Alto Ingredients Inc (ALTO) 2023 Q2 法說會逐字稿

Good day, everyone, and welcome to the Alto Ingredients Second Quarter 2023 Financial Results Conference Call. (Operator Instructions) Please also note, today's event is being recorded.

大家好，歡迎參加 Alto Ingredients 2023 年第二季度財務業績電話會議。 （操作員說明）另請注意，今天的活動正在錄製中。

At this time, I'd like to turn the floor over to Kirsten Chapman with LHA Investor Relations. Ma'am, please go ahead.

現在，我想請 LHA 投資者關係部的 Kirsten Chapman 發言。女士，請繼續。

Thanks, Jamie, and thank you all for joining us today for Alto Ingredients Second Quarter 2023 Results Conference Call. On the call today with me are President and CEO, Bryon McGregor; Director and Interim COO, Mike Kandris; and CFO, Rob Olander.

謝謝杰米，也感謝大家今天參加我們的 Alto Ingredients 2023 年第二季度業績電話會議。今天與我一起參加電話會議的是總裁兼首席執行官布萊恩·麥格雷戈 (Bryon McGregor)；董事兼臨時首席運營官 Mike Kandris；首席財務官羅布·奧蘭德 (Rob Olander)。

Alto Ingredients issued a press release after the market closed today providing details of the company's financial results. The company has also prepared a presentation for today's call that is available on the company's website at altoingredients.com. A telephone replay of today's call will be available through August 14, the details of which are included in today's press release. A webcast replay will also be available at Alto Ingredients' website. Please note that the information on this call speaks of only as today, August 7. You're advised that time-sensitive information may no longer be accurate at the time of any replay.

Alto Ingredients 今天收盤後發布了一份新聞稿，提供了公司財務業績的詳細信息。該公司還為今天的電話會議準備了演示文稿，可在公司網站 altoingredients.com 上查看。今天的電話會議的電話重播將持續到 8 月 14 日，詳細信息包含在今天的新聞稿中。 Alto Ingredients 的網站也將提供網絡廣播重播。請注意，本次電話會議中的信息僅涉及今天（8 月 7 日）。請注意，時間敏感的信息在重播時可能不再準確。

Please refer to the company's safe harbor statement on Slide 2 of the presentation available online, which states that some of the comments in this presentation constitute forward-looking statements and considerations that involve a number of risks and uncertainties. The actual future results of Alto Ingredients could differ materially from those statements. Factors that could cause or contribute to such differences include, but are not limited to, events, risks and other factors previously and from time to time disclosed in Alto Ingredients' filings with the SEC. Except as required by applicable law, the company assumes no obligation to update any forward-looking statements.

請參閱在線演示文稿幻燈片 2 上該公司的安全港聲明，該聲明指出，本演示文稿中的一些評論構成前瞻性陳述和考慮因素，涉及許多風險和不確定性。 Alto Ingredients 未來的實際結果可能與這些聲明存在重大差異。可能導致或促成此類差異的因素包括但不限於 Alto Ingredients 之前向 SEC 提交的文件中不時披露的事件、風險和其他因素。除適用法律要求外，公司不承擔更新任何前瞻性陳述的義務。

In management's prepared remarks, non-GAAP measures will be referenced. Management uses these non-GAAP measures to monitor the financial performance of operations and believes these measures will assist investors in assessing the company's performance for the period being reported. The company defines adjusted EBITDA as unaudited net income or loss before interest expense, interest income, provision for income taxes, asset impairments, loss of extinguishment of debt, acquisition-related expense, fair value adjustments and depreciation and amortization expense. To support the company's review of non-GAAP information, a reconciling table was included in today's press release.

在管理層準備好的評論中，將引用非公認會計原則措施。管理層使用這些非公認會計準則衡量標準來監控運營的財務業績，並相信這些衡量標準將有助於投資者評估公司在報告期內的業績。該公司將調整後的EBITDA 定義為扣除利息費用、利息收入、所得稅準備金、資產減值、債務清償損失、收購相關費用、公允價值調整以及折舊和攤銷費用之前未經審計的淨收入或損失。為了支持公司對非公認會計準則信息的審查，今天的新聞稿中包含了一個調節表。

On today's call, Mike will start with an introduction; Bryon will provide a review of our strategic plan and activities; Rob will comment on our financial results; and then Bryon will wrap up and open the call for Q&A. It is now my pleasure to introduce Mike Kandris. Mike, please go ahead.

在今天的電話會議上，邁克將首先進行介紹；布萊恩將對我們的戰略計劃和活動進行審查；羅布將對我們的財務業績發表評論；然後布萊恩將結束並開始問答環節。現在我很高興向大家介紹邁克·坎德里斯。邁克，請繼續。

Thank you, Kirsten, and thank you, everyone, for joining us today. I'm pleased to announce, as issued in a press release this morning, that Bryon McGregor has been appointed President and CEO; and Rob Olander has been appointed CFO. I will continue on as a director and have agreed to support the company during the leadership transition for up to a year as the Interim Chief Operating Officer.

