Q2 2023 Babcock & Wilcox Enterprises Inc Earnings Call
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Hello, all and a warm welcome to Babcock <unk> Wilcox second quarter 2023 earnings Conference call. My name is Louisa and I'll be your moderator for today, you'll have the opportunity to ask a question. Once you reach the question answer portion you may do so by pressing star followed by one on your telephone keypad when he comes in.
That stage and I have the pleasure of turning over to your host today Sharon Brooks. So Sharon. Please go ahead when you're ready.
Thank you Louisa and thanks, everyone for joining us on Babcock <unk> Wilcox Enterprises' second quarter 2023 earnings Conference call I'm, Sharon Brooks director of Communications.
Joining the call today are Kenny young <unk>, Chairman and Chief Executive Officer, and Lou Salamone, Chief Financial Officer to discuss our second quarter results. During this call certain statements. We make will be forward. Looking these statements are subject to risks and uncertainties, including those set forth in our safe Harbor provision for forward looking statements that can be.
Found at the end of our earnings press release and also in our Form 10-Q that will be filed today and our Form 10-K that is on file with the SEC and provide further detail about the risks related to our business. Additionally, except as required by law, we undertake no obligation to update any forward looking statement.
That lots on a year over year basis, despite increased spending in support of our emerging in new technologies and our renewable energy segment.
These investments include sales marketing engineering research and development and back office services and are all important to support future growth from our clean energy segments.
We are seeing our pipeline increasing to $9 billion of new projects over the next three years, which again does not include our continued strong parts and services platform. In fact, we are seeing more than 1 billion and bright loop opportunities alone and we'll be sharing more about that later on this call.
Our bookings and renewable increased by 28% in Q2 of 2023 versus Q2 of 2022.
Our environmental segment was consistent and help approximately the same amount of bookings in backlog year over year.
Thermal bookings were lower quarter over quarter, primarily due to a large equipment supply construction project that we announced in 2022, however, thermal parts bookings increased by 17% year over year quarter over quarter.
Overall, our backlog was lowered quarter over quarter by 6% again due to the large thermal project mentioned previously in 2022, but our outlook for new booking opportunities remains robust and we are projecting backlog to grow significantly to a range of $850 billion to $1 billion.
By year end 2023, which includes key projects in both thermal and renewable if.
If achieved this would represented growth of 20% to 40% in total company bookings in backlog by year end 2023.
Our parts and services business in the second quarter continued to support our revenue generation accounting for nearly 37% of the company's total revenues.
The thermal segment was a large driving factories, we maintain a vital role in supporting the broad demand for energy security among global expansion and gas conversion efforts.
We see thermal parts and services returning to normal levels, which is reflected in our revenues and full year expectations in.
In addition, our global reach and our renewable services, especially in Europe was in line with our outlook at the start of the year and is expected to remain strong through the remainder of 2023.
As I mentioned earlier, our project bookings within our clean energy technologies continues to grow and most notably the interest across our climate, Brian de Carbonization platform continues to increase.
In July we announced that BMW received a contract award from Norstar clean energy to conduct an engineering study of our salt bright carbon dioxide capture process to convert a coal fired power plant to biomass fuels. This study is the first phase of a commercial scale projects partially fund.
By the US Department of energy and marks an integral step towards are anticipated large scale commercial project to retrofit filers cities.
Stations, Powerplant with biomass and D carbonization technologies to replace coal.
When complete the 75 megawatt power plant would use sustainable biomass as a fuel to generate power with net negative C O two providing power to more than 70000 homes.
We are excited to bring our clean energy technology to the market and further advance Northstar Decarbonize Asian efforts.
In addition, you should watch for an important announcement from the Governor of West Virginia about a hydrogen project developed by our partners at Fidelis.
This new opportunity is based on previous Fidelis H, two announcements and we're excited to be part of this developing next step and clean powered generation in West Virginia that announcement will be made tomorrow morning around 10, 30 am eastern time.
With regard to our renewable project developments, we are pleased with the recent demand we have had within our solar business as well.
