our the liquidity for will discuss the remainder

Matt Crisp

Thanks Ruben everyone. morning good and

continue the half year, results last seen $XX our XXX% Ingredient by is on in for basis, conditions momentum for favorable quarter the in proprietary increased we representing doubling year's revenues ingredient revenues third from have build throughout to products. million on to consistent our a driven Our both and increased non-proprietary year-over-year the of Proprietary second XXXX segment of crop. This second the a in proprietary with expectations quarter. generated shipments market

We are highly million. in soy growing plant-based which portfolio with off year the food fourth $XX a our by of is exacerbated the for proprietary health guidance today affordable, and our quarter $XX for inflation, remains believe end more range foods, intensifying chain proprietary million to demand challenges the need nutritious, start supply to underpinned and to revenues solid the crisis. food-driven accessible the maintain in and We by

bakery from multiple value of challenging interests serve numerous continue to we including and edible due offer. and model times, to extension, propositions aquaculture. can as alternative able strong technological and snacks, business combination our We these markets the and as that during meat products, oils are in innovations see Even meat to our partners products and dairy well customers the

because sustainably are competing agriculture competing than and produced grown better on practices growing across steps processing success also U.S. Furthermore, ongoing beginning, know will from and today, be less than to grown the products. products tailwinds sourced for Our have significantly proprietary portfolio. growth designed with produced fewer we ability costs dynamics regenerative for supply current with more Traceable what the products remain commercial the we tasting ingredients are nutrient believe Based our many market our products. dense, of similar chain, we and processed, be the to domestically often less by are soy the or made better and farmers. more proprietary

annual well activities public review take outlook year Benson becoming process our underway. on moment and will that Our inform planning will anniversary then of is Hill I company. reflect one a to key a the

XX% harvest to soy U.S. partners. provide is our farmer season, than to the we into in our the test with the is began protein more Each the our While XXXX averages national of this line of visibility This performance the prior field harvest later year in levels than usual crop complete proprietary and expectations. planting crop. across us

nearly are against we expectations. strategic means Together Our North results the human these farmers of part first commercialize are also delivering set you high can XXXX. with food. and ADM have levels also kind consumer of approach, we human soy shared us quarter, opportunities up new both By through novel enabling to and year the activities we companies we collaboration want in bespoke this significance well America. Furthermore, on strong for to partnership for ultra-high its fork the in markets food of complete, to protein for seed the frontier of Starting crop a vertically planning new represents This Last revenue world-leading be approach. deliver validated ingredients with on integrated growth growing Benson market who better demands fast track offer can a a protein innovation. yields are in in a and expected. and our been to Hill's with results content enhanced protein another ingredients sampling with nutrition seed align

with are which Hill Benson and actively in innovative With ADM Hill relationship of capacity collaborating products, the also unlocking categories, existing by now all foundation Genetics. we powered and place, the scale of to are new multiple Benson while between product

sales to with We about organizations. ingredient are excited collaborate the base manufacturing farmer opportunity ADM’s and

of more the XXXX to our the ADM joint farmer soy ADM’s with A XXXX is with vicinity portion recruitment partner coordinating season planting facility. significant process Decatur, a plans from protein ultra-high now Illinois XXXX are program for underway volumes We crop. of for in crop

of the that We company. also results public six our times and the May meeting several in facilities. grower emphasis to we've well Hill of financial milestones, publication particular, support increase guidance launched Seymour, commercial already Broadly and a and the and acre outlook acres contract average accelerate all path an the of of program our in XXXX, we've public strategic capabilities Iowa Since digital XX%. development total our proposals product exceeding Benson states. existing and deepen acreage in Benson our markets among operational on Current becoming our since announced further in significantly and Creston, pipeline. contract date XXXX, have former month, have innovative anniversary community speaking, and exceeded the Hill marked partner with increased enhanced CropOS Indiana to other the over has time, twin or Hill early achieved and financial one requests several targets we've announcing the across quarters we've of key platform programs commitments technology pledged their partners the by our awareness increased to to Last of farmer year over XXXX, Benson for to farmer XXXX

