Q2 2026 Stabilis Solutions Inc Earnings Call

August 12, 2026

Speaker #1: Thank you for your continued patience. Your meeting will begin shortly. If at any time you need assistance, please press star zero and a member of our team will be happy to assist you.

Speaker #1: Thank you for your continued patience. Your meeting will begin shortly. If at any time you need assistance, please press star zero, and a member of our team will be happy to assist you.

Speaker #1: Please stand begin. Welcome to the Stabilis Solutions second quarter 2026 earnings call. At this time, all participants have been placed in the listen-only mode, and the floor will be open for your questions following the presentation.

Operator: Welcome to the Stabilis Solutions Second Quarter 2026 Earnings Call. At this time, all participants have been placed in a listen-only mode, and the floor will be open for your questions following the presentation. If you would like to ask a question at that time, please press star one on your telephone keypad. If at any point your question has been answered, you may remove yourself from the queue by pressing star two. So others can hear your questions clearly, we ask you pick up your handset for best sound quality. Lastly, if you should require operator assistance, please press star zero. I would now like to turn our call over to Andy Puhala, Chief Financial Officer. Mr. Puhala, please go ahead.

Speaker #1: If you would like to ask a question at that time, please press star one on your telephone keypad. If at any point your question has been answered, you may remove yourself from the queue by pressing star two.

Operator: If you would like to ask a question at that time, please press star one on your telephone keypad. If at any point your question has been answered, you may remove yourself from the queue by pressing star two. So others can hear your questions clearly, we ask you pick up your handset for best sound quality. Lastly, if you should require operator assistance, please press star zero. I would now like to turn our call over to Andy Puhala, Chief Financial Officer. Mr. Puhala, please go ahead.

Speaker #1: So others can hear your questions clearly, we ask you pick up your handset for best sound quality. Lastly, if you should require operator assistance, please press star zero.

Speaker #1: I would now like to turn our call over to Andy Puhala, Chief Financial Officer, Mr. Puhala, please go ahead.

Speaker #2: Good morning and welcome to Stabilis Solutions second quarter 2026 results conference call. I'm Andy Puhala, Senior Vice President and CFO of Stabilis. And joining me today is our Executive Chairman and Interim President and CEO, Casey Crenshaw.

Andy Puhala: Good morning, and welcome to Stabilis Solutions second quarter 2026 results conference call. I'm Andy Puhala, Senior Vice President and CFO of Stabilis, and joining me today is our Executive Chairman and Interim President and CEO, Casey Crenshaw. We issued a press release after the market closed yesterday detailing our second quarter operational and financial results. This release is publicly available in the investor relations section of our corporate website at stabilis-solutions.com. Before we begin, I'd like to remind everyone that today's conference call will contain certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other securities laws. These forward-looking statements are based on the company's expectations and beliefs as of today, 12 August 2026. Forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those projected.

Speaker #2: We issued a press release after the market closed yesterday detailing our second quarter operational and financial results. This release is publicly available in the investor relations section of our corporate website at stabilis-solutions.com.

Speaker #2: Before we begin, I'd like to remind everyone that today's conference call will contain certain forward-looking statements within the meaning of the private securities litigation reform act of 1995 and other securities laws.

Speaker #2: These forward-looking statements are based on the company's expectations and beliefs as of today, August 12, 2026. Forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those projected.

Speaker #2: The company undertakes no obligation to provide updates or revisions to the forward-looking statements made in today's call. Additional information concerning factors that could cause those differences is contained in our filings with the SEC and in the press release announcing our results.

Andy Puhala: The company undertakes no obligation to provide updates or revisions to the forward-looking statements made in today's call. Additional information concerning factors that could cause those differences is contained in our filings with the SEC and in the press release announcing our results. Investors are cautioned not to place undue reliance on any forward-looking statements. Further, please note that we may refer to certain non-GAAP financial information on today's call. You can find reconciliations of the non-GAAP financial measures to the most comparable GAAP measures in our earnings press release. Today's call is being recorded and will be available for replay. With that, I will hand the call over to Casey Crenshaw for his remarks.

Speaker #2: Investors are cautioned not to place undue reliance on any forward-looking statements. Further, please note that we may refer to certain non-GAAP financial information on today's call.

Speaker #2: You can find reconciliations of the non-GAAP financial measures to the most comparable GAAP measures in our earnings press release. Today's call is being recorded and will be available for replay.

Speaker #2: With that, I'll hand the call over to Casey Crenshaw for his remarks.

Speaker #3: Thank you, Andy, and good morning to everyone joining us today. Our second quarter results reflect the building momentum we are seeing across the business.

Casey Crenshaw: Thank you, Andy, and good morning to everyone joining us today. Our Q2 results reflect the building momentum we are seeing across the business. As we discussed on our Q1 call, the Q1 was the low point for the year, coming immediately after two of our largest multi-year contracts concluded at the end of 2025. Since then, activity has strengthened meaningfully. Aerospace was particularly strong, with LNG volumes sold up 79% year over year and 87% sequentially. Our non-power generation related industrial business volumes grew more than 67% year over year as well. Turning to the balance of the year, we expect results to build steadily from here. As newly awarded contracts come online and we backfill the demand left by those completed agreements, we anticipate incremental improvements in both the Q3 and Q4.

Speaker #3: As we discussed on our first quarter call, the first quarter was the low point for the year coming immediately after two of our largest multi-year contracts concluded, at the end of 2025.

Speaker #3: Since then, activity has strengthened meaningfully. Aerospace was particularly strong with LNG volumes sold up 79% year over year, and 87% sequentially. And our non-power generation related industrial business volumes grew more than 67% year over year as well.