Despite the headwinds within the residential sellers space that you've probably read about recently that tailwind across the U S for both community and commercial solar projects continues to grow.
Our recent contract awards totaling over $20 million by Summit Ridge energy for roughly 25 megawatts of community solar energy projects in Illinois reinforces this point this.
This contract marks another successful collaboration between BMW and summit Ridge energy and demonstrates the increasing demand and community and utility scale solar projects.
We are in negotiations on additional solar projects that when combined with the recent summit Ridge energy announcements would equate to approximately $100 million and solar bookings in the second half of 2023.
That is roughly double the amount of bookings in 2022.
We are also increasing our investments in solar business, which in the long run will help position the company for improved gross margin and operating margins on a run rate basis.
By year end. This includes back office systems and support increased self performance as well as site management.
Transitioning to our bright loop hydrogen generation technology. We are pleased to report several key developments, including announcing a dedicated organization within <unk> Wilcox led by our Chief strategy and Technology Officer branded Johnson to drive our execution and ramp up of our.
You'll commercial projects in Wyoming in Louisiana.
For market clarity, we are redefining are bright loop systems at small medium and large for now to demonstrate their ability to meet demand at all sizes. Initially we are planning to deliver medium platforms in Wyoming in Louisiana with scale up to the larger platforms planned for.
Both sites.
Just yesterday, we announced an uptake agreement with general hydrogen to acquire both hydrogen in C. O two from our medium sized biomass bright loop platform.
We are also informal discussions with a another global sin gas company to sign an additional uptake for hydrogen from both a medium and large platform.
Louisiana projects will produce an initial hydrogen output of approximately 10 to 15 tons per day for industrial use with an.
Hated scale up to a large unit hydrogen production by the second half of 2029.
This timeline closely reflects the development plans in place for our Wyoming project with initial hydrogen production output of approximately 10 to 15 tons per day by mid 2025 with anticipated scale up to a large unit hydrogen production by the second half of 2028 also.
We had demand for one or two smaller platforms, roughly 1% to three tons of hydrogen per day and are determined to have one of those sites producing hydrogen by the end of 2024.
For our upcoming small and medium scale projects, we've outlined projected development plans with the timeline for initial hydrogen production in 2024.
Meanwhile, while bright loop financing efforts continue to develop our confidence remained strong.
We anticipate funding coming from state and local governments as well as investments from various pension funds.
<unk> and customers as well as Babcock can Wilcox, we're seeking direct financing either at the project level or through BMW directed towards specific projects.
Longer term, we continue working with various department of energy and Doa loan program offices, including Congressionally approved appropriations funding directed towards the funding of hydrogen demonstration using chemical looping.
Our pipeline as previously mentioned is over 9 billion across all three segments and we currently have as mentioned previously approximately $1 billion in bright loop opportunities alone.
We believe this puts us on a pathway to reach $1 billion in bookings by 2028 with combinations of small medium and large projects, we feel confident that could lead to $1 billion in revenues by 2030 and beyond.
That will still only represent roughly 1% of the market share of total hydrogen spend by 2030.
To get more clarity roughly and of course, depending on specific site factors the revenues associated with the small projects will equate.
Two roughly $5 million to $40 million per unit revenues for the medium units will be roughly $40 million to $100 million per unit and revenues for large units will be approximately $150 million to $400 million per unit. These.
These revenues should bring 20% to 25% gross margins plus following revenues.
Sorry, 25% gross margin the.
The follow on revenues.
Of approximately 200000 to 250000.
Per ton of hydrogen produced and services and political support per day will produce even higher margins.
You will find more details and the new bright Luke Dec posted to our website today and.
And we've also included some of the new bright loop slides and our investor deck as well.
Given the strong financial performance that as continued through out the year paired with our seasonally strong third and fourth quarter results, which are cyclically second half weighted we're confident in our ability to achieve our full year 2023, adjusted EBIT target of 100 to two $120 million one.
Continuing to balance our investments and future growth along with adjusted EBITDA performance.