謝謝克爾斯滕，也謝謝大家今天加入我們。我很高興地宣布，正如今天早上發布的新聞稿中所發布的那樣，Bryon McGregor 已被任命為總裁兼首席執行官； Rob Olander 被任命為首席財務官。我將繼續擔任董事，並同意在領導層過渡期間以臨時首席運營官的身份為公司提供最多一年的支持。

We believe that succession planning is one of the most important things that we do, and we take it very seriously. To that end, Bryon and I have been working closely together for many years, and even more so the last 3 years, on our strategic plan to diversify revenue streams, optimize operations and expand EBITDA. Bryon is recognized for his strong leadership, strategic vision and outstanding management capabilities.

我們相信繼任計劃是我們所做的最重要的事情之一，我們非常重視它。為此，布萊恩和我多年來一直密切合作，在過去三年中更是如此，共同製定我們的戰略計劃，以實現收入來源多元化、優化運營和擴大 EBITDA。布萊恩因其強大的領導力、戰略眼光和出色的管理能力而受到認可。

Prior to Alto, Bryon developed and managed capital financing for over 40 global industrial and infrastructure projects valued in excess of $12 billion. Then as a critical player at Alto for over 15 years, he gained a deep understanding of our markets and business needs. The Board and I are confident he will lead the team to drive Alto Ingredients sustainable profitability. Congratulations, Bryon.

在加入 Alto 之前，Bryon 為 40 多個全球工業和基礎設施項目開發和管理資本融資，價值超過 120 億美元。隨後，作為 Alto 的關鍵人物超過 15 年，他對我們的市場和業務需求有了深入的了解。董事會和我相信他將領導團隊推動 Alto Ingredients 實現可持續盈利。恭喜，布萊恩。

Rob Olander, our new CFO, is an expert in public accounting, company accounting and process improvement. He has been a valuable player in developing and implementing our financial strategy. Rob will be a strong contributor as our new CFO. Congratulations, Rob.

我們的新任首席財務官 Rob Olander 是公共會計、公司會計和流程改進方面的專家。他在製定和實施我們的財務戰略方面發揮了重要作用。作為我們的新任首席財務官，羅布將做出強有力的貢獻。恭喜，羅布。

Now I will hand the call to our President and CEO, Bryon McGregor.

現在我將把電話轉給我們的總裁兼首席執行官布萊恩·麥格雷戈 (Bryon McGregor)。

Thank you, Mike. I look forward to working with you as we complete our leadership transition, advance our transformative projects and to your continued work as a member of the Board.

謝謝你，邁克。我期待與您合作，完成我們的領導層過渡，推進我們的變革項目，並期待您作為董事會成員繼續工作。

Turning to the quarter, I'm delighted to speak to everyone today and will keep my comments brief. Our key takeaway is that we are successfully executing our plan to transform Alto Ingredients and to achieve our long-term EBITDA targets. We're pleased by the market's continued improvements in Q2 2023, specifically the ethanol crush margins. Complemented by favorable economics from our specialty alcohol and essential ingredient products, we delivered a solid quarter, posting net income, positive adjusted EBITDA and positive operating cash flow. We continue to make significant capital expenditures to support our business transformation, diversify our revenue streams and reduce exposure to commodity markets.

談到本季度，我很高興今天與大家交談，並將簡短髮表評論。我們的主要收穫是，我們正在成功執行 Alto Ingredients 轉型計劃並實現我們的長期 EBITDA 目標。我們對 2023 年第二季度市場的持續改善感到高興，特別是乙醇壓榨利潤率。輔以我們的特種酒精和基本成分產品帶來的有利經濟效益，我們實現了穩健的季度業績，公佈了淨利潤、調整後的正 EBITDA 和正的運營現金流。我們繼續進行大量資本支出，以支持我們的業務轉型、實現收入來源多元化並減少對大宗商品市場的敞口。

With the ultimate goal of expanding margins and increasing profitability, in late 2019, we began modifying our operations, focusing on low-cost, high-value initiatives. Our efforts were fruitful. In 2020, when demand for pharmaceutical-grade alcohol rose sharply, as a long-standing producer of high-quality alcohols, we were prepared to serve the market. We did so successfully, increasing our market share as well as improving top and bottom line financial results. Since then, we have continued making significant progress on our strategy, strengthening our balance sheet and liquidity as well as accelerating investment in longer-term projects.

為了實現擴大利潤率和提高盈利能力的最終目標，我們於 2019 年底開始調整運營方式，重點關注低成本、高價值的舉措。我們的努力卓有成效。 2020年，當藥用級酒精需求大幅上升時，作為長期生產優質酒精的生產商，我們做好了服務市場的準備。我們成功地做到了這一點，增加了我們的市場份額，並改善了營收和利潤的財務業績。自那時以來，我們的戰略繼續取得重大進展，加強了我們的資產負債表和流動性，並加快了對長期項目的投資。

Our near-term focus has been to increase production of high-quality products, including grain neutral spirits, corn oil, and high protein as well as to execute strategies to improve plant efficiency and reliability by adding corn storage and other upgrades. Now we are preparing to install a natural gas pipeline, convert our biogas waste to renewable natural gas, produce primary yeast, expand our cogeneration capabilities and, most importantly, launch carbon capture and sequestration.