Speaker #3: Turning to the balance of the year, we expect results to build steadily from here. As newly awarded contracts come online and we backfill the demand left by those completed agreements, we anticipate incremental improvements in both the third and fourth quarters.

Speaker #3: A key contributor is a contract we secured during the quarter to supply behind-the-meter LNG to generate power for the commissioning of an additional US data center.

Casey Crenshaw: A key contributor is a contract we secured during the quarter to supply behind-the-meter LNG to generate power for the commissioning of an additional US data center. Service is expected to begin in the Q3, and while we currently estimate a 6-month term, it could well extend beyond that. Contracts like this underpin our confidence in a stronger H2, with revenue and profitability building through the Q3 and Q4, and H2 revenues expected to increase by more than 50% compared to the H1 of 2026. As of the end of Q2, we have been awarded contracts in two different phases of data center development. First, data center commissioning, and second, providing bridge power during data center operations. Each type of opportunity brings a different profile in terms of length of project and volumes of LNG.

Speaker #3: Service is expected to begin in the third quarter, and while we currently estimate a six-month term, it could well extend beyond that. Contracts like this underpin our confidence in a stronger second half with revenue and profitability building through the third and fourth quarters and second half revenues expected to increase by more than 50% compared to the first half of 2026.

Speaker #3: As of the end of Q2, we have been awarded contracts in two different phases of data center development. First, data center commissioning and second, providing bridge power during data center operations.

Speaker #3: Each type of opportunity brings a different profile in terms of length of project and volumes of LNG. We believe there will be significant additional opportunities to participate in these phases as well as opportunities to provide LNG during construction and for use in long-term backup power generation once these data centers are running and connected to a grid or gas pipeline.

Casey Crenshaw: We believe there will be significant additional opportunities to participate in these phases, as well as opportunities to provide LNG during construction and for use in long-term backup power generation once these data centers are running and connected to a grid or gas pipeline. As important as the H2 of the year is, our sights are increasingly set on 2027. Early next year, we expect to begin deliveries under what will be the largest contract our company has ever secured, a behind-the-meter power generation project to provide bridge power for a US data center that extends into early 2029 and is expected to generate approximately $100 million of revenue annually over its 2-year term. Preparations are well advanced. As of the end of Q2, we have received $20 million in customer prepayments to fund equipment, mobilization, and readiness.

Speaker #3: As an important as a second half of the year is, our sites are increasingly set on 2027. Early next year, we expect to begin deliveries under what will be the largest contract our company has ever secured, a behind-the-meter power generation project to provide bridge power for a US data center that extends into early 2029 and is expected to generate approximately 100 million of revenue annually over its two-year term.

Speaker #3: Preparations are well advanced. As of the end of Q2, we have received 20 million in customer prepayments to fund equipment, mobilization, and readiness. The project remains on schedule, and our team is actively investing in equipment and securing LNG supply to ensure a successful launch.

Casey Crenshaw: The project remains on schedule, and our team is actively investing in equipment and securing LNG supply to ensure a successful launch. Our commercial team also continues to bid on additional data center opportunities beyond this award. Driven primarily by this contract, we expect company revenues in 2027 to exceed $100 million. Taken together with the balance of our contracted portfolio, we expect 2027 to be a record year for Stabilis in both revenue and profitability. Let me spend a moment on how we are able to take on projects of this scale. Currently, our power generation contracts are being served largely with third-party provided LNG, which speaks to the core strength of our model.

Speaker #3: Our commercial team also continues to bid on additional data center opportunities beyond this award. Driven primarily by this contract, we expect company revenues in 2027 to exceed 100 million, taken together with the balance of our contracted portfolio, we expect 2027 to be a record year for Stabilis in both revenue and profitability.

Speaker #3: Let me spend a moment on how we're able to take on projects of this scale. Currently, our power generation contracts are being served largely with third-party-provided LNG.

Speaker #3: Which speaks to the core strength of our model. Rather than being constrained by the output of our own liquefaction plants, we can combine our own production purchase supply logistics, mobile equipment, and our engineering and field service expertise to meet the demand almost anywhere in the country.

Casey Crenshaw: Rather than being constrained by the output of our own liquefaction plants, we can combine our own production, purchase supply, logistics, mobile equipment, and our engineering and field service expertise to meet the demand almost anywhere in the country. That flexibility allows us to pursue the largest opportunities without building capacity ahead of them, and it reinforces our position as a leading small-scale LNG provider in the US at a time when data center growth is reshaping domestic energy demand. Our aerospace business is another area where the momentum is unmistakable. Launch activity among our commercial space customers continues to climb, and with it, their demand for LNG, which is driving the volume growth I referenced a moment ago. This is a market where our ability to deliver high-purity product reliability and to engineer solutions around each customer's specific technical requirements truly differentiates us.

Speaker #3: That flexibility allows us to pursue the largest opportunities without building capacity ahead of them. And it reinforces our position as a leading small-scale LNG provider in the US at a time when data center growth is reshaping domestic energy demand.

Speaker #3: Our aerospace business is another area where the momentum is unmistakable. Launch activity among our commercial space customers continues to climb, and with it, their demand for LNG, which is driven the volume growth I referenced a moment ago.

Speaker #3: This is a market where our ability to deliver high-purity product reliability and to engineer solutions around each customer's specific technical requirements truly differentiates us.

Speaker #3: We continue to view aerospace as one of the most durable, long-term growth avenues in our portfolio. So far in 2026, we've provided LNG to three leading rocket launch customers and are in discussions to add a fourth later this year.