I'll now turn the call over to allude to discuss the financial details of the second quarter in 2023 loop. Thanks, Kenny I'm pleased to discuss a second quarter results further details of which can be found in our 10-Q that was filed with the SEC today, our second quarter consolidated revenues or $305 too.
Dollars, which is at 38% improvement compared to the second quarter of 2022. This is primarily attributable to higher volumes and a renewable segment due to renewable service and our solar based businesses hire all we're all volume in our environmental segment and increasing thermal <unk>.
Volume due to higher levels of construction and parks activity.
Our net operating income in the second quarter of 2023 with $7 million as compared to an operating income of $3.7 million in the second quarter of 2022. This second quarter included a one time gain on a sale of an asset.
Our adjusted EBITDA was $21.9 million compared to $22.9 million in the second quarter of 2022, which one adjusted for a <unk> for the one time sale the asset.
The second quarter of 2022 represents a significant improvement and adjusted EBITDA from $15.9 million to $21.9 million.
Bookings in the second quarter of 2023 or $191 million, and we had an ending backlog of $567 million.
Our loss per share in the second quarter was 10 cents compared to a loss per share of <unk> in the second quarter of 2022 or a loss of 2022, a loss per share on an underlying basis, one excluding the non-cash a non-cash pension benefit of 7.4 million.
And this also included the one time gain on the sale of the asset which have Primulaceous previously mentioned.
I will now discuss our second quarter segment results within our bag Babcock Wilcox renewable segment revenues or $98.9 million for the second quarter of 2023, which is an increase of 31% compared to the $75.2 million in the second quarter of 2022.
This increase in revenues, primarily due to a higher volume associated with our renewable services business in our solar businesses.
It just said EBITDA in the second quarter of 2023 was $500000 as compared to $4.2 million when excluding non-recurring $7 million gain from the sale related to development rights of a future solar project in the second quarter of 2022.
Within the Babcock Ballcocks environmental segment revenues were $48.7 million in the second quarter of 2023, which is an increase of 54% when compared to $31.6 million in the second quarter of 2022.
This increases primarily driven by overall higher volume of dry cooling technology projects across the environmental segment.
Adjusted EBITDA was 3.4 million for the quarter compared to 600000 for the same period last year again, primarily driven by higher revenue volume as described above.
Turning to our Babcock Wilcox thermal segment revenues were $158 million in the second quarter of 2023, which represents an increase of 36% compared to the $116.3 million in the second quarter of 2022, and this was primarily attributable to the higher level of.
<unk> in our construction projects at.
At our package boiler business adjust.
Jassid EBITDA in the second quarter of 2023 was $24 $4 million, which is an increase of 49% compared to $16.4 million in the second quarter of 2022. This.
This is again, primarily driven by the higher revenue volume described above as well as better project performance.
I will now turn to our balance sheet cash flow and liquidity total debt at June 30th 2023 was $358 $2 million and the company had a cash cash equivalents and restricted cash balances of $83.9 million at the end of June at June 30th 2023, I'll now turn it.
Back to Kenny.
Thanks for a while.
In closing we.
<unk> continued to position Babcock on Wilcox as the leader within the broader clean energy transition further developing our suite of Decarbonize Asian solutions, while continuing to support our thermal customers.
With our line of sight into expanding new bookings opportunities and expanded pipeline over $9 billion and identify global projects, including are bright loop hydrogen generation technology. We are excited about the remainder of 2023 and the industry Tailwinds in place for 24 and beyond.
Our momentum and the first half of the year wouldn't have been possible without the dedicated team of BMW employees driving these initiatives behind the scenes I would like to thank all of our employees for your continued efforts and moving these innovations Ford and also supporting our customer projects, both domestically and abroad, while working safe.
<unk> and providing the highest quality performance and operational success. In addition to thinking our employees. We also want to extend our appreciation to our valued customers shareholders and trusted partners for the continued support and belief in our company or.
Our commitment and driving innovation forward is central to BMW mission, and we look forward to working with you and building upon our accomplishments in the years to come with that I will now turn the call back over to Luisa who will set up your questions Luisa.
Thank you if you would like to ask a question. Please pasta followed by one on your telephone keypad now, but the parents ask a question. Please ensure.