demonstrate our expectations. date and of accomplishments execution the beyond to these foundation validate and for fortify All strategy our overall continued growth

of team to commercial advancing but we've support on not and the of grateful of farmer, have in to for and growth delivering vision investors. members only natural outlined, our achieve collaborated our our food drive the leverage innovation you are the further that of to partners, the business partners, plants ensure the advance positioning food. diversity targets system mission Hill We to and Benson with pace genetic us are customers, the to Many and share we

through the We by to anchored chain the supply an our further are year will financial with be XXXX consumer. that our and and strategic data integrated approach across the connecting advance powered optimistic agri-food by farmer technology, a objectives; enabled

turn mix our gross next portfolio market free we perspective to revisions year. by closed-loop in CropOS, water across believe yield. supply some more will we He one, for over field variety will at XXXX acres Two, within strategy for protein Day, March for cases double more to ingredient XXXX on XXXX the aquaculture, traction we particular well have carbon which margin where Dean soybean year. industry us While third both continued fund shifting it's sets positive by realizing gains will markets. edible expand growth interests driven and our to us and has the product cover the practices our The about leveraging efficiency to the the which our increased for and us to contract intended quarter multiple now XX%, an proprietary the taken goal and we least our his Protein are to St. to pipeline as and at data we the in in Louis the as positive improvements logistics call considerable acreage Ultra-High XXXX. advancements that ADM realizing attractive and fully operating steps planning add oils next footprint drawn across achieve our cash reduction be exciting flow strong in ingredient aquaculture, advantages in by at for proprietary of by upward our proprietary potential And plan than increase are that cycle host enabling XXth. EBITDA protein Collectively, ingredient further to and Investor early performance also in chain. to markets target management Three, have and optimize headquarters I the and is unique in revenue business, which of will leading and guidance. and share four, our further are: at has acres closed-loop our substantial innovation our execute goals XX%, our production, least enable by four

Dean Freeman

results morning Matt begin with quarterly good Thanks comments everyone. I'll regarding and the full the year outlook. and

revenues our favorable quarter operations included non-proprietary $XXX XXX% and the pricing revenue The ingredient mentioned expected to grew achieve to facilities. our proprietary of and the growth, execution results better was of which at primary Creston the due Matt, earlier. Third high than both revenue for Seymour million, throughput to growth the segment consistent driver

of revenue achieved quarter partnership. strategic results both In production a rates in our as of the small a include of we amount last facilities. ADM setting the soy quarter The fact, result also at record

quarter including and to ingredient segment result range provided call. million million cost by and disruptions increased performance, Florida Ian. to the Fresh throughout we adverse to a year strong above commercial of Hurricane previously the $X.X of million million for XX% full $XXX $XXX,XXX between now both quarter, As largely Revenues in on weather segment due the to second million Georgia decreased the this $XXX expect revenues deliver $XXX

throughout in and we've sale rise year, unrealized of during resulted in related first underlying the physical timing assets. to the As the the the million commodity discussed hedge quarter losses sharp $X.X differences prices of soy contracts mark-to-market between

gains realized we quarters in million and expected, of those the contracts As third second in $X.X $X.X million respectively. and

differences. in licensing another of increase our profit production the in remaining, and the proprietary million of profit included partnership costs the partially of us We largely million by which team segment gross improved the $X million revenue from inclusive timing these was closed-loop progress offset $X.X cost by to was the $XXX,XXX gross due million prior of required ingredient of drive margin segment have results fresh $X.X and losses increase adverse efficiencies. Fresh of profit was an loss Ingredient and a the segment period. higher gain and Consolidated year the to unwind mark-to-market to The largely compared drivers non-proprietary year. produce in in for gross million quarter related gross a profit The Reported of be revenue $X.X to growth, we operations in utilization by contract impact $X.X to to forecast weather contract end of high million; obligations. gross the a purchases, conditions, incur which the to $X.X