我們近期的重點是增加高質量產品的產量，包括穀物中性烈酒、玉米油和高蛋白，並執行通過增加玉米儲存和其他升級來提高工廠效率和可靠性的戰略。現在，我們正準備安裝天然氣管道，將沼氣廢物轉化為可再生天然氣，生產初級酵母，擴大我們的熱電聯產能力，最重要的是，啟動碳捕獲和封存。

Each of our projects has a different time line. To be capitally efficient, we are being prudent with our financing. For our near-term endeavors, we are using our working capital resources, cash generated from operations and excess availability under our credit facilities.

我們的每個項目都有不同的時間表。為了提高資本效率，我們對融資持謹慎態度。對於我們的近期努力，我們正在利用我們的營運資本資源、運營產生的現金以及我們信貸額度下的多餘可用資金。

For our longer-term projects, we continue to hold productive discussions with strategic partners, and we will fulfill those capital needs as appropriate. Working diligently on our capital initiatives, we have made progress on each of them. It's important to note, however, that we will have more information we can share publicly as our front-end engineering design or FEED studies are finalized, which we expect to complete in the next few quarters.

對於我們的長期項目，我們將繼續與戰略合作夥伴進行富有成效的討論，我們將酌情滿足這些資本需求。我們在資本計劃上努力工作，每一項都取得了進展。但值得注意的是，隨著我們的前端工程設計或 FEED 研究完成（我們預計將在未來幾個季度完成），我們將獲得更多可以公開分享的信息。

Now I'll provide updates on our capital projects. Regarding revenue-producing projects from near term to long term, first, in high-quality alcohol, we now produce the highest quality 192 proof and ultra-low moisture 200 proof grain neutral spirits on the market. As planned, we are garnering qualifications, positioning us to sell additional high-value GNS to new and existing beverage customers for the annual contracting period for 2024. In addition, we will continue to supply GNS, especially our unique and highly differentiated ultra-low moisture product, on a spot sale basis for the remainder of 2023.

現在我將提供我們的資本項目的最新情況。關於近期和長期的創收項目，首先，在高品質酒精方面，我們現在生產市場上最高品質的192度和超低水分200度穀物中性烈酒。按照計劃，我們正在獲得資格，使我們能夠在2024 年的年度合同期內向新老飲料客戶銷售額外的高價值GNS。此外，我們將繼續供應GNS，特別是我們獨特且高度差異化的超低GNS 。保濕產品，在 2023 年剩餘時間內以現貨形式銷售。

Regarding our expanded production of corn oil and high protein, we continue to align the system in Magic Valley and are working to obtain the dryer permits to achieve full capacity, which is integral to optimizing production of ethanol, corn oil, high protein and other feed products on a low-cost basis.

關於擴大玉米油和高蛋白生產，我們繼續調整魔谷的系統，並正在努力獲得乾燥機許可證以實現滿負荷生產，這對於優化乙醇、玉米油、高蛋白和其他飼料的生產至關重要產品以低成本為基礎。

To provide the needed time to optimize production and properly place our expanded protein and corn oil offerings at appropriate market prices, we now expect to achieve full value for these products in the fourth quarter of 2023.

為了提供所需的時間來優化生產並以適當的市場價格正確放置我們擴大的蛋白質和玉米油產品，我們現在預計將在 2023 年第四季度實現這些產品的全部價值。

Regarding an expansion into primary yeast production, design work is progressing well and on schedule. This said, inflationary pressures have impacted costs negatively, and we expect the cost of installation to be higher than originally anticipated. On the positive side, product prices for primary yeast have also risen. Assuming the returns remain justified, we will continue to target commencing construction in early 2024. We will know more as FEED work progresses.

關於初級酵母生產的擴展，設計工作進展順利且按計劃進行。也就是說，通貨膨脹壓力對成本產生了負面影響，我們預計安裝成本將高於最初的預期。從積極的一面來看，初級酵母的產品價格也有所上漲。假設回報仍然合理，我們將繼續以 2024 年初開始建設為目標。隨著 FEED 工作的進展，我們將了解更多信息。

Regarding carbon capture and sequestration, we have a unique and compelling opportunity. Our current Pekin campus operations yield approximately 700,000 metric tons of carbon a year, which we intend to monetize through carbon capture and sequestration. And as frequently discussed, our campus is ideally located above the Mount Simon Sandstone formation, one of the most significant carbon storage resources in the U.S. and is proximate to the Illinois Basin, one of the largest carbon sequestration locations.

