Arq Inc (ARQ) 2025 Q3 法說會逐字稿

Good morning, ladies and gentlemen, and welcome to the Arq Third Quarter 2025 Earnings Conference Call. (Operator Instructions) This call is being recorded on Thursday, November 6, 2025.

各位女士、先生，早安，歡迎參加 Arq 2025 年第三季財報電話會議。（操作員指示）本次通話於2025年11月6日星期四錄音。

I will now turn the conference over to Anthony Nathan. Please go ahead.

現在我將把會議交給安東尼·內森。請繼續。

Thank you, operator. Good morning, everyone, and thank you for joining us today for our third quarter 2025 earnings results call. With me on the call today are Bob Rasmus, Arq's Chief Executive Officer; Jay Voncannon, Arq's Chief Financial Officer; and Stacia Hansen, Arq's Chief Accounting Officer. This conference call is being webcasted live within the Investors Section of our website, and a downloadable version of today's presentation is available there as well. A webcast replay will also be available on our site, and you can contact Arq's Investor Relations team at investors@arq.com.

謝謝接線生。各位早安，感謝各位今天參加我們2025年第三季財報電話會議。今天和我一起參加電話會議的有：Arq 的執行長 Bob Rasmus；Arq 的財務長 Jay Voncannon；以及 Arq 的首席會計長 Stacia Hansen。本次電話會議正在我們網站的投資者關係版塊進行網路直播，您也可以在那裡下載今天的簡報。本次網路直播的回放也將在我們的網站上提供，您也可以透過 investors@arq.com 聯絡 Arq 的投資者關係團隊。

Let me remind you that the presentation and remarks made today include forward-looking statements as defined in Section 21E of the Securities Exchange Act. These statements are based on information currently available to us and involve risks and uncertainties that could cause actual future results, performance and business prospects and opportunities to differ materially from those expressed in or implied by these statements.

我要提醒各位，今天所作的演講和發言包含《證券交易法》第 21E 條所定義的前瞻性陳述。這些聲明是基於我們目前掌握的信息，但存在風險和不確定性，可能導致實際的未來結果、業績和業務前景及機會與這些聲明中明示或暗示的內容存在重大差異。

These risks and uncertainties include, but are not limited to, those factors identified on Slide 2 of today's slide presentation, in our Form 10-K for the year ended December 31, 2024, and other filings with the Securities and Exchange Commission. Except as expressly required by the securities laws, the company undertakes no obligation to update these factors or any forward-looking statements to reflect future events, developments or changed circumstances or for any other reason. In addition, it is especially important to review the presentation and today's remarks in conjunction with the GAAP references in the financial statements.

這些風險和不確定性包括但不限於今天幻燈片演示第 2 頁中列出的因素、截至 2024 年 12 月 31 日止年度的 10-K 表格以及向美國證券交易委員會提交的其他文件中列出的因素。除證券法明確規定外，本公司不承擔因未來事件、發展或情況變化或其他任何原因而更新這些因素或任何前瞻性聲明的義務。此外，尤其重要的是要結合財務報表中的 GAAP 參考資料來審查本次簡報和今天的演講。

With that, I would like to turn the call over to Bob.

接下來，我想把電話交給鮑伯。

Thank you, Anthony, and thanks to everyone for joining us this morning. Our PAC business delivered yet another strong quarter. The continued and ongoing turnaround of our PAC operations yielded strong financial results, driven primarily by continued average selling price strength of 7% over the prior year as well as a further 43% reduction in SG&A expenses. We also made progress on the granular activated carbon front, achieving first commercial production, delivering initial product and generating our first GAC revenues. Third quarter financial performance was achieved despite operating GAC at well below capacity, which significantly reduced our financial results.

謝謝你，安東尼，也謝謝今天早上所有到場的各位。我們的PAC業務又迎來了一個強勁的季度。我們的 PAC 業務持續好轉，取得了強勁的財務業績，這主要得益於平均售價較上年持續上漲 7%，以及銷售、一般及行政費用進一步下降 43%。我們在顆粒活性碳方面也取得了進展，實現了首次商業化生產，交付了首批產品，並產生了我們的第一筆 GAC 收入。儘管廣汽集團第三季​​的營運產能遠低於負荷，導致財務表現大幅下滑，但我們仍實現了財務表現。

Our third quarter adjusted EBITDA of $5.2 million included the negative impact of several million dollars of inefficiencies caused by nonrecurring items associated with handling and post-commissioning costs for our granular activated carbon ramp as well as impacts due to inefficiencies driven by low early ramp volumes. We previously noted that early GAC production would carry elevated costs due to the high fixed expenses, meaning the first pounds produced would cost more than those made later. That proved true this quarter, but the impact of these dynamics was larger than expected. We expect profitability to improve as volumes ramp and production efficiencies are achieved. Turning back to our PAC business.

我們第三季調整後的 EBITDA 為 520 萬美元，其中包括數百萬美元的效率低下負面影響，這些影響是由於與顆粒活性碳爬坡相關的處理和調試後成本的非經常性項目造成的，以及由於早期爬坡量低而導致的效率低下的影響。我們之前提到過，由於固定成本高，早期 GAC 的生產成本會較高，這意味著最初生產的 GAC 比後來生產的 GAC 成本更高。本季的情況證實了這一點，但這些動態的影響比預期的要大。我們預計隨著產量提升和生產效率提高，獲利能力將會改善。回到我們的政治行動委員會（PAC）業務。

Third quarter prices increased by approximately 7% versus the prior year period and 6% versus last quarter, reinforcing that our foundational PAC platform is not only sustainably profitable, but also capable of fully funding maintenance capital needs for the broader business. Driven by continued price improvements, higher volumes in 2025, broader end market diversification and disciplined SG&A reductions, the company is generating $16.7 million of adjusted EBITDA on a trailing 12-month basis. This marks a significant achievement both in absolute terms and relative to our starting point at the end of September 2023 when trailing 12-month adjusted EBITDA was a negative $8.7 million at the outset of the turnaround. This is more than a $25 million improvement in trailing 12-month adjusted EBITDA. I'm proud of what the team has accomplished and even more encouraged by the upside that still lies ahead.

第三季價格較上年同期上漲約 7%，較上季上漲約 6%，這進一步證明，我們的基礎 PAC 平台不僅能夠持續獲利，而且還能夠完全滿足更廣泛業務的維護資本需求。由於價格持續改善、2025 年銷售成長、終端市場多元化以及嚴格的銷售、一般及行政費用削減，該公司在過去 12 個月中實現了 1,670 萬美元的調整後 EBITDA。無論從絕對值還是相對於我們 2023 年 9 月底的起點來看，這都是一項重大成就。當時，在扭虧為盈之初，過去 12 個月的調整後 EBITDA 為負 870 萬美元。這比過去 12 個月的調整後 EBITDA 提高了 2500 多萬美元。我為團隊的成就感到自豪，更讓我感到鼓舞的是，未來還有很大的發展空間。

Turning now to our strategic investment in granular activated carbon. The operational ramp-up has been impacted by previously discussed design issues while processing the Corbin feedstock at scale. As a result, based on recent operational observations, we now expect to reach full GAC capacity sometime around mid-2026. While this timing adjustment is disappointing, we believe that this revised target is achievable. With that said, let me address head on the logical question of what has caused this extension.