Casey Crenshaw: We continue to view aerospace as one of the most durable long-term growth avenues in our portfolio. So far in 2026, we have provided LNG to three leading rocket launch customers and are in discussions to add a fourth later this year. Stepping back, let me be direct about where our growth is coming from. Power generation for data centers and aerospace are the two end markets driving the business today. That is where demand is the strongest and where we are winning new business, and where we expect the majority of our growth over the next several years. Our asset-light model and flexible balance sheet allow us to scale into demand without overextending ourselves financially. Let me turn briefly to our Galveston LNG project.

Speaker #3: Stepping back, let me be direct about where our growth is coming from. Power generation for data centers and aerospace are the two end markets driving the business today.

Speaker #3: That is where demand is the strongest and where we are winning new business, and where we expect the majority of our growth over the next several years.

Speaker #3: Our asset-light model and flexible balance sheet allow us to scale into demand without overextending ourselves financially. Let me turn briefly to our Galveston LNG project.

Speaker #3: We believe our proposed Galveston project is the most shovel-ready, fastest-to-market, lowest capital-cost-per-gallon small-scale LNG bunkering project anywhere on the Gulf Coast.

Casey Crenshaw: We believe our proposed Galveston project is the most shovel-ready, fastest to market, lowest capital cost per gallon, small-scale LNG bunkering project anywhere on the Gulf Coast. As we discussed last quarter, the project's timeline has been extended, and I want to be candid, we are not yet in a position to provide a firm date for a final investment decision. The path forward depends on securing the right commercial offtake and financing structure, and that work remains ongoing. That said, we continue to make meaningful operational progress. In July, the US Coast Guard issued a letter of recommendation on the waterway suitability assessment covering our facility and its associated barge transit routes. This is a meaningful regulatory milestone that validates the safety and navigability of our proposed operations and strengthens our standing as the preferred LNG bunkering option in the Port of Galveston along the Gulf Coast.

Speaker #3: As we discussed last quarter, the project's timeline has been extended, and I want to be candid: we are not yet in a position to provide a firm date for a final investment decision.

Speaker #3: The path forward depends on securing the right commercial offtake and financing structure. And that work remains ongoing. That said, we continue to make meaningful operational progress.

Speaker #3: In July, the US Coast Guard issued a letter of recommendation on the waterway suitability assessment covering our facility and its associated barge transit routes.

Speaker #3: This is a meaningful regulatory milestone that validates the safety and navigability of our proposed operations and strengthens our standing as the preferred LNG bunkering option in the port of Galveston along the Gulf Coast.

Speaker #3: In parallel, we continue to engage prospective customers and financing partners as we work toward a final investment decision. Marine bunkering remains an important part of our long-term story.

Casey Crenshaw: In parallel, we continue to engage prospective customers and financing partners as we work toward a final investment decision. Marine bunkering remains an important part of our long-term story, particularly for servicing durable multi-year marine demand in the Port of Galveston and the broader Gulf Coast. At the same time, it is only one part of our much larger growth story, and I would not want its timeline to overshadow the momentum building elsewhere. Our existing platform is already delivering meaningful organic growth across power generation for data centers, aerospace, and other industrial business, and that is where the bulk of our near-term value creation is coming from. In summary, we view 2026 as a pivotal year, one in which the business troughed early, recovers through the second half, and sets the stage for what we expect to be a record 2027.

Speaker #3: Particularly for servicing durable multi-year marine demand in the port of Galveston and a broader Gulf Coast. At the same time, it is only one part of our much larger growth story, and I would not want its timeline to overshadow the momentum building elsewhere.

Speaker #3: Our existing platform is already delivering meaningful organic growth across power generation for data centers, aerospace, and other industrial business. And that is where the bulk of our near-term value creation is coming from.

Speaker #3: In summary, we view 2026 as a pivotal year one in which the business troughed early, recovered through the second half, and sets the stage for what we expect to be a record 2027.

Speaker #3: We are staying disciplined with our capital, focused on execution, and squarely committed to converting today's demand into durable, profitable growth for our shareholders. We look forward to keeping you updated in the quarters ahead.

Casey Crenshaw: We are staying disciplined with our capital, focused on execution, and squarely committed to converting today's demand into durable, profitable growth for our shareholders. We look forward to keeping you updated in the quarters ahead. With that, I'll turn the call over to Andy for a detailed review of our financial performance.

Speaker #3: With that, I'll turn the call over to Andy for a detailed review of our financial performance.

Speaker #2: Thank you, Casey. I'll begin with a discussion of our second-quarter performance, followed by an update on our balance sheet, cash flow, liquidity, and capital spending.

Andy Puhala: Thank you, Casey. I'll begin with a discussion of our Q2 performance, followed by an update on our balance sheet, cash flow, liquidity, and capital spending. Q2 revenue was $11.9 million, a decrease of approximately 31% compared to Q2 2025. As we mentioned in last quarter's call, the year-over-year decline was driven primarily by the completion of large marine and power generation contracts in Q4 2025. This was partially offset by continued growth in our aerospace market, where revenue increased 71% compared to Q2 2025, along with continued growth in our other industrial revenues. Adjusted EBITDA was $0.1 million in Q2, compared to $1.5 million in the prior year period. I would also note that our Adjusted EBITDA for Q2 excludes approximately $2.9 million of vessel charter costs incurred during the period.

Speaker #2: Second quarter revenue was 11.9 million, a decrease of approximately 31% compared to the second quarter of 2025. As we mentioned in last quarter's call, the year-over-year decline was driven primarily by the completion of large marine and power generation contracts in the fourth quarter of 2025.

