Q2 2026 PureCycle Technologies Inc Earnings Call

August 6, 2026

Operator: Good day. Thank you for standing by. Welcome to the PureCycle Technologies Q2 2026 corporate update call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star one one on your telephone. You will hear an automated message advising your hand is raised. To withdraw your question, please press star one one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Eric DeNatale, Director of Investor Relations. Please go ahead.

Operator: Good day. Thank you for standing by. Welcome to the PureCycle Technologies Q2 2026 Corporate Update Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star one one on your telephone. You will hear an automated message advising your hand is raised. To withdraw your question, please press star one one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Eric DeNatale, Director of Investor Relations. Please go ahead.

Speaker #1: After the speaker's presentation, there will be a question-and-answer session. To ask a question, during the session, you will need to press star 11 on your telephone.

Speaker #1: You will then hear an automated message advising your hand is raised to withdraw your question. Please press star 11 again. Please be advised that today's conference is being recorded.

Speaker #1: I would now like to hand the conference over to your speaker today, Eric DeNatale, Director of Investor Relations. Please go ahead.

Speaker #2: Thank you, Kelly. I'm Eric DeNatale, Director of Investor Relations for PureCycle. And joining me on the call today are Dustin Olson, our Chief Executive Officer, and Donald Carpenter, our Chief Financial Officer.

Eric DeNatale: Thank you, Kelly. I am Eric DeNatale, Director of Investor Relations for PureCycle, joining me on the call today are Dustin Olson, our Chief Executive Officer, and Donald Carpenter, our Chief Financial Officer. This evening, we'll be highlighting our corporate developments for the Q2 2026. The presentation we'll be going through on this call can also be found in the investor tab on our website at purecycle.com. Many of the statements made today will be forward-looking and are based on management's beliefs, assumptions, and information currently available to management at this time.

Speaker #2: This evening, we will be highlighting our corporate developments for the second quarter of 2026. The presentation will be going through on this call can also be found at the investor tab on our website at purecycle.com.

Speaker #2: Many of the statements made today will be forward-looking and are based on management's beliefs and assumptions, as well as information currently available to management at this time.

Speaker #2: The statements are subject to known and unknown risks and uncertainties. Many of which may be beyond our control, including those set forth in our Safe Harbor provisions and forward-looking statements that can be found at the end of our second quarter 2026 corporate update press release filed this evening.

Eric DeNatale: The statements are subject to known and unknown risks and uncertainties, many of which may be beyond our control, including those set forth in our safe harbor provisions and forward-looking statements that can be found at the end of our Q2 2026 corporate update press release filed this evening, as well as in other reports on file with the SEC that provides further detail about the risks related to our business. Additionally, please note that the company's actual results may differ materially from those anticipated. Except as required by law, we undertake no obligation to update any forward-looking statement. Our remarks today may also include preliminary non-GAAP estimates and are subject to risks and uncertainties, including, among other things, changes in connection with quarter-end and year-end adjustments. Any variation between PureCycle's actual results and the preliminary financial data set forth herein may be material.

Speaker #2: As well as in other reports on file with the SEC that provides further detail about the risks related to our business. Additionally, please note that the company's actual results may differ materially from those anticipated, and accept as required by law, we undertake no obligation to update any forward-looking statement.

Speaker #2: Our remarks today may also include preliminary non-GAAP estimates and are subject to risks and uncertainties,

Speaker #1: Including , among other things , changes in connection with quarter end and year end adjustments . Any variation between pure cycles , actual results in the preliminary financial data set forth herein may be material .

Eric DeNatale: Any variation between PureCycle's actual results and the preliminary financial data set forth herein may be material. You're welcome to follow along with our slide deck or if joining us by phone, you can access it at any time at purecycle.com. With that, I will now turn it over to Dustin Olson, PureCycle's Chief Executive Officer.

Speaker #1: You're welcome to follow along with our slide deck . Or if joining us by phone , you can access it at any time at purecycle.com .

Eric DeNatale: You're welcome to follow along with our slide deck or if joining us by phone, you can access it at any time at purecycle.com. With that, I will now turn it over to Dustin Olson, PureCycle's Chief Executive Officer.

Speaker #1: With that , I will now turn it over to Dustin Olson Pure Cycles Chief Executive Officer Thank you , Eric , and good evening , everyone .

Dustin Olson: Thank you, Eric. Good evening, everyone. This is a quarter of real progress on all fronts and sets up the H2 for further progress. Operationally, we completed the turnaround ahead of schedule and below budget, executed more than 170 site projects, and came out of it with a plant that set a new daily throughput record in June. We brought compounding in-house, and it is running today, producing what customers specify. Commercially, revenue grew for the sixth consecutive quarter, and our first Procter & Gamble application entered commercial production. On the regulatory front, New Jersey approved PureFive as recycled content, the last approval our customers were waiting on, and it's already accelerating qualification at some of the largest food service companies in the country. We also spent the quarter preparing for future developments.

Speaker #1: This is a quarter of real progress on all fronts , and it sets up the second half for further progress Operationally , we completed the turnaround ahead of schedule and below budget .

Speaker #1: Executed more than 170 site projects and came out of it with a plant that set a new daily throughput record in June . We brought compounding in-house , and it is running today , producing what customers specify commercially .

Speaker #1: Revenue grew for the sixth consecutive quarter , and our first Procter and Gamble application entered commercial production . On the regulatory front , new Jersey approved pure five as recycled content .

Speaker #1: The last approval . Our customers were waiting on , and it's already accelerating qualification at some of the largest food service companies in the country We also spent the quarter preparing for future developments .

Speaker #1: In May , we ran Ironton under process conditions that closely match the plant designs . We will build in Thailand and Antwerp , and those tests were successful Thailand received Board of Investment approval in the quarter , and we expect to break ground in the second half of this year Every one of those threads points in the same direction .

Dustin Olson: In May, we ran Ironton under process conditions that closely match the plant designs we will build in Thailand and Antwerp. Those tests were successful. Thailand received Board of Investment approval in the quarter, and we expect to break ground in the H2 of this year. Every one of those threads points in the same direction, an H2 ramp in Ironton breakeven, which remains our H2 target. We are further along the path than we were 90 days ago. Let me walk you through the details. Here's the frame that we are using internally. All year, we have said that commercial ramp will be H2-weighted. It was for two specific reasons. The first was regulatory clock. Requirements that begin in January 2027 set the pace for when brands must move. The second was supply chain readiness.

Speaker #1: A second half ramp and Ironton breakeven , which remains our second half target . We are further . We are further along the path than we than we were .

Speaker #1: 90 . We are further along the path than we were 90 days ago . Let me walk you through the details Here's the frame that we're using internally .

Speaker #1: All year we have said that commercial ramp will be second half weighted , and it was for two specific reasons . The first was the regulatory clock requirements that began in January of 27 , set the pace for when brands must move The second was supply chain readiness .

Speaker #1: It is one thing to technically qualify the product . It is another thing to make it consistently and reliably at specification . Every time Brands buy at the SKU level one application at a time , and they do not start until they're confident the material in the 10th truck will be identical to the material in the first .

Dustin Olson: It is one thing to technically qualify the product. It is another thing to make it consistently and reliably at specification every time. Brands buy at the SKU level, one application at a time, and they do not start until they're confident the material in the 10th truck will be identical to the material in the first. Both factors are now proving out. Since the New Jersey approval, brands are accelerating their qualification process for the first time. You see it in QSR cold cups and in large snack and confectionary programs. That tells you that the regulations really matter for driving demand, and that the demand is coming. With our compounding assets integrated and running, we now have the reliable supply chain that those brands require. You can see it working.

Speaker #1: Both factors are now proving out . Since the new Jersey approval . Brands are accelerating their qualification process for the first time . You see it in QSR cold cups and in large snack and confectionary programs .

Speaker #1: That tells you that the regulations really matter for driving demand , and that the demand is coming . And with our compounding assets integrated and running , we now have the reliable supply chain that those brands require .

Speaker #1: You can see it working . A customer with standards as exacting as Procter and Gamble is accelerating their own commercial ramp . With us .

Dustin Olson: A customer with standards as exacting as Procter & Gamble is accelerating their own commercial ramp with us. The other thing to understand is fragmentation. Outside of a handful of categories, this market converts SKU by SKU. Thousands of separate qualifications rather than a few large contracts. That is not an issue unique to PureCycle. It is the structure of the market and is the same for everyone in it. Quick service restaurants follow the same pattern, but with higher volume SKUs. A large chain carries fewer packaging SKUs, and each one is enormous. A single qualification there can be worth what dozens are worth elsewhere, and they are working against a deadline that is not set by us. New Jersey's food contact exemption expires in January of 2027. The expected future pace from here is largely set by a date in statute.

Speaker #1: The other thing to understand is fragmentation . Outside of a handful of categories , this market converts SKU by SKU thousands of separate qualifications rather than a few large contracts .

Speaker #1: That is not an issue unique to pure cycle . It is the structure of the market and it is the same for everyone in it .

Speaker #1: Quick service restaurants follow the same pattern but with higher volume SKUs . A large chain carries fewer packaging SKUs , and each one is enormous .

Speaker #1: A single qualification there can be worth , what , dozens are worth elsewhere , and they are working against a deadline that's not set by us .

Speaker #1: New Jersey's food contact exemption expires in January of 27 , so the expected future pace from here is largely set by a date in statute .

Dustin Olson: The expected future pace from here is largely set by a date in statute. Customers are driving to have product on the shelves to meet requirements that start in January of 2027. This all drives toward an Ironton breakeven, which remains our H2 target. We have referred to breakeven as roughly 40% to 50% utilization, and that number has not changed. It is built on branded sales at those utilization rates, and branded sales are ramping. Branded pricing remains robust, and applications carrying the highest confidence for the H2 maintain strong pricing. The net of this is our confidence in the H2 ramp and the path through Ironton breakeven has increased because the things that made the H2 weighted are being proved out.

Speaker #1: Customers are driving to have product on the shelves to meet requirements that start in January of 27 . This all drives toward an Ironton breakeven , which remains our second half target .

Dustin Olson: Customers are driving to have product on the shelves to meet requirements that start in January of 2027. This all drives toward an Ironton breakeven, which remains our H2 target. We have referred to breakeven as roughly 40% to 50% utilization, and that number has not changed. It is built on branded sales at those utilization rates, and branded sales are ramping. Branded pricing remains robust, and applications carrying the highest confidence for the H2 maintain strong pricing. The net of this is our confidence in the H2 ramp and the path through Ironton breakeven has increased because the things that made the H2 weighted are being proved out. Ironton produced approximately 4.5 million pounds of PureFive in the Q2, down from the prior quarter and consistent with the message we communicated in advance of the planned turnaround.