現在讓我們來看看我們在顆粒活性碳方面的策略性投資。在大規模加工 Corbin 原料時，由於先前討論過的設計問題，營運爬坡受到了影響。因此，根據最近的運行觀察，我們現在預計 GAC 將在 2026 年年中左右達到滿載運轉。雖然此次時間調整令人失望，但我們相信這項修訂目標是可以實現的。綜上所述，讓我直接回答導致此次延期的原因這個合乎邏輯的問題。

Our operation team is still working through certain design issues that have required refining and updating the process for handling the new Corbin waste-derived feedstock efficiently at scale. This feedstock differs from the traditional lignite coal that we have historically used to produce our PAC products. Specifically, the Corbin feedstock has some greater-than-anticipated variability, which due to design flaws and constraints has required adaptations to processing methodology. You might be wondering how this differs from the Red River commissioning challenges we faced earlier. To clarify, those earlier delays were about getting the plant up and running for the first time.

我們的營運團隊仍在努力解決一些設計問題，這些問題需要改進和更新流程，以便高效、大規模地處理新的 Corbin 廢料衍生原料。這種原料與我們歷史上用於生產 PAC 產品的傳統褐煤有所不同。具體來說，Corbin 原料的變異性比預期的要大，由於設計缺陷和限制，需要對加工方法進行調整。您可能想知道這與我們之前遇到的紅河調試挑戰有何不同。需要澄清的是，之前的那些延誤是為了讓工廠首次投入運作。

The current issues are about scaling, reaching full efficient production of tens of millions of pounds. The delay in achieving nameplate GAC capacity is extremely frustrating. As we previously noted, design issues and flaws have impacted our production capacity, which combined with the inherent variability of our Arq Wetcake has required additional process and methodology changes. While we've solved several issues, we're continuing to explore additional options to further enhance performance and reduce operating costs. One potential solution is to blend or replace Corbin feedstock with low moisture coal.

目前的問題在於規模化，即實現數千萬英鎊的高效生產。未能達到額定GAC容量令人極為沮喪。正如我們之前提到的，設計問題和缺陷影響了我們的生產能力，再加上我們的 Arq Wetcake 本身的變異性，需要進行額外的製程和方法變更。雖然我們已經解決了一些問題，但我們仍在繼續探索其他方案，以進一步提高效能並降低營運成本。一個可能的解決方案是將科爾賓原料與低水分煤混合或替代。

This should reduce feedstock variability as well as improve production rates and operating costs. We are working to resolve these challenges and are applying the same rigor and discipline utilized to successfully turn around the PAC business.

這將有助於降低原料波動性，並提高生產力和降低營運成本。我們正在努力解決這些挑戰，並運用與成功扭轉 PAC 業務時相同的嚴謹性和紀律性。

Importantly, despite the challenges noted, we successfully produced initial on-specification commercial granular activated carbon volumes in Q3 and completed our first sales into a supply-constrained market. As news of our production start-up spread, we received numerous inbound requests for spot purchases. These purchase requests were at pricing levels above our existing contract rates. This is further evidence of the supply constraint and favorable long-term market dynamics. While our strategy remains centered on long-term contracts, these spot inquiries are priced above our initial agreements and could offer attractive diversification opportunities alongside our contracted sales.

重要的是，儘管面臨上述挑戰，我們仍在第三季度成功生產了首批符合規格的商業顆粒活性炭，並在供應受限的市場中完成了首次銷售。隨著我們投產的消息傳開，我們收到了大量現貨採購請求。這些採購申請的價格都高於我們現有的合約價格。這進一步證明了供應受限和有利的長期市場動態。雖然我們的策略仍然以長期合約為中心，但這些現貨詢價的價格高於我們最初的協議價格，並且可能為我們已簽訂合約的銷售提供有吸引力的多元化機會。

In addition, we have extended numerous GAC contracts to account for the updated timelines. We're also seeing positive results from ongoing renewable natural gas field testing and remain confident in our ability to capture value in that market once testing concludes. At the same time, the broader GAC water market provides a reliable outlet, and we expect both markets to grow significantly in the years ahead. Our operational focus is now on rapidly increasing volumes to leverage our fixed cost base and achieve consistent granular activated carbon profitability. As we previously discussed, we are also evaluating adjacent revenue opportunities that could further improve overall returns. This includes determining whether our Corbin feedstock can be used in profitable alternative applications creating diversified end use cases for the feedstock to maximize shareholder value.

此外，我們還延長了許多 GAC 合同，以適應更新後的時間表。我們還從正在進行的可再生天然氣田測試中看到了積極的結果，並且仍然有信心在測試結束後，我們能夠在該市場中獲取價值。同時，廣汽水市場也為市場提供了一個可靠的出口管道，我們預計這兩個市場在未來幾年都將顯著成長。我們現在的營運重點是快速提高產量，以利用我們的固定成本基礎，並實現顆粒活性碳持續獲利。正如我們之前討論過的，我們也在評估可能進一步提高整體回報的鄰近收入機會。這包括確定我們的 Corbin 原料是否可用於有利可圖的替代應用，為原料創造多樣化的最終用途，從而最大限度地提高股東價值。

As such, I would like to provide an update on those efforts. We've previously indicated that there are four key product avenues of interest, including asphalt, purified coal, rare earth materials and synthetic graphite. Starting with asphalt, we're continuing our testing with a major asphalt company. Early indications show it could make asphalt last longer and perform better in cold weather. Second, purified coal. We have signed a nonbinding MOU to test using our material as a coal substitute for making silicon wafers used in semiconductors, with our partner covering all the initial cost if we elect to proceed.

因此，我想就這些工作向大家報告最新進展。我們先前已經指出，有四個主要產品方向值得關注，包括瀝青、精煉煤、稀土材料和合成石墨。我們先從瀝青入手，繼續與一家大型瀝青公司合作測試。初步跡象表明，它可以延長瀝青的使用壽命，並提高其在寒冷天氣下的性能。其次，是精煉煤。我們已簽署一份不具約束力的諒解備忘錄，以測試使用我們的材料作為煤炭替代品來製造半導體中使用的矽晶片，如果我們選擇繼續進行，我們的合作夥伴將承擔所有初始成本。

Next, rare earth minerals. With growing demand for U.S.-sourced materials, we're working with the DOE to explore potential government funding to help us test this at our Corbin facility with research starting in 2026. And finally, synthetic graphite. This potential product would benefit from the high purity of our Arq Wetcake, and we are currently pursuing government funding opportunities to evaluate its commercial potential. Importantly, these opportunities aren't mutually exclusive, meaning we could theoretically produce Arq Wetcake for asphalt blending while generating byproducts for rare earth markets from the same source material. Success with these alternative products could create a stand-alone business line in new markets by turning these products into revenue contributors and thereby further improving profitability and margins.

接下來是稀土礦物。隨著對美國本土材料的需求不斷增長，我們正在與美國能源部合作，探索政府資助的可能性，以幫助我們在科爾賓​​工廠進行測試，研究將於 2026 年開始。最後，還有合成石墨。這款潛在產品將受益於我們 Arq 濕餅的高純度，我們目前正在尋求政府資助機會來評估其商業潛力。重要的是，這些機會並非相互排斥，這意味著理論上我們可以利用同一種原料生產用於瀝青混合的 Arq Wetcake，同時為稀土市場生產副產品。這些替代產品的成功可能會在新市場中創造獨立的業務線，因為這些產品可以轉化為收入來源，從而進一步提高獲利能力和利潤率。

Looking ahead, fundamentals for granular activated carbon remain very strong. With Phase 2 already essentially permitted, we continue to carefully evaluate future GAC facility expansions. Specifically, FID timing is now anticipated to coincide with reaching GAC Phase 1 nameplate capacity around mid-2026. We believe that the experiences gained from Phase 1, along with the ongoing improvements will provide a strong foundation for any future granular activated carbon expansion projects.