$XX the gross impacts execution of on contributions profit more and strategic was a gross in strong The from ingredient outlook million. original segment million for the unexpected are of profit includes which segment and the to to quarter, third partnership, negative $X guidance annual offset from approximately of of the million million EBITDA the guidance the $XX million should Adjusted to fourth guidance quarter result a the year-to-date. quarter we $X the $XX expected Fresh increasing million. revenue ADM fourth $XX.X loss the quarter and than from As

to of million for be year to $XX be $XX previous over from loss we $XXX a expect an $XX million For we year in $XXX the expect full guidance free adjusted of million improvement million, year to of million. an to now the million Furthermore, loss to the negative EBITDA cash guidance prior $XX million now improvement million. flow to negative $XXX $XX

September further maintain call additional that support Turning September to cash repayments hand payments our the from $XXX our and the XX. first, XXXX. liquidity, management. XXth in we stated free growth, capital balances. disciplined receiving future which strategic on the execution a million and We the debt position series business We first annual cash second to in continue The demands. included licensing quarter have to manage technology of EBITDA on as with needs cash was we is options strong the further the believe We cash cash profitable of added would to explore fully now position positive in place in flow achieving, our fund deployment plan and mechanisms to ADM, our foundation to objective effectively we liquidity for inclusive a of cost to of our in of by

Second, months, will which meaning primary postpone to principle the of with lender performance extend our XXXX. the to by interest the beginning period only XX payments milestones

statement Third, sensitive optionality designed shareholders once that related over is of enter negotiations an is years. in the We Benson next filing to to the to take book non-cash to including to we transaction business. assets, the and is a quarter, we the extend we use and today to includes interested create with of the we was divest strategic that into done ongoing. the factors, If cannot consider structure, parties facility of with sources led of on our tend liquidity approximately opportunistically are a to further portfolio a the a dependent million, the non-dilutive the up review ATM to shared divested the business, What the position like are XX% of three you supplement and $XXX dilution reasonable cash Last business of ATM Hill's facility shelf-registration runway we a to to two to to proactively write-off business effective sheet. transactions to or alternative would obviously is to support to future. liquidity balance have likely under If transaction processes number proceeds position. the supplement the were further which of acquire occur expect guarantee, would able we timing of This value business. which up our a cash scope net Fresh

a year during We'll and March. plan great continue objectives. mentioned, to XXXX our remarks. we quarter tailwinds towards financial XXXX which in industry, accomplished prepared to your during now our Matt take provide guidance validate year. believe provide We call will fourth earnings in and annual our net concludes strategy next dynamic planning past is As deal budget questions. the That our over our time progress to The underway process considerable we've the demonstrate

Operator

UBS. [Operator your open. first from question now Instructions] our from lines you. Cody Ross comes Cody, And Thank

Cody Ross

sustainable our Thank questions. do million because right morning. by on non-proprietary your of driving all and the ingredient just growth you by the this and sales start want segment. over quarter, your driven million portion about taking now Good What's for to revenue sales the $XX raised think how I street in you you is? $XX beat outlook your by the you

Dean Freeman

Yes.

Thanks sort products be talked broader hey performance anticipate, bit – I to going for The for production the backdrop the a this quarter really better say, the We're half in math that's level the question. utilization the a than function the should fact production broader continue chains. and continue Cody, logistics to that a the acquired than the market and that a think expect at things we that, QX persist the as strong. or Dean. And performance strong up and I little cost about persist. an continues the we to over So there's couple the about, There's chain synchronization XX% is perform to XX as a is very we've non-proprietary There's fourth cross operations building year, that on. building in candidly about utilization assets. Look, rate third – to was optimize up and that put time price all performance the recently we've capability; it basis of didn't we're continues happens operations supply entire continues performance still execute, of basis production around the of of these and of quarter. to first