Speaker #1: We have referred to break even as roughly 40 to 50% utilization , and that number has not changed . It is built on branded sales at those utilization rates and branded sales are ramping Branded pricing remains robust , and applications carrying the highest confidence for the second half maintain strong pricing The net of this is our confidence in the second half ramp and the path through Ironton break .

Speaker #1: Even has increased because the things that made the second half weighted are being proved out Ironton produced approximately £4.5 million of pure five in the second quarter , down from the prior quarter , and consistent with the message we communicated in advance of the planned turnaround , we processed approximately £5 million of feedstock .

Dustin Olson: Ironton produced approximately 4.5 million pounds of PureFive in the Q2, down from the prior quarter and consistent with the message we communicated in advance of the planned turnaround. We processed approximately 5 million pounds of feedstock. This was not a quarter for rate. It was a quarter for making improvements to the plant, testing equipment, and the tests worked. The turnaround was completed ahead of schedule and below budget, and we executed more than 170 projects during the outage targeting reliability rate and quality. Two reliability items are worth naming because together they were our two largest sources of unplanned downtime last year. The first was the CP2 system, which has been a persistent problem and is now substantially improved.

Dustin Olson: We processed approximately 5 million pounds of feedstock. This was not a quarter for rate. It was a quarter for making improvements to the plant, testing equipment, and the tests worked. The turnaround was completed ahead of schedule and below budget, and we executed more than 170 projects during the outage targeting reliability rate and quality. Two reliability items are worth naming because together they were our two largest sources of unplanned downtime last year. The first was the CP2 system, which has been a persistent problem and is now substantially improved. The second was improving the reliability of numerous mechanical systems, and this outage substantially expanded the capacity of the plant bottleneck and improved the worst-performing seal in the plant. Both are structural fixes.

Speaker #1: This was not a quarter for rate . It was a quarter for making improvements to the plant , testing equipment and the test work worked .

Speaker #1: The turnaround was completed ahead of schedule and below budget , and we executed more than 170 projects during the outage , targeting reliability rate and quality .

Speaker #1: Two reliability items are worth naming because together they were our two largest sources of unplanned downtime last year . The first was the CP two system , which has been a persistent problem and is now substantially improved .

Speaker #1: The second was improving the reliability of numerous mechanical systems , and this outage substantially expanded the capacity of the plant bottleneck and improved the worst performing seal in the plant .

Dustin Olson: The second was improving the reliability of numerous mechanical systems, and this outage substantially expanded the capacity of the plant bottleneck and improved the worst-performing seal in the plant. Both are structural fixes. When we opened the equipment during the outage, the large equipment where we had prior problems was very clean including the settler where co-product separates from the product stream. That bodes well for future reliability. Waste plastic is not fouling the system and is a good long-term indicator for the technology, not just for this facility. May was, by design, a low volume month. We commissioned the newly installed equipment, and we changed process conditions at Ironton to mimic the designs we intend to build in Antwerp and Thailand. Those tests were successful.

Speaker #1: Both are structural fixes . When we open equipment during the outage , the large equipment that we had prior problems was very clean .

Dustin Olson: When we opened the equipment during the outage, the large equipment where we had prior problems was very clean including the settler where co-product separates from the product stream. That bodes well for future reliability. Waste plastic is not fouling the system and is a good long-term indicator for the technology, not just for this facility. May was, by design, a low volume month. We commissioned the newly installed equipment, and we changed process conditions at Ironton to mimic the designs we intend to build in Antwerp and Thailand. Those tests were successful. Being able to run those conditions on an operating commercial asset before we build is an advantage most companies in our position do not have. In June, we set a new daily throughput record, and we demonstrated production at 12,000 pounds per hour. On feedstock supply is very steady. Purchases are routine.

Speaker #1: Where Co-product , including the settler , where Co-product separates from the product stream That bodes well for future reliability . So waste plastic is not fouling the system and is a good long term indicator for the technology , not just for this facility .

Speaker #1: May was, by design, a low volume month. We commissioned the newly installed equipment, and we changed process conditions at Ironton to mimic the designs.

Speaker #1: We intend to build in answer in Thailand Those tests were successful . Being able to run those conditions on an operating commercial asset before we build is an advantage .

Dustin Olson: Being able to run those conditions on an operating commercial asset before we build is an advantage most companies in our position do not have. In June, we set a new daily throughput record, and we demonstrated production at 12,000 pounds per hour. On feedstock supply is very steady. Purchases are routine. Denver is running well, and inventory is balanced. Delivery costs are declining, and we now source from more than 15 different domestic suppliers. On-site compounding is running. We announced mechanical completion on our May call. The asset today is running 24 hours a day for five days a week, and we intend to move to 24/7 in Q4. That is consistent with the cadence we described in February and again in May, and is a large part of why our ramp has been H2-weighted all year.

Speaker #1: Most companies in our position do not have , in June , we set a new daily throughput record and we demonstrated production at £12,000 per hour on feedstock supply , on feedstock supply is very steady .

Speaker #1: Purchases are routine . Denver is running well and inventory is balanced , delivered costs are declining . And we now source from more than 15 different domestic suppliers on site , running .

Dustin Olson: Denver is running well, and inventory is balanced. Delivery costs are declining, and we now source from more than 15 different domestic suppliers. On-site compounding is running. We announced mechanical completion on our May call. The asset today is running 24 hours a day for five days a week, and we intend to move to 24/7 in Q4. That is consistent with the cadence we described in February and again in May, and is a large part of why our ramp has been H2-weighted all year. We previously relied on third-party compounders. Third-party operations carry their own reliability risks. Bringing it in-house saves us money and lets us ship by rail car. Most importantly, it de-risks our supply chain, strengthens our quality control, and gives us the flexibility to deliver on what each customer specifies. Now that it's running, here is what it changes.

Speaker #1: We announced mechanical completion on our May call . The asset today is running 24 hours a day for five days a week , and we intend to move to 24 over seven in the fourth quarter .

Speaker #1: That is consistent with the cadence we described in February and again in May , and is a large part of why our ramp has been second half weighted all year .

Speaker #1: We previously relied on third-party compounders, and third-party operations carry their own reliability risks. Bringing it in-house saves us money and lets us ship by railcar.

Dustin Olson: We previously relied on third-party compounders. Third-party operations carry their own reliability risks. Bringing it in-house saves us money and lets us ship by rail car. Most importantly, it de-risks our supply chain, strengthens our quality control, and gives us the flexibility to deliver on what each customer specifies. Now that it's running, here is what it changes. We control the formulation. We can hit a customer's specification, the precise recycled content percentage, the precise properties, and hold it consistently. The mandates do not currently require 100% recycled material. They require a percentage. Compounding is how we deliver that percentage in a form that the application needs. It also opens thermoform cups at scale in clear and in white. Both sit directly in the scope of regulations, and with compounding, we can make both.

Speaker #1: Most importantly , it de-risks our supply chain , strengthens our quality control and gives us the flexibility to deliver on what each customer specifies .

Speaker #1: Now that it's running , here is what it changes . We control the formulation . We can hit a customer specification . The precise recycled content percentage , the precise properties , and hold it consistently , and the mandates do not currently require 100% recycled material .

Dustin Olson: We control the formulation. We can hit a customer's specification, the precise recycled content percentage, the precise properties, and hold it consistently. The mandates do not currently require 100% recycled material. They require a percentage. Compounding is how we deliver that percentage in a form that the application needs. It also opens thermoform cups at scale in clear and in white. Both sit directly in the scope of regulations, and with compounding, we can make both. Also importantly, we can now deliver compounded product in rail cars directly from Ironton. This was a capability that we don't have with a third-party compound partner. We have generated and shipped numerous samples since startup. The product looks excellent, and you see the examples of it in the deck.

Speaker #1: They require a percentage . Compounding is how we deliver that percentage in a form that the application needs . It also opens thermoform cups at scale in clear and in white .

Speaker #1: Both sit directly in the scope of regulations and with compounding , we can make both . Also , importantly , we can now deliver compounded product in railcars directly from Ironton This was a capability that we don't have with the third party compound partner .

Dustin Olson: Also importantly, we can now deliver compounded product in rail cars directly from Ironton. This was a capability that we don't have with a third-party compound partner. We have generated and shipped numerous samples since startup. The product looks excellent, and you see the examples of it in the deck. Because compounding is running at Ironton, we can now control the product samples going into the hands of prospective customers in Thailand and Europe, and we are doing exactly that. One comment on how to read the numbers. Compounded volumes includes additives and virgin polypropylene alongside our PureFive content. Compounded products will run ahead of the PureFive resin pounds. This is the product that the market is asking for. Finally, in May, we achieved ISO 9001 certification, independent validation of the quality systems that sit behind all of this.

Speaker #1: We have generated and shipped numerous samples since startup . The product looks excellent and you see the examples of it in the deck .

Speaker #1: And because compounding is running in Ironton, we can now control the product samples going into the hands of prospective customers in Thailand and Europe.

Dustin Olson: Because compounding is running at Ironton, we can now control the product samples going into the hands of prospective customers in Thailand and Europe, and we are doing exactly that. One comment on how to read the numbers. Compounded volumes includes additives and virgin polypropylene alongside our PureFive content. Compounded products will run ahead of the PureFive resin pounds. This is the product that the market is asking for. Finally, in May, we achieved ISO 9001 certification, independent validation of the quality systems that sit behind all of this. It's one of those quiet milestones, but it's kind of the thing that branded customers ask about before they commit. Revenue was approximately $4.5 million, up substantially from a year ago, with seven new customer conversions, including our first building and construction application.

Speaker #1: And we are doing exactly that . One comment on how to read the numbers compounded volumes includes additives and virgin polypropylene . Alongside our purified content .

Speaker #1: So compounded products will run ahead of the purified resin pounds . This is the product that the market is asking for Finally , in May , we achieved ISO 9001 certification .

Speaker #1: Independent validation of the Quality systems that sit , that sit behind all of this . It's one of those quiet milestones , but it's kind of a thing that branded customers ask about before they commit .

