Release Date: December 19, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q: Can you discuss the recent restructuring and the growth expected in fiscal '25, including the new operating model and profitability profile? A: Jason Few, President and CEO, explained that the restructuring aims to shorten the path to profitability by narrowing the focus on core technologies and reducing costs by about 15% in 2025. This realignment is expected to enhance growth and leverage the sales pipeline, with a focus on turning opportunities into closed transactions, ultimately leading to positive EBITDA sooner than previously anticipated.
Q: Can you provide more detail on the opportunities for Tri-gen and the impact of 45V? A: Jason Few noted that there are expectations for updates on 45V, which could influence the adoption of clean hydrogen technologies. The Tri-gen platform, capable of producing low to zero carbon hydrogen, remains promising, especially with commitments from the transportation sector. The company anticipates that clearer regulations will open more opportunities for Tri-gen and hydrogen generation projects.
Q: What are your plans for manufacturing capacity, and is there a specific timeline for growth? A: Michael Bishop, CFO, stated that with the GGE order, the company plans to increase production rates from the current 25 megawatts. The Torrington facility has the capacity for up to 200 megawatts, which positions the company well for future large-scale orders, particularly in the data center sector, where demand is expected to grow.
Q: How should we think about the gross margin profile for 2025 across different segments? A: Michael Bishop explained that while product margins are currently negative due to overcapacity costs, the GGE deliveries are profitable. The restructuring and increased production volumes are expected to improve margins over time. Generation margins, when adjusted for depreciation and derivative impacts, are around 22% EBITDA, with efforts ongoing to optimize costs further.
Q: What was the rationale behind the recent $21 million capital raise, and how do you view liquidity going into 2025? A: Michael Bishop stated that the company feels comfortable with its current liquidity position. The capital raise was part of a strategy to maintain a strong cash position and support growth. The company will continue to monitor liquidity and pursue prudent financing opportunities as needed.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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