Q4 2023 Babcock & Wilcox Enterprises Inc Earnings Call

Kenneth M. Young: in seeing new opportunities in waste to energy, specifically in the United States as well as in Europe and Australia through an improved pipeline of selective and higher margin opportunities. With the recent EPA announcements, we are also seeing waste-to-energy environmental opportunities as facilities in the United States are required to improve emission controls and flue gas treatment.

It's the energy specifically in the United States as well as in Europe, and Australia through an improved pipeline of selective and higher margin opportunities.

With the recent EPA announcements, we are also seeing waste to energy environmental opportunities as facilities in the United States are required to improve emission controls and flue gas treatments.

Kenneth M. Young: We are also expanding our thermal segment higher-margin parts and services and seeing more opportunities around gas conversion. We are growing our renewable services presence in Europe and see growth opportunities over the next several years. We are seeing increased activities and have doubled the amount of our paid carbon capture feed studies, and some of those should eventually lead to full project engagements to deploy our carbon capture technology. We are also continuing our efforts to deploy our Bright Loop technology, and we'll discuss that a little bit more later. Looking at our full-year financial performance, we continue to display year-over-year improvement in adjusted EBITDA, which helped drive our full-year results in line with our 2023 adjusted EBITDA target range. We achieved double-digit revenue growth across all business segments, driven by increased activity and expansion into our key end markets, particularly in our environmental segment, which saw a 31% year-over-year increase.

We are also expanding our thermal segment higher margin parts and services and seeing more opportunities around gas conversions.

We are growing our renewable services presence in Europe and seek growth opportunities over the next several years.

We are seeing increased activities and have doubled the amount of our paid carbon capture feed studies and some of those should eventually lead to a full project engagements to deploy our carbon capture technologies.

We are also continuing our efforts to deploy our bright loop technology, and we'll discuss that a little bit more later.

Looking at our full year financial performance, we continue to display year over year improvement in adjusted EBITDA, which helped drive our full year results in line with our 2023 adjusted EBIT target range, we achieved double digit revenue growth across all business segments.

Driven by increased activity and expansion into our key end markets, particularly in our environmental segment, which saw a 31% year over year increase.

Kenneth M. Young: We also continue to make progress in converting our now over 9 billion global pipeline of identified project opportunities into bookings, as shown in our consolidated top-line improvement when compared to last year. Our pipeline includes over 1.5 billion of climate-bright and bright-loop opportunities as well. And we are confident and have reason to believe that our bookings in 2024 will be one of the highest in recent history.

We also continue to make progress in converting our now over $9 billion global pipeline of identified project opportunities to bookings as shown in our consolidated topline improvement when compared to last year.

Our pipeline includes over one 5 billion of climate bright and bright loop opportunities as well and we are confident and have reason to believe that our bookings in 2024 will be one of the highest in recent history. In fact, we expect to announce a large gas conversion.

Kenneth M. Young: In fact, we expect to announce a large gas conversion project on Monday morning. The underlying industry trends resulting from strong global demand for clean power production and energy security underpin our pipeline and outlook for sustained growth in 2024 and beyond. Our year-end backlog was short of our expectations, but this was largely due to longer-than-anticipated negotiations on a few new opportunities. The majority of the delays were due to an increased scope for B&W's aftermarket services as many utilities and large energy companies are re-evaluating projects due to higher interest rates. However, we have seen continued interest from utilities in North America and around the world in extending the life of their thermal generating assets and replacing coal or oil with cleaner burning fuels like natural gas, biofuels, or hydrogen.

<unk> on Monday morning.

The underlying industry trends, resulting from strong global demand for clean power production and energy security.

Underpinned our pipeline and outlook for sustained growth in 2024 and beyond.

Our year end backlog was short of our expectations, but this is largely due to longer than anticipated negotiations on a few new opportunities. The majority of the delays were due to an increased scope for BMW aftermarket services as many utilities and large energy companies are.

<unk> reevaluating projects due to higher interest rates.

However, we have seen continued interest from utilities in North America and around the world on extending the life of their thermal generating assets and replacing coal or oil with cleaner burning fuels like natural gas biofuels or hydrogen.

Kenneth M. Young: With increased visibility into our near-term booking opportunities, we are reiterating our full-year 2024 adjusted EBITDA target of $100 to $110 million, which excludes Bright Loop and Climate Bright. We continue, though, to invest in our Bright Loop opportunities and anticipate spending around $5 to $9 million in 2024 on our Bright Loop projects and technology-advanced. Reflecting on what was another year of challenging macroeconomic conditions, primarily due to the higher interest rate environment of today, we remain focused on delivering strong execution across our parts and services business, which continue to perform above our expectations and contribute meaningfully to our cash flow and revenue generation. We see this focus as an instrumental next step to de-leverage the balance sheet and improve the liquidity profile of our business.

With increased visibility into our near term booking opportunities. We are reiterating our full year 2024, adjusted EBIT target of $100 million to $110 million, which excludes bright loop in climate bright.

Continue though to invest in our bright loop opportunities and anticipate spending around $5 million to $9 million in 2024 on our bright loop projects and technology advancements.

Reflecting on what was another year of challenging macroeconomic conditions, primarily due to the higher interest rate environment of today, we remain focused on delivering strong execution across our parts and services business, which continued to perform above our expectations and contribute meaningfully to.

Our cash flow cash flow and revenue generation.

We see this focus as an instrumental next step to deleverage the balance sheet and improve the liquidity profile of our business.

Kenneth M. Young: As a part of our announced strategic business realignment, we have taken significant steps to realign the company for improved financial performance in 2024, driven by several key initiatives that are expected to deliver more predictable cash flow generation and improved financial performance through higher margin opportunities. As a result, we will continue to reduce our reliance on high-cost, low-margin, new-build projects, which will, in turn, allow us to reduce the associated overhead and interest costs.

As a part of our announced strategic business realignment, we have taken significant steps to realign the company for improved financial performance in 2024, driven by several key initiatives that are expected to deliver more predictable cash flow generation and improved financial performance through higher margin opportunities.

As a result, we will continue to reduce our reliance on high cost low margin newbuild projects, which in turn will allow us to reduce the associated overhead and interest cost in parallel we remain on track to realize our expected annualized cost savings target of over $30 million and.

Kenneth M. Young: In parallel, we remain on track to realize our expected annualized cost savings target of over $30 million and reduce our interest expense. To date, we have successfully realized more than $19 million in cost savings, and we have established a new $150 million senior secure credit facility and received a reaffirmed credit rating of a double B plus from Egan Jones. These developments not only enhance our liquidity profile and provide an additional annual interest cost savings of approximately $5 million, but also allow for more flexibility in our use of capital to support letters of credit, drive renewable energy growth, and deliver on other potential accretive business initiatives. The reaffirmation of our credit rating and our new Senior Secured Credit Facility reflect the stability of our business model and our continued commitment to our long-term growth capabilities.