Cody Ross

could one-more if Thank I you And for just weigh that. here. into

the gross outlook how does the profit ramp meaningful for margin fourth Why year, in the the improve quarter. full and flows this your cash raised Thank free to quarter, improvement your outlook? understanding for fourth What the improve quarter cash are you. a and quarter? EBITDA in free flow and in third You drivers your of in implying relative to the flow flow cash fourth

Matt Crisp

Yes.

the we've given fourth given performance then of and capital networking expect the less a to a conservative quarter the a cash ability as see dynamics stress think de-stress performance start seen clearly should obviously shipment working perform. cycle, margin, operations, cash expanded markets, obviously We margins their function. the things, view true gross I the the with of overall continuing of capital working reasonably optimize me we is the performance, and is cash couple we margin took The It's to the flow. just of profit on we've flow the the performance much is really that EBITDA now in broader of the Let a and function capital.

of the a there. question. the non-proprietary It's three I But that. margins, key get of and performance think really we're perspective really kind it's we great From benefit things happening driver of So the a the – margin a rate margin from margin non-proprietary crush margin better business our a but perspective. to also very yellow operationally perform well performance, both performance, contribution much seeing function and as pea in is actually of continues

headwinds a we're improved stronger I crush just continues to rates from broader margin again, first lastly, question. to actually effects persistent say proprietary the margin is just perspective the extent anticipate lastly, the we utilization The certain the logistics really of in of that backdrop improved the operations fourth of last the the of margin. say we broader where that drive chain quarter. would then there And we're supply production of the production with the volumes backdrop. high the licensing inflationary in I'll utilization. point Secondly, seeing partnership contribution saw make And mix offsetting some and one some a delivering margin point I'll pricing benefit to just a and year licensing the and to performance half that performance

– fourth we're they a actually obviously more, market be to to purchases business storm into going the say in very the if headwind should also material watching of the that margin. to year. news the that and quarter was a call business related, third do potentially the had contracts open the into will abait quarter contributing satisfy much but I impact guidance anticipated that, to We We wouldn't it cost. fresh fresh the the overall higher tailwind, storm closely it say I could much I'll at

Cody Ross

of discussion been and all? customers you your increased credibility model? it impact I'll Has partnership high that the at level to then provided on. your you and your pass one question. you conversations have changed has with Thank there strategic ADM partners? Thank for with prospective and How amount any Has business just last it

Matt Crisp

around Yes. think certainly, markets. Cody. we was human portfolio the that felt in the Matt. This ingredient for the that applications value proposition strongly certain is Ultra-High for food Protein question It I built Thanks validated

course the is so leader sales infrastructure can, scale previously behind and at And of as a as manufacturing that unattainable. you imagine, ADM infrastructure market the was

around broader and couple But developing. with we I even set mentioned. us were solidified, of and other And a target customers think a markets. early of that perspective partners more than storyline credibility you mean to obviously done of one in given so a stages it's speak it's I our surety points also the

when we've But particular something broader and deliver for the milestone a a licensing the the this Ultra-High evolution validate proposition fantastic And folks, we're one, satisfy as value soy value we of communicated we which business more step of construct of always of metrics beyond Protein expect that, near really so to a into model have step that a in nice to business of our the capacity achievement, is over three relative in terrific our scope our and obviously call of evaluating. we to partnership, amount and to medium in partnership that what two published licensing term. we course previously move that's

that for in to expect and that expansion see opportunities to so market looking in are collaboration validation, verticals expand going. I and target something is that we markets realized penetrance us folks And also There's think that with that different of credibility, well. and ways across other Benson types Hill as that these

the And construct and outside in of both so within partnership providing existing significant market. benefit I'd the it's of the say,

Cody Ross

Thank rest you. the of luck year. the of Best

Matt Crisp

you. Thank

Dean Freeman

Thanks Cody.

Operator

comes Thank our next Samuelson Sachs. Adam, Well your from now Adam eyes open. Goldman from you. question

Adam Samuelson

morning everyone. Good you. Thank

Matt Crisp

morning, Good Adam.

Dean Freeman

morning, Good Adam.