Dustin Olson: It's one of those quiet milestones, but it's kind of the thing that branded customers ask about before they commit. Revenue was approximately $4.5 million, up substantially from a year ago, with seven new customer conversions, including our first building and construction application. On top of the $40 to 50 million of non-New Jersey and $25 to 50 million of New Jersey ramp, the most significant new commercial development is in QSR, and it happened after quarter close. In Q3 to date, we've shipped to all three major converters that serve the QSR cold cup market for clear cups. That is the channel, not the single customer. Cold cup programs are underway at two major QSRs through those converters. New Jersey is what accelerated this.

Speaker #1: Revenue was approximately $4.5 million , up substantially from a year ago , with seven new customer conversions , including our first building and construction application .

Speaker #1: On top of the 40 to 50 million of non-New Jersey and 25 to 50 million of new Jersey , ramp , the most significant new commercial development is in quick serve restaurants , and it happened after quarter close in the third quarter .

Dustin Olson: On top of the $40 to 50 million of non-New Jersey and $25 to 50 million of New Jersey ramp, the most significant new commercial development is in QSR, and it happened after quarter close. In Q3 to date, we've shipped to all three major converters that serve the QSR cold cup market for clear cups. That is the channel, not the single customer. Cold cup programs are underway at two major QSRs through those converters. New Jersey is what accelerated this. Following the approval, we were fast-tracked into two very large qualification programs for cold cup lids. For QSR applications in New Jersey alone, we estimate the annual demand to meet the recycled content requirement to be roughly 20 million pounds. One piece of context on timing.

Speaker #1: To date , we've shipped all three major converters that serve the QSR Cold Cup market for clear cups . That is the channel , not the single customer .

Speaker #1: Cold cut programs are underway at two major qsrs through those converters , new Jersey is what accelerated this following the approval . We were fast tracked into two very large qualification programs for cold cup lids for QSR applications in new Jersey alone , we estimate the annual demand to meet the recycled content requirement to be roughly £20 million .

Dustin Olson: Following the approval, we were fast-tracked into two very large qualification programs for cold cup lids. For QSR applications in New Jersey alone, we estimate the annual demand to meet the recycled content requirement to be roughly 20 million pounds. One piece of context on timing. The approval landed in mid-May, which means the entire market is qualifying on a compressed calendar ahead of January 2027. Compression creates urgency, and urgency favors the supplier that is ready. The brands are moving as fast as we are. This is what the acceleration actually looks like. In February, we laid out 5 application categories that we chose to concentrate on. Let me come back to that list because I think it provides the clearest way to show you what our progress really looks like.

Speaker #1: One piece of context on timing the approval landed in mid-May , which means the entire market is qualifying on a compressed calendar ahead of ahead of January 2027 .

Dustin Olson: The approval landed in mid-May, which means the entire market is qualifying on a compressed calendar ahead of January 2027. Compression creates urgency, and urgency favors the supplier that is ready. The brands are moving as fast as we are. This is what the acceleration actually looks like. In February, we laid out 5 application categories that we chose to concentrate on. Let me come back to that list because I think it provides the clearest way to show you what our progress really looks like. The largest of the 5 was QSR cold beverages, which we sized at roughly 330 million pounds in North America, growing at 7% to 10% per year. This is where we have moved furthest, as I just described it. Value household goods at roughly 150 million pounds across multiple brand owners.

Speaker #1: Compression creates urgency and urgency favors the supplier that is ready . The brands are moving as fast as we are . This is the acceleration .

Speaker #1: This is what the acceleration actually looks like . In February , we laid out five application categories that we chose to concentrate on .

Speaker #1: Let me come back to that list because I think it provides the clearest way to show you what our progress really looks like .

Speaker #1: The largest of the five was QSR cold beverages , which we seized , which we sized at roughly £330 million in North America , growing at 7 to 10% per year .

Dustin Olson: The largest of the 5 was QSR cold beverages, which we sized at roughly 330 million pounds in North America, growing at 7% to 10% per year. This is where we have moved furthest, as I just described it. Value household goods at roughly 150 million pounds across multiple brand owners. This is where P&G sits, and I'll come back to them in a moment. We also added 2 closure partnerships during the quarter with Reliable Caps and StackTeck. Premium pet food and jerky and meat sticks are both BOPP film categories. In June, working with Innovia Films, we successfully produced white cavitated BOPP film using PureFive Choice. So the capability is now demonstrated with a named converter. We also continue to progress with 2 of the top 5 global food manufacturers on snack and confectionery packaging.

Speaker #1: This is where we have moved furthest . As I just described it , value household goods at roughly £150 million across multiple brand owners .

Speaker #1: This is where P&G sits , and I'll come back to them in a moment . We also added two closure partnerships during the quarter with reliable caps and stack tech premium pet food and jerky and meat sticks are both Bop film categories In June , working with Innovia Films , we successfully produced White Cavitated Bop film using pure five choice , so the capability is now demonstrated with a named converter .

Dustin Olson: This is where P&G sits, and I'll come back to them in a moment. We also added 2 closure partnerships during the quarter with Reliable Caps and StackTeck. Premium pet food and jerky and meat sticks are both BOPP film categories. In June, working with Innovia Films, we successfully produced white cavitated BOPP film using PureFive Choice. So the capability is now demonstrated with a named converter. We also continue to progress with 2 of the top 5 global food manufacturers on snack and confectionery packaging. One of those food manufacturers has accelerated its work with us and is pushing to move as quickly as it can. One of the first instances we've seen of a large company pulling a timeline forward rather than pushing one out. It is a 2027 program, and the direction of the travel is the point.

Speaker #1: We also continue to progress with two of the top five global food manufacturers on snack and confectionery packaging One of those food manufacturers has accelerated its work with us and is pushing to move as quickly as it can .

Dustin Olson: One of those food manufacturers has accelerated its work with us and is pushing to move as quickly as it can. One of the first instances we've seen of a large company pulling a timeline forward rather than pushing one out. It is a 2027 program, and the direction of the travel is the point. The current regulatory deadline is a hard catalyst, and our supply chain and commercial infrastructure are materially better than they were a year ago. Dermacosmetics is the earliest of the 5, but it moved to this quarter, achieving the highest CosPaTox purity grade, the first recycler to do so, and is what made the category accessible to us. And we are nearing commercial shipments to a large global cosmetics and personal care company.

Speaker #1: One of the first instances we've seen of a large company pulling a timeline forward , rather than pushing one out , it is a 2027 program , and the direction of travel is the point .

Speaker #1: The current regulatory deadline is a hard catalyst , and our supply chain and commercial infrastructure are materially better than they were a year ago .

Dustin Olson: The current regulatory deadline is a hard catalyst, and our supply chain and commercial infrastructure are materially better than they were a year ago. Dermacosmetics is the earliest of the 5, but it moved to this quarter, achieving the highest CosPaTox purity grade, the first recycler to do so, and is what made the category accessible to us. And we are nearing commercial shipments to a large global cosmetics and personal care company. They are all at different stages. 4 of the 5 moved this quarter, and the largest QSR is moving the fastest. One thing about this business builds, accounts are sticky. Once you are qualified into an application, you tend to stay there for a long time. For calibration, partnership we announced in July with Mitsui and FUJICELLO in Japan took roughly 3 years from first engagement to announcement.

Speaker #1: Dermocosmetics is the earliest of the five , but it moved to this quarter , achieving the highest cost purity grade . The first recycler to do so in what is and is what made the category accessible to us .

Speaker #1: And we are nearing commercial shipments to a large, global cosmetics and personal care company. They are all at different stages. Four of the five move this quarter, and the largest QSR is moving the fastest. One thing about this business build: accounts are sticky.

Dustin Olson: They are all at different stages. 4 of the 5 moved this quarter, and the largest QSR is moving the fastest. One thing about this business builds, accounts are sticky. Once you are qualified into an application, you tend to stay there for a long time. For calibration, partnership we announced in July with Mitsui and FUJICELLO in Japan took roughly 3 years from first engagement to announcement. This is a measure of the business we are in, and it is the same reason these relationships are durable once they are established. Following the New Jersey approval and the Cleveland Kitchen launch, inbound interest increased meaningfully. Today, the pipeline stands at 42 brands, 15 converters, 28 applications, and 37 programs.

Speaker #1: Once you are qualified into an application , you tend to stay there for a long time . For calibration partnership , we announced in July with Mitsui and MX Costello in Japan took roughly three years from first engagement to announcement .

Speaker #1: This is a measure of the business we are in , and it is the same reason these relationships are durable . Once they are established .

Dustin Olson: This is a measure of the business we are in, and it is the same reason these relationships are durable once they are established. Following the New Jersey approval and the Cleveland Kitchen launch, inbound interest increased meaningfully. Today, the pipeline stands at 42 brands, 15 converters, 28 applications, and 37 programs. Advanced at least one stage during the Q2 to the Q3 to date. Our relationship with Procter & Gamble continues to broaden. Downy detergent caps are now in commercial production. Tide caps are scheduled for retail production in the Q3, and the ZzzQuil PURE Zzzs child-resistant lids are targeted for the Q4. Procter & Gamble continues to execute the pipeline by adding brands. This is important because Procter & Gamble has among the most demanding qualification standards in consumer products. Having cleared them once, additional applications move faster and other brands notice.

Speaker #1: Following the new Jersey approval and the Cleveland Kitchen launch inbound interest increased meaningfully Today , the pipeline spans at 42 brands , 15 converters , 28 applications and 37 programs advance at least one stage during the second quarter to the third quarter to date , our relationship with Procter and Gamble continues to broaden , Downing detergent caps are now commercial production tied caps are scheduled for retail production in the third quarter , and the Vicks DayQuil pure Z child resistant lids are targeted for the fourth quarter .

Dustin Olson: Advanced at least one stage during the Q2 to the Q3 to date. Our relationship with Procter & Gamble continues to broaden. Downy detergent caps are now in commercial production. Tide caps are scheduled for retail production in the Q3, and the ZzzQuil PURE Zzzs child-resistant lids are targeted for the Q4. Procter & Gamble continues to execute the pipeline by adding brands. This is important because Procter & Gamble has among the most demanding qualification standards in consumer products. Having cleared them once, additional applications move faster and other brands notice. When one of the toughest qualifiers in the industry buys again, that is a third-party verdict on quality that we could not deliver ourselves. A few things worth remembering about Procter & Gamble. They hold an offtake arrangement for up to 15% of Ironton's capacity.

Speaker #1: Procter and Gamble continues to execute the pipeline by adding brands . This is important because Procter and Gamble has among the most demanding qualification standards in consumer products , having cleared them once additional applications move faster and other brands notice when one of the toughest in the industry buys again , that is a third party verdict on quality that that we could not deliver ourselves A few things worth remembering about Procter and Gamble .