Speaker #2: This was partially offset by continued growth in our aerospace market, where revenue increased 71% compared to the second quarter of 2025, along with continued growth in our other industrial revenues.

Speaker #2: The adjusted EBITDA was $0.1 million in the second quarter, compared to $1.5 million in the prior year period. I would also note that our adjusted EBITDA for the second quarter excludes approximately $2.9 million of vessel charter costs incurred during the period.

Speaker #2: These costs relate to the lease of an LNG bunkering vessel that we entered into in the fourth quarter of 2025 in anticipation of supporting the logistics requirements of our marine bunkering customer.

Andy Puhala: These costs relate to the lease of an LNG bunkering vessel that we entered into in Q4 2025 in anticipation of supporting the logistics requirements of a marine bunkering customer. This charter was terminated late in Q2, and we have excluded these costs from Adjusted EBITDA as an extraordinary item, as this cost is not reflective of the earnings of the underlying go-forward business. With the charter now terminated, we do not expect any further P&L impact from this vessel beyond what we've reported in Q2. Turning to cash flow and liquidity, cash flow from operations was $7.1 million for the quarter. This included $5 million of advanced payments for our behind-the-meter data center contract scheduled to begin in Q1 2027. These payments are restricted to support equipment purchases and other preparations for that project.

Speaker #2: This charter was terminated late in the second quarter, and we have excluded these costs from adjusted EBITDA as an extraordinary item as this cost is not reflective of the earnings of the underlying go-forward business.

Speaker #2: With the charter now terminated, we do not expect any further P&L impact from this vessel beyond what we've reported in the second quarter. Turning to cash flow and liquidity, cash flow from operations was 7.1 million dollars for the quarter.

Speaker #2: This included $5 million of advance payments for our behind-the-meter data center contract scheduled to begin in Q1 of '27. These payments are restricted to support equipment purchases and other preparations for that project.

Speaker #2: A quarter-end total liquidity was 18.9 million dollars, including unrestricted cash of 4.5 million, and 5 million of borrowing capacity under our revolving credit agreement.

Andy Puhala: At quarter end, total liquidity was $18.9 million, including unrestricted cash of $4.5 million and $5 million of borrowing capacity under our revolving credit agreement. Capital expenditures totaled $2.3 million during the quarter. These expenditures were primarily related to equipment and infrastructure purchases associated with the upcoming data center contract, as well as engineering and design work for the proposed Galveston LNG facility. Looking ahead, we expect to continue investing capital to secure equipment and guaranteed supply for our data center projects. We expect these investments to be funded through the advanced payments received from customers. Before we close, let me offer some context on the earnings profile that accompanies the 2027 revenue picture Casey described. We are not providing 2027 guidance today, but there are a few points we believe are useful as you think about the business at that scale.

Speaker #2: Capital expenditures totaled 2.3 million dollars during the quarter, these expenditures were primarily related to equipment and infrastructure purchases associated with the upcoming data center contract, as well as engineering and design work for the proposed Galveston LNG facility.

Speaker #2: Looking ahead, we expect to continue investing capital to secure equipment and guaranteed supply for our data center projects. We expect these investments to be funded through the advance payments received from customers.

Speaker #2: Before we close, let me offer some context on the earnings profile that accompanies the 2027 revenue picture Casey described. We're not providing 2027 guidance today, but there are a few points we believe are useful as you think about the business at that scale.

Speaker #2: First, our corporate infrastructure and fixed cost base are largely in place, and we do not expect them to grow proportionally with revenue as these contracts come online.

Andy Puhala: First, our corporate infrastructure and fixed cost base are largely in place, and we do not expect them to grow proportionally with revenue as these contracts come online. Second, our asset-light approach allows us to serve this growth largely with third-party LNG, which limits the incremental capital required to support it. Third, our contracts are designed to pass through commodity price risk. Taken together, we would expect a materially larger revenue base in 2027 to translate into meaningful growth in Adjusted EBITDA dollars and expansion in our Adjusted EBITDA margin to the high teens as project execution accelerates. That concludes our prepared remarks. Operator, please open the line for the Q&A session.

Speaker #2: Second, our asset light approach allows us to serve this growth largely with third-party LNG, which limits the incremental capital required to support it. Third, our contracts are designed to pass through commodity price risk.

Speaker #2: Taken together, we would expect a materially larger revenue base in 2027 to translate into meaningful growth in adjusted EBITDA dollars and expansion in our adjusted EBITDA margin to the high teens, as project execution accelerates.

Speaker #2: That concludes our prepared remarks. Operator, please open the line for the Q&A session.

Speaker #1: Thank you. The floor is now open for questions. At this time, if you have a question or comment, please press star one on your telephone keypad.

Operator: Thank you. The floor is now open for questions. At this time, if you have a question or comment, please press star one on your telephone keypad. If at any point your question is answered, you may remove yourself from the queue by pressing star two. Again, we ask you pick up your headset when posing a question to provide optimal sound quality. Thank you. Our first question is from Marty Malloy, Johnson Rice. Please go ahead. Your line is open.

Speaker #1: If at any point your question is answered, you may remove yourself from the queue by pressing star two. Again, we ask that you pick up your headset when posing a question to provide optimal sound quality.

Speaker #1: Thank you. Our first question is from Martin Malloy. Johnson Rice, please go ahead. Your line is open.

Speaker #3: Good morning and congratulations on another data center contract. My first question, I want to ask about the data center contracts. Could you maybe talk about the revenue and profitability profile and any differences between the contracts for different phases with the data center, whether it be commissioning, bridge, and then backup?