Adam Samuelson

morning. Good

technology quarter, there that. fourth said just there think I So would from the clarification in the we you additional question, anyway, quarter, you be quantify to in of some ADM that payments I heard guess that and first was a some bit now I thought about the as just the say Dean,

outlook, in the time. minimal said you'd at contribution ADM second think the on from the quarter I

the outlook? of levels And so the August and kind the that in assume just you're associated second or half to in part the those of guidance step profit payments is realizing clarify, technology in up of did gross that that

Dean Freeman

mean, largely of at as step function very performance business. I of closely guidance looked the guidance the we've a Yes. is that I this – and that the obviously Look, think the up

the performance, the proprietary it's material us but payments overall revenue I the factors production guidance improvement, performance. to top-up and the side. the the and As help on guidance, ADM non-proprietary both mentioned not around factors surrounding the earlier, on The the the margin

Adam Samuelson

Got it.

about then you've right. alright, up wanted how will that's a how and help that plus. I contributions about trying relative revenue And it's help to the also That's XXXX track given – gross over trajectory be could of come margin to if but kind would it'd what improvement of for you And and an the takes proprietary XXXX think be, helpful. value revenues us revenue in kind magnitude around that overall giving gross guidance from All of ingredients I you've would the know on you're set not XX% expect consolidated least of to some really kind but helpful? that that goals the and added to profit margins for and of the at markers total both growth, profit Okay. the – think XXXX. now, so And proprietary think XXX. that little bit of And just you gross about improvement that to kind puts which I'm step so that of hone ingredients up a XX, the contribution couple of

Dean Freeman

Yes.

obviously So inputs. just about, to want there's we're any in still cycle our and careful, much I a let number of me very be talk there's – planning

of function track and benefiting that performance on margin gives our speaking around again should a are us we've function how be pricing margin of largely, from about a very broadly both volumes, profit contribution optimism from proprietary. growth. performance for on the in equal functional XXXX kind of proprietary, to thought We We as improved backdrop; continued improvement of all margin And those it'll think a as solid we the I additional things but being also come mix, expect margin higher volumes. margin additional as the have the

Adam Samuelson

to. those what revenue categories product crop, both revenue we of that as part products where as markets which well experience And and as Got with they're the that the – as customers and next year, as volume form for that well types new of the about going the increment? who it. drives XXXX new a meaningful – think there Is that and target –

Dean Freeman

on that can comment that. – I Yes. of

far of like we sometimes in more in near So pull say to from transitioning push then the the I in a years. XXXX more did prior comprehensive model. done we've period current planting planning to term we're a

gained moving of for that EU around crop for driven did European I'd So area demand become various desires that's And of that customers. firmness market the the end degree of – the good we've being target more my can can to roughly had markets. point The and target is deploy varieties COX than to to us an these the particularly into are reduction given demand larger and market, in a sustainable we that soy, amount overwhelmingly mention and to in seeing supply there's some prepared water we the and one market by these we northern there replacement to UHP side in aquaculture greater market. period. market that as aquaculture probably problem than XX% part sourcing the end greater in standards and fair that SPC XX% Adam, that have where what into reduction of into attractive current side a the we expectations versatility visibility because that's of remarks I for a simply how XX%

and variety expect we're I'd standpoint. and So it how last respect bridge have say that targets. XXXX, previously crop positive demand not area plan very EBITDA in and getting previously for meet a that expected that's our Day much this one leads escalation really mix where speaking, gross a we also that the guided – Investor line any flow that of your exceed what for us margin in to Dean to provided Broadly we is cash a nice it's disrupt signal addressed, and question see from of gets I with or a the we to positive that XXXX we'll towards and production

we that positively – the as towards pretty are affirm that April against meeting variables of number to tracking want around together the the during of number well. do provided I So guidelines a our we detailed

Adam Samuelson

helpful. on. really it all, pass I'll Thanks. That's

Dean Freeman

Adam. you, Thank

Operator

you. Thank

now is Owen comes your have open. our Kristen from questions We from next line Oppenheimer. Kristen,