<unk> our interest expense to date, we have successfully realized more than $19 billion in cost savings.

And as established a new $150 million senior secured credit facility.

<unk>, a reaffirmed credit rating of a double b plus from Egan Jones.

These developments not only enhance our liquidity profile and provide an additional annual interest cost savings of approximately $5 million, but also allow for more flexible flexibility in our use of capital to support letters of credit drive renewable energy growth and deliver on other potential accretive busy.

<unk> initiatives.

The reaffirmation of our credit rating and our new senior secured credit facility reflects the stability of our business model and our continued commitment to our long term growth capabilities. Additionally, it bolsters our efforts to support multi year projects and capitalize on future growth through our evolving bright loop and climate bright.

Kenneth M. Young: Additionally, it bolsters our efforts to support multi-year projects and capitalize on future growth through our evolving Bright Loop and Climate Bright technology opportunities. With our recent strategy changes, we are confident in realizing stronger cash flows from our thermal operations as we continue to expand and implement our new renewable technologies, including hydrogen production and carbon capture. Looking forward, we anticipate 2024 to be a pivotal year for our decarbonization platform and the deployment of our Bright Loop technology at commercial scale. We have doubled our activity around carbon capture feed studies, and are optimistic these efforts will translate into potential projects in 2024 for utility-scale carbon capture technology.

<unk> opportunities.

With our recent strategy changes, we are confident in realizing stronger cash flows from our thermal operations as we continued to expand and implement our new renewable technologies, including hydrogen production and carbon capture.

Looking forward, we anticipate 2024 to be a pivotal year for our de carbonization platform and deployment of our bright loop technology at commercial scale, we have doubled our activity around carbon capture feed studies.

And are optimistic these efforts will translate into potential projects in 2024 for utility scale carbon capture technology.

Kenneth M. Young: On Bright Loop specifically, we've achieved several key milestones to date across this project portfolio with respect to financing and off-take arrangements, as mentioned. We have increased our investment in Bright Loop and Bright Loop projects in 2024 and continue our development activities as each project is at various stages. As discussed previously, we are developing a small hydrogen production plant in Massillon, Ohio, not too far from our headquarters in Akron.

On bright loop, specifically, we've achieved several key milestones to date.

Across this project portfolio with respect to financing and offtake arrangements as mentioned.

We have increased our investment in bright bright new projects in 2024 and continue our development activities as each project is at various stages.

As discussed previously we are developing a small hydrogen production plant in Massillon, Ohio, and not too far from our headquarters in Akron.

Kenneth M. Young: In addition to the previously announced letter of intent for Project Global Financing, we are also negotiating final offtake agreements and working diligently to finalize the construction cost estimates for this project. With respect to our medium and larger platforms, we've been awarded a $16 million grant from the Energy Matching Funds Program of the Wyoming Energy Authority to fund the permitting, engineering, and initial construction activities for our Black Hills project. We have a great partner with Black Hills Energy, and we are working together to further progress this project, which will utilize local coal to produce low-carbon-intensity hydrogen while sequestering carbon dioxide. This award is a testament to the progress we've made in our efforts to develop a clean hydrogen generation facility with CO2 capture.

In addition to the previously announced letter of intent for project project Global financing. We are also negotiating final offtake agreements and working diligently to finalize the construction cost estimates for this project.

With respect to our medium and larger platforms, we've been awarded a $16 million grant from the energy matching funds program of the Wyoming Energy Authority to fund the permitting engineering and initial construction activities for our Black Hills project.

We have a great partner with Black Hills energy and we are working together to further progress this project, which will utilize local coal to produce low carbon intensity hydrogen while sequestering carbon dioxide.

This award is a testament to the progress we've made in our efforts to develop a clean clean hydrogen generation facility with Sidoti capture.

Kenneth M. Young: We also continue to progress our Louisiana Bright Loop project and have signed a memorandum of understanding with Air Products and General Hydrogen to enter into a definitive offtake agreement for what could be up to 215 tons of carbon negative hydrogen offtake per day, as well as the CO2 produced at the facility. We are in discussions around fuel availability and fuel supply agreements, and we are engaging with several potential investors who are attracted to the project's net negative carbon intensity characteristics. Based on our experiences and interactions, we've received to date and continue to progress with prospective new build project opportunities. It has become clear that the demand for commercial solutions that address carbon-neutral targets is continuing to grow.

We also continued to progress our Louisiana Bright loop project and have signed a memorandum of understanding with air products in general hydrogen to enter into a definitive offtake agreement for what could be up to 215 tonnes of carbon negative hydrogen offtake per day as well as the Cotwo produced at the facility.

We are in discussions around fuel availability and fuel supply agreements and we are engaging with several potential investors who are attracted to the project's net negative carbon intensity characteristics.

Based on our experiences and interactions we've received to date and continued progress with prospective new build project opportunities it.

It has become clear that the demand for commercial solutions that address carbon neutral targets is continuing to grow. Additionally, we continue to see potential for new projects related to waste to energy in the United States and expect higher margin opportunities to arise for our broader climate bright technologies.

Kenneth M. Young: Additionally, we continue to see potential for new projects related to wasted energy in the United States and expect higher-margin opportunities to arise for our broader Climate Bright technology. To reiterate, our updated pipeline is over $9 billion across all three segments, with approximately $1.5 billion in Bright Loop and Climate Bright opportunities alone. We believe this puts us on a pathway to reach $1 billion in bookings by 2028, and we feel confident that this could lead to $1 billion in revenues by 2030, which still only represents roughly 1% of the market share for total hydrogen spend by 2030.

To reiterate our updated pipeline is over 9 billion across all three segments with approximately $1 5 billion and bright loop and climate bright 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 bright loop projects, we feel confident that could lead to $1 billion in revenues by 2030, which still only represents roughly 1% of the market share for <unk>.

It'll hydrogen spend by 2030.

Lou Salamone: We look forward to deploying these technologies at scale and further developing our suite of carbon capture solutions and ultimately leveraging our Climate Bright decarbonization platform and supportive industry legislation to further diversify our environmental and renewable business. I'll now turn the call over to Lou, who will discuss the financial details of the fourth quarter and full year 2023.

We look forward to deploying these technologies at scale and further developing our suite of carbon capture solutions and ultimately leveraging our climate bright de carbonization platform and supportive industry legislation to further diversify our environmental and renewable businesses.

Ill now turn the call over to Lou who will discuss the financial details of the fourth quarter and full year 2023 Blue. Thanks, Kenny first I'll review, our full year 2023 results and then I'll turn to our fourth quarter of 2023 results for further detail I'd call. Your attention to the fact that we will file our 10-K with the SEC tomorrow.