展望未來，顆粒活性碳的基本面依然非常強勁。第二階段基本上已經獲得批准，我們將繼續認真評估未來GAC設施的擴建計畫。具體而言，預計最終投資決定 (FID) 的時間將與廣汽一期專案在 2026 年年中達到額定產能的時間相吻合。我們相信，從第一階段獲得的經驗，以及持續的改進，將為未來任何顆粒活性碳擴張計畫奠定堅實的基礎。

With that, I'll now turn it over to Jay for a detailed financial review.

接下來，我將把這項工作交給傑伊進行詳細的財務審查。

Thanks, Bob, and thanks, everyone, for joining us today. Notwithstanding the impact of the granular activated carbon ramp-up, Arq continued to deliver strong financial results during the third quarter. With revenue of $35.1 million, this continues to be driven largely by enhanced contract terms, including a 7% growth in average selling price year-on-year, in part the result of ongoing successful end market diversification.

謝謝鮑勃，也謝謝各位今天蒞臨。儘管顆粒活性碳產能提升帶來了一定影響，但Arq在第三季仍然取得了強勁的財務業績。公司營收達 3,510 萬美元，主要得益於合約條款的改善，包括平均售價年增 7%，部分原因是終端市場持續成功多元化發展。

Our gross margin in the quarter was 28.8%, well below our steady-state margin of recent quarters, primarily due to the negative impact of GAC fixed production costs as we ramped up volumes. We continue to incur post-commissioning costs associated with preproduction feedstock used in our granular activated carbon line. Additional negative impact to margin this quarter was related to low volumes versus higher fixed cost. We generated positive adjusted EBITDA of approximately $5.2 million compared to adjusted EBITDA of $9 million in the prior year period. I would note that the -- consistent with many market participants beginning in Q1 2025, we have added back stock-based compensation as a part of our adjusted EBITDA calculation and revised corresponding 2024 adjusted EBITDA calculations for comparability.

本季我們的毛利率為 28.8%，遠低於近幾季的穩定毛利率，這主要是由於隨著產量的增加，廣汽固定生產成本產生了負面影響。我們顆粒活性碳生產線使用的預生產原料相關的調試後成本仍在持續產生。本季利潤率受到的額外負面影響與銷售低迷而固定成本上升有關。我們實現了約 520 萬美元的正調整 EBITDA，而去年同期調整 EBITDA 為 900 萬美元。需要指出的是，與許多市場參與者從 2025 年第一季開始的做法一致，我們已將股票選擇權費用加回調整後的 EBITDA 計算中，並修訂了相應的 2024 年調整後 EBITDA 計算，以增加可比性。

As Bob noted, this quarter saw a significant anticipated ramp-up costs associated with GAC. As we continue to work to get the GAC line to run rate capacity with only approximately two months of commercial production in Q3, margins were materially impacted by the high fixed production costs related to granular activated carbon. While we do not intend to split our business lines in the future for competitive reasons, I think it is important to note today that we achieved an extremely strong quarter in regards to our PAC performance. As noted earlier, our third quarter adjusted EBITDA performance of $5.2 million included several million dollars of nonrecurring expenses associated with handling and post-commissioning costs for our GAC ramp as well as impacts due to inefficiencies driven by low early ramp volumes. Q3 is often a strong quarter for us, but this was an especially solid quarter for our PAC business, demonstrating not only the impact of our enhanced pricing, but also our cost reduction initiatives.

正如鮑勃指出的那樣，本季與 GAC 相關的預期啟動成本顯著增加。由於我們仍在努力使 GAC 生產線達到滿載產能，但第三季僅約有兩個月的商業生產，顆粒活性碳相關的高固定生產成本對利潤率產生了重大影響。雖然我們未來不打算出於競爭原因拆分業務線，但我認為今天有必要指出，我們在 PAC 業績方面取得了非常強勁的季度成績。如前所述，我們第三季調整後的 EBITDA 業績為 520 萬美元，其中包括與 GAC 爬坡作業相關的數百萬美元非經常性支出和調試後成本，以及由於早期爬坡量低而導致的效率低下的影響。第三季通常是我們業績強勁的季度，但本季我們的 PAC 業務表現尤為穩健，這不僅體現了我們提高價格的成效，也體現了我們降低成本的舉措。

We incurred a net loss of approximately $700,000 versus net income of $1.6 million in Q3 of 2024, primarily attributable to the high fixed production cost on initial volumes from our Phase 1 GAC line as we continue to ramp up to nameplate capacity. Selling, general and administrative expenses totaled $4.6 million, reflecting a reduction of approximately 43% versus the prior year period. This reduction was primarily driven by payroll and benefits as well as general and administrative expenses. Research and development costs for the third quarter increased to $2.6 million, up from approximately $800,000 in the prior year quarter.

2024 年第三季度，我們淨虧損約 70 萬美元，而淨利潤為 160 萬美元，這主要是由於我們第一階段 GAC 生產線初期產量的固定生產成本較高，因為我們仍在逐步提高產能至額定產能。銷售、一般及行政費用總計 460 萬美元，比去年同期減少了約 43%。此次削減主要源自於薪資福利以及一般和行政開支。第三季的研發費用增加至 260 萬美元，高於去年同期的約 80 萬美元。

This increase was primarily attributable to the ramp-up of the GAC line we discussed earlier. Overall, our performance in Q3 2025 demonstrates our ability to operate our PAC business efficiently such that it contributes very positively and sustainably to our economic position, while further enabling us to pursue and execute on anticipated high-growth and high-margin opportunities with our expanding GAC business.

這一增長主要歸因於我們之前討論過的GAC生產線的產能提升。總體而言，我們在 2025 年第三季度的業績表明，我們有能力高效運營 PAC 業務，從而對我們的經濟地位做出非常積極和可持續的貢獻，同時進一步使我們能夠利用不斷擴大的 GAC 業務，追求和執行預期中的高增長和高利潤機會。

As always, we remain focused on enhancing the profitability of our PAC business even further, and I believe that is how a business which can, on a medium-term basis, feasibly generate significantly greater than our previous target of simply covering maintenance CapEx. To discuss the impacts of the quarter on our balance sheet, let me turn it over to our Chief Accounting Officer, Stacia Hansen.

一如既往，我們將繼續專注於進一步提高 PAC 業務的盈利能力，我相信，只有這樣，我們的業務才能在中期內切實產生比之前僅能覆蓋維護資本支出目標更大的收益。為了討論本季對我們資產負債表的影響，我把麥克風交給我們的首席會計官史塔西亞·漢森。

Thanks, Jay. Turning to the balance sheet. We ended the third quarter with total cash of $15.5 million, of which approximately $7 million is unrestricted. This is compared to total cash of $22.2 million as of year-end 2024. This change was driven primarily by trailing CapEx spend at Red River relating to the GAC line and buildup of Arq Wetcake delivery and critical spare parts.

謝謝你，傑伊。接下來看一下資產負債表。第三季末，我們共有現金1,550萬美元，其中約700萬美元為非限制性現金。相較之下，截至 2024 年底，現金總額為 2,220 萬美元。這項變更主要是由於紅河工廠與 GAC 生產線相關的資本支出增加，以及 Arq Wetcake 的交付和關鍵備件的增加所致。

Today, we are also reiterating our full year 2025 CapEx forecast of between $8 million and $12 million. This is particularly relevant given Bob's comments about potential work at Red River, which we do not believe will add materially to our budgeted CapEx for the year as we continue to expect to fund our operating and CapEx needs via our existing cash, cash generation, debt facilities and ongoing cost reduction initiatives. With that, I will turn things back to Bob.

