普拉格能源 (PLUG) 2020 Q3 法說會逐字稿

Hello, and welcome to the Plug Power Third Quarter 2020 Earnings Conference Call.

(Operator Instructions) As a reminder, this conference is being recorded.

It's now my pleasure to turn the call over to Teal Hoyos.

Teal, please begin.

Thank you.

Welcome to the Plug Power 2020 Third Quarter Earnings Call.

This call will include forward-looking statements.

We intend these forward-looking statements to be covered by the safe harbor provision for forward-looking statements contained in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.

We believe that it is important to communicate our future expectations to investors.

However, investors are cautioned not to unduly rely on forward-looking statements because they involve risks and uncertainties and actual results may differ materially from those discussed as a result of various factors, including, but not limited to, risks and uncertainties discussed under Item 1a Risk Factors in our annual report on Form 10-K for the fiscal year ending December 31, 2019, as well as other reports we file from time to time with the SEC.

These forward-looking statements speak only as of the day in which the statements are made, and we do not undertake or intend to update any forward-looking statements after this call.

At this point, I would like to turn the call over to Plug Power's CEO, Andy Marsh.

Thank you, Teal, and thank you for joining Plug Power's third quarter conference call.

I'd just like to provide a few minutes overview.

Please refer to our investor letter for detailed description of the past quarter.

First, I'd like to highlight our operational performance.

Company achieved $126 million in gross billing.

This represents a 106% increase from the third quarter of 2019.

Second, this quarter is really a strong validation of our business model in years to come.

I think many of you know, we're targeting 20% EBITDA in 2024.

We achieved 19% EBITDA on an adjusted basis this past quarter, generating $21.2 million of adjusted EBITDA.

The cost of warrants greatly increased this past quarter because of our increasing stock price, which can hide this significant achievement.

Third, and just to highlight the acceleration of our business, in all of 2018, we shipped approximately 5,000 units versus the 4,000 GenDrive units delivered the past quarter.

We also bought 1,300 fuel stations this quarter, again, another record.

This business is growing as expected, and we are moving into on-road vehicles and large-scale backup power systems.

First, on on-road vehicles, we have deals with Linde, Doosan and Lightning.

We also have a fourth large OEM, which we are deploying vehicles for testing in Europe.

Our approach to the on-road vehicle market is really straightforward.

Partnerships for ventures with large OEMs, which may require some product modifications on our part for large scale business, and standard products for integrators and low-volume applications.

Now the reason we can it is because the high-density of our ProGen module, which is 30% to 45% higher power density than our competitors, making our products easier for customers to integrate into existing battery electric phases, very similar to our approach to electric forklift truck.

These same ProGen building blocks we've developed for on-road vehicles is leveraged into our large-scale backup power solution.

We have closed deals for this product, and we'll be deploying units at the end of the second quarter 2021.

I've become increasingly more excited about this opportunity for both data center customers and now in finding logistic customers.

The same restrictions to limiting deployments of an internal combustion engines in certain regions for vehicles, we are now also seeing similar regulations impacting the deployment of diesel generators for large-scale backup power systems, fuel cells and hydrogen because of energy and gravimetric density have the same advantages in the market as on-road vehicles versus batteries, an example that I've told from both a logistic customer and a data center customer that the regional restrictions are real.

For example, California is informing customers that they must prepare to have 96 hours of backup power because of the instability of their electrical grid.

And by the way, they say you can't use diesel gen sets.

We believe that hydrogen fuel cells are really the only viable solution to meet this requirements, and it's more -- and I think what's more important in my opinion, I think you're hearing any customers say the same.

I'd also like to highlight our progress in building 5 green hydrogen plants that will generate 100 tonnes of green hydrogen by 2024.

We've announced partnerships with Apex and Brookfield to provide a source of green hydrogen in solar, wind or hydro power.

We're in the design phase for 2 of our new hydrogen plants.

We expect completion by the end of 2022.