Dustin Olson: When one of the toughest qualifiers in the industry buys again, that is a third-party verdict on quality that we could not deliver ourselves. A few things worth remembering about Procter & Gamble. They hold an offtake arrangement for up to 15% of Ironton's capacity. Their portfolio is highly fragmented across SKUs and applications, which means each approval opens the door to the next rather than closing the opportunity. They have also been clear in their support of our growth plan, and they remain committed to increasing recycled content across their portfolio. One more point on Procter & Gamble, because it applies to every large brand we serve. You start small, you prove it, then you expand. You walk before you run. The applications we have commercialized so far are walking, we believe the larger volume opportunities are starting to filter into the pipeline behind them.

Speaker #1: They hold an offtake arrangement for up to 15% of Ironton capacity . Their portfolio is highly fragmented across SKUs and applications , which means each approval opens the door to the next rather than closing the opportunity , they have also been clear in their support of our growth plan , and they remain committed to increasing recycled content across their portfolio One more point on Procter and Gamble , because it applies to every large brand we serve , you start small .

Dustin Olson: Their portfolio is highly fragmented across SKUs and applications, which means each approval opens the door to the next rather than closing the opportunity. They have also been clear in their support of our growth plan, and they remain committed to increasing recycled content across their portfolio. One more point on Procter & Gamble, because it applies to every large brand we serve. You start small, you prove it, then you expand. You walk before you run. The applications we have commercialized so far are walking, we believe the larger volume opportunities are starting to filter into the pipeline behind them. This is a natural progression of a relationship like this one, it is what we expected to see.

Speaker #1: You prove it , and then you expand . You walk before you run . The applications . We have commercialized so far are walking , and we believe the larger volume opportunities are starting to filter into the pipeline behind them .

Speaker #1: This is the natural progression of a relationship like this one . And it is what we expected to see in June Cleveland Kitchen Deli containers were made with 25% purified recycled polypropylene produced by our converter partner , IPL .

Dustin Olson: This is a natural progression of a relationship like this one, it is what we expected to see. In June, Cleveland Kitchen deli containers were made with 25% Ultra-Pure Recycled Polypropylene produced by our converter partner, IPL Schoeller, reached store shelves at a major big box retailer. I want to be very precise about what this is. It is a commercial retail conversion, not a trial. It is on shelves. Consumers are buying it, additional brands have since approached IPL Schoeller about using our resin. Connect that to what other converter announcements we made during the quarter. Reliable Caps, StackTeck, Innovia, Amcor, alongside our continuing work with Plastic Ingenuity. Converter relationships and our marketing effort open the long tail of demand, smaller brands, and private label, which in aggregate is very real, just as affected by regulation, they may be far less aware that a solution actually exists.

Dustin Olson: In June, Cleveland Kitchen deli containers were made with 25% Ultra-Pure Recycled Polypropylene produced by our converter partner, IPL Schoeller, reached store shelves at a major big box retailer. I want to be very precise about what this is. It is a commercial retail conversion, not a trial. It is on shelves. Consumers are buying it, additional brands have since approached IPL Schoeller about using our resin. Connect that to what other converter announcements we made during the quarter. Reliable Caps, StackTeck, Innovia, Amcor, alongside our continuing work with Plastic Ingenuity. Converter relationships and our marketing effort open the long tail of demand, smaller brands, and private label, which in aggregate is very real, just as affected by regulation, they may be far less aware that a solution actually exists.

Speaker #1: Schuler reached store shelves at a major big box retailer. I want to be very precise about what this is. It is a commercial retail conversion, not a trial.

Speaker #1: It is on shelves Consumers are buying it and additional brands have since approached IPL . Schuler about our using our resin . Connect that to what other converter announcements we made during the quarter .

Speaker #1: Reliable CAPS stack tech and Amcor, alongside our continuing work with Plastic Ingenuity converter relationships and our marketing effort, open the long tail of demand.

Speaker #1: Smaller brands and private label , which in aggregate is very real . Just as affected by regulation . And they may be far less aware that a solution actually exists .

Speaker #1: That is how demand broadens beyond the largest CPGs . The Cleveland Kitchen B2B marketing campaign was our first fully integrated marketing campaign , and it worked .

Dustin Olson: That is how demand broadens beyond the largest CPGs. The Cleveland Kitchen B2B marketing campaign was our first fully integrated marketing campaign, it worked. Eight industry outlets picked up the story, it generated seven new account engagements with large retailers, food CPG companies, and converters. That is pipeline, not impressions, it came from deliberately small test budget. We will run this playbook behind more brand launches, incremental spend is modest against the pipeline it opens. The regulatory picture is one of the most reliable part of our demand outlook because it sets the date in which regulations will come. It's set by them and not set by us. ESG has been a headwind for several years, globally and in the United States. The regulations matter. However, the regulations that matter kept advancing anyway. New Jersey approved. California is in effect.

Speaker #1: Eight industry outlets picked up the story, and it generated seven new account engagements with large retailers, food and CPG companies, and converters.

Speaker #1: That is pipeline , not impressions . And it came from deliberately small test budget . We will run this playbook behind more brand launches and incremental spend .

Speaker #1: Is modest against the pipeline . It opens the regulatory picture is one of the most reliable part of our demand outlook because it sets the date in which regulations will come .

Speaker #1: It's set by them and not set by us . ESG has been a headwind for several years globally and in the United States .

Speaker #1: The regulations matter . However , the regulations that matter kept advancing anyway . New Jersey approved California is in effect . Japan opened food contact and Europe keeps moving forward .

Dustin Olson: Japan opened food contact, Europe keeps moving forward. Rules that advance the toughest part of the cycle are durable, our demand is built on those rules. Our posture toward regulation has changed as well. We used to react to legislative developments. Today, we are proactive. We have stepped up our lobbying and government relations work. We are in regular dialogue with policymakers, we are increasingly the thought leader in the room when recycled content rules are written. We are well ahead of those same efforts in Europe and Asia. Two key points. First, our largest customers are accelerating in circular solutions because of regulations. The QSR programs and the food manufacturer I mentioned earlier both moved faster after the New Jersey approval. This is the clearest evidence that we have brands are treating these deadlines as real rather than aspirational.

Speaker #1: Rules that advance the toughest part of the cycle are durable and our demand is built on those rules . Our posture toward regulation has changed as well .

Speaker #1: We use we used to react to legislative developments . Today we are proactive . We have stepped up our lobbying and government relations work .

Speaker #1: We are in regular dialogue with policy makers , and we are increasingly the thought leader in the room . When recycled content rules are written , we are well ahead of those same efforts in Europe and Asia .

Speaker #1: Two key points. First, our largest customers are accelerating in circular solutions because of regulations. The QSR programs and the food manufacturer I mentioned earlier both moved faster after the New Jersey approval.

Speaker #1: This is the clearest evidence that we have . Brands are treating these deadlines as real rather than aspirational . Second , we believe new Jersey and California are the tip of the iceberg .

Dustin Olson: Second, we believe New Jersey and California are the tip of the iceberg. This is going global, and the regulations are set to affect the entire foundation we continue to build. One element of the global regulatory process may be underappreciated. While Ironton is the focus on domestic demand, our REACH certification allows us to serve Europe and other geographies from it, and we're seeing increased interest in doing so. That has also helped us convert letters of intent in Thailand, which brings me to growth. In New Jersey, the recycled content requirements rise to 20% in 2027. The food contact exemption expires in January 2027. In California, SB 54 is in effect with 10% source reduction by 2027, 20% by 2030, and 25% by 2032. PureFive qualifies as recycled content through our APR certification.

Speaker #1: This is going global, and the regulations are set to affect the entire foundation. We continue to build. One element of the global regulatory process may be underappreciated.

Speaker #1: While Ironton is the focus on domestic demand , our Reach certification allows us to serve Europe and other geographies from it . And we're seeing increased interest in doing so .

Speaker #1: That has also helped us convert letters of intent in Thailand . Which brings me to growth in new Jersey . The recycled content requirements rise to 20% in 2027 .

Speaker #1: The food contact exemption expires in January of 2017 . In California , SB 54 , in effect is in effect with 10% source reduction by 2,720% by 2030 and 25% by 2032 .

Speaker #1: Pure Five qualifies as recycled content through our April certification. One point on New Jersey I want to highlight, because I believe it matters how you understand the demand.

Dustin Olson: One point on New Jersey I want to highlight, because I believe it matters how you understand the demand. The approval we received in May is a one-year conditional approval with a defined path to permanent status. We do not regard this as a meaningful hurdle. The conditions are largely documentation, feedstock sources, the types of feedstocks processed, PureFive end-use applications, and compliance information as the New Jersey DEP requested. We are already providing a number of these items. One related point. Most recycled content claims in our industry rely on mass balance, an accounting approach where a producer buys credits and allocates recycled content to output that may not physically contain any. New Jersey and California both exclude it. Our product physically contains the recycled material, so it qualifies where credit-based claims do not.

Speaker #1: The approval we received in May is a one year conditional approval with a defined path to permanent status . We do not regard this as a meaningful hurdle .

Speaker #1: The conditions are largely documentation feedstock sources . The types of feedstocks process , purified end use applications , and compliance information . As deep as the new Jersey Department .

Speaker #1: The new Jersey DEP requested . We are already providing a number of these items . One related point most recycled content claims in our industry rely on mass balance and accounting approach , where a producer buys credits and allocates recycled content to output that may not be physically , that may not physically contain any .

Speaker #1: New Jersey and California , both exclude our product physically contains the recycled material , so it qualifies where credit based claims do not .

Speaker #1: That makes Purecycle one of the very few compliant suppliers at scale for food grade recycled polypropylene outside the United States , the same shift is underway in July , together with Mitsui , we announced a strategic partnership with Coachella to bring recycled polypropylene into flexible packaging in Japan .

Dustin Olson: That makes PureCycle one of the very few compliant suppliers at scale for food-grade recycled polypropylene. Outside the United States, the same shift is underway. In July, together with Mitsui, we announced a strategic partnership with FUJICELLO to bring recycled polypropylene into flexible packaging in Japan, following Japan's approval of physically recycled polypropylene for food contact. Europe continues to advance to the Packaging and Packaging Waste Regulation. On Thailand, the detailed design is confirmed. We have ordered key long lead equipment, and we have a team on the ground progressing the project.

Speaker #1: Following Japan's approval of physically recycled polypropylene for food , contact Europe continues to advance to the to the packaging and packaging waste regulation On Thailand , the detailed design is confirmed .