Lou Salamone: Thanks, Kenny. First, I'll review our full year 2023 results, and then I'll turn to our fourth quarter 2023 results. For further detail, I call your attention to the fact that we will file our 10-K with the SEC tomorrow, March 15, 2024, and you can refer to it for further details beyond what we discussed in this call. Consolidated revenues for 2023 were $999.4 million.

March 15th 2024, and you can refer to it for further details beyond what we discussed in this call.

Consolidated revenues for 2023 were $999 4 million, that's an 18% improvement compared to 2022. This improvement was primarily due to higher level of activity across all of our segments.

Lou Salamone: That's an 18% improvement compared to 2022. This improvement was primarily due to higher levels of activity across all of our segments. Our net loss in 2023 was $78.6 million, as compared to a net loss of $20 million in 2022. This is related primarily to an overall increase in costs and expenses, our higher interest expense, an increase in foreign exchange losses, and goodwill impairment expenses. Gap operating income in 2023 was $19.9 million, compared to operating income of $2.3 million in 2022.

Our net loss in 2023 was $78 6 million as compared to a net loss of $20 million in 2022, and this is related primarily to the overall increase in costs and expenses are higher interest expense and increase in foreign exchange losses, and goodwill impairment expense.

GAAP operating income in 2023 was $19 9 million compared to operating income of $2 3 million in 2022.

Lou Salamone: We achieved our revised 2023 adjusted EBITDA target, excluding Bright Loop and Climate Bright expenses, with an adjusted EBITDA of $84.1 million as compared to $71.8 million in 2022. Total bookings in 2023 were $878 million, an increase of 2% compared to the full year 2022. Backlog at December 31st, 2023 was $530 million, which is a slight decrease compared to the prior year end. Let me now turn to our fourth quarter results. Fourth quarter consolidated revenues were $227.2 million.

<unk>, our revised 2023, adjusted EBITDA target, excluding bright loop and climate bright expenses within adjusted EBITDA of $84 1 million as compared to $71 8 million in 2022.

Total bookings in 2023 or $878 million, an increase of 2% compared to the full year 2022.

Backlog at December 31, 2023 was $530 million, which is a slight decrease compared to the prior year end.

Let me now turn to our fourth quarter results.

Fourth quarter consolidated revenues were $227 2 million. This is a 4% decline compared to the fourth quarter of 2022. This decline was primarily attributed to lower volumes in our renewable segment as it were.

Lou Salamone: This is a 4% decline compared to the fourth quarter of 2022. This decline was primarily attributed to lower volumes in our renewable segment as a result of the completion of some lower-margin new-build work and the combination of our strategic shift away from these lower-margin new-build businesses. The net loss in the fourth quarter of 2023 was $54.3 million, as compared to a net income of $2.5 million in the fourth quarter of 2022. This was primarily due to non-cash adjustments for pension accounts.

As a result of the completion of some lower margin new build work and the combination of our strategic shift away from these lower margin Newbuild businesses. The net loss in the fourth quarter of 2023 was $54 3 million as compared to a net income of $2 5 million in the fourth quarter of.

<unk> 2022, and this was primarily due to noncash adjustments for pension accounting.

Lou Salamone: Our GAAP operating income in the fourth quarter of 2023 was $700,000 as compared to operating income of $6.3 million in the fourth quarter of 2022. Adjusted EBITDA was $19.5 million in the fourth quarter of 2023 compared to $21 million in the fourth quarter of 2022. Bookings in the fourth quarter of 2023 were $250 million, a 44% increase compared to bookings of $174 million in the fourth quarter of 2022 I'll now turn to our cash flow, balance sheet, and liquidity. We ended the year with total debt of $379.5 million and combined cash, cash equivalents, and restricted cash balances of $71.3 million for a net debt of approximately $308.2 million.

Our GAAP operating income in the fourth quarter of 2023 was 700000 as compared to operating income of $6 3 million in the fourth quarter of 2022.

Adjusted EBITDA was $19 5 million in the fourth quarter of 2023 compared to $21 million in the fourth quarter of 2022.

Bookings in the fourth quarter of 2023 or $250 million.

A 44% increase compared to the bookings of $174 million in the fourth quarter of 2022.

I'll now turn to our cash flow balance sheet and liquidity. We ended the year with total debt of $379 5 million and combined cash cash equivalents and restricted cash balances of $7 71 3 million.

For a net debt of approximately $308 2 million.

Lou Salamone: Additionally, as Kenny mentioned, subsequent to December 31, 2023, we entered into a new three-year senior secured credit agreement with Axos Bank, under which Axos has provided an asset-based revolving credit facility of up to $150 million that can be used to support letters of credit, renewable energy growth initiatives, and potential accretive business. The new revolver provides for reduced interest rates on letters of credit and much greater flexibility with overall use of up to $150 million versus the previous facilities that were limited to a $50 million revolver and a separate letters of credit facility. The new financing arrangements have a maturity date of January 18, 2027, and all obligations under the company's prior credit agreement with PNC Bank N.A. as administrative agent have been discharged.

Additionally, as Kenny mentioned subsequent to December 31, 2023, we entered into a new three year senior secured credit agreement with Axis Bank under which access is provided an asset based revolving credit facility of up to $150 million that can be used to support letters of credit renewed.

<unk> energy growth initiatives and potential accretive businesses.

The new revolver provides for reduced interest rates on letters of credit and much greater flexibility with overall use of up to $150 million versus the previous facilities that were limited to $50 million revolver and a separate letters of credit facility.

The new financing arrangements have a maturity date of January 18th 2027, and all obligations under the company's prior credit agreement with PNC Bank M&A as administrators.

Australia of agents have been discharged the credit agreement has also been terminated letters of credit issued under the previous facility with PNC are expected to transition to the access facility over the next several months.

Lou Salamone: Credit Agreement has also been terminated; letters of credit issued under the previous facility with PNC are expected to transition to the ACCESS facility over the next several months. We faced liquidity challenges arising primarily from losses recognized on our B&W solar loss contract. We are actively evaluating certain actions to address eloquidity. Based on our ability to raise funds through such actions, we've concluded that it is probable that we will have sufficient capital to meet our operating debt service and capital requirements over the next 12 months. We expect 2024's quarterly profile to follow our normal cyclical performance of increasing profitability from the first quarter through the fourth quarter. As Kenny highlighted, we're reiterating our 2024 target of between $100 and $110 million of adjusted EBITDA, excluding Bright Loop and Climate Bright expenses, and are confident in an improved financial performance underpinned by a robust pipeline of more than $9 billion of opportunities and expected backlog growth beginning in the first quarter I'll now turn the call back over to Kenny. Thanks, Lou.

We faced liquidity challenges arising primarily from losses recognized on our BMW solar loss contracts, we are actively evaluating certain actions to address our liquidity needs.