We are leveraging our expertise in operating and designing plants from our recent United acquisitions and the ability to convert renewables into green hydrogen from our acquisition of Giner ELX.

The demand for green hydrogen is closely tied to our present customers' sustainability goals.

Plug Power is projecting that by 2024, our own internal demand will approach 100 tonnes per day.

With another note of interest to investors, our gigafactory is progressing, and with the election now over, we expect that announcement will be forthcoming for the location.

The equipment to support the gigafactory is on order, and we expect first production in late Q2 2021.

And finally, I'd like to highlight that we will be increasing our gross billing target for this year from $310 million to $325 million to $330 million.

The demand for our products will continue to grow, and this will be another record quarter.

Paul and I are now ready to take questions.

(Operator Instructions) Our first question today is coming from Colin Rusch from Oppenheimer.

And guys, congrats on all the progress.

Can you guys follow through -- Andy, it's always good to hear your voice.

As you're looking at the hydrogen plants, can you -- and I know you've done a lot of work on the financing side, can you just give us an update on where you're at, the number of partners you're thinking about working with on the finance side?

And any sort of detail around deal structure that you guys might be looking at, at this point?

So Colin, I'm going to -- I can tell you a little, and then I'm going to kind of punt on the remainder of your question.

But just to kind of give some guidance, we do expect to break ground on 2 of these plants, 1 with Apex, 1 by Brookfield by the end of the year.

When we look at the finance side, I probably would be thinking about 30% of the financing being equity and 70% being debt.

We are in discussions with not only financial -- potential financial backers, but also people who are more industrial-related.

And I would expect that more will be coming in the future.

Okay.

Great.

And then just shifting to the stationary power opportunity for you guys.

Having a product in the market is meaningful.

Can you talk a little bit about the customer dynamics, how far through the testing process you are with any of those folks?

How big that funnel is?

And a little bit of detail around the fuel logistics for those gen sites?

Yes.

I think that we're really beginning to do the first deployments in the second quarter call.

And that we do have both customers in the data center space as well as in the logistics space, which, quite honestly, the issues in California really has accelerated some of that discussion.

I think it's a business that you probably won't see meaningful revenue to 2022.

From my perspective, the funnel continues to grow.

You see activities, not only, I've kind of mentioned, the logistic operations with our present customers.

You see activities with the data center customers.

You also see activity for people thinking about microgrids.

So it's a real interesting opportunity.

You actually hit on question I spent a lot of time thinking about is that how one thinks about the hydrogen for these solutions.

And do they become almost depot points also to support other customers.

So you could see hydrogen data center, logistics center being generated on-site to buy backup, but that also could be a point of distribution.

And we actually do a model like that for the Southern Company, which during this past hurricane, we've really demonstrated the success of.

So we have 500 small-scale backup power system, with 500 small-scale backup power systems for the Southern Company, and we actually service them from -- 1 or 2 of our customers for large -- for distribution customers.

So -- but that is actually one of the more interesting opportunities.

And because we have uses for hydrogen, so many applications, that it kind of really makes sense because we're system guys, and you have to always think about how systems all fit together.

That's a real interesting question.

Our next question is coming from Craig Irwin from ROTH Capital Partners.

Congrats on a really solid quarter here.

I think it's nice to see Plug really showing that it can deliver.

What I wanted to ask about is the EBITDA.

This is a really impressive result.

Can you maybe talk about what's going right for you on the earnings side?

Where do we need to focus to see whether or not this kind of performance is sustainable over the next couple of quarters?

I know your guidance is more conservative and you tend to give conservative guidance, but can you talk us through sort of some of the things you're learning that's allowing you to deliver really strong EBITDA on the bottom line?

I think that's a good question, Craig.

And first, I think the easy pour that is delivering on this next fourth quarter for our increase in guidance.

But if I then take a step back, I think one of the critical items is the announcement of the next pedestal customer.

Jose Crespo, our EVP of Sales, is actually working with 4 customers, 2 in New York, 2 in North America, who could be that next pedestal customer.

And if I was monitoring Plug, that's an item I would monitor.