Speaker #1: We have ordered key long lead equipment and we have a team on the ground progressing the project . We received the Board of Investment approval in the quarter , including admission to Thailand's Fast pass investment Acceleration Program .

Dustin Olson: We received the Board of Investment approval in the quarter, including admission to Thailand's FastPass Investment Acceleration Program. The facility is expected to be operational in 2028, and we expect to break ground in the H2 of this year. Total investment remains approximately $250 million. On the commercial side of Thailand, we have signed seven letters of intent with Thai feedstock suppliers and 14 letters of intent on feedstock. Those letters more than cover the plant requires. On the sales side, they span similar categories and are targeting the US customers with heavy export business into the US, Europe, and Japan. In Belgium, permitting continues on schedule. We signed the EUR 40 million European Innovation Fund earlier this year. I'll now turn it over to Donald for the financial update and some commentary on our capital position.

Speaker #1: The facility is expected to be operational in 2028 , and we expect to break ground in the second half of this year . Total investment remains approximately 250 million on the commercial side of Thailand , we have signed seven letters of intent with Thai feedstock suppliers and 14 letters of intent with Thai food and 14 letters of intent on feedstock .

Speaker #1: Those letters more more than cover the plant requires On the sales side , they span similar categories and are targeting the US customers with heavy export business into the US , Europe and Japan In Belgium , permitting , continues on schedule .

Speaker #1: We signed the €40 million European Innovation Grant fund earlier this year . I'll now turn it over to Donald for the financial update and some commentary on our capital position .

Speaker #1: Thank you Dustin . Operating loss improved by 4.3 million year over year to 41.3 million , from 45.6 million , net loss for the second quarter was 142.2 million , compared to 144.2 million a year ago .

Donald Carpenter: Thank you, Dustin. Operating loss improved by $4.3 million year-over-year to $41.3 million from $45.6 million. Net loss for the Q2 was $142.2 million, compared to $144.2 million a year ago. Adjusted EBITDA was -$31.7 million, compared to -$27.8 million. That comparison reflects $7.8 million of lower non-cash add-backs, which primarily consist of equity-based compensation and prior year equipment write-downs, rather than a deterioration in operating performance. Both quarters included a planned outage, and this year's was substantially longer. Production still grew approximately 32% year-over-year, while core monthly operation spending declined approximately 8%. Operation spending was $8.3 million per month in the quarter, within the $8 to 9 million per month range we have described previously.

Speaker #1: Adjusted EBITDA was -31.7 million . Compared to -27.8 million . That comparison reflects $7.8 million of lower non-cash add backs , which primarily consists of equity based compensation and prior year equipment writedowns , rather than a deterioration in operating performance .

Speaker #1: Both quarters included a planned outage and this year's was substantially longer . Production still grew approximately 32% year over year , while core monthly operation spending declined approximately 8% .

Speaker #1: Operation spending was 8.3 million per month in the quarter . Within the 8 to 9 million per month range . We have described previously .

Speaker #1: That figure reflects core operations and corporate cash spend presented on a consistent basis for all periods . It excludes materials , purchases , meaning feedstock , virgin polypropylene and additives , which averaged approximately 2.1 million per month , up from approximately 0.7 million per month in the first quarter .

Donald Carpenter: That figure reflects core operations and corporate cash spend presented on a consistent basis for all periods. It excludes materials purchases, meaning feedstock, virgin polypropylene, and additives, which averaged approximately $2.1 million per month, up from approximately $0.7 million per month in the Q1. This was aligned with the restart of production and a new compounding operation. On the same basis, spending was $8.5 million per month in the Q1 and $9 million per month in the Q2 of last year. Core spending is trending down year-over-year. The Ironton turnaround, which came in below budget, was tracked separately from the ongoing operation spending rate.

Speaker #1: This was aligned with the restart of production and the new compounding operation on the same basis , spending was 8.5 million per month in the first quarter and 9 million per month in the second quarter of last year .

Speaker #1: Core spending is trending down year over year . The Ironton turnaround , which came in below budget , was tracked separately from the ongoing operations spending rate .

Speaker #1: We ended the quarter with total liquidity of $236.9 million, which includes $165.2 million in cash and cash equivalents, $59.6 million invested in marketable securities, and $12.1 million in restricted cash.

Donald Carpenter: We ended the quarter with total liquidity of $236.9 million, which includes $165.2 million in cash and cash equivalents, $59.6 million invested in marketable securities, and $12.1 million in restricted cash. That compares to $131 million of total liquidity at the end of the Q1. Q2 project spend was $20.9 million. For the full year, we now expect project spend of $45 to 50 million, up from our prior range of $39 to 45 million, driven primarily by incremental engineering, permitting, and long lead equipment spending for the Antwerp and Thailand projects. H2 project spend of $10 to 12 million remains contingent on project gating decisions and the timing of the Thailand project financing.

Speaker #1: That compares to 131 million of total liquidity at the end of the first quarter . Second quarter project spend was 20.9 million for the full year , we now expect Project Spend of 45 to 50 million , up from our prior range of 39 to 45 million , driven primarily by incremental engineering , permitting and long lead equipment spending for the Antwerp and Thailand projects .

Speaker #1: Second half project spend of $10 to $12 million remains contingent on project gating decisions and the timing of the Thailand project financing. In June, we closed concurrent public offerings of our 4.75% convertible senior notes due 2032 and common stock.

Donald Carpenter: In June, we closed concurrent public offerings of our 4.75% convertible senior notes due 2032 and common stock. The offerings priced at aggregate gross proceeds of $395 million, with the over-allotment options exercised, gross proceeds were $450.5 million. Net proceeds were $432 million after $18.5 million of underwriting and offering costs. We used a portion of the proceeds to repurchase $216 million aggregate principal amount of our 7.25% convertible notes for $241.1 million, plus $5.2 million of accrued interest, leaving approximately $186 million of net cash on the balance sheet. The transaction moved the put date on the substantial majority of our convertible debt from 2027 to 2030, reduced our ongoing interest costs, and funds our commercial ramp and near-term growth plans.

Speaker #1: The offerings , priced at aggregate gross proceeds of 395 million with the Overallotment options exercised . Gross proceeds were 450.5 million . Net proceeds were 432 million .

Speaker #1: After 18.5 million of underwriting and offering offering costs , we used a portion of the proceeds to repurchase 216 million aggregate principal amount of our 7.25% convertible notes for 241.1 million , plus 5.2 million of accrued interest , leaving approximately 186 million of net cash on the balance sheet .

Speaker #1: The transaction moved the put date on the substantial majority of our convertible debt from 2027 to 2030, reduced our ongoing interest costs, and funds.

Speaker #1: Our commercial ramp and near-term growth plans. Beyond that, our $200 million revolving credit facility remains undrawn and available. We have approximately $76 million in revenue bonds available to monetize and approximately $273 million of potential warrant proceeds.

Donald Carpenter: Beyond that, our $200 million revolving credit facility remains undrawn and available. We have approximately $76 million in revenue bonds available to monetize and approximately $273 million of potential warrant proceeds. Equipment financing payments step down in the H2 of the year as existing leases mature. Debt service in the Q3 is expected to be approximately $2.4 million, primarily the August coupon on the $34 million of remaining 7.25% notes, plus the final equipment lease payments. The new notes carry no coupon until January. On Thailand project financing, we are actively negotiating binding terms and targeting financial close by year-end. With the liquidity added in June, our capital is sufficient for the commercial ramp and for our planned growth spending, and most of that spending remains discretionary until project financing is in place. With that, operator, please open the line for questions.

Donald Carpenter: We have approximately $76 million in revenue bonds available to monetize and approximately $273 million of potential warrant proceeds. Equipment financing payments step down in the H2 of the year as existing leases mature. Debt service in the Q3 is expected to be approximately $2.4 million, primarily the August coupon on the $34 million of remaining 7.25% notes, plus the final equipment lease payments. The new notes carry no coupon until January. On Thailand project financing, we are actively negotiating binding terms and targeting financial close by year-end. With the liquidity added in June, our capital is sufficient for the commercial ramp and for our planned growth spending, and most of that spending remains discretionary until project financing is in place. With that, operator, please open the line for questions.

Speaker #1: Equipment financing payments stepped down in the second half of the year as existing leases mature. Debt service in the third quarter is expected to be approximately $2.4 million, primarily the August coupon on the $34 million of remaining 7.25% notes, plus the final equipment lease payments.

Speaker #1: The new notes carry no coupon until January on Thailand project financing . We are actively negotiating binding terms and targeting financial close by year end with the liquidity added in June , our capital is sufficient for the commercial ramp and for our planned growth spending , and most of that spending remains discretionary until project financing is in place .

Speaker #1: With that . Operator , please open the line for questions

Speaker #2: Thank you . At this time , we will conduct the question and answer session . As a reminder to ask a question , you will need to press star one one on your telephone and wait for your name to be announced .

Operator: Thank you. At this time, we will conduct the question and answer session. As a reminder, to ask a question, you will need to press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Please stand by while we compile the Q&A roster. Our first question comes from the line of Andres Sheppard of Cantor. Your line is now open.

Speaker #2: To withdraw your question , please press star one one again . Please stand by while we compile the Q&A roster Our first question comes from the line of Andre Shepherd of Cantor .

Speaker #2: Your line is now open .

Speaker #3: Hey everyone , this is Anand on for Andres . Congrats on the quarter and thanks for taking our questions and congrats on the buoy approval and fast .

[Analyst] (Cantor): Hey, everyone. This is Anandan for Andres. Congrats on the quarter, and thanks for taking our questions. Congrats on the BOI approval and Fast Pass. I was wondering, touching on Thailand, if you could give us a more full picture of where that sits today, first on the ground in terms of engineering long lead equipment and what happens between now and groundbreaking, and then on the financing side, where that process stands and what are the remaining steps to financial close? Thank you.

Speaker #3: I was wondering , touching on Thailand , if you could give us a more full picture of where that sits today . First , on the ground in terms of engineering , long lead equipment and what happens now between now and groundbreaking ?

Speaker #3: And then on the financing side , where that process stands ? And what are the remaining steps to financial close ? Thank you .

Speaker #1: Yeah . Hey , thanks a lot . And that's a that's a good question . We're really excited about Thailand Thailand's doing exactly what we need it to do .