今天，我們再次重申我們對 2025 年全年資本支出的預測，即 800 萬美元至 1,200 萬美元。鑑於鮑伯對紅河潛在工作的評論，這一點尤其值得關注。我們認為，由於我們將繼續透過現有現金、現金產生、債務融資和持續的成本削減計劃來滿足營運和資本支出需求，因此這項工作不會實質地增加我們今年的預算資本支出。好了，接下來就交給鮑伯了。

Thanks, Jay and Stacia. Before we turn to questions, I'd like to leave you with four key takeaways. First, our PAC business continues to perform extremely well. As mentioned earlier, the $5.2 million of adjusted EBITDA we reported this quarter included the negative effect of several million dollars of nonrecurring items associated with activated carbon. This reflects the underlying strength of our foundational PAC business.

謝謝傑伊和斯塔西亞。在進入問答環節之前，我想和大家分享四個關鍵要點。首先，我們的 PAC 業務持續表現非常出色。如前所述，本季我們報告的 520 萬美元調整後 EBITDA 包含了與活性碳相關的數百萬美元非經常性項目的負面影響。這反映了我們基礎政治行動委員會業務的強大實力。

Our PAC turnaround has exceeded expectations. And while we view PAC's long-term growth potential as more limited than that of granular activated carbon or our potential emerging product lines, it's now clear that this foundational business delivers meaningful and sustained value. I remain confident there is still room to further improve our PAC business. My goal has always been for PAC profitability to fully cover maintenance CapEx across the business, and I now believe that it can do even more than that. As a major shareholder, I see this, combined with our substantial asset base, which has a replacement value well in excess of $500 million, is a strong foundation for the company's long-term valuation.

我們的政治行動委員會（PAC）的扭轉局面超出了預期。雖然我們認為 PAC 的長期成長潛力比顆粒活性碳或我們潛在的新興產品線要有限，但現在很明顯，這項基礎業務能夠帶來有意義且持續的價值。我仍然相信我們的政治行動委員會業務還有進一步改進的空間。我的目標一直是讓 PAC 的獲利能力完全涵蓋整個業務的維護資本支出，而我現在相信它甚至可以做得更多。作為主要股東，我認為這一點，再加上我們龐大的資產基礎（重置價值遠超過 5 億美元），為公司的長期估值奠定了堅實的基礎。

Second, while costs related to granular activated carbon ramp-up weighed on our financial results this quarter, it's important to recognize that we have now produced and sold commercial quantities of granular activated carbon from Red River, a major milestone for our company. My primary focus remains on driving profitability as we scale production. It is also important to highlight that we've overcome business challenges before. As I discussed earlier, we successfully transformed a loss-making PAC business to an attractive business generating attractive profit and cash flow. We are confident our best-in-class team will be able to work through the GAC production challenges. We will get this resolved.

其次，雖然與顆粒活性碳產能提升相關的成本在本季度對我們的財務業績造成了影響，但重要的是要認識到，我們現在已經從紅河生產並銷售了商業數量的顆粒活性炭，這對我們公司來說是一個重要的里程碑。隨著生產規模的擴大，我的首要任務仍然是提高獲利能力。值得強調的是，我們之前也克服過類似的業務挑戰。正如我之前討論過的，我們成功地將一家虧損的 PAC 業務轉型為一家能夠產生可觀利潤和現金流的有吸引力的業務。我們相信，我們一流的團隊能夠克服GAC生產過程中遇到的挑戰。我們會解決這個問題。

Third, granular activated carbon’s underlying market fundamentals remain exceptionally strong, which makes the delays in scaling production even more frustrating. The market opportunity is there for us to capture. And fourth, I believe our ongoing review of potential feedstock alternatives will ensure we are scaling this business as efficiently and profitably as possible. Separately, our assessment of potential alternative product opportunities creates additional diversification and upside for the long term.

第三，顆粒活性碳的基本面依然非常強勁，這使得擴大生產規模的延遲更加令人沮喪。市場機會就在那裡，等待我們去把握。第四，我相信我們對潛在原料替代品的持續審查將確保我們盡可能有效率、有利潤地擴大這項業務的規模。此外，我們對潛在替代產品機會的評估，為長期發展創造了額外的多元化和成長空間。

With that, I'll hand it back to our moderator to open for questions.

接下來，我將把發言權交還給主持人，由他來回答問題。

(Operator Instructions) And the first question comes from Gerry Sweeney at ROTH Capital.

（操作說明）第一個問題來自 ROTH Capital 的 Gerry Sweeney。

Bob, I'm just going to -- I don't know if you can answer this or would want to answer this. But what -- how much GAC are you producing at spec? And I think what people want to know or what I would like to know is where you are today versus what nameplate capacity is?

鮑勃，我只是想——我不知道你是否能回答這個問題，或者你是否願意回答這個問題。但是，你們按規格生產多少GAC？我認為人們想知道的，或者說我想知道的，是你們目前的實際情況與標稱產能之間的差距？

We're producing less than we want to. That's for sure. What we're producing is on spec as it relates to that. You're right that for competitive reasons, I'm not going to -- and for other reasons, I'm not going to give you the specific answers. But it's clear that the suboptimal production volumes are impacting our gross margin and our financial results.

我們的產量低於預期。那當然。就此而言，我們目前生產的產品都是以規格生產的。你說得對，出於競爭原因，我不會——而且出於其他原因，我也不會給你具體的答案。但很顯然，產量不足正在影響我們的毛利率和財務表現。

Can you produce GAC level that we'll just say, breakeven while you test alternatives? Or is this going to be a drag until we get the problem solved?

你們能否生產出我們姑且稱之為損益平衡點的 GAC 水平的產品，同時測試其他方案？還是說，在我們解決問題之前，這種情況會一直持續下去？

And so if you look at it, what is breakeven, we have an idea what that is on that. But as we start out -- any time you start out a new production process, there are going to be costs associated with the ramp-up. The costs have clearly been greater than we had anticipated, and we've had some greater difficulty in ramping up the production volume as it relates to that. And progress isn't linear. We believe that the best thing to do long term is to both evaluate blending of a feedstock, drier feedstock to overcome some of these design issues. That will help us get to profitability and commercial production even faster.

所以，如果你仔細觀察，你會發現損益平衡點是多少，我們對它有一個大致的了解。但是，當我們開始的時候——任何時候你開始一個新的生產流程，都會有與啟動相關的成本。成本顯然比我們預期的要高，因此我們在提高產量方面也遇到了更大的困難。而且進步並非線性發展。我們認為，從長遠來看，最好的方法是評估原料與較乾燥原料的混合，以克服這些設計問題。這將有助於我們更快地實現盈利和商業化生產。

Speaking of alternatives, I'm assuming that's a drier feedstock that would be met coal, which is traditionally used as GAC and would that have an impact on margins?

說到替代品，我假設那是一種更乾燥的原料，例如冶金煤，它傳統上用作顆粒活性碳（GAC），這會對利潤率產生影響嗎？

First of all, we're going to do what's in the best economic interest for our shareholders. And we're evaluating blending drier coal as really one way to help overcome the design issues that have been affecting our ability to deal with the variable feedstock. And while we're evaluating that because the logical question is, we're also evaluating whether it makes sense to switch to drier coal. Why would we switch to drier coal? Well, if one of the four ultimate uses for carbon feedstock develop, it would account for all of the Corbin capacity and then some.