I would be monitoring, are they making an announcement for large-scale backup power systems and on-road vehicles that could be meaningful to 2024 revenue.

So that would kind of be another guidepost I would use.

And then I would look at our success.

Look, I'm saying we're breaking ground by the end of the year on 2 sites, I would be looking for some meaningful announcements and more details about those 2 sites with hydrogen.

So that's kind of my PowerPoint for the next 90 -- 450 -- and 450 days, and they're the kind of things I'm looking for to make sure we're on track.

So usually when Plug has such a strong quarter like this, the stock responds very favorably, very positively.

But the stock is maybe a little bit more tepid than many of us would have expected.

It seems like your guidance, the raised gross bookings or gross billings guidance implies $84 million to $89 million in the fourth quarter, and consensus is out there at $90 million.

Can you maybe tell us if there was something pulled forward in the third quarter from the fourth quarter?

Is there something seasonal where some of your pedestal customers can't take deliveries in the Thanksgiving, Christmas holiday period because it interrupts their sales?

What's going on there with the sequential revenue progression, given that you've had such a strong quarter now and it doesn't read as strong?

Is this just conservative?

Are you just giving us numbers that you're very confident to make?

Yes.

Craig, I learned to be -- I've done this for a dozen years and I've been less wrong recently than I've been in the past.

So I am -- it's taught me to be conservative.

That being said, I think you also make another really valid point.

My major customers are in the logistics business, associated with the -- and their big business is seasons, the holiday season.

And during the holiday seasons, they don't want to change everything.

They spend all year preparing.

And so I think you see the mix of customers in the fourth quarter different, and this happens every year.

We see more activity in auto space and manufacturing in the fourth quarter than we generally see earlier in the year and less than the logistics space.

So I think, again, next quarter is going to be incredibly stronger than the fourth quarter of 2019.

And we see the first quarter 2021, increasing dramatically from the first quarter 2020.

So we're seeing the progress all along.

My next question is about UHG and the Tennessee plant.

So can you just give us a little bit of color, I guess, color is a good pun, do you consider this a green, gray, blue, a hydrogen plant given that you are using waste hydrogen off one of Olin chemicals plants?

And can you maybe comment about the carbon intensity of that plant on a relative basis versus the other plants that produce hydrogen for transportation and fuel cells in North America?

Sure.

So one, what do I consider?

I think it's fair to consider a new hydrogen plant.

And just -- and I think, Craig, you mentioned I'm conservative about definitions of -- definitions, and I think a pure green hydrogen plant is one that is coming from hydro power, coming from wind, coming from solar.

Even though -- look, the plan in Tennessee that hydrogen just be burned off in the air if we weren't using it.

For the CI score, we're actually doing a deep, deep dive at the moment, and our goal is the CI score for that plant that we get to about a 50 CI score and -- at the pump.

And our other goal is that, Craig, we're looking to ultimately deliver that hydrogen using fuel cells and green fuel cells and green hydrogen to bring it to the customers.

So there's less of an impact in wells to wheels.

But we look forward to telling you more about that.

We're having a detailed study going on at the moment.

Our next question is coming from Eric Stine from Craig-Hallum.

So I jumped on a little late.

I apologize if I'm going to cover some things you already have.

But so curious, I know you've talked about 4 on-road programs you're targeting mid-'21, where we could see some movement there and where it could start to contribute to revenues.

But I know you're also talking about a large OEM in Europe.

So curious, is that 1 of those 4?

Is this a new customer or partner?

And then maybe what we can look for as part of that relationship?

Sure.

So it is 1 of the 4, Eric.

And before you joined the call, I mentioned we have deals going on with Linde, Doosan and Lightning at the moment.

We have the fourth OEM.

When I think about this market, I think about there's going to be 2 channels mainly to market for us.

One is partnerships or ventures with the large OEMs and another one is leveraging our standard products to the integrators.

I don't want to be -- those 4 programs that are ongoing, 2 in Europe, 2 in the U.S., we look forward to making more announcements as soon as possible.