Dustin Olson: Yeah. Hey, thanks a lot, Anand. That's a good question. We're really excited about Thailand. Thailand's doing exactly what we need it to do. The detailed design is confirmed, the key long lead equipment is ordered, and we've got a really good team on the ground. We've received BOI approval in the quarter, including a Fast Pass treatment, which is a significant accelerant to permitting and licensing. We expect to break ground in the H2 of this year, and the facility is expected to be operational in 2028. The one new capability worth noting is that with the compounding running in Ironton, we're actually now putting real samples in the hands of prospective customers in Thailand. I think this full project is really starting to wrap together nicely, and we're very excited about it. Donald, do you want to give a little bit more information on the financing?

Speaker #1: The detailed design is confirmed . The key long lead equipment is ordered . And we've got a really good team on the ground .

Speaker #1: We've received boy approval in the quarter , including a fast pass treatment , which is a which is a significant accelerant to permitting and licensing .

Speaker #1: We expect to break ground in the second half of this year , and the facilities expected to be operational in 28 . The one new capability worth noting is that with the compounding running , you know , in Ironton , we're actually now putting real samples in the hands of prospective customers in Thailand .

Speaker #1: So I think this full project is really starting to wrap together nicely . And we're very excited about it . Donald , do you want to give a little bit more information on the financing ?

Dustin Olson: Donald, do you want to give a little bit more information on the financing?

Speaker #1: Yeah , sure . Thank you . Dustin . We're really pleased with the progress of the discussions thus far . We're discussing binding terms , and we believe that we can meet the requirements negotiated thus far .

Donald Carpenter: Yeah, sure. Thank you, Dustin. We're really pleased with the progress of the discussions thus far. We're discussing binding terms, and we believe that we can meet the requirements negotiated thus far. After the binding terms are finalized, we'll begin working on the definitive agreements and then satisfying the conditions to close. The process is tracking to a close by year-end.

Speaker #1: After the binding terms are finalized, we'll begin working on the definitive agreements and then satisfying the conditions to close. The process is tracking to a close by year-end.

Speaker #3: Gotcha . Appreciate all the color . Dustin and Donald and maybe as a follow up , touching on PNG , that relationship looks like it keeps broadening .

[Analyst] (Cantor): Got you. Appreciate all the color, Dustin and Donald. Maybe as a follow-up, touching on P&G, that relationship looks like it keeps broadening, Downy commercial, Tide, and ZzzQuil. Maybe can you talk about what's driving that cadence, and are you seeing similar behavior from other large brands that maybe aren't ready to put their names out yet? I'm just trying to get a sense of how much of the H2 ramp is already in motion underneath all of the announcements. Thank you.

Speaker #3: Downey commercial tide and Ezequiel , maybe can you talk about what's driving that cadence and . Are you seeing similar behavior from other large brands that maybe aren't ready to put their names out yet ?

Speaker #3: I'm just trying to get a sense of how much of the second half ramp is already in motion . Underneath all of the announcements .

Speaker #3: Thank you

Speaker #1: Yeah , that's that's also a good question . A lot of the ramp is already in motion . You just see it publicly at the last step .

Dustin Olson: Yeah, that's also a good question. A lot of the ramp is already in motion. You just see it publicly at the last step. When a product hits the shelves, like Procter & Gamble shows you the full pattern. We have Downy caps, Tide caps, and ZzzQuil, and it's just one by one by one added to the list. The cadence is trust in compounding and trust in our ability to deliver good products. P&G has among the most demanding qualification standards in consumer products. Once you clear them, the next application moves faster. Yeah, we see the same behavior from large customers. Other large companies, they're not ready to put their names out there. One of the largest global food manufacturers pulled its timeline forward in the quarter. For the first time we've seen that.

Speaker #1: When a product hits the shelves like Procter and Gamble shows you the full pattern . I mean , we have downy caps and tide caps and zzyquil and just one by one by one added to the to the list .

Speaker #1: The cadence is trust and compounding, and trust in our ability to deliver good product. P&G has among the most demanding qualification standards in consumer products, but once you clear them, the next application would be faster.

Speaker #1: And yeah , we see the same behavior from large customers , other large companies , they're not ready to put their names out there .

Speaker #1: One of the largest global food manufacturers pulled its timeline forward in the quarter for the first time . We've seen that the cold Cup work with other major qsrs moved from conversation to shipments in weeks , in total , the 37 programs advancing at least one qualification stage look , a lot of times these announcements lag the activity .

Dustin Olson: The cold cup work with other major QSRs moved from conversation to shipments in weeks. In total of 37 programs advancing at least 1 qualification stage. Look, a lot of times these announcements lag the activity. The activity is the ramp. With Procter & Gamble, again, we've been working with them for so long, have such a good relationship with them, and we have a large pipeline behind what you see on the paper right now. This effort continues every single week where we look for new trials and new developments with other applications. I'm very excited where this is going to go with Procter & Gamble.

Speaker #1: The activity is the ramp , and with Procter and Gamble , again , like we've been working with them for so long , have such a good relationship with them .

Speaker #1: And we have a large pipeline behind what you see on the paper right now . This this effort continues . Every single week where we look for new trials and new developments with other applications .

Speaker #1: I'm very excited about where this is going to go with Procter & Gamble.

Speaker #3: Wonderful. Thanks so much for all the color, and congrats again on all the progress. I'll pass it on.

[Analyst] (Cantor): Wonderful. Thanks so much for all the color, and congrats again on all the progress. I'll pass it on.

Speaker #2: Thank you. One moment for our next question. Thank you. Our next question comes from the line of Hassan Ahmed of Alembic Global Advisors.

Operator: Thank you. One moment for our next question. Thank you. Our next question comes from the line of Hassan Ahmed of Alembic Global Advisors. Your line is now open.

Speaker #2: Your line is now open

Speaker #4: Afternoon , Dustin . Dustin , a high level question , both on near-term production as well as demand . You know , obviously I know production was negatively impacted by your planned turnaround in Q2 .

Hassan Ahmed: Afternoon, Dustin. Dustin, a high-level question, both on near-term production as well as demand. Obviously, I know production was negatively impacted by your plant turnaround in Q2. You guys produced, call it, four and a half million pounds. You also talked about post-turnaround production levels of 12,000 pounds per hour. I'm just trying to get a better sense of what Q3 production levels will look like. That's on the production side of it. In your previous quarter's update, you guys had talked about the demand ramp up, right? I mean, Q2, Q3, 40 to 50 million pounds, Q3 to Q4, 20 to 25 million pounds. Where do we stand on those forecasts?

Speaker #4: And you know , you guys produced , call it , £4.5 million , but you also talked about post turnaround production levels of , you know , £12,000 per hour .

Speaker #4: So I'm just trying to get a better sense of , you know , what Q3 production levels would look like . So that's on the production side of it .

Speaker #4: And then , you know , in your previous quarters update , you guys had talked about the demand ramp up , right ? I mean , Q2 to Q3 .

Speaker #4: Q2 Q3 40 to £50 million . Q3 to Q4 20 to £25 million . Where do we stand up on on those forecasts

Speaker #1: Yeah . So look , I can I can make this pretty simple . All year long we've said that the ramp would be in the second half weighted for basically two reasons .

Dustin Olson: Yeah. Look, I can make this pretty simple. All year long, we've said that the ramp would be in the H2, weighted for basically two reasons. The regulatory clock, with requirements starting in January 2027, and then supply chain readiness. It's one thing to qualify products, and another thing to deliver it consistently with every truck. Both are now proving out. Since the New Jersey approval, brands are accelerating their qualification work for the first time. With compounding running, we have the reliable supply chain that they require. You can see it in the Procter & Gamble applications that are accelerating. Our confidence has increased because the things we said that the ramp depended upon are actually happening. That's what converts the Ironton into break even.

Speaker #1: The regulatory clock, with requirements starting in January of '27. And then supply chain readiness. It's one thing to qualify products.

Speaker #1: It's another thing to deliver it consistently with every truck . But both are now proving out . And so since the new Jersey approval brands are accelerating their qualification work for the first time , and with compounding running , we have the reliable supply chain that they require .

Speaker #1: You can see it in the Procter and Gamble applications that are accelerating . And so our our confidence has increased because of things .

Speaker #1: We said that the ramp depended upon are actually happening . And that's what converts the Ironton into break . Even . The site level monthly cash break , even at an exit rate built on the branded sales that we talked about with 40 to 50% utilization , we've discussed .

Dustin Olson: The site level monthly cash break even at an exit rate built on the branded sales we talked about, with 40% to 50% utilization we've discussed. With respect to the ramps, the $40 million to 50 million and the $25 million to 50 million for New Jersey, those ramps are underway. Okay. Part of those ramps in the $40 million to 50 million is described by Procter & Gamble. You see progress there. Part of the ramp is described by a little bit of the revenue growth. Quite frankly, there's a lot of unnamed companies that are in that ramp that have started to pull product on the branded basis. That's working really well. We've always talked about the H2 ramp. The H2 ramp is in play, and it's largely driven by regulatory hurdles that are on the back end of the year.

Speaker #1: So with respect to the the ramps , the 40 to 50 million and the 20 to 20 5 million or 20 5 to 50 million for new Jersey , like those ramps are underway .

Speaker #1: Okay . Part of those ramps is in the 40 to 50 is described by Procter and Gamble . You see progress there . And part of the ramp is described by , you know , a little bit of the revenue growth .

Speaker #1: But quite frankly , there's a lot of unnamed US companies that are in that ramp that have started to pull , that started to pull product on the branded basis .

Speaker #1: So that's working really well . We've always talked about the second half ramp , the second half ramp is , is in play and it's largely driven by regulatory hurdles that are on the back end of the year .

Dustin Olson: The H2 ramp is in play, and it's largely driven by regulatory hurdles that are on the back end of the year. People don't want to start the year by trying to meet the regulation. People want to have the regulation met by the beginning of the year. That naturally means that they're going to start pulling in Q3 and Q4 in order to meet those regulations, and we see that in spades. With respect to production, for sure the production came down in Q2 and we, quite frankly, planned on that. We knew that the outage was going to take a chunk out of the production, but we also planned on a substantial amount of testing of the new equipment and testing of the design premise for Antwerp and Thailand in May.

Speaker #1: I mean, people don’t want to start the year by trying to meet the regulation. People want to have the regulation met by the beginning of the year.

Dustin Olson: People don't want to start the year by trying to meet the regulation. People want to have the regulation met by the beginning of the year. That naturally means that they're going to start pulling in Q3 and Q4 in order to meet those regulations, and we see that in spades. With respect to production, for sure the production came down in Q2 and we, quite frankly, planned on that. We knew that the outage was going to take a chunk out of the production, but we also planned on a substantial amount of testing of the new equipment and testing of the design premise for Antwerp and Thailand in May. We followed that and did a good job of gathering that data.