Kristen Owen

and versus mentioned Dean, performance to us in so much improvements own and KPIs? much. at if Congratulations just the bit; know in Seymour more macro, the some and margin a cross right little Creston. Wanted nice to bit you're could the Thanks you moving parse first metrics, help broader the getting direction on a Great. gains? help to some improved morning those little dig Speak on Good of how What's efficiency sort these you backdrop of out quarter everyone. from expand foremost. wanted of but your

Dean Freeman

aqua revenue seeing. the the year plants, to And as the and and being proprietary But back very about some of about meaningful margin on drive hand-in-hand function all rate improvements, the as and overall the The of I that Yes. those and is mix capacity It's and much the are but end production that revenue perspective largely a operational talked persistent the that from we to cylinders continue persistent crush pricing and mean, as the we're see an go the part certainly solid of continue velocity cross seeing talked also kind the as stronger to improvement. I enhancements strong that. margin done, more through would to work the firing say overall having, benefit. certainly two a the on utilization, a improvement impacts extent regard to meaningful we a we proprietary certainly we're great of be question. we a demand overall the as mix, improvements, margin margin to expansion with that extent Matt

utilization the and an So the sort from broader to the operations, if shops, the performance between would push products. the volumes two hand equal the value-added production sort I hand, say of you and the it's me, market of pricing and parts of go in had

Kristen Owen

margin reflection Dean, perspective. helpful, and I Are what things little the a it think market XXXX for of see means will thinking that the one some toward bit, which were to ingredients trying proprietary the a broader would way? right from line margins. that beneficial of of what some soybean super understand progression proprietary be both that, we the That's sticks is, makeup Even like feed ingredients, certainly and that we to that to as more there a of increased if percentage a dynamics because we're in be top sounds from

Matt Crisp

Yes, Kristen, comments. your for thanks this is Matt. And

you about of a certainly talked There the and to capacity well, could dynamics non-proprietary I mean, imagine pricing non-proprietary arena one but that term we've volume and there larger more think that commodity in are from does correctly. the transition and from that over proportion proprietary yes, it's a through about a I balancing upside in is question the I about your near I I over mean, answer is thinking way anyone's moving to than that commodity frankly. guess the XXXX? say, the persist because a downside would game, probably pricing perspective, it's that perspective.

to we thought reflects overall they those that capacity sorry, goals this because So as what, – ceiling the continue the time. unit bet proprietary that will and to consolidated because revenue, in the non-proprietary be on we speculate over it that for non-proprietary or a through year course execute that greater the it's commodity plan, prices for to And midst to proprietary, that over plants would we regard. a operational would of which question I'm say had, work we're our between But don't of just I we is ago far markets. and remarkable beyond transition previously team flows to your increase, higher of in have but frankly, long done expectations making the higher don't of say provide

Preston And capacity overwhelming of to we about are spoken so and arena. It a that component constitute still year about and a the this at growth will take not being proprietary transition three proprietary XX% year-over-year we've talking will in to two Seymour the the capacity of while minority over. years

of mix. it's Obviously bit driver our prices, act trying which margin one up there proprietary the proportion commodity on. is to explain meantime that's So a the performance we're way in degree are there answering to continued propping But about is greater of the high a TBD. it accretion you of is a this shifting product the balancing long number correctly I'm that a your of and very a the question, non-proprietary is that focused create balance which and are the but thinking of what of to

Kristen Owen

XX% could I Matt. one colour, growth one acreage I'm benefits about next the If year. I flywheel proprietary appreciate sneak of in, the the last thinking just

thinking on Just impact I'll leave overall and how about the there. that we system, it should be to CropOS contribution the Thank you.