You'll have unlimited likely before speaking.
Both close briefly what questions are now being <unk>.
Oh first question today comes from Iran Spy chat of Craig Hallum.
R. M. Please go ahead when you're ready.
Hi, Kenny and Louie Thanks for taking the questions.
You may be first on my end you can you just talk a little bit about the norstar clean energy project and just kind of what the opportunity on the revenue side is there and maybe timeline milestones as we look to kind of phase one to phase two.
And then there's anything else you can share their on the opportunity with with this customer or other customers.
Biomass side of things.
Sure I'd be happy to think Sir first of all for joining today.
So the the key kickoff project, which we announced was the obviously the engineering study in phase.
And that's small revenues for us probably roughly $1 million for that phase.
Of the project.
Overall.
Intent would be that that's complete here.
Probably three early fourth quarter.
And finalizing that by year end with the client.
We anticipate once they move past that phase when they if they move it to the full project phase of the project, which is 75 megawatt biomass facility.
Our our efforts in this regard on this project will be more focused towards the deep carbonization aspect of that plant in sight.
So the salt bright.
Technologies will be positioned well there for that and we're excited about that opportunity ballpark. If we were to move to full project phase.
Think about the revenues being similar.
Somewhere in the $90 million to $100 million ish range, plus or minus depending on the exact scope and finalizing that particular contract and that probably would be something that would be.
If we get to that range or that step would be a booking that we would realize somewhere good next year.
Third quarter may be something like that so but that's that's that's the exciting part is one of the early opportunities around our saw Brian technology, and we're excited to see that move forward.
Got it thanks for the call are there and then maybe just second.
Can you just on the backlog in kind of the guidance can you just talk a little bit about the confidence you have in the second half and kind of reaching.
Reaching the guide and then just kind of laid out $850 million to $1 billion, just any color on what areas.
Drive drive that.
Yeah, No I think I said 852, a $1 billion, but when a clarify you're right. It's 850 million. So thanks, thanks for clarifying that.
But.
Obviously, a number of projects that we have that we're in negotiations on.
That are.
Sizable projects in both.
Thermal as well as in the clean energy technologies that we're involved in today.
Some of those.
Obviously, when we give a range we're anticipating some of those to happen and some may get pushed into early next year.
But we've got a number of those projects that we're in negotiations on right now.
From an internal planning perspective, we thought one or two of those may may move into bookings more in the Q2 Q3, but they're.
They are slipping into Q3 Q for but.
And one or two of those may slip into next year. That's why we provide the range of the $850 billion to $1 billion.
But we see a pathway to those opportunities and we're in and discussions and negotiations on those and as we speak so.
That's what gives us the confidence in in those numbers hopefully that helps but happy to answer.
More if I can.
No.
I think that's good thanks for taking the questions I appreciate it.
No problem. Thanks appreciate it.
Thank you for your question I mean, our next question today comes from Rob Brown <unk> capital markets. Please go ahead.
Hi, Kenny.
On the on the bright Lupe.
<unk> gotten.
You've gotten more bullish on the brightly pipeline and sort of scripted out a little bit more definitively here, what's what's driving all that common so I assume it's a number of customer interactions but.
Where are the customers at and is it is it.
Driven by some of the I R a and other legislation.
Alright.
Yeah, well combinations of all that so it is more bullish because of the interactions that we're having both both of them the Wyoming aspect in Louisiana aspect initially on those too.
There is excitement for us any way and I won't can't comment much further but in and around discussions we're having.
The oil and gas industry on potential projects.
Using petroleum Coca pet Coke as a fuel sources will too.
Plus a number of other projects we're also seeing.
Discussions and we're moving into specific long-term planning around as I mentioned in the call scale up from the initial medium sized projects in both those locations, Louisiana in Wyoming.
Two large size.
Size units, both those locations the need for hydrogen.
On both of those are much bigger than the medium units will provide but the scale up as is.
In discussions right now and we see pathways to move those forward.
A little bit.