Marty Malloy: Good morning, and congratulations on another data center contract. My first question, I wanted to ask about the data center contracts. Could you maybe talk about the revenue and profitability profile and any differences between the contracts for different phases with a data center, whether it be commissioning, bridge, and then backup? I guess specifically on backup, how would a potential backup contract be structured? Would it be a reoccurring type revenue stream for making equipment and capacity available or any commentary you have there would be helpful.

Martin Malloy: Good morning, and congratulations on another data center contract. My first question, I wanted to ask about the data center contracts. Could you maybe talk about the revenue and profitability profile and any differences between the contracts for different phases with a data center, whether it be commissioning, bridge, and then backup? I guess specifically on backup, how would a potential backup contract be structured? Would it be a reoccurring type revenue stream for making equipment and capacity available or any commentary you have there would be helpful.

Speaker #3: And I guess, specifically on backup, how would that—how would a potential backup contract be structured? Would it be a recurring-type revenue stream for making equipment and capacity available? Or, any commentary you have there would be helpful.

Speaker #4: Yeah. Marty, thank you for joining today. Thank you for your call and your question. Let me start with the kind of way we view the data center projects.

Casey Crenshaw: Well, Marty, thank you for joining today. Thank you for your call and your question. Let me start with the kind of way we view the data center projects. We really see it as a construction as being one type of revenue profile, commissioning, bridge, and then the last would be that long-term backup that you asked details on. Right now, though we mentioned commissioning and bridge, we also have booked a construction project during the first part of Q3. Each of those three that we're actively working on, again, construction, commissioning, or bridge, have much different revenue profiles and duration of term associated with them. The construction projects often can be 24 months in duration. They are much lower in total volume of fuel and use a similar equipment that we would use on smaller behind-the-meter power applications.

Speaker #4: We really see it as a construction as being one type of revenue profile commissioning, bridge, and then the last would be that long-term backup that you asked details on.

Speaker #4: Right now, though, we mentioned commissioning and bridge, we also have booked a construction project during the first part of Q3. And each of those three that we're actively working on, again, construction, commissioning, or bridge, have much different revenue profiles and duration of term associated with them.

Speaker #4: The construction projects often can be 24 months in duration. They are much lower in total volume of fuel and use a similar equipment that we would use on smaller behind-the-meter power applications.

Speaker #4: Commissioning is normally 50 to 75 megawatts of power. It's normally a six-month kind of phase where they're commissioning the operations before they either get their pipe connection or their grid connection.

Casey Crenshaw: Commissioning is normally 50 to 75 megawatts of power, is normally a six-month kind of phase where they're commissioning the operations before they either get their pipe connection or their grid connection. So normally six months, but they may have different blocks after that they need commissioning on. Bridge power is really when they want to be first mover and in a market and could be anywhere from a year to four years or five years, depending on what their connecting are. The bridge power project we're working on is a two-year committed project. Long-term backup is where they would provide equipment and infrastructure and a supply contract to provide almost like a peaker plant where you would provide LNG on-site.

Speaker #4: So normally six months, but they may have different blocks after that they need commissioning on. And then bridge power is really when they want to be first mover and in a market and could be anywhere from a year to four years or five years depending on what they're connecting are.

Speaker #4: The bridge power project we're working on is a two-year committed project. Long-term backup is where they would provide equipment and infrastructure and a supply contract to provide almost like a peaker plant where you would provide LNG on-site if there was issues related to the pipeline outages or connection to the grid outages.

Casey Crenshaw: If there was issues related to pipeline outages or connection to the grid outages, it would turn on just like your diesel backup or something like that would be in a different application. So we do not have a long-term backup contract to date. We are having discussions around how to do that and how to work on that with different operators. But we do not have one yet to explain the exact economics of how that would work. The other three we are active on.

Speaker #4: It would turn on just like your diesel backup, or something like that, but would be in a different application. So, we do not have a long-term backup contract to date.

Speaker #4: We are having discussions around how to do that and how to work on that with different operators but we do not have one yet to explain exact economics of how that would work.

Speaker #4: The other three we are active on.

Speaker #3: Great. And for a follow-up question, just wanted to ask about the aerospace. Obviously, it's very strong growth there. And great to hear you're going to get a fourth customer.

Marty Malloy: Great. For a follow-up question, just wanted to ask about the aerospace. Obviously, some very strong growth there, and great to hear you're going to get a fourth customer. We haven't really seen any longer-term contracts in that area. Could you maybe talk about the opportunities, if there are any, to perhaps go after or sign some longer-term contracts with the activity picking up like it is?

Martin Malloy: Great. For a follow-up question, just wanted to ask about the aerospace. Obviously, some very strong growth there, and great to hear you're going to get a fourth customer. We haven't really seen any longer-term contracts in that area. Could you maybe talk about the opportunities, if there are any, to perhaps go after or sign some longer-term contracts with the activity picking up like it is?

Speaker #3: We haven't really seen any longer-term contracts in that area. Could you maybe talk about the opportunities, if there are any, to perhaps go after or sign some longer-term contracts with the activity picking up like it is?

Speaker #4: Yeah. It's a great question. And we're really excited about this end market. One of our larger customers kind of has a long-term strategy where they like to do all things themselves.

Casey Crenshaw: Yeah, it's a great question, and we're really excited about this end market. One of our larger customers has a long-term strategy where they like to do all things themselves. They've stated that. But the need and the demand is just a lot, and the duration to have their own capacity is years out. So we're real excited about all the clients. All the different rocket customers are at different stages of development. Some are much further behind the leader, but all of them are making great progress and all of them intend to use LNG. It's a great end market that we feel like we're a leader in. We're hopeful over the next year or so to get some more duration term and visibility. We've been working on it consistently trying to get it, trying to do fit-for-purpose facilities and infrastructure.