But these discussions are -- always take slightly longer than I expect.

I can tell you, I expect it to announce the United deal in early March, and I announced it in early June or late June.

So I've learned to be a little cautious, but meaningful discussions and plans are ongoing, and hope to be telling you more about it soon.

Got it.

Okay.

And then last one for me, just on pedestal customers.

You've talked about that you hope to sign one by the end of 2020.

Curious, is that still the outlook?

And then, I mean, is it still -- I think you said in the past that to get to your 2024 goals that you'd target 6 to 7 in total.

Wondering if that's still the number as well?

Yes.

I think the number is 6. And so earlier in the call, Eric, I mentioned that Jose is working with -- Jose Crespo, our EVP of Sales, is working with 2 potential pedestal customers in United States, 2 in Europe, and we still expect that we'll have 1 done by year-end.

Okay.

And you said 6% is kind of the number you're targeting for 2024?

That's correct.

Your next question is coming from Christopher Souther from B. Riley.

First, I wanted to see if you could walk through some of the warrant mechanics.

As of the second quarter, about half of the Amazon warrants said vested and a smaller portion of the Walmart one to add.

I thought these were typically more paid in installments as those tranches hit.

It was just a matter of very large orders during the quarter or exercise of some of those warrants.

Could you kind of remind us how the math works on that?

Sure.

I'm going to tell you -- I'm going to start off and then going to hand it off to Paul, Chris.

So -- but the warrants actually get charged against each order.

So I know this may be hard for folks to understand the higher warrant charges, which is a noncash event, it's actually a real positive.

So one of our pedestal customers in the third quarter actually exceeded the tranche where the warrant price gets reset.

And the warrant price is reset at a rate that's actually 10x higher in cost than the original ones, which is a real good item since those warrant strike prices over $13 versus the original strike price of $1.19.

What it really says with these increased warrant charges is that you've seen increased purchases of our products.

And I think on the last item I would highlight, the fact that the stock is doing so well and the fact that those straight price for the warrants is now 11, 12x higher, it ultimately means less dilution for shareholders.

So it's somewhat hard to see maybe in GAAP financials all the time.

This less dilution is really, really good and something we negotiated 3 years ago to protect shareholders, and it's really proven now.

So Paul, would you like to add to this from an accounting point of view?

Yes.

I think you covered it, Andy.

There's really 2 factors in terms of the jump in the cost rate from a GAAP basis, which is increased purchases and them moving into the final tranche, which now the price has been set.

And because it's 10x, we use the Black-Scholes methodology, which is the proven accounting approach to use.

And those are worth -- the cost value is higher.

So you just get a book effect, which as Andy said, is noncash, but those are the 2 drivers that drove that increase and that's why you see the delta change in the quarter.

Got it.

And then on the opportunity within the backup power stations, you've targeted that as a portion of the $250 million by 2024.

Maybe just from a high level, do you see this progressing similar to material handling, where several kind of key customers that are going to be doing kind of a lion's share?

And how many customers do you think you'd need to kind of hit those longer-term targets?

Is it going to be kind of announcements like that, that give visibility?

I just want to get an idea of what the ramping pipeline should look like there.

Chris, I think good question.

And I think there are some differences.

One, I think you're absolutely right that the initial ramp of that business will be more associated with large customers or large owners of data centers.

I think you know some of those names.

And I think that will be the initial success, but -- as well as maybe with some of our present logistic customers.

I think ultimately, large-scale diesel generators are going to have more and more, I'll say, policy pressure and customer pressures.

And I think that you'll see more and more enterprise opportunities, take a hotel where you may have a large-scale diesel generator set today in a city that won't allow it anymore and thinking through those models and how to go to market, probably is a post-2024 activity.

I do think it's a really a large market opportunity, which will first take off with big customers, that take off because of policy, both the customers' policies and government policies.

And it's a real, real interesting opportunity.

That's helpful.

And then just last one.

I wanted to see if you could walk through some of the moving pieces on the fuel margins.