Based on our ability to raise funds through such actions. We've concluded that it is probable that we will have sufficient capital to meet our operating debt service and capital requirements over the next 12 months.

We expect 2024th quarterly profile to follow our normal cyclical performance of increasing profitability from the first quarter through the fourth quarter.

As <unk> highlighted we're reiterating our 2024 target of between 101 hundred $10 million of adjusted EBITDA, Excluding bright loop in climate Fright expenses.

And our confidence in an improved financial performance underpinned by a robust pipeline of more than $9 billion of opportunities and expected backlog growth beginning in the first quarter of 2024.

I'll now turn the call back over to Kenny.

Thanks, Lou will briefly and in closing our strategic business realignment is expected drive predictable cash flow generation and provide higher margin performance across all business segments in 2024.

Kenneth M. Young: Well, briefly and in closing, our strategic business realignment is expected to drive predictable cash flow generation and provide higher margin performance across all business segments in 2024. Our deep industry expertise with clean energy and carbon capture technologies, coupled with our experience in traditional energy sources, gives us a unique advantage in delivering sustainable solutions to our customers and stakeholders. As we move forward, we're both passionate and extremely enthusiastic about further developing our Climate Bright platform and the many opportunities ahead to deploy this innovative and game-changing technology at scale. As always, I want to express my gratitude to our employees around the world, our customers, shareholders, and partners for the continued support and confidence in our company. We remain steadfast in our commitment to become a frontrunner in the global energy transition and to continue to drive our strong profitable growth and create more sustainable energy for future generations.

Our deep industry expertise with clean energy and carbon capture technologies, coupled with our experience in traditional energy sources.

US a unique advantage in delivering sustainable solution to our customers and stakeholders.

As we move forward, we're both passionate and extremely enthusiastic about further developing our climate <unk> platform and the many opportunities ahead to deploy this innovative and game changing technology at scale.

As always I want to express my gratitude to our employees around the world, our customers and shareholders and partners for their continued support and confidence in our company.

We remain steadfast in our commitment to become a front runner in the global energy transition and continued to drive strong profitable growth and create more.

Sustainable energy for future generations to come.

Kenneth M. Young: So with that, Joel, I'll turn it back over to you for questions and answers. Absolutely. We will now begin the question and answer session. Again, if you would like to ask a question during this time, you can press star followed by one on your touchtone keypad. If you'd like to remove a question for any reason, you can press star followed by one.

So with that Joe I'll turn it back over to you for questions and answers.

Absolutely we will now begin the question and answer session again, if you'd like to ask a question. During this time you can press star followed by one on your Touchtone keypad.

If you'd like to remove the question for any reason you can press star followed by <unk>.

Operator: Again, to ask a question, it is star 1. As a reminder, if you're using a speakerphone, please remember to pick up your handset before asking your question. The first question is from the line of Aaron Spychalla with Craig Hallam.

Again to ask a question it is star one.

As a reminder, if you are using a speaker phone. Please remember to pick up your handset before asking your question.

The first question is from the line of Ernst <unk> with Craig Hallum. Your line is now open.

Aaron Michael Spychalla: Your line is now open. Yeah, good afternoon, Kenny and Lou. Thanks for taking the question. Hey Greg, thanks for joining us; no problem at all.

Yes, good afternoon, Kenyan Lou thanks for taking the questions.

Hey, Greg Thanks for joining no problem at all.

Kenneth M. Young: Yeah, first question, you know, no worries on some of the large projects that you've been kind of talking about, you know, the bookings up in the fourth quarter, did some of those hit in the fourth quarter? And then maybe just some more details on, you know, what's to come. You called out a large gas conversion project here. You know, any kind of details on size and timing as we think about confidence in the guide for this?

First question.

No noise on some of the large projects that you've been kind of talking about.

Bookings up in the fourth quarter did some of those hit in the fourth quarter and then maybe just some more details on what's to come you called out a large gas conversion project here.

Any kind of details on size and timing as we think about confidence in the guide for this year.

Kenneth M. Young: Yeah, so we'll definitely announce more details around that project on Monday as we work through final disclosures and everything else around that specific project. But we're excited to announce that on Monday. I think the important message on the timing of bookings, some of these projects which are sizable, the negotiations and other aspects took a little bit longer, some of the other requirements to get those approved inside the customers took a little bit longer than anticipated. So we didn't quite hit the perfect timing of a Q4 booking versus a Q1 booking.

Yes, so we will definitely announce more details around that project on Monday.

As we work through final.

Disclosures and everything else around that specific project, but we're excited to announce that on Monday.

I think the important message on the timing of bookings and some of these projects.

Which are sizable.

The negotiations in other aspects took a little bit longer or some of the other requirements to get those approved inside the customers took a little bit longer than anticipated. So we didn't quite hit the perfect timing of Q4 booking versus the Q1 booking.

Kenneth M. Young: But it helps to reiterate and stress that as we go into this year, we think we're going to have one of the highest booking years we've had in recent history. And obviously, we're confident in that, and it will be underpinned by potentially some of the announcements on Monday as well as others that we're working on as well too. Alright, and then on the doubling of the feed studies for carbon capture. You know, can you just kind of give some quantification there, any on timing as we kind of think about how those progress throughout the year and when we might see some contribution from those moving forward? Yeah, so we're excited about that because, you know, the amount of feed studies that we're getting, and for us, those are, I mean, they're not material revenues on an independent feed study, but you know, good margins for us on those, but developing those leading to further projects is obviously the most exciting part. And we do anticipate that one or two of those would come to fruition in 2024 from a project standpoint. Not to get too far over the skis, but we're in discussions on one of those specifically right now about furthering that into project aspects. There are a lot of approvals that have to be done and so on and so forth.

But it helps to to reiterate and stress that as we go into this year. We think we're going to have one of the highest booking years, we've had in recent history.

And obviously, we're confident that and underpinned by.

Potentially some of the announcements on Monday as well as others.

Others that we're working on as well too.

Alright, and then on the doubling of the feed studies for carbon capture.

Can you just kind of give some some.

Quantification there.

Anything on timing as we kind of think about how those progress throughout the year end and when we might see some contribution from those moving forward.

Yeah. So we're excited about that because.

The amount of feed studies that we're getting.

For us those are I mean, they're not material in revenues on an independent feed study, but good margins for us.

On those but they're.

Developing those leading to further projects is obviously the most exciting part.

We do anticipate.

That one or two of those would come to fruition in 'twenty four from a project standpoint.

Not to get too far over the skis. We're in discussions on what are the I guess one of those specifically right now about furthering that into project aspects.

Approvals have to be done and so on and so forth but.