首先，我們將做對股東最有利的事。我們正在評估摻入較乾燥的煤是否是克服影響我們處理可變原料能力的設計問題的一種方法。我們正在評估這個問題，因為合乎邏輯的問題是，我們也在評估改用更乾燥的煤炭是否有意義。我們為什麼要改用乾燥的煤炭？如果碳原料的四個最終用途之一得到發展，那麼它將佔用科爾賓公司的所有產能，甚至還有剩餘。

So, it behooves us to evaluate alternative feedstock to maintain full optionality. And keep in mind, from an economic standpoint as well, as you mentioned in your question, Gerry, that the Corbin feedstock is essentially 50% water. We're paying to ship 50% water that we then take out of the product as it relates to that. So, we believe it's a distinct possibility that blending drier coal with the feedstock could also have positive CapEx implications.

因此，我們有必要評估替代原料，以保持充分的選擇權。還要記住，從經濟角度來看，正如你在問題中提到的，Gerry，Corbin 原料基本上是 50% 的水。我們支付了 50% 的運費，然後從產品中去除這些水。因此，我們認為將較乾的煤與原料混合，很有可能也會對資本支出產生正面影響。

Got it. One more for me. Just want to understand the numbers, $5.2 million in EBITDA in the quarter, that does not include some of the extraneous costs that were incurred with this ramp-up, correct? So, in other words, that $5.2 million in EBITDA would have been higher by a couple of million dollars if these issues didn't arise, all things being equal, right?

知道了。我再來一個。我只是想了解一下這些數字，本季 EBITDA 為 520 萬美元，但這並不包括此次產能擴張過程中產生的一些額外成本，對嗎？換句話說，如果沒有這些問題，在其他條件相同的情況下，520萬美元的EBITDA將會高出數百萬美元，對嗎？

Yes. So, the $5.2 million includes the negative impact of several million dollars of costs associated with the GAC. Now again, what's several million dollars, it's more than a couple as it relates to that. I'm not going to be specific, but I can try and provide an analogy. If you look at the gross margin of the last four quarters prior to this, so third quarter of '24 to second quarter of '25, and you added back those several million dollars in costs, our gross margin would have been several percentage points above the average for those four quarters.

是的。因此，520萬美元包含了與GAC相關的數百萬美元成本所帶來的負面影響。再說一遍，幾百萬美元可不是幾塊錢就能解決的。我不打算具體說明，但我可以試著舉個例子。如果查看先前四個季度的毛利率，即 2024 年第三季度至 2025 年第二季度，並將這幾百萬美元的成本加回去，那麼我們的毛利率將比這四個季度的平均水平高出幾個百分點。

No. I mean, listen, 3Q -- ASPs were up year-over-year and coal plants aren't being shut down as fast. So, I mean there's demand for PAC out there. So, I mean, it would have been a very strong for the PAC business. I get it.

不。我的意思是，聽著，第三季——平均售價年增，燃煤電廠的關閉速度也沒有那麼快。所以，我的意思是，市場上對政治行動委員會（PAC）是有需求的。所以，我的意思是，這對政治行動委員會（PAC）的業務來說將會非常有利。我得到它。

The next question comes from George Gianarikas at Canaccord Genuity.

下一個問題來自 Canaccord Genuity 的 George Gianarikas。

I'd like to dig in some more on the Corbin feedstock. I'm just curious what -- can you go into a little bit more detail around what you mean about variability? And when did you figure out that this was an issue? And I'm assuming that there had been tests prior to starting production that indicated that this wouldn't. So just a little bit more detail as to exactly what you discovered and when?

我想更深入地研究一下柯爾賓的原料。我只是好奇——您能更詳細地解釋一下您所說的變異性是什麼意思嗎？你是什​​麼時候意識到這是一個問題的？我假設在開始生產之前已經進行過測試，結果表明不會發生這種情況。那麼，能否再詳細說說你​​究竟發現了什麼，以及是什麼時候發現的呢？

Sure. This is really a design flaw issue. We always knew as part of our due diligence that there would be variability in the feedstock from Corbin. Regarding the design issues, we worked through many of those design flaws in the original engineering to just be able to complete commissioning and achieve commercial production. But those design flaws and some of those design flaws and constraints still impact our production on the granular Line 1 are essentially that the original engineering firm really failed to account for the moisture content and variability in the feedstock in the design of some of the openings and chutes and some of the -- if you consider what you have extremely sharp angles, which led to inefficiencies and led to plugging and tarring on that.

當然。這確實是設計缺陷問題。作為盡職調查的一部分，我們一直都知道 Corbin 提供的原料會有波動性。關於設計問題，我們克服了原始工程中的許多設計缺陷，得以完成調試並實現商業化生產。但是，這些設計缺陷以及一些設計缺陷和限制仍然影響著我們在顆粒生產線 1 上的生產，本質上是因為最初的工程公司在設計一些開口和溜槽以及一些——如果你考慮一下，你會發現它們有非常尖銳的角度，這導致了效率低下，並導致了堵塞和焦油沉積。

So, we knew there was going to be variability, but that the design did not account for that.

所以，我們知道會有變數，但設計並沒有考慮到這一點。

Right. So, this sort of begs the question if it's a design issue as opposed to necessarily a feedstock issue because the feedstock is something that you knew about going in, wouldn't -- why are you exploring other alternatives to feedstock as opposed to just redesigning the facility?

正確的。所以，這就引出了一個問題：這究竟是設計問題還是原料問題？因為原料是你一開始就知道的，對吧？ ——為什麼你要探索其他原料替代方案，而不是重新設計工廠？

Redesigning the facility would cost more. We know that. And we think that -- one of the issues relates to, as I say, if you think of a 90-degree angle and you're trying to push product that has some moisture content or some sticky content through that 90-degree angle, it's going to catch on that -- the curbs and on the corners, et cetera. By blending it with drier coal and reducing that moisture content on the input, it makes it easier to make that it's less likely to stick for lack of a more technical term as it relates to going around those corners. So, it would be easier to blend that feedstock and cheaper than it would be to redesign and put in place the additional equipment.

重新設計該設施將花費更多。我們知道這一點。我們認為——其中一個問題在於，正如我所說，如果你想像一個 90 度角，然後試圖將含有一些水分或粘性物質的產品推過這個 90 度角，它就會粘在路沿石和拐角處等等。透過將其與較乾的煤混合，降低原料的水分含量，可以更容易地製造出更不容易粘鍋的煤（暫且用更專業的術語來說），尤其是在轉彎時。因此，混合這些原料會比重新設計和安裝額外的設備更容易、更便宜。

All right. And maybe just last question. In terms of -- I think it was asked previously as well. How do we think about the long-term margin implications of some of the changes you're making?

好的。或許這是最後一個問題了。關於——我想之前也有人問過這個問題。我們如何看待您正在進行的一些變革對長期利潤率的影響？

Yes. No, a couple of things. One, short term, there's clearly a negative impact from their ability or an inability to reach full run rate production on granular activated carbon. Long term, the granular activated carbon margins, we expect to be extremely strong for all the market fundamentals that I discussed in the prepared remarks and pricing continues to be even stronger than it was in terms of even a year ago as it relates to that. And if you look at one benefit of blending some drier coal, as I mentioned in my earlier question, is that we won't be shipping as much water that we're taking out of the system.