Obviously, the sales are up, but the gross margins are down.

I assume United Hydrogen, is that in there?

I was curious if there are any kind of onetime items?

How we should think about kind of the ramp in margins over the next few quarters there as you start to make a dent with some of the integration of green hydrogen strategies?

Paul, do you want to talk about the margins?

Because I think the margins probably are better on a non-GAAP basis.

Yes.

If you look on a non-GAAP basis, it was effectively breakeven for the quarter.

And I think what you're seeing is the benefit of the United Hydrogen starting to kick in.

And as we've talked publicly, we're actually investing to ramp additional capacity out of that existing facility.

And as that starts to kick in, and we're able to utilize that, you'll see continued progression.

And I think as we move into next year, we're actually thinking -- I mean, we're continuing to invest in increased efficiencies in the system, making big strides.

So I think directionally, you're going to continue to see great leverage in that product line as we start to leverage the existing facility we have, we leverage the existing capacity we have, invest in efficiencies and then as early '23, when the new capacity comes online, there'll be, again, another big step function.

So we're pleased with the direction that we're making and the efforts.

And I think you're going to continue to see that continue to play out.

Our next question is coming from Jed Dorsheimer from Canaccord Genuity.

A couple of questions.

I guess, Andy, first, if I just kind of read between the lines, you sound a lot more bullish and optimistic that I've heard -- than I've heard in the past, so it could just be me misunderstanding, but around backup power.

And so I guess I just wanted to unpack that a little bit and I'm curious, is your optimism more market dynamics in terms of what you've seen unfold over the past 90 days or so?

Or is it -- have more to do with your 2 acquisitions?

Because I would think that maybe United and Giner would -- is that what changed it?

Or have you always been this bullish, and I've just wasn't paying attention to that?

Jed, I think your read of me is correct.

If you would have sat down with me 1.5 years ago, you would have never heard me be so positive about the backup power market.

And I think what primarily changed is that I'm hearing it from customers, people who would be users of those products.

So I -- so I'll give you an example for National Hydrogen Day, which I'm sure everyone here celebrated, I was on a panel with Microsoft, and Microsoft explained why hydrogen was the right solution for data centers in the future.

And they're believing that it'll be cost competitive with internal combustion engines by 2024.

I think it's -- those sort of bullish notions, I also hear from our logistics customers.

And then finally, I think you hit on another point that our ability to provide a full system solution with electrolyzers as well as ability now to distribute hydrogen, which I think is going to be important for large-scale backup power as all -- the combination of both of them have may be more bullish about this market.

Got it.

I wonder -- I think one of the challenges for you and other companies in the space is changing the conversation.

You had just mentioned in terms of -- compared to traditional internal combustible.

But it seems like the efficiency compare, as well as even the negative externalities really isn't the competition.

So, for example, in the battery backup, and this is why I asked the question in particular, the -- your acquisition of United, the fact that when you look at the complexity of the grid and the fact that in California, utilities are actually shutting off solar in the middle of the day to keep from substations blowing up, that generation and those electrons could be used somewhere to gain some value versus just shuttering it that therefore, your comparison is to, I would think, akin to driving through Trenton and looking at the flaring of refineries, that, that energy is just going into the sky.

And in the same way, hydrogen seems like that's the lowest hanging fruit.

So you don't get in this really, physics ending conversation comparing the storage to that of lithium-ion or other storage solutions where hydrogen has a lower down conversion in the round trip of that energy.

Yes.

I think that's an interesting point, Jed.

When I think about it, so let's take it -- I'm going to answer your question, too.

First, I think you hit on a very valuable point.

So 2 other things.

One, when one thinks about storage, there has been significant work done by people like Jack Brouwer, UC Irvine, by the DOE, that kind of shows that from an energy density point of view, from a cost point of view, that after about 11 hours, hydrogen is the best storage medium.

In a place like California, you not only have to think about inter-day storage, but long-term seasonal storage.

