Greg Lewis

Greg Lewis asked about the expected increase in SG&A over time as CleanSpark builds out its team for the new HPC business, inquiring about costs, processes, and employee growth. He also asked how owning additional land at Sandersville changes conversations with potential HPC tenants.

Answer

Gary Vecchiarelli (President and CFO, CleanSpark) indicated that SG&A will slowly uptick, but precise guidance is difficult due to hiring timing and optionality for consultants. Harry Sudock (Chief Business Officer, CleanSpark) confirmed that owning additional land at Sandersville is crucial for specific basis of design alignment and mapping out complex project timelines, which are critical for commercial discussions.

Greg Lewis asked about the expected growth in SG&A and employee levels as CleanSpark builds out its team for the HPC business, considering the existing talent and the option to use external consultants. He also inquired how the recent acquisition of additional land at Sandersville impacts discussions and terms for HPC contracts, specifically if not owning the land would have been a non-starter.

Answer

Gary Vecchiarelli, President and CFO, stated that precise SG&A guidance is difficult due to the timing of new hires, but CleanSpark maintains flexibility by using consultants and expects a slow, measured uptick in employee levels. Harry Sudock, Chief Business Officer, explained that owning the additional land at Sandersville is crucial for progressing the AI data center project, enabling specific basis of design alignment and providing clarity on compute and power ramp timelines, which are critical for commercial discussions.

Greg Lewis asked for more details on the Texas facility, specifically its energization schedule, whether there are intermediate steps, and the long-term ability to expand at the site or grow with a customer.

Answer

Harry Sudock, Chief Business Officer of CleanSpark, outlined the Texas site's energization schedule: the first 200+ megawatts in the first half of 2027, followed by two 40 MW tranches in 2028 and 2029. He highlighted the high build certainty due to the counterparty being a major substation developer and the site having full ERCOT approval. Sudock also confirmed significant land capabilities for expansion and potential behind-the-meter gas generation opportunities, emphasizing CleanSpark's core competency in opportunistic land and power acquisition.

Greg Lewis inquired about the energization schedule for CleanSpark's Texas facility, including specific steps and the potential for expansion at the site or growth with a customer.

Answer

Chief Business Officer Harry Sudock detailed the Texas project, stating the first 200+ megawatts are scheduled for online in the first half of 2027, followed by two 40-megawatt tranches in 2028 and 2029. He highlighted that the counterparty is a major substation developer, ensuring high build certainty, and the site is fully ERCOT approved, having cleared all regulatory hurdles. Mr. Sudock also emphasized the significant land capabilities for expansion and the potential for behind-the-meter gas generation, aligning with CleanSpark's core competency in opportunistic land and power acquisition.

Greg Lewis (BTIG) inquired about the go-to-market strategy for EnerSys's lithium UPS system, considering its new entrant status, the competitive landscape, and the expected ramping trajectory for the solution. He also asked Andrea Funk about the drivers behind the upward price mix in Motive Power, specifically inquiring if the growth in maintenance-free solutions or tariff pass-through contributed to this trend.

Answer

Shawn O'Connell, President of Energy Systems Global, EnerSys, explained that lithium's unique risks necessitate a cautious adoption approach, with pre-agreed customer trials expected to last around six months for fine-tuning and comfort. He noted strong customer pull-through due to EnerSys's service and global presence. O'Connell anticipates steady, rather than rapid, growth in the first year due to long data center planning and lead times, highlighting a less crowded market with only one to two other credible lithium providers. Andrea Funk, EVP and CFO, EnerSys, clarified that tariff pass-through typically results in lower margins. She attributed the strong 14.9% Motive Power margin in Q3 2026 to volume softness predominantly in the flooded business, which favorably impacted the product mix. Funk noted that smaller manufacturers and warehouses, facing pressure, are holding back on purchases, further contributing to the beneficial mix, alongside ongoing restructuring efforts.

Greg Lewis asked Andrea Funk about the drivers behind the upward price mix in Motive Power, specifically if it was influenced by the growth of maintenance-free solutions or tariff pass-through.