Further once we get the medium sized up and running so we've got pathway into larger units in fee visibility into those we've see visibility into other projects like I said in the oil and gas industry as well as a few others that are around the world.
That's on I would call it im seeing immediate opportunities meeting opportunities that were actively engaged and we're in early discussions with.
On other projects potentially in Europe , and elsewhere that gives us confidence.
And those around our abilities to get to those bookings and and.
In backlog that I mentioned.
Our bookings in revenues that I mentioned on the call associated with bright loop. So that uniqueness for US is we're one of the only technologies that can leverage a solid fuel aspect on a scale up environment to produce hydrogen and also isolate the C O two the second aspect.
<unk>, we are unique in our abilities to be able to blend fuels on bright loop.
Would that really comes into play in these opportunities. If you look at for example in Wyoming, the possibility exists and we're planning on introducing a mixture of biomass.
With.
In that particular case coal as a fuel source.
That will as to your point will allow us to leverage the some of the higher rate credits 45, the credits on that.
The customer depending on how we finalize that but.
Still the drivers from the Iras standpoint to blend the biomass and with the coal.
To leverage those credits and that's something that we're in dialogue and discussions right now directly with the customer.
To make a final determination there, but ours is the only real technology that can have that duel blending will be looking at similar aspects on either natural gas and biomass in other locations.
Yet in other locations it will strictly the biomass in yet another is that it will be strictly natural gas. So we have that that runway when you look at.
Just to expand on that I'm going to go a little bit further when you look at our technology versus safety methane reformer auto thermal reform.
Technologies, we vastly different.
And the fact that we can produce hydrogen from natural gas, but our process using the chemical looping will actually create an icily. The C. O. Two on the front end of the process rather than in a very expensive post combustion environment, and <unk> and HCR by their definition and the way that.
Technology works actually requires a post combustion carbon capture which.
Is very expensive from a a capital standpoint.
To be able to provide so long term, we believe the market for.
Hydrogen being produced from natural gas will remain strong for many many many many years.
And the fact that we can produce hydrogen from natural gas, but we automatically isolate the C 024, either other beneficial user sequestration.
Puts us in a real competitive advantage from a cost profiling standpoint versus traditional SNR and HCR technology. So if.
If you combine all of those elements together gives us confidence in our technology and where we see a growing.
Okay. Thanks for the great overview there.
And then in general and you're on your pipeline grocery increase in your pipeline estimate how much of that or how is the European waste energy market. At this point is that increase as well.
Yeah, we're seeing we're seeing some opportunities in ways synergies still strong in the in the European market UK in particular is still a strong for new build projects.
We're starting to see more demand I think which is great for our renewable services business in platform in Europe , where older plants.
Are requiring upgrades and new services either.
To expand their size or platform or.
Update the technologies and or.
Various parts and services that traditionally BMW hadn't been involved in.
So we're seeing that as well too and we're obviously I think we've tried to share that excitement and the release and on the call, but Ah renewable services group in Europe is doing a great job and.
And we're seeing the increase in revenues.
On that platform as well so that we mentioned earlier announced when it gets late last year that were involved in the low stock project, which I think now.
Is the largest in the United Kingdom presently form of plant size standpoint.
The.
There will be others and were involved in discussions on some other projects as well, which would be potentially part of that backlog that we talked about but clearly in our pipeline too.
Okay. Thank you I'll turn it I will I will add to that.
No that's good Rob I'll, just add to it cause I think it's important.
We're starting to see early early on but we're starting to see a number of potential projects emerge in the U S as well.
In the waste the energy segment, and that's exciting for us and we're in discussions with the number of partners on those projects, but we're starting to see some some early demand around waste energy here in the U S and I think that's it exciting development. So.
Nothing.
Yeah.
I don't think we would seating in a potential bookings until the latter part of 24 early 25 somewhere in that neighborhood, but.
Those take time, obviously to develop but there is a number of them beginning to develop here in the U S and I think that's that's exciting news for us.
It's been a while.
Anyway. Thank you all for either.
Thanks.
Thank you for that question next question today comes from.
<unk>. Please go ahead.