So I think the other point I would make is that when you think about short-term storage and you're creating it to afford the hydrogen, for example, in California, the value of that hydrogen as a fuel, which you really need it, is actually more valuable than going back into the grid or being pumped into natural gas line.

So I think when you think about fuel cells and hydrogen for long-term storage, hydrogen is really clear.

But for short-term storage, it actually may create more value using hydrogen as a fuel vis-à-vis using hydrogen just creating impact to electricity and putting it on the grid.

Got it.

So, I guess, where I'm going with all of this is, as you think of the business and you think of the -- you've provided targets in 2024, that was largely based on a model that was primarily that of fuel cells with a slight contribution in terms of hydrogen production.

Are you rethinking that in the context of these -- this increased optimism with respect to hydrogen production, which seems to -- and backup, which seems to be skewed more heavily to that of the production, as you just mentioned, in terms of short-term and the value of that fuel that's being created?

And then I do have 2 more follow-ups.

Sure.

So Jed, we think every day about how to accelerate the growth of the business.

And having done this for a dozen years, we try to make sure we focus on -- put numbers out there that we feel comfortable with that we can hit so that I don't have a bad earnings call.

That being said, I think we're just beginning to touch on the value of hydrogen in the marketplace.

And when I think about it, it's almost like I think this is going to be a play in a market where folks who like wireless networks who build out the hydrogen generation that's green will get it the fastest, will get an unfair share of the market, and our goal is to get an unfair share of the market.

Got it.

So 2 questions for Paul.

First question is just how to think of -- you're beating on billings as well as increasing outlook on billings, but revenue is in line.

And I'm just wondering, should we think about this quarter as indicative in terms of the ratio between revenue rec and billings?

Or was this an anomaly?

Well, gross billings for us is gross revenue.

It's equivalent.

It's just the term that we use.

So the only difference is the warrant charges in terms of how that's reflected in the financials.

So the gross billings reflects really the commercial revenues that I've recognized in the quarter.

So the traction that you're seeing is directly correlated to the activity underlying the business.

So it's -- I think from a modeling standpoint, I think we can give -- talk about percentage of sales and stuff like we've done in the past and how that might play out in the future.

But from an underlying business perspective and then just understanding the dynamics, think about that being a true reflection of the shipments and deliveries that we made in the quarter.

And as we progress, I think they'll continue to be correlated.

I hope that's helpful, Jed.

It is.

Got it.

My mistake on that.

So second question, and last one for me.

So Paul, you were quoted in terms of saying that, I think in a publication, one of the most important things for Plug would be that of the ITC tax credits for vendor financing.

And with the administration change, which would seem to put into a scenario analysis of more favorable spend to your outlook, I'm just wondering if you could just expand upon that because it seems like, for me, it was the first time that I'd heard that from you guys.

And I'm just wondering how -- if you could articulate, I'm assuming that that's for your customers financing the equipment.

But I was wondering if you could just speak to that a little bit.

Yes.

I think there's many factors in general.

I mean it's one is as opposed to maybe the most important.

But I would say, the most efficient place to monetize the tax benefits and finance the projects is in the traditional bank market.

It's where our customers often go to for those that use traditional models.

I mean a lot of customers lease their trailers and their forklifts and their other operation, their assets.

And two, they often lease their forklift -- the fuel cell systems.

And so because it's eligible for the investment tax credit that goes to the traditional market, the traditional bank.

But what you've seen this year is, in the market, in general, and this is true for solar and wind and others, is that a lot of the banks have had losses from COVID and other effects going on in the market.

And obviously, when you reduce your taxable income, you kind of impact the available investment tax capacity in the market.

So I think as we go forward, I think my discussion previously in the quotes, I think, were around ways that things could be beneficial.

Obviously, first and foremost, economy picks up, the banks will have more income.

Secondly, things like the 1603 grants.

If they were to reinstate that, that's a big change in terms of benefits of being able to access the market, not dependent on having the taxable income that we have to take the credits.

So it's more about just making it easier to access the banks and -- not just for Plug customers, in general.