關於碳捕獲和封存，我們擁有獨特且引人注目的機會。我們目前的北京園區運營每年產生約 700,000 噸碳，我們打算通過碳捕獲和封存來貨幣化。正如經常討論的那樣，我們的校園地理位置優越，位於西蒙山砂岩地層上方，這是美國最重要的碳儲存資源之一，並且靠近伊利諾伊州盆地，這是最大的碳封存地點之一。

As stated before, with increased 45Q tax incentives under the Inflation Reduction Act, we believe we can generate over $30 million annually in EBITDA. This is based solely on a conservative assumption of annual carbon production sold at $85 per metric ton. To be clear, this is after operating and sequestration costs and does not include any of the substantial economic benefits from 45Z or of the environmental attributes associated with low-carbon ethanol, including use in the production of ethanol-to-jet fuel, blue ethanol, synthetic natural gas and sustainable aviation fuel or SAF.

如前所述，隨著《通貨膨脹減少法案》規定的 45Q 稅收優惠力度的增加，我們相信我們每年可以產生超過 3000 萬美元的 EBITDA。這僅基於年碳產量售價為每噸 85 美元的保守假設。需要明確的是，這是扣除運營和封存成本後的結果，不包括 45Z 帶來的任何實質性經濟效益或與低碳乙醇相關的環境屬性，包括用於生產乙醇到噴氣燃料、藍色乙醇、合成天然氣和可持續航空燃料或SAF。

To further this initiative, we contracted the FEED study firm to determine capture, compression and engineering design. And we have selected our development partner to provide turnkey transportation, sequestration and monitoring services.

為了進一步推進這一舉措，我們與 FEED 研究公司簽訂了合同，以確定捕獲、壓縮和工程設計。我們選擇了開發合作夥伴來提供交鑰匙運輸、封存和監測服務。

Notably, the CCS project requires the upgrading of our natural gas pipeline and cogeneration projects, both of which have excellent project returns on a stand-alone basis. Our goal is to have CCS operational by the end of 2026. We believe this represents an aggressive but achievable schedule.

值得注意的是，CCS項目需要對我們的天然氣管道和熱電聯產項目進行升級，這兩個項目的單獨項目回報率都很高。我們的目標是在 2026 年底前讓 CCS 投入運行。我們相信這是一個雄心勃勃但可以實現的時間表。

While we are finalizing arrangements to fund the installation costs associated with the capture and compression, the nature of these activities requires discretion, limiting what we can discuss publicly at this time. As such, we do not expect to reveal our strategic partners until mid-2024.

雖然我們正在最終確定為與捕獲和壓縮相關的安裝成本提供資金的安排，但這些活動的性質需要謹慎對待，限制了我們目前可以公開討論的內容。因此，我們預計要到 2024 年中期才會透露我們的戰略合作夥伴。

Regarding cost savings projects from near to long term, first, our new corn storage at the Pekin Campus, as discussed on our last call, is fully operational and contributing to improved corn procurement costs, greater plant reliability and reduced plant operating costs.

關於近期和長期的成本節約項目，首先，正如我們在上次電話會議上討論的那樣，我們在北京園區的新玉米倉庫已全面投入運營，有助於改善玉米採購成本、提高工廠可靠性並降低工廠運營成本。

Regarding a new natural gas pipeline having completed the FEED study, we are finalizing easements and access as well as targeting commencement of construction before year-end. Our goal is to improve procurement, pricing and stability, which will lower our natural gas costs at the Pekin campus. It will also support our future energy needs for our capital projects. Additionally, the gas pipeline will create a new revenue stream, lower our operating costs and reduce environmental footprint by converting our biogas waste into renewable natural gas.

關於已完成 FEED 研究的新天然氣管道，我們正在最終確定地役權和通道，併計劃在年底前開始施工。我們的目標是改善採購、定價和穩定性，這將降低北京園區的天然氣成本。它還將支持我們資本項目未來的能源需求。此外，天然氣管道將通過將我們的沼氣廢物轉化為可再生天然氣，創造新的收入來源，降低我們的運營成本並減少環境足跡。

Regarding expanding our cogeneration capabilities at the Pekin Campus, we have completed the FEED study, furthered our design and prep work and initiated financing discussions. We expect these capabilities to also address energy needs for both our current operations as well as our capital projects.

關於擴大我們在北京園區的熱電聯產能力，我們已經完成了FEED研究，進一步推進了我們的設計和準備工作，並啟動了融資討論。我們預計這些能力也能滿足我們當前運營和資本項目的能源需求。

Before I turn the call over to Rob for our financial remarks, I'd like to reiterate that our business is focused on renewable products, which underscores our daily commitment to sustainability. As part of that pursuit, during Q2, we achieved EcoVadis Silver Medal status at both ICP and Pekin, indicating sustainability ratings in the 80th percentile amongst our peers. We're proud of our team's efforts and continue to build and bolster procedures and implement programs focused on our sustainability, health and safety. We plan to include greater details on this in our 2024 proxy statement.