Hey, great. Thanks said.
Afternoon or evening.
Yes.
You gave us a little flavor chenette financial prospects around.
We appreciate the added covered is Cynthia.
Gave us kind of the revenue opportunity I Gotta ask.
We ought to think about maybe the margin opportunity from the business sense of unique sort of technology to you in terms of what you're offering.
<unk> at least margin opportunity may be.
An assessment kind of the legacy BMW businesses that any thought.
Sure.
Yeah, no, we fully anticipate and expect it to be.
A strong margin uplift to BMW overall.
As we mentioned the different sized platforms.
Rough order of magnitude, we're fully anticipating knows to be in the 20% to 30% gross margin range on those newbuild projects.
That were involved in.
The other key piece that that I mentioned.
Or tried to mention any way was that we also anticipate follow on an annual basis of about now to call at 200000 to 250000 roughly.
Additional revenues on per ton of hydrogen produced so if.
If we deploy several I don't know four or 500 tons of hydrogen you could multiply that out times 200, 5200 to 250000, a year in additional incremental revenues from follow on parts services and particle.
We fully anticipate that to be a much higher margin.
Then the initial projects so.
So that helps but that's how we're thinking about it in terms of our future.
<unk> and we wanted to reflect that in the call.
Got it appreciate that.
Just back on the visibility towards the backlog figures you talked about by potentially by year end $850 billion to $1 billion.
Maybe just what stages. These various opportunities are I guess I'm getting that Kenny at each things you've been selected for but not just not find yet I just wanted to understand that a little more.
Some doubts both with some of those where we've been selected for and we're in discussions on.
Our negotiations in contracts.
Some some of those are.
We're we're down to us versus one other and were highly confident that that will come our way for either technology purposes competitive purposes.
We've got to strengthen if we go to some of the thermal projects and the fact that we provide union construction opportunities combined with our technologies and.
Were involved in a couple of projects on the thermal side that were required books is unique construction and the technology component and we're really in a strong position to provide that.
And that.
With customers that we've got.
Also customers that we've got strong prior history, and performing services and workforce. So those those all give us the confidence that we can reach those backlog numbers that makes sense.
It does maybe just lastly that Stoller arena for you and that that's the business you'd been ramping up.
Quite a bit maybe just to map data broadcast you're seeing that.
Yeah, as we mentioned.
The solar side, we're starting to see.
For us and that the market the market demand, it's been there, but we're starting to slowly pick up our share of opportunities and.
As mentioned.
With what we have either.
Been awarded just we just announced in July or projects that were well and part of that 850 to 1 billion, but projects that we're well into discussions on we fully.
Intern plan and should be able to announce at least $100 million and bookings in solar.
For the second half of 2003, which would double from last year, there are more opportunities than that in the in the solar market on the community and utility scale.
Clearly.
We are improving are working to improve the margins on those projects, primarily as we've expanded that business and as I mentioned in the call. We're investing in some back office systems.
As well as a critical part is more self performance.
Those projects.
Around those solar services and so those are two areas that were actively involved in and we will continue to invest in but we are seeing that growth.
On the solar opportunities and as we mentioned before the key thing that we're seeing constantly as we get into these renewable energy projects.
Many at the state level and some of the state funding in the IRL requires solar.
Aspects as well as clean energy aspects and or C. O two sequestration and some of those are opportunities long term that we're starting to see that would blend some of those services wherever we're pulling together solar in conjunction with <unk>.
Possible other green energy or clean energy projects in the marketplace. So.
We'll see that in full probably next year more as the iras kicks in fully but.
A lot of the developers that we're in discussions with are starting to acquire or we're answering rfps in other aspects and around some of those combined technology. So, but there's there's a ramp up seller. We've got improved the margins we know that.
We are working behind the scenes to do that.
Overall.
I should have mentioned on the call and didn't but I will take the opportunity to put it here. So it's in the script, but we are based on.
This is beyond solar but based on decisions and actions that we've taken over the past couple of years to help create more optimization efficiencies in the business.
We are working to take out roughly another $15 million of cost out of our platform.