Speaker #1: And so that naturally means that they're going to start pulling in Q3 and Q4 in order to meet those regulations . And we see that in spades with respect to production .

Speaker #1: Yeah , for sure . The the production came down in Q2 and , and we , quite frankly , planned on that . We knew that the outage was going to take a chunk out of the production , but we also planned on a substantial amount of testing of the new equipment and testing of the design premise for Antwerp and Thailand in May .

Speaker #1: And we followed . We followed that and did a good job of gathering that data . Production will always follow the commercial . So I think that what you'll see is as the commercial begins to ramp in Q3 and Q4 , you're going to see the production follow suit .

Dustin Olson: We followed that and did a good job of gathering that data. Production will always follow the commercial, I think that what you'll see is as the commercial begins to ramp in Q3 and Q4, you're going to see the production follow suit with that.

Dustin Olson: Production will always follow the commercial, I think that what you'll see is as the commercial begins to ramp in Q3 and Q4, you're going to see the production follow suit with that.

Speaker #1: With that

Speaker #4: Very helpful . And as a follow up , I think part of the part of the answer you already gave me , but just wanted to get a bit more granular around , around the demand side of things .

Hassan Ahmed: Very helpful. As a follow-up, I think part of the answer you already gave me, just wanted to get a bit more granular around the demand side of things. If I heard correctly, you talked about the nearer-term New Jersey opportunity being around 25 million to 50 million pounds, right. That's one side of it, whether that is the case or not. The other side is obviously a lot of encouraging stuff on the P&G side, between Downy, Tide, and Vicks. I know you talked about walking before running over there, but could these individually be multi-million pound opportunities, I guess, in the nearer term, over the next couple of quarters?

Speaker #4: If I heard you know , you talked about the nearer term , new Jersey opportunity being around 25 to £50 million , right ?

Speaker #4: And so , so that's one side of it . You know , whether that is the case or not . And then the other side is obviously a lot of encouraging stuff on the PNG side , you know , between Downy and Tide and VIX and I know you talked about sort of working before running over there , but I mean could these individually be multi-million pound opportunities I guess in the near term over the next couple of quarters .

Speaker #1: Yeah . I see it that way . I mean new Jersey was a real what was a real qualification for us . I would say that in the past when you're working through the demand ramp and forecasting where you're going to go , you you have a sense for what is holding up some of the qualifications .

Dustin Olson: Yeah, I see it that way. New Jersey was a real qualification for us. I would say that in the past, when you're working through the demand ramp and forecasting where you're going to go, you have a sense for what is holding up some of the qualifications. I think that when New Jersey passed, we had such an influx of requests and we had some brands that were calling converters and saying, "Get PureCycle's product in the trial now," where they weren't there originally because we didn't have New Jersey. A lot of these things really started to happen and we fast-tracked into two large qualification programs for cold cups. We have 17 active trials that were tied to New Jersey compliance. Brands were, quite frankly, paused because of the uncertainty. What hasn't changed is just the qualification process.

Speaker #1: But I think that when new Jersey passed , we had such an influx of requests and , you know , we had we had some brands that were calling converters and saying , get pure cycles product in the trial .

Speaker #1: Now , weren't there originally because we didn't have new Jersey . I mean , a lot of these things really started to to happen .

Speaker #1: And I mean, we fast-tracked into two large qualification programs for cold cups. We have 17 active trials that were tied to New Jersey compliance.

Speaker #1: Brands were , quite frankly , paused because of the uncertainty and what what hasn't changed is , you know , just the qualification process .

Speaker #1: Those cycles can run quarters , which is why the converts into volume late this year and into 27 is exactly what we described .

Dustin Olson: Those cycles can run quarters, which is why the converts into volume late this year and into 2027 is exactly what we describe. I think the 25 to 50 million pound term in the near frame still holds. I think QSR cups alone is a 20 million per year kind of bucket, but that's only a couple of QSRs, and there's a bunch of them out there. I see New Jersey as being a real accelerant to what we're doing, and I think you're going to see that in the next coming quarters.

Speaker #1: And so I , I think the 25 to £50 million term in the year frame still still holds . I think QSR cups alone is a is a 20 million per year kind of bucket , but that's only a couple of Qsrs .

Speaker #1: And there's a bunch of them out there . And so I see new Jersey as being a real accelerant to what we're doing .

Speaker #1: And I think you're going to see that in the next coming quarters .

Speaker #4: Very helpful . Dustin . Thank you so much .

Hassan Ahmed: Very helpful, Dustin. Thank you so much.

Speaker #2: Thank you . One moment for our next question Thank you . Our next question comes from the line of Luke Persons of Craig-hallum Capital Group .

Operator: Thank you. One moment for our next question. Thank you. Our next question comes from the line of Luke Persons of Craig-Hallum Capital Group. Your line is now open.

Speaker #2: Your line is now open .

Speaker #5: Hey , this is Luca for Eric . Thanks for taking our questions . So I guess first here when thinking about the international expansion plan .

Luke Persons: Hey, this is Luke on for Eric. Thanks for taking our question. I guess first here, when thinking about the international expansion plan, how should we think about these timelines versus your plans to ramp at Ironton? Are the new project timelines at all contingent on hitting certain commercial and operational milestones at Ironton, or should we just consider them to be completely independent of each other?

Speaker #5: So how should we think about these timelines versus your plans to ramp at Ironton ? Are these are the new project timelines at all contingent on hitting certain commercial and operational milestones at Ironton , or should we just consider them to be completely independent of each other ?

Speaker #1: Yeah , to a certain extent , they're tied . I mean , there's a few qualifications that we're going to need to make on the commercial side to keep moving forward with , with Thailand , but these are pretty low hurdles that we don't expect to impact our overall ramp timing .

Dustin Olson: Yeah, to a certain extent they're tied. There's a few qualifications that we're going to need to make on the commercial side to keep moving forward with Thailand, but these are pretty low hurdles that we don't expect to impact our overall ramp timing. I think it's a pretty safe assumption to say that this project stays on track. With respect to the timeline of Thailand relative to Ironton, look, we're already pulling samples from Ironton into Asia and into Europe. Okay? There's a pretty healthy demand building for sampling of the Ironton product, which will accelerate the adoption process in those regions. It will probably create incremental demand in Ironton in the short term, which then will be replaced by Thailand supply and Antwerp supply when those plants are up and running. I feel really good about that timeline.

Speaker #1: I think it's a pretty safe assumption to say that this project stays on track with respect to the timeline of Thailand relative to to Ironton , look , we're already pulling samples from Ironton into Asia and into Europe .

Speaker #1: Okay ? There's a there's a pretty healthy demand building for sampling of the Ironton product , which will accelerate the adoption process in those regions .

Speaker #1: It will probably create incremental demand in Ironton in the short term , which then will be replaced by Thailand supply and supply . When those plants are up and running .

Speaker #1: So, I feel really good about that timeline. The reality is that in order to have a good project, you've got to have a good project team, and you've got to have a good strategy for how you're going to implement this.

Dustin Olson: The reality is that in order to have a good project, you've got to have a good project team and you've got to have a good strategy for how you're going to implement this. With the team we have on site or in Thailand, as well as the support we have at the board level, we've got a very good project that's developing here. I think it's going to be the right size in terms of capital, and I think it's going to be the right team to execute, and I'm very excited about where this is going to go the next couple of years.

Speaker #1: And with the team we have on site , or , you know , in Thailand , as well as the support we have at the board level , we've got a very good project that's developing here .

Speaker #1: I think it's going to be the right size in terms of capital , and I think it's going to be the the right team to execute .

Speaker #1: And I'm very I'm very excited about where this is going to go . The next couple of years .

Speaker #5: Thanks for all the color there . That's helpful . So I guess for a follow up here , just on the compounded product , how's pricing trending relative to the pier recycled product when you're having conversations with some of these customers ?

Luke Persons: Thanks for all the color there. That's helpful. I guess for a follow-up here, just on the compounded product, how's pricing trending relative to just the pure recycled product when you're having conversations with some of these customers? Are you finding that you're still able to demand a significant premium to virgin resin?

Speaker #5: I mean, are you finding that you're still able to demand a significant, significant premium to virgin resin?

Speaker #1: Yeah , I mean , like we kind of break this up into a couple different ways . I mean , when we , when we sell the compounded product , you know , there's a component of that sale that is PCT material .

Dustin Olson: Yeah. We kind of break this up into a couple different ways. When we sell a compounded product, there's a component of that sale that is PCT material. When you look at the pricing range that we see for that product, it's still consistent with the guidance that we've given in the past. Then on top of that, you're giving additional service. Okay? You're giving them a one-pellet solution, so the operational headaches are reduced, the supply chain headaches are reduced, and they're willing to pay a premium for that as well. The virgin component, the mixture, the other additives that we're putting into that overall compound is really a value proposition for the customer. They like it because it makes their life easier, and it gives them exactly what they want.

Speaker #1: And when you look at the pricing range that we see for that product, it's still consistent with the guidance that we've given in the past.

Speaker #1: And then on top of that , you're giving additional service . Okay , you're giving them a one pellet solution . So the operational headaches are reduced .

Speaker #1: The supply chain headaches are reduced , and they're willing to pay a premium for that as well . And so the virgin component , the mixture , the the other additives that we're putting into that overall compound is really a value proposition for the customer .

Speaker #1: They like it because it makes their life easier, and it gives them exactly what they want. I mean, there are some customers that want to have a higher percentage of PCR content because they want to do more with that application for their overall book.

Dustin Olson: There are some customers that want to have a higher percentage of PCR content because they want to do more with that application for their overall book, and there are other customers that want to meet it exactly. With the compounding asset at Ironton, it allows us to really tailor fit to their unique specifications. It's really a differential asset that we've built in Ironton. I'm really excited to have it in service.

Speaker #1: And there are other customers that want to meet it. Exactly. And so, with the compounding asset at Ironton, it allows us to really tailor fit for their unique specifications.

Speaker #1: It's really a differential asset that we've built in Ironton. I'm really excited to have it in service.

Speaker #5: Thank you . That's helpful . I'll turn it over

Luke Persons: Thank you. That's helpful. I'll turn it over.

Speaker #2: Thank you . One moment for our next question Thank you . Our next question comes from the line of Gerard Sweeney of Roth Capital .

Operator: Thank you. One moment for our next question. Thank you. Our next question comes from the line of Gerard Sweeney of ROTH Capital Partners. Your line is now open.