Answer

Andrea Funk, EVP and CFO, clarified that tariff pass-through would typically result in lower margins. She attributed the nice 14.9% adjusted operating margin in Motive Power (up year-on-year and sequentially) to volume softness in the flooded business, which improved the product mix. She suggested that smaller manufacturers and warehouses, feeling pressure, are holding back, contributing to this mix benefit, in addition to restructuring efforts.

Greg Lewis asked if the consolidator's focus on older vessels (10-15+ years) extends to more modern tonnage, and how DHT views its own vessels now entering the 15+ year range. He also inquired about the impact of recent Venezuelan developments on crude flow, specifically if crude previously destined for Asia might now deviate to the U.S. Lastly, he asked about the process for mainstream fleets like DHT to transport Venezuelan oil, given its historical movement via the shadow fleet.

Answer

Svein Moxnes Harfjeld (President and CEO, DHT Holdings Inc) stated that DHT is 'done selling, for now,' emphasizing that their five 2011-2012 built ships are high-performing and will remain in the fleet. He believes consolidators are likely looking at modern tonnage, but their initial focus on 10-15 year olds is a rational strategy for significant cash returns. Regarding Venezuela, Mr. Harfjeld noted that initial barrels would likely go to the U.S., but China, as a creditor, and traders like Trafigura and Itochu, suggest some oil will be placed in Asia, which he sees as positive for the market. For mainstream fleet involvement, he explained that if traders sell the oil, they would be DHT's customer, requiring clear resolution of OFAC risks before DHT would move the oil.

Greg Lewis asked about the consolidator's focus on older vessels versus modern tonnage and DHT's strategy for its own 15+ year old vessels. He also inquired about the impact of recent developments in Venezuela on crude flow and the process for mainstream fleets like DHT to transport Venezuelan oil, considering past shadow fleet involvement.

Answer

Svein Moxnes Harfjeld, President and CEO, stated that DHT is not currently selling vessels, and their five 2011/2012-built ships will remain in the fleet. He believes the consolidator is also looking at modern tonnage, but their initial focus on 10-15 year old ships is a rational strategy. Regarding Venezuela, Mr. Harfjeld noted that initial crude flows would predominantly go to the U.S., but China's role as a creditor and traders like Trafigura and Itochu could lead to some oil being placed in Asia. He emphasized the need for clarity on OFAC risk for DHT to move such oil.

Greg Lewis asked about the drivers of margin improvement, specifically the split between pricing and cost efficiencies, and the sustainability of pricing power. He also inquired about the EV backlog, potential customer shifts to alternative fuels, and whether diesel has been gaining market share.

Answer

CFO Razvan Radulescu explained that approximately two-thirds of the margin improvement came from pricing actions and one-third from efficiency and quality improvements, noting that efficiency gains are sustaining. He clarified that pricing is net of material cost increases and the impact of the latest pricing action will be seen in the second half of the fiscal year. Regarding the EV backlog, Mr. Radulescu highlighted a strong backlog of over 1,000 units, with some deliveries extending into fiscal 2027 Q1 due to infrastructure readiness timing. He also noted a strong quarter for diesel, which did not compromise overall profitability, and suggested a potential pre-buy or pull-forward of diesel units due to uncertainty around 2027 emission regulations. CEO John Wyskiel added that diesel remains a 'sticky' option.

Greg Lewis with BTIG inquired about the drivers behind Blue Bird's strong Q1 margins, specifically asking for a breakdown between pricing actions and operational efficiencies. He also sought clarity on the sustainability of pricing benefits throughout the fiscal year and trends in the backlog, questioning if EV delays were leading to a shift towards other alternatives like diesel.

Answer

CFO Razvan Radulescu explained that approximately two-thirds of the margin improvement came from pricing and one-third from better efficiency and quality, noting that efficiency gains are sustaining while pricing is net of material cost increases. CEO John Wyskiel added that diesel remains "sticky" and there might be a pre-buy due to potential 2027 emission regulations.

Greg Lewis asked for an update on the EV backlog, specifically if its growth mirrored the total backlog's quarter-to-date increase. He also inquired about New Jersey's updated incentive program for additional buses, whether it was expected, and if other states are likely to follow with similar programs.