And those things can be enablers.

But fortunately, we've got enough traction outside of that, that it's not the sole factor, I guess.

The best way to think about it is just one of many dynamics.

And we've had many customers who sign on and don't take the tax credits and still yield tremendous benefits in the programs.

And so it's -- as I said, it's just one of many dynamics that we think about in terms of opportunities.

(Operator Instructions) Our next question today is coming from Amit Dayal from H.C. Wainwright.

Congrats on a strong quarter, by the way.

For the 2 plants, Andy, you are breaking ground on, could you give us a sense of the sort of the completion time frame?

And then how should we think about utilization levels ramping at these facilities?

Sure.

So 2 plants, 1 which will be in the Northeast and 1 which will be in the Southwest and they will come online in the second half of 2022, probably the fourth quarter 2022.

And we would expect that those plants would be fully utilized, I would say, by early 2024.

Understood.

And do you have a sense of maybe sort of the margin impact from these plants getting to full utilization in the 2024 period?

Yes.

So full utilization, we expect these plants to be in line to 30% to 35% gross margin.

And just sort of when you look at these warrants, right, previously, there seem to be a little bit of an overhang.

But do you feel these are now sort of a little bit of an edge, protecting or has protected the business from maybe competitors, et cetera, given that these large pedestal customers were tied to just not really being able to go to anybody else, but you guys?

I think the key item is that we need to put forward for our customers every day and focus on providing our customers value.

And it's -- that's really -- next to preparing for calls like this, Amit, I don't spend a lot of time thinking about the warrants.

I think about how to keep on making sure that Plug Power is delivering value for our customers.

Just one last one.

With respect to some of your 2024, '25 guidance, what's the contribution from Europe expected to be towards that guidance?

Yes.

I would expect Europe -- if I look at next year, I think Europe contributes 10% of our revenue and how we think by 2024, you can expect it to be in the 15% to 20% range.

Our next question today is coming from Moses Sutton from Barclays.

Congrats on [all the achievements] and execution.

And apologies if I missed this before, but did you provide 2021 adjusted EBITDA target?

Or just even if you could speak more generally, is the EBITDA margin going to be above 15%, we're looking at $60 million, $70 million range off of the $450 million in billings?

Any sort of directional view there would be quite helpful.

Paul, are you there?

Yes, I'm sorry.

I wasn't sure if you want me to respond.

We haven't given that guidance, Moses.

I mean, I think, I guess at this point, what I can tell you is it will definitely be higher but we haven't really provided that.

We know -- we see in the pipeline, the sales are going to be higher, and we see continued progression and margin profiles for all our product lines.

So we're very confident that we'll continue to be accretive and go up, but we haven't given a specific range yet.

We have a business for -- scheduled for January -- end of January, as we do every year and at that point, we might be in a better position to give you more specificity.

Great.

Looking forward to that.

And maybe to, I guess on this call here, on this really out-there question, would you ever consider integrating some ownership of solar and wind assets, truly controlling the full integration from electricity generation to hydrogen production and its use, maybe there could be some synergies there?

These assets are easy to operate with third parties.

Why not control the very full process ultimately one day?

But I know that's an out-there question for you, Andy.

Well, Moses, I think we've bitten off enough with our plans at the moment.

And when you have such good partners like Apex and Brookfield, I don't see any need to get into their business.

So our plan at the moment is to work with partners.

And I think as you know, this is effectively been driven by Sanjay Shrestha.

And Sanjay has been -- really has been working with folks that make sure we have rates, which allows us to generate competitive green hydrogen.

We reached the end of our question-and-answer session.

I'd like to turn the floor back over to Andy for any further closing comments.

Well, thank you, everyone.

I really enjoy our discussion today.

We're really pleased with the quarter.

It's going to be another great fourth quarter, and look forward to talking to many of you in the near future.

Thank you.

Thank you.

That does conclude today's teleconference.

You may disconnect your line at this time, and have a wonderful day.

We thank you for your participation today.