Kenneth M. Young: But we're confident that one of those will turn into a project this year, and that's why we mentioned that on the call itself. We don't need to give any numbers on that yet because we're still going through negotiations and other aspects. But these would be very impactful projects for us both on top line revenue and margins as well. But probably more exciting is that we fully anticipate getting one of these in. We would actually be driving our carbon capture solutions to the utility commercial scale, and it will still take one or two years to implement those projects over time.

We're confident that hope that one of those will turn into a project this year and Thats why we mentioned that on the call itself.

Give any size on that yet because we're still going through negotiations and other aspects but.

These would be very impactful projects for us both on top line revenue and margins as well but.

Probably more excited is that we fully anticipate getting one of these in we would actually be driving our carbon capture solutions to that utility commercial scale.

Standpoint.

I'll still take one or two years to implement those projects over time, but getting the.

Kenneth M. Young: But getting a few of these out the door would be very exciting for us, so we're confident that it will happen. But never say a perfect world.

Few of these out the door to be very exciting for us. So we are confident that will happen.

Never say.

Kenneth M. Young: Obviously, we've got to get through the negotiations and other aspects. But always, something could happen. But we're confident that we'll get to a conclusion and get one of those announced this year. OK. And then just if I can sneak one more in on free cash flow for 2024. Can you just kind of talk about the outlook there? You know, does that follow a similar cadence to, you know, the P&L for the rest of the year? And then just on the cost savings initiatives, just, you know, thinking about that as we think about cash flow. Yeah, the cash flow does follow because, as we've always talked about, the Cadence from Q1 to Q4 is very significant. Q1 for us is a very low quarter. We always come off a strong fourth quarter because of the buying habits of many of our customers. However, the first quarter is much lower.

Perfect World, Obviously, we've got to get through negotiations and other aspects are always something could happen but.

We're confident that we'll get to a conclusion and get one of those announced this year.

Good and then just if I can sneak one more in just on free cash flow for.

For 2024 can you just kind of talk about the outlook there does that follow a similar cadence to.

The P&L for the for the rest of the year.

And then just on the cost savings initiatives, just thinking about that as we think about cash flow.

Yes, the cash the cash flow does follow because as we've always talked about.

<unk>.

The cadence from Q1 to Q4 is very significant Q1 for us is very low quarter, we come off.

We always come off a strong fourth quarter because of the buying habits of many of our customers first quarter is much lower usually EBITDA will generally double in the second quarter, and then increase each quarter from there and the cash flows will follow along.

Kenneth M. Young: Usually, EBITDA will generally double in the second quarter and then increase each quarter from there. And the cash flows will follow along with that, Aaron. All right, thanks for the color.

With that Aaron.

Alright, thanks for the color I'll turn it over.

Rob Brown: I'll turn it over to Rob Brown with Lake Street Capital Markets. Your line is now open. Hi Kenny and Lou. Hey Ron.

Thank you.

Next question is from Rob Brown with Lake Street Capital markets. Your line is now open.

Okay.

Hey, Ron.

Hey, Rob.

<unk>.

Kenneth M. Young: Hey Rob, I'm in the thermal business. I think you talked about some sort of strength or activity there. Could you give us a sense of how you expect that to grow and how you see the drivers coming this year? Yeah, well, kind of, I guess, threefold on thermal, you know, the parts and services business this year. We feel confident that it's a very strong position for us. You know, as we mentioned, a lot of these utility plants, particularly in the U.S., but obviously elsewhere in the world, are under a lot of pressure to continue performing. The electrical demand in the U.S., you know, is reaching all-time highs, right, and renewables are not necessarily in a position to catch up with the demand. So some of these plants have a lot of pressure to continue to perform.

On the on the thermal business since you talked about some some sort of strength of activity. There could you give us a sense of how you expect that to grow and then how you see the drivers coming in this year.

Yes.

So kind of I guess threefold on thermal.

The parts and services business. This year, we feel confident that it's a very strong position for us as we mentioned.

A lot of these utility plants, particularly in the U S. But obviously elsewhere in the world are under lot of pressure to continue.

Performing the electrical demand in the U S is reaching all time highs right in the in the renewables are not necessarily in a position to catch up with the demand. So some of these plants are have a lot of pressure to continue to perform.

Kenneth M. Young: That helps on our parts and services platform, so we're optimistic about that and, you know, see some of the early signs of that coming in in 2024 already. So that's positive. The other piece is we're seeing a large number of plant conversions, gas conversions in particular, happening, and we're seeing a lot more of those opportunities. And we're in a much stronger position now to compete for those opportunities based on some of the acquisitions that we made with some of the companies up in Canada and some of the companies in the U.S. over the past couple years, which provides a greater capability for us around those And so we're in a much stronger place to compete on those, and we're excited about the number of opportunities that continue to build for us in the pipeline and, obviously, this project that we will announce on Monday as well. We see those gas conversions continuing.

That helps on our parts and services platform. So we're optimistic about that and see some of the early signs of that coming in 2024.

Already.

So that's positive the other the other pieces, we're seeing a large number of conversions of plants gas conversions in particular.

Are happening and we're seeing a lot more of those opportunities and we're in a much stronger position now to compete on those opportunities based on some of the acquisitions that we made.

With some of the companies up in Canada. Some of the companies in the U S. Over the past couple of years that provides a greater capability for us around this gas conversions and so.

We're in a much stronger place to compete on those and we're excited about the number of opportunities that continue to build for us.

Pipeline and obviously.

Project that we will announce on Monday as well so we see those those gas conversions continuing.

Kenneth M. Young: As a result, our construction business is strong, and bookings this year will be strong for our construction business, which will flow into 25, 26, and a little bit into 27 as well from that standpoint. So we're excited about the pull-through of some of these projects, not only for the parts and services aspect and the technology but also for our construction business as well. So those combined are helping, and that's mainly North American-based, everything you described. At the same time, we continue to expand our presence on thermal internationally, in particular in Asia and the Pacific region, where the use of a lot of our technology from a parts and service standpoint continues to grow, and we continue to expand with that. And so that's a positive, too.

As a result, our construction business.

It's strong.

Bookings this year will be strong for our construction business, which will flow into 'twenty, five 'twenty, six and a little bit into 2007.

Well for that for that standpoint, so we're excited about the the pull through of some of these projects not only for the parts and services aspect and the technology, but also for our construction business as well. So those combined are health and that's that's mainly North America base everything you described it to say.

<unk> continued to expand our presence on thermal internationally and in particular in Asia Pacific region, where the use of a lot of our technology from a parts and service standpoint continue to grow and we continue to expand with that.

And so that's a positive too so thermal we do see that growing this year I mean.

Kenneth M. Young: So thermal, we do see that growing this year. We anticipate the environment continuing to perform extremely well this year overall. From a growth standpoint, as I said, we strategically reset a little bit on renewable energy by trying to revamp waste energy into better projects for us and markets, and as I mentioned in my remarks, we're actually seeing opportunities in the U.S. in the renewable segment for waste energy, and we're very excited about those, and even though those will probably be projects that would, if we're able to successfully win those, would be more in 2025 We haven't talked about the U.S. market for that in quite some time, so hopefully that helps, but that's how we see thermal growing this year. Very helpful.