是的。不，有兩件事。一、短期來看，顆粒活性碳的生產能力或生產能力顯然會對其產生負面影響。從長遠來看，鑑於我在準備好的演講稿中討論的所有市場基本面，我們預計顆粒活性碳的利潤率將非常強勁，而且就此而言，其價格甚至比一年前還要強勁。正如我在先前的問題中提到的，混合一些較乾的煤的一個好處是，我們運出的水量將比從系統中抽取的水量要少。

So that in and of itself should lead to lower operating costs and improved margins.

因此，這本身就應該能降低營運成本，提高利潤率。

The next question comes from Aaron Spychalla at Craig-Hallum.

下一個問題來自 Craig-Hallum 公司的 Aaron Spychalla。

Maybe just one on GAC. I mean, can you just -- maybe at a high level, just what gives you confidence in hitting the mid-2026 targets? I mean, have you started to implement some of these design tweaks? Or are you seeing some benefit from the changes you're making on the feedstock side? It doesn't sound like there's a lot of cost you're expecting, but just again, trying to just understand the confidence in reaching these targets.

或許GAC上就有一個。我的意思是，您能否——或許從宏觀層面來說——是什麼讓您有信心實現 2026 年中期的目標？我的意思是，你們已經開始實施這些設計調整了嗎？或者，您在原料方面所做的改變是否帶來了一些好處？聽起來你預期的成本並不高，但我還是想了解你對實現這些目標的信心。

Yes. Sure. Great question, Aaron. And I'm going to apologize in advance because it's going to be -- either depending on your point of view, long-winded or you ask what time it is, I'm going to tell you how to make a watch. But I think it's important to provide that context.

是的。當然。問得好，亞倫。我先道個歉，因為接下來我要講的內容可能會——取決於你的看法——冗長乏味，或者如果你問我現在幾點了，我就會告訴你如何製作一隻手錶。但我認為提供這些背景資訊很重要。

As everybody knows, the design flaws led to the delays in commissioning the granular activated carbon facility earlier this year. And while we successfully addressed those issues to complete commissioning, the same design flaws as we've mentioned, have continued to affect our ongoing granular activated carbon production and the ramp-up to full capacity. And in answer to your question, I think it's important to provide context as to why and how we expect to achieve full run rate production around mid-2026. So going into that detail, and also this is some additional detail for George's question as well. The initial design and construction included a 320-foot off-gas line from the (inaudible).

眾所周知，由於設計缺陷，今年早些時候顆粒活性碳工廠的調試工作被推遲了。雖然我們成功解決了這些問題並完成了調試，但正如我們所提到的，同樣的設計缺陷仍然影響著我們正在進行的顆粒活性碳生產以及產能的全面提升。至於你的問題，我認為有必要說明我們為什麼以及如何預計在 2026 年年中左右實現全面投產。所以，接下來我會詳細解釋一下，這也是針對喬治的問題的一些補充細節。最初的設計和施工包括一條從…延伸至…的320英尺長的廢氣排放管道（聽不清楚）

The design was not only inefficient but unworkable. And part of the original commissioning delay stemmed from addressing design defects in the system that led to the cooling of the line and subsequent tar and plugging and particulate plugging really. So, in collaboration with a new engineering firm, we determined that installing a thermal oxidizer and shortening that off-gas line from 320 feet to 28 feet was the best solution. Locating a suitable unit, a suitable thermal oxidizer was difficult as really only one with the required specifications existed in the U.S. We have secured that on a rental basis.

該設計不僅效率低下，而且根本行不通。最初的調試延誤部分原因是由於系統設計缺陷導致管道冷卻，進而造成焦油堵塞和顆粒物堵塞。因此，我們與一家新的工程公司合作，確定安裝熱氧化器並將廢氣管道從 320 英尺縮短到 28 英尺是最佳解決方案。找到合適的設備，合適的熱氧化器，很困難，因為美國祇有一台符合要求規格的設備。我們已經租到這台設備了。

And once installed, it enabled us to have successful plant commissioning and to start commercial production. And after getting that thermal oxidizer successfully in place and beginning production, we determined that the current rental thermal oxidizer could really only support production of about 15 million pounds of granular activated carbon per year. As a result, in working with that new design firm, we now plan to purchase and install a purpose-built thermal oxidizer, which is designed to support 25 million pounds of granular activated carbon production a year. The lead time for construction and installation of this new purpose-built 25-million-pound capable thermal oxidizer is why we have moved our expectations of full run rate production to around mid-2026. That is when we expect to receive and install that purpose-built thermal oxidizer.

安裝完成後，它使我們能夠成功完成工廠調試並開始商業化生產。在成功安裝並開始生產熱氧化器之後，我們發現目前租賃的熱氧化器實際上每年只能支援約 1500 萬磅顆粒活性碳的生產。因此，在與這家新的設計公司合作後，我們現在計劃購買並安裝一台專用的熱氧化器，該氧化器設計用於支援每年 2500 萬磅的顆粒活性碳生產。由於建造和安裝這座新型專用 2500 萬磅級熱氧化器的工期較長，因此我們將全面投產的預期時間推遲到了 2026 年年中左右。屆時我們預計將收到並安裝那台專用的熱氧化器。

And once on site, installation will take about 6 days -- 1 day to cool the existing unit, 1 day for removal and 4 days for replacement and connections. The GAC production will have to pause for roughly 1 week during this process, but operations should quickly get to full run rate capacity once installation is complete because all we're changing then at that point is working through the full capacity of the -- having a thermal oxidizer, which allows us to get to 25 million pounds, and we're confident we'll be able to have solved the input issues prior to that time.

到達現場後，安裝大約需要 6 天時間——1 天冷卻現有設備，1 天拆除，4 天更換和連接。在此過程中，GAC 生產將不得不暫停大約 1 週，但一旦安裝完成，營運應該會很快恢復到滿載運轉能力，因為到那時我們所做的改變只是利用熱氧化器的全部產能，這使我們能夠達到 2500 萬磅的產量，而且我們有信心在此之前解決輸入問題。

Logical question is, what's it going to cost? The new thermal oxidizer will require an estimated total investment of $8 million to $10 million. That includes roughly $3 million for the equipment and the remainder is for installation. The vast majority of the spending will occur at the time of final shipment and installation. This will be funded as 2026 CapEx, and based on our conversations with current and potential lenders, along with our available cash and operating cash flow, we believe that this can be readily funded in a capital-efficient manner.

合乎邏輯的問題是，這要花多少錢？新的熱氧化器預計需要總共投資 800 萬至 1000 萬美元。其中約 300 萬美元用於購置設備，其餘部分用於安裝。絕大部分支出將在最終發貨和安裝時發生。這將作為 2026 年資本支出進行融資，根據我們與現有和潛在貸款人的溝通，以及我們可用的現金和營運現金流，我們相信可以以資本高效的方式輕鬆獲得​​資金。

And to minimize disruption, we plan to complete our biannual TAR during that same period, that way we avoid any additional planned downtime in '26 or '27. So, I apologize for being so long-winded, but I think it's important to show that -- the detail behind why we have changed our prognosis.

為了最大限度地減少干擾，我們計劃在同一時期完成每半年一次的 TAR，這樣我們就可以避免在 2026 年或 2027 年出現任何額外的計劃停機時間。所以，很抱歉我說了這麼多，但我認為有必要說明——我們改變預後的原因背後的細節。

No, I appreciate that color. That's helpful. And then you kind of talked to -- I mean, on the PAC business, if you back out a few million dollars, obviously, really good margin performance. It seems like the outlook still remains strong there. Can you just kind of talk about that and potential further diversification and kind of ASPs and just with the outlook on the PAC side?