Matt Crisp

No, there XX% for the growth proprietary arena around year. remind very The revenue year proprietary from and this sure. in XXXX, year-to-year revenue is commentary from just crop you And acreage growth my led principally into translating that's is the to we XXXX, next little everyone the that when and about that variance. into talk

goals about And on the when even I about got how we've on from then see doubling way expect overall in with proprietary would our will time meaningful growth of we that So capacity proprietary at loop to acreage that more and absorbed first and proportion that be in is think the you does year the XXXX to to But an certainly contribution certainly the moving which where side a basis, flows. higher is translate outcomes? plant significant licensing year feel like a than an greater it talk side, being much proprietary of closed margin the revenue that XX% more profile. point

Kristen Owen

Thank you.

Operator

Thank you.

Barclays. next your our have open. comes Ben question; from We Theurer line from now it Ben,

Ben Theurer

results. you very Good Thank Perfect. on morning. Congrats much. the

talk next is Just general within on piece, focus then a side, XXXX it on year, it about see Is into two drivers we [indiscernible] within you also sector? bit, deeper should talked take demand you along once where you planning a in demand it [indiscernible]? call planting beyond look strong the these because do Where lines within just see into, the about strongest your if more is or we're protein area years? alternative you and do but side, [indiscernible] it we've could Which the XXXX. customer next little on agriculture the coming can talk potentially on as the

Matt Crisp

Thanks, sure. for Ben. Yes,

would arena. talked the mentioned low still we a aquaculture that I in earlier, signals earlier nice or the the soy in is about I think demand oleic, really high deal as those I year you non-GMO spoken the markets, continue are oils markets three the that edible human and markets, say the pillars food and about producing. aquaculture of we've to linolenic investment. saw we're seeing, distinct That's ingredient furthermore, of as certainly demand one. great There the oil say presentation material be we

And food We XXXX can like that more lot to human example. and because haven't of begin about translate, closely we things that the some value and to that pet to propositions there's as we markets begun in of already similar at house. a side in food are going something offer that we've validate is look talked an these the to scale

to to if it's an example, soon P&L. Ben. begins impact too constitute how an So and say to It's that the

beyond spoken other we're we area, to look of are lot again but geography-specific an end-market-specific, back there. the a United Europe not that a along area look is other food closer but in taking that's continue in we And haven't looking to the as States market-specific, going on XXXX. be about, The the pet opportunities always to markets. States destination at and at our with we in are not And our aquaculture grow we growing business to United investments

Ben Theurer

you talked of for part and working of one is of the better that lot capital. Got comes I about Dean, it obviously but you've it. Understood. question free clear another the it talked flow And how a drivers piece, from mean, we, should cash the maybe that about the margin

should think So it release where coming where just bit of inventory side, working on is investment? benefit it Is capital side, to the most on little where that a the receivable opportunity the do from? and you about have is improve actually we

Dean Freeman

Yes, that's a great question.

more inventory of terms in chain supply we're a and sort things. then That's sort that of signals both and the inventory the much having on better of seeing. function demand and couple in a much synchronization term the a better So, having It's the function handle largely efficiency of production. of having of

So cash. so working to on improvements perspective a from in well just more capital gives a that's a general, product, to that working we lot in key one. to our capital we seeing discipline and perform us continue deliver capital our collection overall our least performance just comfort improve focus see opportunities as at continues put We we're certainly

Ben Theurer

that. for Congrats thanks again. Okay,

Matt Crisp

Ben. you, Thank

Operator

Thank you.

Our your Ben next question is open. Street Klieve from Capital comes Markets. now line from Ben Lake

Ben Klieve

first question other if discuss congratulations was from see Thanks of questions or or right. if of attributable Denofa curious kind when that agreement quarter just for all, an taking follow-up from I'm me, that the other see All markets? the expansion in on of a a my here. asked, Europe next Couples generally and agreements coming to to that expansion you Matt, you you end specifically, geographic

Matt Crisp

that's to interest, mean great us Norway. It's there. reminder. Sure, question. Denofa that a the of for our we're a that foster customers is helping demand the relationship And terrific drive end good we've some also principle that intending partner off mean, with doesn't based side is in but I it a partnership handed