Anticipate environmental continuing to perform extremely well this year overall.

From a gross standpoint, they said, we strategically reset a little bit on renewable.

Trying to revamp waste to energy into better projects for us.

Markets and as I mentioned in the remarks, we're actually seeing opportunities in the U S. In the renewable segment for waste to energy and we're very excited about those and even though those will be probably projects that would if were able to successfully win those would be more than 25% and 26, but we're seeing.

Some real pipeline development around a number of different waste to energy projects here in the U S and that's an exciting development because we havent talked about the U S market on that in quite some time so.

So that's <unk>.

That helps but that's how we see thermal growing this year.

That's very helpful. Thank you.

Kenneth M. Young: And then on the timeline of sort of these non-strategic actions and I guess getting the solar business out and changing over on the Waste Energy stuff. How is that sort of out of your numbers now, or do you see that trailing down throughout 24?

And then just on the timeline of surgeries done strategic actions and I guess getting the solar business out in.

Changing over in the waste to energy stuff.

How is that sort of out of your numbers now or do you see that trailing down throughout 'twenty for us.

<unk>.

Well, we synergies has been reclassified right. So that's that's not in the in the solar I'm sorry.

Kenneth M. Young: Waste Energy has been reclassified, so that's not in the numbers from an adjusted perspective on that particular piece. We continue to drive that business, obviously, as we look at strategic options around the solar platform and business. I think we announced a large project not very long ago on a series of projects that we're implementing now. Our pipeline that we report of $9 billion does not include solar because of reclassification, but we have a pipeline outside of that for solar that is sizable.

There has been reclassified so thats not in the numbers on.

From an adjusted EBITDA perspective on that particular piece, but.

We continue to drive that business, obviously, as we look at strategic options.

Around the solar platform of business.

I think we announced.

A large project not very long ago.

On a series of projects that we're implementing now and we see.

Our pipeline that we reported a $9 billion does not include solar because of the reclassification, but we have a pipeline outside of that for solar that is sizable and we see.

Kenneth M. Young: We see a number of opportunities expanding and growing around solar. The team there is doing a great job of running that business overall and delivering on those projects that we're winning today. As we get past the prior projects that we had difficulties with, and a lot of that is fast coming to an end, we're excited to see what our solar team is doing, and we'll continue to perform on those opportunities as we look at the strategic options around that particular business. Yeah, I think even though that business is in discontinued operations, and it's reported separately so you can see the business that's not in discontinued operations, as we've indicated, So I don't want to give anybody the idea that we've abandoned that business because it's in discontinued operations, but also, we do have the intent to continue to improve the business and therefore make it more valuable for us as we exit it and sell it. Great, great. Thanks for clarifying. I'll turn it over.

A number of opportunities expanding and growing around seller. So.

The team there is doing a great job of running that business.

Overall and delivering on those projects that we are winning today and.

We will.

As we get past.

The prior projects that we had difficulties with and a lot of that is.

Possibly coming to us and we're excited to see what our solar team is doing and we'll continue to.

Perform on those.

Opportunities as we look at the strategic options around that particular business, yes, I think even though that business is in discontinued ops and is reported separately. So you can see the business, it's not in discontinued ops.

As we've indicated we intend to sell that business, we're actively marketing it but at the same time, we've got a team that is growing the business.

And that should create us more value.

With respect to a potential sale.

So I don't want to give anybody the idea that we've abandoned that business because it's in discontinued ops, but also we do have the intent to continue to improve the business and therefore make it more valuable for us.

We exited it and sell it.

Great great. Thanks for clarifying I will turn it over.

Brent Thielman: Thanks. Thank you. The next question is from Brent Thielman with D.A. Davidson.

Thanks, Joe.

<unk>.

The next question is from Brent Thielman with D. A Davidson your line is now open.

Brent Thielman: Your line is now open. Thanks. Thanks. Good evening, Kenny.

Okay. Thanks.

Hey, Brian.

Yes.

Maybe just turn it turn it back to the renewables business I just wanted to get a better sense of why that revenue was down so much quarter on quarter and year on year.

Kenneth M. Young: I may just turn it back to the renewables business. I just wanted to get a better sense of why the revenue, sort of quarter-on-quarter and year-on-year, and Al Bini. Maybe it's just the timing.

You had some.

Work developing in Europe.

Maybe just maybe it's just a timing issue, but maybe just kind of clarify what's that what's been happening in that business.

Kenneth M. Young: Maybe just kind of clarify what's been happening at that time. Yeah, it's mainly timing. So we had a number of projects, waste energy projects, and renewable energy projects in Europe. Some of those projects, a little bit lower margin, but as we completed those projects, or some of those are nearing completion out there, as we mentioned. So, when those projects start to slow down or get near the end, right? The revenue profile of those projects, because we recognize revenue based on cost over time. So, as they complete, the revenue drops on it.

Obviously XOMA.

Yes, it's mainly timing so we had a we had a number of projects.

Synergy projects and renewable in Europe.

Some of those.

Projects, a little bit lower margin, but as we completed those projects or some of those are nearing completion.

Out there as we mentioned.

And when those projects start to slow down or get near the end right. The revenue profile of those projects because we recognize revenue based on cost over time, so as they complete the revenue drops.

Kenneth M. Young: So, there's always the lumpiness and timing of new projects and contracts versus the completion of others. At the same time, we also, as we announced in Q3, intently said, hey, we want to really focus more on selective opportunities, and continue doing that, if you will, and there's a few projects out there that we're in discussions on right now that haven't reached the contract phase, but the opportunities are there, and we're in discussions on those projects overall. So a little bit of a timing issue there, quarter over quarter, because we had a large number of projects we were completing at about the same time, so that impacted revenue. The other aspect of renewable energy is in our services business, the renewable services segment, and we're not hugely material yet to the top line revenue versus the project side of that business, but we are seeing that business grow and has similar margin characteristics as our thermal here in the U.S. We should see that business continue to perform very strongly in... 2024. I see nothing that tells us any different at this point in time.

On it. So there is there is always the lumpiness and timing of new projects and contracts versus the completion of the other.

Same time, we also as we announced in Q3 intently said, Hey, we want to really focus more on selective opportunities.

And continue.

Doing that if you will and there is a few projects out there that we're in discussions on.

Right now that haven't reached a contract phase but.

The opportunities are there and we're in discussions on those projects overall, so a little bit of a timing issue there quarter over quarter, because we had a large number of projects. We were completing about the same time, so that that impacted the revenue.

The other aspect.

On renewable as in our services renewable services segment.

And we are not.