Speaker #4: They've stated that. And but the need and the demand is just a lot and the duration to have their own capacity is years out.

Speaker #4: So we're really excited about all the clients. All the different rocket customers are at different stages of development—some are much further behind the leader—but all of them are making great progress, and all of them intend to use LNG.

Speaker #4: So it's a great kind of end market that we feel like we're a leader in. And we're hopeful over the next year or so to get some more duration term and visibility.

Speaker #4: We've been working on it consistently trying to get it, trying to do fit for purpose facilities and infrastructure. We've been not able to get that yet.

Casey Crenshaw: We've been not able to get that yet, but have really close relationships with the clients and have visibility for the next 18 months of demand, but don't have a whole lot beyond 18 months.

Speaker #4: But we have really close relationships with the clients and have visibility for the next 18 months of demand, but don't have a whole lot beyond 18 months.

Speaker #2: Marty, this is Andy. Let me just add a little to what Casey said. I mean, we have a long-term relationships with multiple rocket launch companies as we mentioned.

Andy Puhala: Marty, this is Andy. Let me just add a little to what Casey said. We have long-term relationships with multiple rocket launch companies, as we mentioned. There's been a tendency for them not to commit to long-term fixed volumes historically, and that's probably had a lot to do with the fact that there's been ample supply in the small-scale domestic LNG market. But as these data centers come online and that existing supply tightens, we may be able to see some change in some of the behavior there to where they're willing to lock up some longer term, make some longer-term commitments to guarantee that they actually have access to that supply.

Speaker #2: There's been a tendency for them not to commit to long-term fixed volumes historically, and that's probably had a lot to do with the fact that there's been ample supply in the small-scale domestic LNG market.

Speaker #2: But as these data centers come online and that existing supply tightens, we may be able to see some change in some of the behavior there to where they're willing to lock up some longer-term make some longer-term commitments to guarantee that they actually have access to that supply.

Speaker #4: Yeah. And just to further add to that, not only has it been easy for them to for us to provide it, they've had inconsistent cadence in launches.

Casey Crenshaw: Yeah, and just to further add to that, not only has it been easy for us to provide it. They've had inconsistent cadence in launches. There's a lot of engineering happening. If you're watching the market around the space launch business, you have a lot of R&D still happening, so you don't have a consistent launch cadence by any of the space operators fully yet on the big LNG methane-using rockets. That is improving each month. We think over time, they'll be able to know what their launch cadence is going to be and want to be more thoughtful about how to lock in supply.

Speaker #4: There's a lot of engineering happening. If you're watching the space—sorry, the market around the space launch business—you have a lot of R&D still happening.

Speaker #4: So you don't have a consistent launch cadence by any of the space operators fully yet on the big LNG, methane-using rockets. That is improving each month.

Speaker #4: And so we think, over time, they'll be able to know what their launch cadence is going to be, and they'll want to be more thoughtful about how to lock in supply.

Speaker #3: Great. Very helpful. Thank you.

Marty Malloy: Great. Very helpful. Thank you.

Martin Malloy: Great. Very helpful. Thank you.

Speaker #1: Thank you for your question. Once again, if you do have a question, you may press star one on your telephone keypad at this time.

Operator: Thank you for your question. Once again, if you do have a question, you may press star one on your telephone keypad at this time. Our next question comes from Matt Dame, Titan Capital. Please go ahead. Your line is open.

Speaker #1: Our next question comes from Matt Dane Titan Capital. Please go ahead. Your line is open.

Speaker #3: Great. Thank you. I did want to ask the six-month LNG commissioning agreement for the data center customer. That's beginning here. Has that already begun here in the third quarter, or would you expect it to begin when would you expect that to begin?

Matt Dame: Great. Thank you. I did want to ask, the six-month LNG commissioning agreement for the data center customer that is beginning here, has that already begun here in the Q3, or when would you expect that to begin?

Matt Dhane: Great. Thank you. I did want to ask, the six-month LNG commissioning agreement for the data center customer that is beginning here, has that already begun here in the Q3, or when would you expect that to begin?

Casey Crenshaw: Yes, we have executed the contract, as we discussed, and the equipment is being readied and being deployed right now with anticipated liquids being delivered, I believe, next month. So that is our-

Speaker #4: Yeah. So we've executed the contract. As we discussed, and the equipment is being readied and being deployed right now with anticipated liquids being delivered, I believe, next month.

Speaker #4: So that's our—this month—sorry, August. So it's happening right now.

Andy Puhala: This month.

Casey Crenshaw: This month. Sorry, August. So it is happening right now.

Speaker #3: Okay. Perfect. Great. Good to know. And then the behind-the-meter data center contract that's going to be starting here next year, will you be receiving further cash in advance of that, or are those cash advances done at this point in time?

Matt Dame: Okay, perfect. Great. Good to know. Then the behind-the-meter data center contract that is going to be starting here next year, will you be receiving further cash in advance of that, or are those cash advances done at this point in time?

Matt Dhane: Okay, perfect. Great. Good to know. Then the behind-the-meter data center contract that is going to be starting here next year, will you be receiving further cash in advance of that, or are those cash advances done at this point in time?

Speaker #2: Yeah, Matt. This is Andy. Good morning. We had received 20 million of cash payments through the end of Q2, and we received an additional 5 million early in Q3, and that is the full amount under that contract.