That would be more incremental to whatever targets, we put out in 2024.
And those are just further optimizations based on actions that we have taken it previously.
Through a number of different areas. So we're.
We're excited and we wanted wanted to points of that because it is important that we continue to announce and discuss that we're constantly trying to optimize the business as we continued to invest in future growth of the platform and the company. So we're looking to do both.
Okay. Thank you.
Thank you for your question.
Final question today comes from Alex Michael Offbeat mining Securities and X piece Gonna Hatch.
Thank you good morning, Candy and Lou it looks like you've got a lot of exciting things going on here long term.
A couple of questions for you first.
Backlog $567 million.
Your projection of 852, a 1 billion by ear and it's pretty fantastic growth can you just kind of.
Keep it simple and help us to bridge from 560, 728, 52, a $1 billion sounds like a $100 million coming out of solar, but maybe give us a few other kind of bigger chunks that can help walk us there.
Yeah, we have great question, Alex by the way.
Thanks for joining.
We have a number of I won't get specific because obviously, we're in negotiations discussions, but we have a number of projects.
Al.
That were involved in some of those are larger projects that are in the $150 million to $200 million range.
That were involved in both thermal in our.
I would say horrible and renewable energy to keep it simple primarily.
There is some smaller ones and environmental but the larger ones that referring to her and renewable and thermal boat.
And we're in discussions on this projects, but some of those are new build opportunities and.
And waste of energy and biomass energy some of those are continue.
Continued upgrades enhancement and conversions and the and the thermal sector, but they're.
We have several large projects that are in the $100 million plus range I guess a.
Couple that could be in the $200 million plus range.
That would be potentially part of that scale.
Scale up from the 568 $52 billion.
[noise], that's very helpful and then.
[laughter].
With that said.
Can you talk about your comfort level and guidance of the $100 billion to $120 billion.
And clearly it's backlogs at 852, a $1 billion got us a snack you are going to have.
Incrementally greater confidence in strong grossed over that $100 million to $220 million this year.
2024, so maybe talk about those two points.
Yeah no it's.
It would.
The backlog would come in obviously and timing EBIT adjusted EBITDA impact this year will be greatly dependent upon that backlog heads right obviously were.
From a cost standpoint, we have to get those projects isn't going obviously some.
Some will happen before the end of the year and some lap and more in November December So there's always a timing issue there around that.
It would allow us to really focus on growth opportunities in 2024.
The offset to that would only be as we mentioned on the call. Obviously, we continued to invest in these new technologies bright loop.
As well as.
Biomass with carbon.
Combustion.
Carbon capture associated with that.
As well as some of the new environmental.
Bluegrass treatment technologies, we brought the marketplace. So we we constantly have to balance the expense and spend towards investing in the future growth of the platform to support those new technologies versus.
The run rate EBIT and the business, but that's tried to indicate that on the in the call as well that we balance those two but clearly on a site we've got growth.
That we see obviously getting the backlog in with support that some of that backlog will be spread over 2425 26. Some of that backlog will will actually be 25, 26 27. So.
Revenue timing standpoint built.
Bill vary depending on the specific project on on the revenue impact and the timing of that revenues, but.
I don't know that.
Yeah, I think you'll see Alex when you look at the queue. The backlog run off is about about 60% of that 560 $570 million run off this year and then about 30% next year and then is Kenney said the rest thereafter, so that's the immediate backlog that we have literally under contract.
And then there will be additional backlog and then we don't we don't include a substantial amount and backlog for the parks business, because that's kind of a book and build business. So we don't really put much of that consider that in the backlog. So that gives us a confidence of hitting these numbers for twenty-three and be.
<unk>.
Thank you.
Alex tanks.
Louisa was terrific.
That concludes the question and answer session. We have a nice type of questions. Thank you <unk> I will now possible back to <unk> any closing.
Thank you for joining us that concludes our conference call a replay will be available for a limited time on our website later today.
Thank you all for joining today's back and Wilcox second <unk> 2023 Addicts conference call how 'bout. The rest of your day you may now disconnect your lines.
[music].