Not hugely material yet to the topline revenue versus the project side of that business, but we are seeing.

That business grow.

And had similar margin characteristics as our thermal here in the us so.

We should see that continue to perform very strong in.

2024.

See nothing that tells us any different at this point in time.

Kenneth M. Young: I think we do see opportunities there that, you know, from 25 to 26, renewable services will continue to grow year over year over year. I think that will be a very strong piece of business for us, mainly because of the number of upgrades and enhancements and the aging, if you will, of a lot of the waste energy plants in Europe over there. Similar to the U.S., there are advanced environmental pressures that go on those plants, so those continue to have to be upgraded and enhanced.

I think we do see opportunities there that from in 2000.

Five and 26 renewable services will continue its growth.

Year over year over year, I think that will be a very strong piece of business for us.

When we look out and mainly because of the number of upgrades and enhancements and the ageing. If you will have a lot of the waste energy plants in Europe.

They're so similar to the U S advair.

Advanced environmental pressures that go on those plants.

So those continue to have to be upgraded and enhanced the efficiency of the plants were out over time, so that impacts the overall performance of those plants need to be upgraded and enhanced and we're we're continuing to be involved in and many of those aspects on a number of those those plants in Europe on our renewable services standpoint so.

Kenneth M. Young: The efficiency of the plants was out over time, so that impacts the overall performance, so those plants need to be upgraded and enhanced. We're continuing to be involved in many of those aspects on a number of those plants in Europe from a renewable services standpoint. We do see that business continuing to grow for us and should become very material for us over the next couple of years. Okay, okay. Fair enough.

We do see that business continuing to grow for us.

It should become very material for us over the next couple of years.

Okay, Okay fair enough.

Brent Thielman: I mean, I guess just in consideration of the liquidity position, obviously, you've made some notes to try and address that. But Lou, can you talk about free cash flow expectations for 2024? Again, for the guidance you've given for EVA Guide.

And then I guess just in.

Consideration liquidity position, obviously, you've made some moves to try and address that.

Luke can you can you talk about free cash flow expectations for 2024 again.

So the guidance you've given for EBITDA I know youll have some working capital requirements beginning of the year.

Lou Salamone: I know you'll have some working capital requirements at the beginning of the year; it would be helpful to understand what kind of cash you think you can come up with. I think, from an operating perspective, we'll end up being slightly positive to a little better than slightly positive on an operating basis. As we talked about, we have liquidity issues. We've worked hard to put a plan in place to solve them.

Just be helpful to understand what kind of cash and can come into the business. This year.

I think from an operating perspective, we will end up being.

Slightly positive to a little better than slightly positive on an operating basis.

As we talked about we had liquidity issues, we've worked hard to put a plan in place to solve them.

Lou Salamone: That plan should overcome those liquidity issues and put us on a much stronger footing from a balance sheet standpoint. Again, the emphasis is away from the lower margin, and I don't want to denigrate the new-build business, but the lower margin new-build business uses a great deal of overhead, as we've announced for taking 30 million. The emphasis of that is allowing us to take about 30 million costs out of the business. Then we can concentrate on, as Kenny said, these higher margin renewable services businesses, which are in Europe especially, which are very much in line with the profit margins that we generate on our United States thermal business.

That plan has overcome those should overcome those liquidity issues and put us on a much stronger footing from a balance sheet standpoint, and then the again the emphasis away from the.

The lower margin and I want to I don't want to denigrate, the newbuild business, but the lower margin Newbuild business.

It uses a great deal of overhead as we've announced we're taking 30.

The emphasis of that is allowing us to take about $30 million.

<unk> costs out of the business.

And then we can concentrate on as Kenny said these higher margin renewable services businesses, which are in Europe, especially which are very much in line with the profit margins that we.

Generate on our United States thermal business. So from a cash flow standpoint, we think that's going to help us not ready to give a projection on cash flow at this point, Brent plus we've got a lot of moving parts.

Lou Salamone: From a cash flow standpoint, we think that's going to help us. I'm not ready to give a projection on cash flow at this point, Brent, because we've got a lot of moving parts. As we said, we've got to work out a plan that solves our other liquidity issues that arose primarily from those solar losses. Okay, I'll get back in queue. Sure. Again, if you'd like to ask a question, it is star 1.

We've got as we said we've got to work our plan.

That solves our other liquidity issues that arose primarily from the from those solar losses.

Yeah.

Got it okay I'll get back in queue. Thanks, guys.

Sure.

Thank you.

If you'd like to ask a question it is star one.

Alex Rygiel: The next question is from Alex Rygiel with B. Reilly. Your line is now open. Thank you. Good evening, Kenny and Lou.

The next question is from Alex Rygiel with B Riley. Your line is now open.

Okay.

Thank you good evening Kinney and Lou couple of quick questions here first as it relates to the strategic realignment target of $30 million. When do you think youre going to reach that and is there any upside there.

Alex Rygiel: A couple quick questions here. First, as it relates to the strategic realignment target of $30 million, when do you think you're going to reach that? And is there any upside there?

Kenneth M. Young: There's always upside, Alex, but we'll get to that upside when we get to that front, because we're always looking at how we optimize and re-optimize the business to make it more efficient from that standpoint. So there is potential upside on top of that 30 on that particular piece. But by the end of the year, this year, I think we're through $19 million now, and I think we'd realize the full $30 by the end of the year. And it's part of the plan to get to the $100 million to $110 million of EBITDA that we've got as our target out there. So on that, if we can get upside, obviously, we'll take advantage of that, but that's the plan right The other thing that happens, Alex, as we de-emphasize that business somewhat, letters of credit, they can go down.

There is always upside Alex, but we will.

We will get to the we'll get to the upside when we get to the upside.

From that front, because we're always looking at how we optimize and re optimize the business to make it more efficient from that standpoint.

So there is potential upside on top of that 30 on that particular piece, but by end of year.

This year I think we're through 19 million now and I think we'd realized by end of year. The full 30, and Thats part of the plan to get to the $100 million to $110 million of EBITDA that we've got is our target out there. So.

On that if we can get upside obviously, we'll take advantage of that but that's the plan right now.

The other thing that does Alex as we as we deemphasize that business somewhat letters of credit.

Lou Salamone: That substantially reduces our interest costs. So in addition to the $30 million that we're talking about, there are other costs that will positively impact our cash flow. So I think it's a good idea.

Can go down that substantially reduces our interest cost. So in addition to the $30 million that we're talking about there are other costs that will impact positively our cash flow. So I think.

I think it is.

Kenneth M. Young: The strategic direction we're taking makes sense, it fits in line with our balance sheet, and it fits in line with our emphasis on parts, services, that type of business, and conversions rather than pure new builds that have just a low margin and high cost. And then, as it relates to the discontinued solar business, any update on the timing of a resolution of the outcome? No update on timing.