不，我很喜歡這個顏色。那很有幫助。然後你和——我的意思是，關於政治行動委員會（PAC）業務，如果你扣除幾百萬美元，顯然，利潤率表現會非常好。那裡的前景似乎依然強勁。您能否談談這方面，以及潛在的進一步多元化、平均售價以及PAC方面的前景？

Sure. We had, again, another strong quarter of average selling price increase. We were up 7% year-over-year, 6% quarter-to-quarter. That pace has abated somewhat from our previous quarters of 9% or better double-digit -- or excuse me, average selling price increases. And it was natural.

當然。本季平均售價再次大幅上漲。我們年增了 7%，季增了 6%。這一增速已經比前幾季的 9% 或兩位數（或更準確地說，是平均售價）的成長速度有所放緩。這很自然。

We couldn't continue that cadence forever. We still expect to see continued improvement from the PAC business and the PAC-related results from a combination of increased volumes. We are still seeing increased average selling prices and also the additional fixed cost absorption related to additional volumes. As it relates to new markets, our sales force has done an outstanding job of looking to develop and penetrate additional markets. And those additional markets also have higher average selling prices than some of our additional outlets. So, we're optimistic about the future for PAC as our foundational business.

我們不可能永遠保持這種節奏。我們仍期待 PAC 業務和 PAC 相關業績能持續改善，這得益於銷售量的成長。我們仍然看到平均售價上漲，同時銷售增加也帶動了固定成本的增加。在開拓新市場方面，我們的銷售團隊在尋找和開發其他市場方面做得非常出色。而且，這些新增市場的平均售價也比我們的一些新增銷售點更高。因此，我們對PAC作為我們基礎業務的未來持樂觀態度。

The next question comes from Peter Gastreich at Water Tower Research.

下一個問題來自 Water Tower Research 的 Peter Gastreich。

Just a few, if I may. The first one is regarding the delay for the GAC, is there any risk or penalties that could be associated with the contracted customers for the delay?

如果可以的話，就說幾句吧。第一個問題是關於 GAC 的延誤，對於延誤，簽約客戶是否會面臨任何風險或處罰？

Our customers have been great with this. We work closely with all of our contracted customers to provide visibility on production outlet -- output, excuse me, as it relates to their needs. All of our customers have worked with us to amend their orders or ordering cadence and all of our GAC contracts that were one year or less have been extended. So, I think that's a testament both to the strength of our relationships and the undersupplied nature of the market. But everything is going as well as it should be.

我們的客戶對此評價很高。我們與所有簽約客戶緊密合作，讓他們了解生產出貨情況——抱歉，是產量情況，因為這取決於他們的需求。我們所有的客戶都與我們合作修改了他們的訂單或訂購節奏，所有一年或一年以下的 GAC 合約都已延期。所以，我認為這既證明了我們關係的牢固，也證明了市場的供不應求。但一切都進展順利。

Okay. Great. So, my second question, just following on from the previous question about the PAC prices. Yes, congratulations. It's great to see. Even though the momentum has slowed year-on-year, you're still able to raise, which is really commendable. I just wanted to ask though, is that -- for that 7% increase, are we talking purely about the PAC there? Or are we seeing any kind of a net measurable impact from the GAC spot volumes that you mentioned?

好的。偉大的。我的第二個問題，是接著上一個關於 PAC 價格的問題提出的。是的，恭喜。真是太好了。儘管成長勢頭逐年放緩，但你們仍然能夠籌集資金，這真的很值得稱讚。我只是想問一下，那7%的成長，我們說的只是政治行動委員會（PAC）的成長嗎？或者，我們是否看到了您提到的GAC現貨交易量的任何可衡量的淨影響？

So we didn't sell anything on the spot market. We're concentrated on meeting our customer contracted orders on that, which is the right thing to do from a relationship standpoint. So, all of the price increases that we referred to that 7% are coming from the PAC business.

所以我們沒在現貨市場上賣出任何東西。我們專注於履行與客戶簽訂的合約訂單，從客戶關係的角度來看，這是正確的做法。所以，我們提到的 7% 的價格上漲全部來自 PAC 業務。

Okay. Got it. Okay. And just a final question on the SG&A. So regarding the reduction in SG&A, how much of that can be sustained? And also for that, I understand that was allocated to cost of goods sold, why was that decision made?

好的。知道了。好的。最後一個關於銷售、管理及行政費用的問題。那麼，關於銷售、管理及行政費用的削減，有多少是可以持續的呢？另外，據我了解，這部分費用被計入了銷售成本，請問為什麼會做出這樣的決定？

Peter, this is Jay. Yes, the SG&A reductions are coming from prior year to this current year. And yes, those are definitely sustainable. We actually think that the -- we'll see as a percentage of revenue as the granular line comes up and starts coming up in '26, you'll start seeing SG&A as a percentage of revenue decline because we don't anticipate needing to increase the SG&A cost as we ramp up the GAC line. With regard to, I think, your second question there, which is on the reclassification into R&D, most of that -- we won't have that going forward.

彼得，這是傑伊。是的，銷售、管理及行政費用的減少是從前一年減少到本年度。是的，這些肯定是可持續的。我們實際上認為，隨著細化生產線在 2026 年的推出，我們將看到銷售、一般及行政費用佔收入的百分比開始下降，因為我們預計隨著 GAC 生產線的擴大，不需要增加銷售、一般及行政費用。關於你的第二個問題，也就是重新歸類為研發，我認為大部分情況──我們以後不會再有這種情況了。

We did that reclass also in Q2 as it relates to preproduction volumes as we were commissioning -- bringing the granular activated line to a commissioning point. So, most of that cost that was reclassed in Q3 was the July and really like one week of August cost for preproduction volumes. Once we commissioned the facility, all of that cost has been running through the cost of goods sold line. And that's why we're seeing an impact, the negative -- or the margin in Q3 was negatively impacted by those fixed costs being spread across fewer pounds as we are not up to really a breakeven point yet for granular.

在第二季度，我們也進行了重新分類，因為它與預生產量有關，因為我們當時正在調試——將顆粒活化生產線推向調試點。因此，第三季重新分類的大部分成本是 7 月的成本，實際上還有 8 月大約一週的預生產量成本。該設施投入使用後，所有相關成本都計入了銷售成本。這就是為什麼我們看到了負面影響——或者說，第三季度的利潤率受到了負面影響，因為固定成本被分攤到更少的英鎊上，而我們還沒有真正達到顆粒產品的盈虧平衡點。

The next question comes from Tim Moore at Clear Street.

下一個問題來自 Clear Street 的 Tim Moore。

I just want to follow up on an important thread. I mean it's great the GAC is going under way. That's a really important milestone. And you've got a lot of things to optimize before you add additional lines over the coming years. But I just want to really dig into one other thing.

我只是想跟進一個重要的主題。我的意思是，GAC專案能夠順利進行真是太好了。這是一個非常重要的里程碑。在未來幾年增加更多線路之前，您有很多方面需要優化。但我還想深入研究另一件事。

I get the SG&A reconciliation and Jay just went through that. But how should we think about really gross margin in the next two quarters until you get enough utilization underway on GAC? I was kind of under the impression that the really big drag was the June quarter and it won't be as bad in September, but you can expect a big step up? I mean, there should be a step-up in the December quarter for gross margin, right?