在我將電話轉給 Rob 進行財務評論之前，我想重申一下，我們的業務專注於可再生產品，這強調了我們對可持續發展的日常承諾。作為這一追求的一部分，我們在第二季度在 ICP 和北京獲得了 EcoVadis 銀牌，這表明我們的可持續發展評級在同行中處於第 80 個百分點。我們為我們團隊的努力感到自豪，並將繼續建立和加強程序並實施專注於可持續發展、健康和安全的計劃。我們計劃在 2024 年股東委託聲明中包含更多相關細節。

Now I'll turn the call over to Rob, our new CFO.

現在我將把電話轉給我們的新任首席財務官 Rob。

Thanks, Bryon.

謝謝，布萊恩。

Our gross profit increased significantly from Q1 2023, and our production capacity utilization increased 81% from 70% in Q1 2023. Looking ahead, we expect production capacity to increase further for two reasons. First, when Magic Valley systems are aligned, we expect to achieve optimal capacity at that facility. Second, Washington state recently approved a new low carbon fuel standard that justifies the economics of shipping our Columbia ethanol production north, basically opening a new low carbon fuel market for the plant.

我們的毛利潤較 2023 年第一季度大幅增長，產能利用率從 2023 年第一季度的 70% 增長 81%。展望未來，我們預計產能將進一步增加，原因有二。首先，當 Magic Valley 系統協調一致時，我們期望在該設施中實現最佳容量。其次，華盛頓州最近批准了一項新的低碳燃料標準，該標准證明了將我們的哥倫比亞乙醇生產向北運輸的經濟性，基本上為該工廠開闢了一個新的低碳燃料市場。

For Q2 2023, we improved adjusted EBITDA to $16 million. Looking ahead, July's crush margins were strong, so we locked in some positive spreads for Q3. Taking this into consideration as well as current positive crush margins and a positive forward curve, we expect to generate positive adjusted EBITDA for Q3 2023.

2023 年第二季度，我們將調整後 EBITDA 提高至 1600 萬美元。展望未來，7 月份的壓榨利潤率很高，因此我們鎖定了第三季度的一些正利差。考慮到這一點以及當前的正壓榨利潤率和正遠期曲線，我們預計 2023 年第三季度將產生正的調整後 EBITDA。

During Q2 of 2023, we spent $8 million in CapEx, bringing investment year-to-date to $18 million. We also purchased 400,000 shares of our common stock for $1 million. Since beginning the share repurchase campaign last September, we have bought back 1.6 million shares for a total of $4 million at an average overall price of approximately $2.50 per share. Given Alto's significantly undervalued market price, we believe these repurchases are a beneficial return on investment and an effective use of capital resources.

2023 年第二季度，我們在資本支出上花費了 800 萬美元，使年初至今的投資達到 1800 萬美元。我們還以 100 萬美元購買了 400,000 股普通股。自去年 9 月開始股票回購活動以來，我們已回購 160 萬股股票，總金額為 400 萬美元，平均總價約為每股 2.50 美元。鑑於 Alto 的市場價格被嚴重低估，我們認為這些回購是有利的投資回報和資本資源的有效利用。

As of June 30, 2023, our cash balance was $23 million, and our total loan borrowing availability was up to $114 million to support business operations and growth initiatives. Borrowing availability includes $49 million under our operating line of credit, $40 million under our term loan facility and an option to request up to an additional $25 million on that facility.

截至 2023 年 6 月 30 日，我們的現金餘額為 2,300 萬美元，可用貸款總額高達 1.14 億美元，用於支持業務運營和增長計劃。可用借款包括我們的運營信貸額度下的 4,900 萬美元、我們的定期貸款安排下的 4,000 萬美元以及請求最多額外 2,500 萬美元的選項。

With that, I'll turn the call back to Bryon.

說完，我會把電話轉回給布萊恩。

Thanks, Rob.

謝謝，羅布。

Before I open the call to questions for our covering sell-side analysts, I'd like to reiterate, as shareholders ourselves, our team is dedicated to driving sustainable long-term value for all stakeholders, including customers, employees and investors.

在開始向我們的賣方分析師提問之前，我想重申，作為股東，我們的團隊致力於為所有利益相關者（包括客戶、員工和投資者）推動可持續的長期價值。

As part of that mission, management, together with our Board, continually pursue legitimate opportunities to maximize the value of our assets through capital investment and partnerships with strategic third-party industrial enterprises that share our vision. We believe this approach provides the best option to liberate the inherent value of the company.

作為這一使命的一部分，管理層與董事會一起不斷尋求合法機會，通過資本投資以及與具有共同願景的戰略性第三方工業企業建立夥伴關係，實現我們資產價值的最大化。我們相信這種方式提供了釋放公司內在價值的最佳選擇。

Where appropriate and as previously demonstrated, we've also chosen to sell noncore facilities, including Aurora, Madera and Stockton, and invest those proceeds in more productive and profitable alternatives. Our team is experienced and committed to leveraging our assets to deliver more diversified, higher value and sustainable revenue streams from our specialty alcohol and essential ingredients.