Andy Puhala: Yeah, Matt, this is Andy. Good morning. We had received $20 million of cash payments through the end of Q2, and we received an additional $5 million early in Q3, and that is the full amount under that contract. So we will not be receiving any additional payments from today forward.

Speaker #2: So we won't be receiving any additional payments from today forward.

Speaker #3: Okay. Good. Good to know. And then finally, I did want to spend some time talking about the data center opportunity pipeline. I know that it was great to hear you lay out the bridge commissioning construction, the three different areas that they fall into.

Matt Dame: Okay, good. Good to know. Finally, I did want to spend some time talking about the data center opportunity pipeline. It was great to hear you lay out the bridge commissioning, construction, the three different areas that they fall into. I was curious, when you look at the pipeline as it exists today, where would you say a lot of those opportunities are falling? Just give us a little bit more color around the pipeline of opportunities that you're seeing, how significant it is, and whatever more color you can give us would be great.

Matt Dhane: Okay, good. Good to know. Finally, I did want to spend some time talking about the data center opportunity pipeline. It was great to hear you lay out the bridge commissioning, construction, the three different areas that they fall into. I was curious, when you look at the pipeline as it exists today, where would you say a lot of those opportunities are falling? Just give us a little bit more color around the pipeline of opportunities that you're seeing, how significant it is, and whatever more color you can give us would be great.

Speaker #3: I was curious, when you look at the pipeline as it exists today, where would you say a lot of those opportunities are falling? Yeah.

Speaker #3: Just give us a little bit more color around the pipeline of opportunities that you’re seeing—how significant it is, and, yeah, just whatever more color you can give us would be great.

Speaker #4: Well, let me start. I might have Andy come back in. So, I mean, we are super excited about all four of those areas that we've discussed.

Casey Crenshaw: Well, let me start, and I might have Andy come back in. We are super excited about all four of those areas that we've discussed. They're just different profiles and different intensity. We find the commissioning to be very interesting right now because a lot of people in the space need those facilities to get commissioned, and they've got a lot of stuff waiting on that to happen. We really like that area, and I really like the power side of it. Those two, the construction side and the commissioning. I say power, I meant power construction side and commissioning. That's the biggest area that we've had more recent touchpoints on a lot more jobs to work on. When you're talking about a bridge job, they're just really big.

Speaker #4: I mean, the and they're just different profiles and different intensity. We find the commissioning to be very interesting right now because a lot of people in the space need those facilities to get commissioned, and they've got a lot of stuff waiting on that to happen.

Speaker #4: We really like that area, and I really like the power side of it. Those two, the construction side and the commissioning. I say power.

Speaker #4: I meant power construction side and commissioning. That's the biggest area that we've had more recent touchpoints on a lot more jobs to work on.

Speaker #4: When you're talking about a bridge job, I mean, they're just really big. It's a lot of planning in place and the operator has to choose that they're going to pay a higher price in the very beginning for their site to be to be more of a first mover while they wait or they have some other reason where the connection point or the pipeline didn't make it, and they want to start sooner.

Casey Crenshaw: It's a lot of planning in place, and the operator has to choose that they're going to pay a higher price in the very beginning for their site to be more of a first mover while they wait, or they have some other reason where the connection point or the pipeline didn't make it and they want to start sooner. They're making a definite choice to pay a higher price than normally pipeline gas or the grid connection would be. That's more of a strategic decision for the clients. We believe the long-term backup is a real exciting space, and we don't believe the market has fully appreciated that. That's going to be something that we hear more and more about over the next 1 to 3 years, where people are starting to put in facilities and infrastructure to make that reliability consistent.

Speaker #4: They're making a definite choice to pay a higher price than normally pipeline gas or the grid connection would be. So that's more of a strategic decision for the clients.

Speaker #4: And then we believe the long-term backup is a real exciting space, and we don't believe the market is fully appreciated that. And that's going to be something that we hear more and more about over the next year to three years where people are starting to put in facilities and infrastructure to make that reliability consistent.

Speaker #4: I think a lot of people just assumed all over the place, it's easy to get electrical hookups with big needs, and it's easy to get pipelines put in.

Casey Crenshaw: I think a lot of people just assumed all over the place it's easy to get electrical hookups with big needs, and it's easy to get pipelines put in. The reality is this stuff just takes a lot of time. Our business is supporting them on just the sloppiness of time on that. Obviously, the construction commissioning bridge, long term, when we look out 5 and 10 years from now, we'll still be doing construction, we'll still be doing different commissioning projects, but the long-term backup could be a really big long-term business for us, where we put infrastructure in and support the clients around that. All of them are exciting. I'd say the biggest number of jobs are the construction and the commissioning. The biggest revenue opportunities in this commercial funnel are the bridge power opportunities.

Speaker #4: And the reality is this stuff just takes a lot of time. And our business is supporting them on just the sloppiness of time, on that.

Speaker #4: But obviously, the construction commissioning bridge long-term, when we look out 5 and 10 years from now, we'll still be doing construction. We'll still be doing different commissioning projects, but the long-term backup could be a really big long-term business for us where we put infrastructure in and support the clients around that.

Speaker #4: So all of them are exciting. I'd say the biggest number of jobs are the construction and the commissioning. The biggest revenue opportunities in this commercial funnel are the bridge power opportunities.

Speaker #3: Great, appreciate those insights, Casey. And when you talk about the long-term backup—and that could be a very substantial opportunity over time—just curious, do you currently do any of that?

Matt Dame: Great. Appreciate those insights, Casey. When you talk about the long-term backup, and that could be a very substantial opportunity with time, just curious, do you currently do any of that there? There's obviously a lot of data centers are already on the grid out there. Do you currently have any long-term backup of data centers that you do, or is this really a developing opportunity for you folks?