Speaker #2: Your line is now open .

Speaker #6: Good afternoon guys . Thanks for taking my call .

Gerry Sweeney: Good afternoon, guys. Thanks for taking my call.

Speaker #1: Thanks , Jerry . How are you doing ?

Dustin Olson: Thanks, Gerry. How you doing?

Speaker #6: I'm doing well. You?

Gerry Sweeney: Doing well. You?

Speaker #1: Yeah . Doing well . Thanks .

Dustin Olson: Yeah, doing well. Thanks.

Speaker #6: Listen , you put out some stats earlier . I think you said convert £5 million of product to £5 million of material to £4.5 million of product .

Gerry Sweeney: Listen. You put out some stats earlier. I think you said converted 5 million pounds of material to 4.5 million pounds of product. That's about a 90% yield, which I think is very good, if not in the realm where you want to be. I think you also said you were running Ironton around 12,000 pounds an hour, which is sort of 85% utilization. Is that accurate, my math assessment on where those numbers came out?

Speaker #6: That's about a 90% yield , which I think is , you know , very good , if not in the realm where you want to be .

Speaker #6: And I think you also said you were running Ironton around £12,000 an hour, which is sort of 85% utilization. Is that accurate?

Speaker #6: My math assessment on where those numbers came out.

Speaker #1: Yeah , that math is right . A couple of clarifications . One on the 5 million down to 4.5 million , the delta there represents Co-product one and Co-product two applications .

Dustin Olson: Yeah, that math is right. A couple of clarifications. One, on the 5 million down to 4.5 million, the delta there represents co-product 1 and co-product 2 applications. We've had increasing success marketing that and getting that into the market. The 0.5 gap there is a good product for us. The 12,000 is a production rate that we have touched, but I did not say that we're running there routinely right now. That's a rate that we've confidently run since the outage to test different rate limitations, and we're going to continue to do that in Q3, okay? It shows what's capable, not what we're doing on a day-to-day basis.

Speaker #1: And we've had increasing success marketing that and getting that into the market . So we're that's the point five gap . There is is , is a good product for us .

Speaker #1: And the 12,000 is a production rate that we have touched, but I did not say that we're running there routinely right now.

Speaker #1: That's a rate that we've confidently run since the outage to test different rate limitations, and we're going to continue to do that in Q3.

Speaker #1: Okay . It shows what's capable , not what we're doing on a day to day basis . That was .

Gerry Sweeney: That was my. Oh, yeah, sorry, go ahead.

Speaker #6: My yeah . Sorry . Go ahead . Go ahead .

Speaker #1: No . Yeah , yeah . So you're probably going to ask what's the day to day , the day to day is going to similar to how I responded to it earlier .

Dustin Olson: No. Yeah. You're probably going to ask, Well, what's the day-to-day? The day-to-day is going to, similar to how I responded to it earlier, it's really the production's going to chase the commercial.

Speaker #1: It's really the production that is going to chase the commercial. And we see the qualifications with the branded sales. We'll continue to raise rates to compensate for that.

Gerry Sweeney: Okay.

Dustin Olson: As we see the qualifications with the branded sales, we'll continue to raise rates to compensate for that.

Speaker #6: So in other words , you have a high degree of confidence . The system , the plan is operating as you want . And can handle the volume of orders as they accelerate

Gerry Sweeney: In other words, you have a high degree of confidence the system, the plant is operating as you want and can handle the volume of orders as they accelerate.

Speaker #1: More and more every day . Look , Jerry , I mean , you've been you've been in the story for a long time .

Dustin Olson: More and more every day. Look, Gerry, you've been in the story for a long time, and so you've seen, let's say, all the twists and turns with bringing this technology to the market. It's hard, okay. Bringing technology.

Speaker #1: And so you've seen , let's say , all the twists and turns with bringing this technology to , to the market . I mean , it's hard .

Speaker #1: Okay . Bring your technology to the market is a very hard thing to do . There's a lot of unexpected things that jump in your way that you've got to figure out how to work around .

Gerry Sweeney: Yeah

Dustin Olson: Bringing to the market is a very hard thing to do. There's a lot of unexpected things that jump in your way that you've got to figure out how to work around. I've said many, many times that the testament of this company is that we've got the team that has the capability to push through all of those constraints and keep moving forward. That said, our technology is really, really good. Okay. We've demonstrated that in terms of all the different applications that we've qualified. We've demonstrated that in terms of the, we call it SOI reduction, which is substance of interest. A lot of the big brands really care about that, and we're quite frankly really good there. We've demonstrated that in some of these high-colorable applications. We're making good product.

Speaker #1: And, you know, I've said many, many times that the testament of this company is that we've got the team that has the capability to push through all of those constraints and keep moving forward.

Speaker #1: That said , I mean , our technology is really , really good . Okay . We've demonstrated that in terms of all the different applications that we've qualified , we've demonstrated that in terms of the we call it SOI reduction , which is substance of interest .

Speaker #1: A lot of the big brands really care about that , and we're , quite frankly , really good there . We've demonstrated that in some of these high colorable applications .

Speaker #1: I mean, we're making a good product. We have a really good technology that does things with feed that other people, quite frankly, can't touch.

Dustin Olson: We have a really good technology that does things with feed that other people, quite frankly, can't touch. From a technology perspective, look, are we done learning? No. Is there more we're going to figure out? Yes. The core technology is right there, and we're just getting better and better every single day.

Speaker #1: And so from a technology perspective , like , you know , look , are we done learning ? No . Is there more we're going to figure out ?

Speaker #1: Yes . But the core technology is right there . And we're just getting better and better every single day .

Speaker #6: I mean , my next comment , to be quite honest with you , is going to be over the last several quarters , you have consistently shown incremental improvements at Ironton and that should be the plan .

Gerry Sweeney: My next comment, to be quite honest with you, was going to be, over the last several quarters, you have consistently shown incremental improvements at Ironton, that should be the plan forward, expectation-wise. Which I think is what you just said.

Speaker #6: Forward expectation wise , which I think is what you just said .

Speaker #1: Yeah . I mean , like on all levels . Okay . There's the understanding , the tech , there's the running the plant , there's the uptime , there's the reliability , there's the rate , there's the quality performance .

Dustin Olson: Yeah. On all levels, okay? There's the understanding the tech, there's the running the plant, there's the uptime, there's the reliability, there's the rate, there's the quality performance. You can imagine, Gerry, when you get into these discussions with some of the big brands, we're talking of major players in the market, all right? They don't just accept an FDA LNO and say, Okay, good enough for us. They want to peel behind the curtain.

Speaker #1: I mean , you can imagine , Jerry , when you get into these discussions with some of the big brands , I mean , we're talking to , we're talking major players in the market .

Speaker #1: All right . And they don't just accept an FDA . No and say , okay , good enough for us . They want to peel behind the curtain .

Speaker #6: Oh , no doubt .

Gerry Sweeney: Oh, no doubt. Yeah.

Speaker #1: As they start looking and really peeling back the technology and asking you a lot of questions, we have to answer very hard questions, and we have to have the data to back it up.

Dustin Olson: As they start looking and really peeling back the technology and asking a lot of questions, we have to answer very hard questions, and we have to have the data to back it up. With our R&D team, with our group in Durham, with our team in Ironton, we've gotten really good at answering a lot of hard questions, which is why we're starting to get traction with a lot of these big brands. Yeah, on every level in this company, every single day, we get better. There's just no doubt about that, and I expect that to be a core part of our DNA that continues to move forward every single day.

Speaker #1: And with our R&D team , with our group in Durham , with , you know , with , with our team in Ironton , like we've gotten really good at answering a lot of hard questions , which is why we're starting to get traction with a lot of these big brands .

Speaker #1: And so , yeah , I mean , on every level in this company , every single day , we get better . There's just , there's just no doubt about that .

Speaker #1: And I expect that to be a core part of our DNA that continues to move forward . Every single day .

Speaker #6: Got it . All right . I , I'll jump back in queue . I appreciate it , and I for what it's worth , I , I was very happy to see things continuing to move forward .

Gerry Sweeney: Got it. All right. I'll jump back in queue. I appreciate it. For what it's worth, I was very happy to see things continuing to move forward, so thanks.

Speaker #6: So thanks .

Speaker #1: Thanks , Jerry .

Dustin Olson: Thanks, Gerry.

Speaker #2: Thank you . This concludes the question and answer session . I would now like to turn it back to Dustin Olson Chief Executive Officer for closing remarks .

Operator: Thank you. This concludes the question and answer session. I would now like to turn it back to Dustin Olson, Chief Executive Officer, for closing remarks.

Speaker #1: Yeah . Hey , look , thanks , everybody for joining us today . Let me close with some facts about the quarter . We completed a major turnaround ahead of schedule and below budget .

Dustin Olson: Yeah. Hey, look. Thanks, everybody, for joining us today. Let me close with some facts about the quarter. We completed a major turnaround ahead of schedule and below budget, and within weeks of that restart, we set a new daily throughput record. We brought compounding online. It's running well. We're delivering what customers specify. Revenue grew for a sixth consecutive quarter. Our first Procter & Gamble application went into commercial production, and our product is in the hands of converters who serve the largest cold cup programs in the country. New Jersey approved PureFive's recycled content with a mandate taking hold in January of 2027. Every one of those facts point in the same way. The plant is ready, the product is qualified and being qualified into more applications every quarter.

Speaker #1: And within weeks of restart of and within weeks of that restart , we set a new daily throughput record . We brought compounding online .

Speaker #1: It's running well . We're delivering what customers specify Revenue grew for a sixth consecutive quarter . Our first Procter and Gamble application went into commercial production , and our product is in the hands of converters , who serve the largest cold cut programs in the in the country .

Speaker #1: And new Jersey approved purifies recycled content with a mandate taking hold in January of 20 of 27 . Every one of those every one of those facts point in the same way .

Speaker #1: The plant is ready . The product is qualified , and being qualified into more applications every quarter . The regulation arrives on a statutory clock , and Ironton break even remains our second half target closer now than it was 90 days ago .

Dustin Olson: The regulation arrives on a statutory clock, and Ironton breakeven remains our H2 target, closer now than it was 90 days ago, with the remaining work squarely within our control. Thank you, everybody, for following us, investing in us, and supporting us each quarter. See you next time.

Speaker #1: With the remaining work squarely within our control . Thank you for everybody for following us , investing in us , and supporting us each quarter .

Speaker #1: See you next time .

Operator: Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.

Q2 2026 PureCycle Technologies Inc Earnings Call

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