如前所述，在適當的情況下，我們還選擇出售非核心設施，包括奧羅拉、馬德拉和斯托克頓，並將這些收益投資於更俱生產力和利潤的替代方案。我們的團隊經驗豐富，致力於利用我們的資產從我們的特種酒精和基本成分中提供更多元化、更高價值和可持續的收入流。

Our strategic plan is coming to fruition as evidenced by our new high-quality products and benefits from our cost improvements. The aggregate sum of our parts carries far greater intrinsic value than the individual pieces, will be an even higher value when carbon capture and sequestration is deployed. As such, we continue to be excited about our capital projects, which we expect to increase our annual EBITDA incrementally by over $65 million by the end of 2025, with the completion of our near-term projects, and by approximately $125 million by the end of 2026 when our CCS, cogeneration and other long-term initiatives are fully realized.

我們的戰略計劃正在取得成果，新的高質量產品和成本改進帶來的好處證明了這一點。我們各個部分的總和比各個部分具有更大的內在價值，當部署碳捕獲和封存時，其價值甚至更高。因此，我們繼續對我們的資本項目感到興奮，隨著近期項目的完成，我們預計到 2025 年底，我們的年度 EBITDA 將增加超過 6500 萬美元，到年底將增加約 1.25 億美元到2026 年，我們的CCS、熱電聯產和其他長期舉措將得到全面實現。

Now I'd like to open this call for questions.

現在我想開始本次電話提問。

(Operator Instructions) Our first question today comes from Eric Stine from Craig-Hallum.

（操作員說明）今天我們的第一個問題來自 Craig-Hallum 的 Eric Stine。

So you just came off $16 million in adjusted EBITDA for Q2. And I know you're guiding to positive. But I mean, as it stands here today, just directionally, it would seem to me that you are expecting sequentially it to be directionally higher. And I know that ethanol markets can change very quickly. But given a positive crush in July, given some of the operational things that you've got coming on, is that a fair way to think about it? Or are there other factors that should drive our thoughts?

因此，第二季度調整後的 EBITDA 剛剛達到 1600 萬美元。我知道你正在引導積極的方向。但我的意思是，正如今天所站的那樣，就方向而言，在我看來，您預計它會依次走高。我知道乙醇市場變化得非常快。但考慮到 7 月份的積極勢頭，考慮到您即將進行的一些運營工作，這是一個公平的思考方式嗎？或者還有其他因素可以驅動我們的想法嗎？

It's a great question, Eric. I think -- well, from your mouth to God's ears, but I think that what I'd say as well is we're also coming into a harvest that, with corn prices rising -- basis rising, and there's still questions as to when the harvest will occur. That being said, we're seeing positive -- as Rob said, positive crush margins through the quarter and actually right now through year-end. But we would think it would be a disservice to comment on the fourth quarter to be sure. But again, we've been able to lock in some spreads. We're feeling good about the quarter and expect positive EBITDA margins for Q3.

這是一個很好的問題，埃里克。我認為——好吧，從你的嘴到上帝的耳朵，但我認為我還要說的是，隨著玉米價格的上漲，我們也即將進入收穫期——基差上升，但仍然存在一些問題當收穫發生時。話雖這麼說，我們看到了積極的一面——正如羅布所說，整個季度以及實際上從現在到年底，壓榨利潤率都是積極的。但我們認為，對第四季度的評論肯定會造成損害。但同樣，我們已經能夠鎖定一些利差。我們對本季度感覺良好，並預計第三季度 EBITDA 利潤率為正。

Okay. I'll just leave it there. Maybe just on carbon capture. So the $30 million, and I know that's definitely a longer-term plan, but just to be clear, that's $30 million if you're kind of going at it solo or if you get a high percentage of the economics. I mean just -- so maybe confirm that first.

好的。我就把它留在那裡。也許只是碳捕獲。因此，3000 萬美元，我知道這絕對是一個長期計劃，但需要明確的是，如果你想單獨行動或者獲得較高的經濟效益，那麼 3000 萬美元就是 3000 萬美元。我的意思是——所以也許先確認一下。

And then some of the early work you're doing, I mean should we take that as you're leaning towards more of a partnered approach? Or is it still something where you've kind of got all options on the table?

然後你正在做的一些早期工作，我的意思是，當你傾向於更多的合作方式時，我們是否應該採取這一點？或者說你仍然有所有選擇？

We're certainly going down the path -- we have not made a final selection, but the intent is to clearly bring to bear for the benefit of the company and the shareholders to optimize the value that's returned to the company, particularly since we're the one that's generating the CO2, right?