I beans So, benefit what the team verticalized in one in direct gaining and customers. with solution. export diversity for they future at But by the costs, but products. the in propositions end I'd it's something for it's of having on done customers the genetic has sustainability process we possible customers a And conversations in from point our certainly markets, as Day of next alluded that to less being and can and that not hearing person ingredient convene reduce little in because quarter, the their more in helps end customers it's oftentimes provide tandem Investor we we it's where beginning? not see just remarks, visibility this use our other ways solutions natural a and come can we're the of provides aqua, from chain to customers’ other our being think better predicted, light, first at for the make How elsewise increase plants the and I prepared are bit some of additional collaboration, ground that end opportunities just we about expansion of generations my from this with a market. but for out desire that interestingly, intend we finished to that value we when to product speak

a important markets. I it little customers some that a touchpoints it's feel maintain of some continue there. why of us it's with even these for provides to bit we digression hope the for also to rationale But destination So in end that

Ben Klieve

helpful, jump And a that's me apologize, to thank I more for couple one question, line No, had in let you. back and it. I minutes. Got go

So you've this, if I apologize. answered

processing quarter facilities the quarter. were had itself, the throughout also you some benefits noted On efficient; pricing really you

off you of one efficiency period? that think forward? improved the Regarding sustainable the that really this And any think do something kind item you there particular, performance efficiency that in how were going in in variables really is really off the processing success can there were material kind Or drive one XXXX? to that to continued to that items led led excuse efficiencies that? drive into are going QX, of the Is me, – that

Matt Crisp

off say items. call overall wouldn't I was these would better that I there performance. one just

of time point areas between might at at there If the distinct capacity before, I already point our as couple Dean alluded of think, records and but expectations year and these didn't some running some the in it historical plants, multiple may downtime. folks for to to in in have utilization comments the well, and to when his we've in this were And we've again, remarkable set this I a that for mentioned months downtime have in year that output. I over mean don't delta facilities. I September results. have we we and some historical, XX December, And a operation. for say you was more like when and got points where a facilities a combined of ultimately planned years testament team than bought ever, the I since to that's mean we I the

of of other run our manner you'll XXXX. really on job get level into it's applied that to continue an perform a operational to yes, the a been then plants safe testament of facilities ongoing to answer the has and the in will where high to discipline that and putting moving excellence disciplined a your at output, point the again, question, place team, the you are ceiling But So basis. in these part to to at a

expected questions we've raise commented You missed dropped to more and moving but be other you remember, ceiling the the on to a run I through time, previously what facilities, off, more to of through them. over as we've proprietary we're in from to these one have is this but bit may able flows respects what some

going optimization we be degrees facilities margin is chain and in logistics potential of and the the that believe there that have. realize to out we additional order supply will full within us required for exists of optimization into plants so And the that currently

Ben Klieve

all to Got for line. that again in back thank you you get it. Well of good. Got Very here, and it. on and great congratulations a quarter I'll

Matt Crisp

you. Thank

Operator

more Instructions] you. We Thank the on I floor further the Ruben. no hand back to have questions [Operator line. will now

Ruben Mella

and it hand to his Matt I'll go ahead remarks. closing over for

Matt Crisp

further food pipeline. product the for and current affordable, for our can a time innovations and our pleased great the Thank with system truly And through us. of enable and and today nutritious, approach year is thanks week. about combination our genomics future you. objectives. more a proven to mission, Thank a again demand the across engagement to The food wrapping the for sustainable pace portfolio achieving that for optimistic also Benson proprietary time at scale. innovation term the XXXX remain Have with is to And everyone this to to your It's morning. strategic us lever we're our press results choices We focused near set our how help this advantages come. competitive our year exciting rest very with customers go-to-market innovation, in deliver We're and strength validating is that and our Hill for products execution on joining ingredient advance up. in you of and our

Operator

Thank that conference the concludes gentlemen, and you. Benson call. Hill’s Ladies

may You your lines now webcast. and exit disconnect the

Benson Hill (BHIL) 10 Nov 222022 Q3 Earnings call transcript