Matt Dhane: Great. Appreciate those insights, Casey. When you talk about the long-term backup, and that could be a very substantial opportunity with time, just curious, do you currently do any of that there? There's obviously a lot of data centers are already on the grid out there. Do you currently have any long-term backup of data centers that you do, or is this really a developing opportunity for you folks?

Speaker #3: There are obviously a lot of data centers that are already on the grid out there. Do you currently have any long-term backup solutions for data centers that you provide, or is this really a developing opportunity for you folks?

Speaker #4: It's a developing opportunity. Most data centers have their backup with diesel power generation today.

Casey Crenshaw: It's a developing opportunity. Most of the data centers have their backup with diesel power generation today.

Speaker #3: Do you see opportunities to oh, I'm sorry.

Matt Dame: Do you see opportunities to. Oh, I'm sorry.

Matt Dhane: Do you see opportunities to. Oh, I'm sorry.

Speaker #2: Yeah, Matt. Just to add to that, I mean, although we don't have any long-term backup for data centers today, that business is very similar to kind of the winter peaking business that we do in the Northeast, where we provide a lot of rental equipment during the winter months, and we're kind of on standby to provide LNG.

Andy Puhala: Yeah, Matt, just to add to that, although we don't have any long-term backup for data centers today, that business is very similar to kind of the winter peaking business that we do in the Northeast, where we provide a lot of rental equipment during the winter months, and we're kind of on standby to provide LNG. Although we've not done any of that for data centers yet, it's very similar to a business that we've done for many years for the utilities in the Northeast.

Speaker #2: So although we're not doing any of that for data centers yet, it's very similar to a business that we've done for many, many years for the utilities in the Northeast.

Speaker #4: Yeah. So, Northeast winter peaking and/or pipeline outages, projects, are the same as data center backup.

Casey Crenshaw: Yeah. Northeast winter peaking and/or pipeline outages projects are the same as data center backup.

Speaker #3: And going forward, since historically been a diesel generator is used for backup power, what is leading to the data centers converting or changing going forward to using LNG?

Matt Dame: Going forward, since it has historically been diesel generators used for backup power, what is leading to the data centers converting or changing going forward to using LNG? Does it seem to be a preference going forward? Do they seem to be agnostic? What is going to really facilitate that change to where LNG may be a more widely used and emphasized fuel going forward?

Matt Dhane: Going forward, since it has historically been diesel generators used for backup power, what is leading to the data centers converting or changing going forward to using LNG? Does it seem to be a preference going forward? Do they seem to be agnostic? What is going to really facilitate that change to where LNG may be a more widely used and emphasized fuel going forward?

Speaker #3: Does that seem to be a preference going forward? Do they seem to be agnostic? What's going to really facilitate that change to where LNG may be a more widely used and emphasized fuel?

Speaker #4: Well, a lot of the data center or hyperscalers are starting to use natural gas as either prime power or their secondary power to be able to toggle depending on grid connectivity and grid pricing.

Casey Crenshaw: A lot of the data center or hyperscalers are starting to use natural gas as either prime power or their secondary power to be able to toggle depending on grid connectivity and grid pricing. What has happened is the natural gas infrastructure to create the power is being loaded into the facilities. We are just providing the bridge fueling solution when that is an issue. In the past, most of the data centers were connected to the grid, and then they had some diesel backup. Now we are seeing them connected to the grid or primary is primary self-generated power off of natural gas. You are not going to be able to generate prime power with diesel. The cost is going to be probably too expensive for the hyperscaler. But they can do it behind-the-meter with natural gas and do it effectively and compete with grid power.

Speaker #4: So what's happened is the natural gas infrastructure to create the power is being loaded into the facilities. So we're just providing the bridge fueling solution when that's an issue.

Speaker #4: In the past, most of the data centers were connected to the grid, and then they had some diesel backup. Now we're seeing them connected to the grid or primary is primary self-generated power off of natural gas.

Speaker #4: So, you're not going to be able to generate prime power with diesel. The cost is probably going to be too expensive for the hyperscaler.

Speaker #4: But they can do it behind the meter with natural gas and do it effectively and compete with grid power.

Matt Dame: Okay, great. Appreciate the help, guys.

Matt Dhane: Okay, great. Appreciate the help, guys.

Speaker #3: Okay, great. Appreciate the help, guys.

Speaker #4: Thank you for the question.

Casey Crenshaw: Thank you for the question.

Speaker #1: Thank you. This concludes the Q&A portion of today's call. I would now like to turn the floor over to Andy Puhala for closing remarks.

Operator: Thank you. This concludes the Q&A portion of today's call. I would now like to turn the floor over to Andy Puhala for closing remarks.

Speaker #2: Well, thank you all for joining us today. And we appreciate the continued interest in Stabilis and look forward to keeping you updated as we progress through the quarters ahead.

Casey Crenshaw: Well, thank you all for joining us today. We appreciate the continued interest in Stabilis and look forward to keeping you updated as we progress through the quarters ahead. Thank you.

Andy Puhala: Well, thank you all for joining us today. We appreciate the continued interest in Stabilis and look forward to keeping you updated as we progress through the quarters ahead. Thank you.

Speaker #2: Thank you.

Speaker #1: Thank you. This concludes today's Stabilis Solutions, second quarter 2026 earnings conference call. Please disconnect your line at this time and have a wonderful day.

Operator: Thank you. This concludes today's Stabilis Solutions Q2 2026 earnings conference call. Please disconnect your line at this time, and have a wonderful day.