我們當然會走這條路——我們還沒有做出最終選擇，但目的是明確地為公司和股東的利益帶來好處，以優化公司回報的價值，特別是因為我們“是產生二氧化碳的那個，對嗎？

The $30 million that we talked about and as I mentioned in our prepared remarks is that -- that's really just the economics around the 45Q. It doesn't include 45Z and the benefits that are associated with that, nor the environmental attributes that are also -- are all available today. And part of that reason is that we think it would be premature to be sharing some of that information because those numbers are all over the place. But they are certainly contributory and beneficial to the bottom line, right, as you drop those in.

我們談到的 3000 萬美元，正如我在準備好的發言中提到的那樣，這實際上只是 45 季度左右的經濟情況。它不包括 45Z 以及與之相關的好處，也不包括環境屬性 - 今天都可用。部分原因是我們認為現在分享一些信息還為時過早，因為這些數字到處都是。但當你把它們放進去時，它們肯定對底線有貢獻和有益，對吧。

And whether we are taking that all in by ourselves or going at it alone or whether we're sharing that, we'll make sure that we optimize that so that we can make sure that we get execution and get the best execution available.

無論我們是自己承擔這一切，還是單獨進行，或者我們是否共享，我們都會確保對其進行優化，以便我們能夠確保我們獲得執行並獲得可用的最佳執行。

Okay. Got it. Maybe last one for me, just on high protein. I know the -- early on, and you did a lot of due diligence about it, but CoPromax, it was a newer technology. Just curious if you could talk about how that's played out -- again, I know it's still early at Magic Valley, but how that's played out versus your -- maybe your original expectations.

好的。知道了。也許對我來說是最後一種，只是高蛋白。我知道——很早就，你對此做了很多盡職調查，但 CoPromax，這是一項更新的技術。只是好奇你是否能談談這是如何實現的——再說一遍，我知道在魔谷還為時過早，但是這與你的——也許是你最初的期望相比，是如何實現的。

We had hoped to be able to accelerate through that, through the, if you will, start-up. Clearly, the implementation of the CoPromax technology is significant with regards to the profile of the facility. And so as you would have with any project where you were moving and changing a lot of parts that you need time to be able to line out all of the different assets and the operations of that facility.

我們曾希望能夠通過（如果你願意的話）初創公司加速實現這一目標。顯然，CoPromax 技術的實施對於設施的概況具有重要意義。因此，正如您在任何需要移動和更改許多部件的項目中一樣，您需要時間來列出該設施的所有不同資產和運營情況。

We've seen good results individually and all of these -- both in corn oil and in protein, on par with what you're hearing in the open market, but the real challenge is being able to do it on an ongoing sustainable basis and be able to do it at capacity for all -- for the full operation of the facility.

我們已經單獨看到了良好的結果，所有這些——無論是玉米油還是蛋白質，與你在公開市場上聽到的結果相當，但真正的挑戰是能夠在持續可持續的基礎上做到這一點，並且能夠為所有人提供能力——為了設施的全面運作。

So we're working hard at that. We're making good progress, but it's taken longer than we expected. And -- but we remain optimistic and we expect to be able to do that -- have that in full FFO capacity by -- on or before year-end or into Q4.

所以我們正在努力做到這一點。我們正在取得良好進展，但花費的時間比我們預期的要長。而且 - 但我們仍然樂觀，我們希望能夠做到這一點 - 在年底或之前或進入第四季度時充分發揮 FFO 能力。

And our next question comes from Sameer Joshi from H.C. Wainwright.

我們的下一個問題來自 H.C. 的 Sameer Joshi。溫賴特。

Bryon, congratulations, and Rob, too. And Mike, nice to see you moving towards retirement and trying to enjoy life.

布萊恩，恭喜你，還有羅布。邁克，很高興看到你走向退休並努力享受生活。

So my first question is just following up on the CCS, primary yeast and nat gas FEED studies. Do you have any estimate on this front-end engineering for each of these? Is it going to be completed within the next few months? Or how is it progressing?

所以我的第一個問題是跟進 CCS、初級酵母和天然氣飼料研究。您對每個項目的前端工程有什麼估計嗎？是否會在未來幾個月內完成？或者說進展如何？

Yes. So we expect to have -- first off, thanks, Sameer. I appreciate your comments. We expect to have the FEED study -- we have the FEED study done on the cogeneration, and now it's just about lining that out and getting bids for equipment and materials.

是的。所以我們希望——首先，謝謝 Sameer。我很欣賞你的評論。我們期望進行 FEED 研究——我們對熱電聯產進行了 FEED 研究，現在只是將其列出並獲得設備和材料的投標。

With regards to natural gas pipeline, we also had that FEED study done. We've actually obtained -- as we mentioned in the prepared remarks, we've obtained all of our easements. And at this point, it's just finishing up again on some of the bid work. And then we would expect to be able to start that facility before the end of the year.

對於天然氣管道，我們也完成了 FEED 研究。我們實際上已經獲得了——正如我們在準備好的評論中提到的，我們已經獲得了所有的地役權。此時，它剛剛完成一些投標工作。然後我們預計能夠在今年年底之前啟動該設施。

And those are, of course, important and integral to making the kinds of improvements that we would like to make at the facility so that we're building carbon sequestration on the -- on a good firm foundation. And so those we need to continue to progress and then we're working concurrently on the carbon sequestration and making good progress there as well.