The strategic direction, we're taking makes sense.

It fits in line with our balance sheet and it fits in line with our emphasis on really.

<unk> services that type of that business.

And conversions rather than pure new builds that have just a low margin and high costs.

Sure.

And then as it relates to the discontinued solar business any update there on the timing of a resolution of the outcome of it.

No update on timing, we're actively in discussions and involved in conversations in the process, but.

Kenneth M. Young: We're actively in discussions and involved in conversations and the process, but we haven't received an update on timing as of yet. And lastly, as it relates to Bright Loop in Ohio, could you go back through and kind of update us on where we stand on that and what the timeline looks like for construction to start and, and so on. Yeah, no, good.

No update on timing as of yet.

And lastly, as it relates to freight loop in Ohio can you go back through and kind of update us on where we stand on that and what the timeline looks like.

For construction to start in.

So on.

Kenneth M. Young: I appreciate that. So, you know, as we announced last quarter, and I think I reiterated in my remarks here, we have a letter of intent for the financing of that project. We are, you know, we have the location actually under contract right now for that site in Massillon, which is good. We're working through the permitting processes on that. The major piece that we're waiting on right now to complete, and we're going through internally on that, is to come up with and finalize the construction estimates. So, we'll utilize both our own internal Boilermakers Construction Company, but we will also have a civil works partner on the civil works aspect, and we're trying to complete some of those estimates based on that particular project.

Yes.

So as we announced last quarter and I think I reiterated in the remarks here, we have a letter of intent on the financing of that project.

We are we have the location actually under contract right now.

For that site in Massillon, which is good we're working through.

Through the permitting processes on that the piece that the major piece that we're waiting on right now to complete and we're going through.

Internally on that is to come up and to finalize the construction estimates. So we will we will utilize their both are our own internal boilermakers construction company, but we will also have a.

A civil works partner on the civil works aspects and we're trying to complete some of those estimates.

Based on.

That particular project.

Kenneth M. Young: So, as we continue to evolve that project, you know, we continue to evolve the engineering side of it and the construction estimates, and we're waiting to get those complete, and specifically a couple of long-lead time items on the compression and compression technologies. We're also trying to, again, as we look at finalizing that project, to make sure that we're in sync with our offtake partner, both for the hydrogen and the CO2. In this particular case, we believe that the CO2 would be beverage grade rather than sequestered CO2.

So.

As we continue to evolve that project, we continue to have all the engineering side of it and the construction estimates and we are waiting to get those complete and specifically a couple of long lead time items.

On the compression in compression technologies.

So trying to.

And then as we look at finalizing that project.

To make sure that we're in sync with our offtake partner, both for the hydrogen and Cotwo.

In this particular case, we believe that the Sidoti we'd be beverage grade rather than sequestered cotwo.

Kenneth M. Young: That's added a little bit of complexity, not much, pretty standard off the shelf technology, but it has added a little bit of complexity to the layout of that project and, therefore, some consideration to some of the civil construction elements that we need to finalize. So, once we get through that particular piece, we need to see where we are specifically on the gap between the financing we have and the final construction price and work through any final issues there, and then we would look to try to move forward with that project and begin construction. So, a little bit loose on specific timings.

<unk> added a little bit of complexity not much pretty standard off the shelf technology, but added a little bit of complexity on the layout of that project and therefore, some consideration on some of the civil construction elements that we need to finalize so once we get through that particular piece, we need to see.

Where we are specifically on the gap between.

The financing we have in the final construction price.

And work through any of those final issues. There and then we would look to try to move forward with that project and begin the construction so a little bit looser on specific timing as we try to complete some some of those elements and finalize that.

Kenneth M. Young: We will try to complete some of those elements and finalize that, and we'll work through some of those details, but we'll keep everybody apprised as we move along. And, then lastly, congratulations on the $16 million grant. Can you talk about maybe some of the other applications that you have in for other grant money and what the timelines of those could look like? Yeah, we are obviously working with one or two other states. I won't go too much further than that because we're under an NDA, but we are working with one or two other states on some funding capabilities around additional bright loop projects within those states. And so we're progressing and moving those discussions and dialogue along, and obviously, we would announce that as soon as it is practical.

And worked through some of those details, but we will keep everybody apprised as we move along.

And then lastly, congratulations on the $16 million grant.

Can you talk about maybe some of the other applications that you have in for other grant money and what the timelines of those could look like.

Yes, we are working obviously with with one or two other states I won't go too much further than that but because we're under NDA, but we are working with one or two other states on some funding capabilities around.

Additional bright loop projects.

Within those states and so we're we're progressing and moving those discussions and dialogue along and.

And obviously would announce that as soon as practical.

Kenneth M. Young: We are working aggressively with the Department of Energy on a few different opportunities to help fund some of this technology. A couple of areas, obviously, combinations of the DOE loan program and looking at also the possibilities of some other funding within some other departments and the federal government to support the implementation of these projects, and we're working on that as well.

We are working aggressively with the.

The department of energy on a few different.

Opportunities to help fund some of this technology.

A couple of areas obviously.

Combinations of the department of energy loan program.

Looking at also the possibilities as some other.

Ending within some other departments in the federal government to support it.

Limitation.

Of these projects and we're working on that as well.

Kenneth M. Young: The other key piece, you know, I think as a reminder, I think we announced or discussed it last year, but we do have appropriations language that was bipartisan and approved and signed into law by the president last year for appropriations funding for the commercialization efforts of chemical looping to hydrogen production from biomass, coal, and natural gas, and we're in a lot of discussions there with state officials as well as federal officials to try to push that through and So we are continuing those efforts rigorously here in Washington, D.C. to try to get that moved forward as well. Perfect, thank you very much. Thank you. Thank you. There are no additional questions in queue.

Other key piece.

I think as a reminder, I think we've announced that discussed it last year, but we do have appropriations language that was a bipartisan approved and signed into law by the President last year for appropriations funding of the commercialization efforts of chemical looping to hydrogen production from biomass coal in.

Natural gas and we're in.

A lot of discussions there with state officials as well as federal officials to try to push that through and move that along so we're continuing those efforts.

<unk> here in Washington, DC to try to get that moved forward as well too.

Perfect. Thank you very much.

Thanks.

Thank you there are no additional questions in queue I'd like to turn the call back over to Sharon Brooks for concluding remarks.

Sharyn Brooks: I'd like to turn the call back over to Sharyn Brooks for concluding remarks. Thank you, everyone, for joining us today. This concludes our conference call. A replay will be available for a limited time on our website later today. That concludes today's conference call. Thank you for your participation. You may now disconnect your line.

Thanks, everyone for joining US today. This concludes our conference call a replay will be available for a limited time on our website later today.

That concludes today's conference call. Thank you for your participation you may now disconnect your lines.