我收到了銷售、一般及行政費用結算單，Jay 剛剛也處理過。但是，在 GAC 達到足夠的利用率之前，我們應該如何看待未來兩季的真正毛利率呢？我以為真正拖累業績的是六月的季度，九月的情況不會那麼糟糕，但預計會有大幅好轉？我的意思是，12 月的毛利率應該會有所提升，對吧？

I mean what I would say is as we're producing volumes at this suboptimal point level, there's a lot of fixed cost at the plant that's getting -- as I said, getting spread across fewer volumes, which are dragging the gross margin. I would -- what I would say is that it's not the fixed cost is going to go up. So, the fixed cost is pretty stable. So, what we'll continue to see is probably in Q4 and in Q1 of next year, margins similar to what we produced in Q3. And it's until we're able to get the volume up and actually have more pounds to sell and spreading those costs across that greater pounds, then we'll see the margin improve.

我的意思是，由於我們目前的產量水平低於最佳水平，工廠的固定成本很高——正如我所說，這些成本被分攤到較少的產量上，從而拉低了毛利率。我想說的是，不是固定成本會漲。因此，固定成本相當穩定。因此，我們可能會在第四季和明年第一季繼續看到與第三季類似的利潤率。只有當我們能夠提高銷量，真正有更多的英鎊可以出售，並將這些成本分攤到更多的英鎊上時，我們才能看到利潤率得到改善。

So, I would expect probably for the next two quarters and probably even some even into Q3 when we -- once we get the new oxidizer installed -- I mean Q2 of next year, get the new oxidizer installed that we'll probably see a fairly consistent gross margin. Now we're also expecting -- hopefully, we'll see a continued improvement in PAC as we have demonstrated over the last 12 months. And so that may offset some of that as we continue to grow and improve PAC performance going into next year as well.

因此，我預計在接下來的兩個季度，甚至可能到第三季度（一旦我們安裝新的氧化器——我的意思是明年第二季度，安裝好新的氧化器），我們可能會看到相當穩定的毛利率。現在我們也期待——希望——PAC能夠像過去12個月所展現的那樣繼續改善。因此，隨著我們明年 PAC 業績的持續成長和提升，這或許能夠抵銷部分影響。

That's really helpful color on the cadence of -- and the other question I had was -- I understand right now with GAC revenue not that much, it will be pretty sizable by the June quarter. And for competitive reasons, you might not want to disclose it. Cal Carbon is owned by another firm. It's a small sliver of their conglomerate. Do you think though at some point, I mean, given that it's 25 million pounds, we had another more lines that you think you would break out maybe a year or two from now or GAC revenue, just to have the difference and especially when maybe it starts cannibalizing PAC a little bit on the feedstock later on?

這對節奏的把握真的很有幫助——我的另一個問題是——我知道目前GAC的收入還不多，但到6月份的季度將會相當可觀。出於競爭原因，你可能不想透露這些資訊。加州碳素公司隸屬於另一家公司。這只是他們龐大集團的一小部分。不過，你認為在某個時候，我的意思是，考慮到金額高達 2500 萬英鎊，我們是否還有更多產品線，你認為你或許會在一兩年內將其拆分出來，或者從 GAC 的收入中分離出來，只是為了彌補差額，尤其是在它以後可能會在原料方面蠶食 PAC 的情況下？

A couple of things on that. I think that, one, given the long-term favorable market dynamics, I think it's highly probable that we will build a line two and further increase capacity. You mentioned competitive reasons. I'll refer to it more as competitive tension. There's always competitive tension between the IR side of things and the sales side of things as to what we break out.

關於這一點，有幾點需要說明。我認為，第一，鑑於長期有利​​的市場動態，我們極有可能建造第二條生產線，進一步提高產能。你提到了競爭方面的原因。我更願意稱之為競爭緊張關係。在投資人關係部門和銷售部門之間，對於我們應該推出哪些產品，總是存在著競爭關係。

As you know, I'm a big believer in providing detail, an informed investor is a good investor and is a long-term investor. The flip side of that is that we are the only public company. So, we're handing competitive information to our competitors on a platinum platter on that. And so, the long-winded answer is maybe.

如你所知，我非常相信提供細節的重要性，一個消息靈通的投資者才是好的投資者，也是長期投資者。但另一方面，我們是唯一一家上市公司。所以，我們這是在白送競爭對手重要的競爭訊息。所以，冗長的答案是：也許是吧。

What I would say also add to Bob's comments is once we get to the 25 million nameplate and then we add another line 2, and we're then at $50 million of capacity. I mean, we're probably -- we're at about 100 million pounds capacity on the PAC. There, you'll be able to -- again to see, you can do correlations and kind of -- it wouldn't take -- wouldn't be very difficult to back into what the ultimate margin is between the two. So that will -- and as we continue to grow and we start seeing PAC get cannibalized, as you mentioned, yes, there probably will become a point where we'll be -- the bulk of our discussion in the MD&A and the Q will be around the granular business and the PAC will be just kind of a base level that we know and talk.

我還要補充鮑伯的評論，一旦我們達到 2,500 萬美元的額定產能，然後我們再增加一條 2 號生產線，那麼我們的產能就將達到 5,000 萬美元。我的意思是，我們PAC的產能可能已經達到1億磅左右了。在那裡，你將能夠——再次看到，你可以進行相關性分析，而且——不會花費——不會很難反推出兩者之間的最終差距。所以，隨著我們不斷發展壯大，正如你所提到的，PAC 開始被蠶食，是的，可能會出現這樣的情況：我們在 MD&A 和 Q 中的大部分討論將圍繞細粒度的業務展開，而 PAC 將只是我們了解和討論的基本層面。

No, that's fine because I'll be off the back into the GAC revenue pretty closely when you lap a full year, just if you keep announcing average price increase when you start year-over-year on the GAC.

不，沒關係，因為如果你繼續在年末公佈 GAC 的平均價格上漲，那麼當你滿一年的時候，我很快就能從 GAC 的收入中分一杯羹了。

We have no further questions. I will turn the call back over to Bob Rasmus for closing comments.

我們沒有其他問題了。我將把電話轉回給鮑伯·拉斯穆斯，請他做總結發言。

Thank you very much. Both short term and long term, the outlook for the powdered activated carbon business is strong. We also continue to expect even better performance from the PAC side, and this is a dramatic improvement from two years ago when the PAC business was a significant money loser. Short term there clearly remains some challenges to getting the granular activated carbon business up to full run rate. We're applying the same rigor, discipline, focus and resolve we successfully applied to the PAC business to solving these challenges.

非常感謝。無論從短期或長期來看，粉狀活性碳產業的前景都很強勁。我們也持續期待 PAC 業務能有更好的表現，這與兩年前 PAC 業務嚴重虧損的情況相比，已經有了顯著的改善。短期來看，要讓顆粒活性碳業務達到滿載運轉，顯然仍存在一些挑戰。我們將運用在 PAC 業務中取得成功的同樣嚴謹、自律、專注和決心來解決這些挑戰。

The long-term market dynamics for granular activated carbon remain extremely strong. And as a reminder, I'm fully aligned with shareholders with my minimum salary and my large stock ownership. I want this fixed as badly, if not more so than you all do, and we will get this resolved. So, thank you all for your interest, and we look forward to continued communication.

顆粒活性碳的長期市場動態依然非常強勁。再次提醒大家，我的最低工資和大量持股讓我與股東的利益完全一致。我比你們更迫切地希望這個問題得到解決，我們一定會解決這個問題。感謝大家的關注，我們期待與大家繼續保持溝通。

Ladies and gentlemen, this concludes your conference call for today. We thank you for participating, and we ask that you please disconnect your lines.

女士們、先生們，今天的電話會議到此結束。感謝您的參與，請您斷開線路。