當然，對於我們希望在設施中進行的各種改進來說，這些都是重要且不可或缺的，以便我們在良好堅實的基礎上建立碳封存。因此，我們需要繼續取得進展，然後我們同時致力於碳封存並在那裡取得良好進展。

Got it. On the specialty alcohols ongoing sales, how is the certification process going for the customers for the next buying cycle? Do you have any insight on that?

知道了。對於特種酒精的持續銷售，客戶下一個購買週期的認證流程進展如何？您對此有什麼見解嗎？

I think it's going actually pretty well. We're actually seeing some early interest in not only that product, but also just in the fourth -- and what would be otherwise the fourth quarter exercise. I think that's partially because we've seen corn prices come off materially from where they were earlier in Q2. So that's all positive, and we're getting good feedback. And again, we're really excited about the product. I would say, though, that it's -- especially in the general specialty market, it's a crowded space. And so we look forward to sharing with you more information as we move along here.

我認為實際上進展順利。實際上，我們不僅看到對該產品產生了一些早期興趣，而且只是在第四季度——以及第四季度的活動中也出現了一些興趣。我認為這部分是因為我們看到玉米價格較第二季度早些時候大幅下跌。所以這都是積極的，我們得到了很好的反饋。再說一次，我們對這個產品感到非常興奮。不過，我想說的是，尤其是在一般專業市場，這是一個擁擠的空間。因此，我們期待著與您分享更多信息。

Understood. And on the ethanol, as we understand the crush spreads are beneficial and expected at least in the near term. Is there any positive benefit from the E15 requirement? Have you already seen any increased demand as a result of that?

明白了。至於乙醇，據我們了解，壓榨價差是有利的，至少在短期內是預期的。 E15 要求有什麼積極的好處嗎？您是否已經看到由此帶來的需求增加？

I think it's hard to measure. But yes, I think that it's been contributory to the solid margins this year. We've seen gas demand up slightly, but I think it's still down from 2019 a bit. But yes, I think that it's all integral. I think that we've also seen generally some discipline in the market space with regards to just production values and production volumes, and that's also been helpful and contributory to that.

我認為很難衡量。但是，是的，我認為這對今年的穩健利潤做出了貢獻。我們看到天然氣需求略有上升，但我認為與 2019 年相比仍略有下降。但是，是的，我認為這都是不可或缺的。我認為我們還普遍看到市場空間中有關產值和產量的一些紀律，這也是有幫助和貢獻的。

Okay. And just last one. I know you have access to borrowing capacity of $110 million to $115 million. Do we know what is the cost of this capital? And is it tied to LIBOR or any other such parameter?

好的。就最後一張。我知道您的借款能力為 1.1 億至 1.15 億美元。我們知道這筆資金的成本是多少嗎？它是否與 LIBOR 或任何其他此類參數相關？

So it consists of -- yes, I think we do. I mean you have to figure out -- or we'd have to do the math, but I think as Rob laid out, you've got 3 sources: ongoing cash from operations and retained cash and earnings. But then on top of that, we have our borrowing base under our line of credit, which is really inexpensive. And I don't know what's -- Rob, something 5.5%, 6%.

所以它包括——是的，我認為我們是這樣做的。我的意思是你必須弄清楚——或者我們必須進行數學計算，但我認為正如羅布所闡述的那樣，你有 3 個來源：來自運營的持續現金以及留存現金和收益。但最重要的是，我們的信貸額度下有借貸基礎，這確實很便宜。我不知道是什麼——Rob，5.5%、6%。

Yes.

是的。

Right, it's -- so for us, whatever the small spread is, and that's all public. And then on top of that, we have the fixed rate at 10% from the Orion term loan.

是的，對我們來說，無論價差有多大，這都是公開的。除此之外，我們還從 Orion 定期貸款中獲得 10% 的固定利率。

Got it. Congrats on the progress and good luck to all of you.

知道了。祝賀你們取得的進展並祝大家好運。

And ladies and gentlemen, with that, we'll be ending today's question-and-answer session. I'd like to turn the floor over to management for any closing remarks.

女士們、先生們，我們今天的問答環節就到此結束。我想請管理層發表結束語。

Thank you, Jamie. Thank you all again for joining us today. We'll be in New York City at the H. C. Wainwright Conference in September 11 to 12. Have a great day.

謝謝你，傑米。再次感謝大家今天加入我們。我們將於 9 月 11 日至 12 日在紐約市參加 H.C. Wainwright 會議。祝您有美好的一天。

Ladies and gentlemen, with that, we'll conclude today's conference call and presentation. We thank you for joining. You may now disconnect your lines.

女士們先生們，我們今天的電話會議和演示就到此結束。我們感謝您的加入。您現在可以斷開線路。