Answer

CFO Razvan Radulescu stated that the EV backlog increased to 850 units. President and CEO John Wyskiel noted that the New Jersey program is a testament to state funding, which is real and flowing, and part of a general trend of growth in state-level EV programs, though not a specific cornerstone of Blue Bird's communications.

Greg Lewis asked for an update on the EV backlog, specifically if its dollar value and percentage growth quarter-to-date mirrored the overall backlog growth. He also inquired whether New Jersey's recently announced $37 million incentive program for additional buses was expected or a surprise, and if other states are anticipated to follow with similar updated programs.

Answer

CFO Razvan Radulescu confirmed that the EV backlog increased to 850 units, mirroring the overall backlog growth in terms of units. President and CEO John Wyskiel stated that while the specific New Jersey program wasn't a cornerstone of their communications, it reflects a broader trend of real and flowing state-level funding for EVs, with many states showing aggressive mandates and a general growth trend in such programs.

Greg Lewis inquired about the step-up in Galaxy Digital's loan book, its driving factors, potential performance in a market recovery, and whether growth came from incremental or new customers.

Answer

CFO Tony Paquette stated that the loan book grew healthily, averaging $1.8 billion in Q4, slightly up from Q3 despite a decline in underlying asset prices. He noted increased loan originations and quantums, steady net interest margins, and continued client base growth, with collateralization remaining around 130%. President and CIO Chris Ferraro emphasized the focus on growing the loan book without taking incremental net risk.

Greg Lewis asked for color on the step-up in Galaxy Digital's loan book, including its drivers, how it might look in a market recovery, and whether it involved incremental or new customers.

Answer

CFO Tony Paquette stated the loan book grew healthily to an average of $1.8 billion in Q4, offsetting a 24-25% decline in the underlying asset class. He noted net interest margins held steady, the client base grew, and originations were up. President and Chief Investment Officer Christopher C. Ferraro emphasized maintaining a 130%+ collateralization ratio and growing the loan book without incremental net risk.

Greg Lewis inquired about the drivers behind the incremental margin expansion embedded in Legence's next year's guidance and potential opportunities for upside. He also asked about the company's overall pricing power and the ability to push pricing in technology and life sciences markets.

Answer

CFO Stephen Butts explained that margin expansion is driven by mix shifts, particularly within the Installation & Maintenance segment, where higher-margin custom fabricated projects are increasing in proportion. This margin accretion in I&M is somewhat offset by the overall mix shift towards the lower-margin I&M segment. Regarding pricing, Stephen Butts stated that Legence continuously seeks opportunities to push pricing but balances this with maintaining long-term client relationships, acknowledging the price sensitivity of its technical customer base.

Greg Lewis asked about the drivers of incremental margin expansion embedded in Legence's next year's guidance and opportunities for upside. He also questioned the potential to push pricing in the technology and life sciences sectors given current momentum.

Answer

Stephen Butts, CFO, explained that margin accretion is expected from mixed shifts, particularly within the Installation & Maintenance segment, by selling more higher-margin custom fabricated projects. This is somewhat offset by the overall mix shift towards the I&M segment, which has a lower gross margin profile. Regarding pricing, Stephen Butts stated Legence always seeks opportunities to push pricing but balances this with maintaining long-term client relationships and acknowledging the price-savvy customer base.

Greg Lewis asked about the challenges faced by the Q4000 in 2025, the visibility for 2026, and the potential for customer deferrals. He also inquired about the shallow water abandonment (SWA) market outlook for 2026, specifically regarding increased activity at reduced rates, and the anticipated stronger market in 2027, including competitor capacity additions.

Answer

Owen Kratz, President, CEO, and Director, and Scotty Sparks, Executive VP and COO, explained that unexpected deferrals impacted Q4000's 2025 schedule, leading to an accelerated dry dock and consideration of West Africa or Guyana campaigns to hedge risk. They highlighted the Q4000's versatility for lower-rate ROV/construction work. For SWA, Owen Kratz detailed the market's oversupply and competition in 2024-2025 following a banner 2023, anticipating increased volume but continued rate competition in 2026, with a strong rebound expected in 2027 as deferral provisions expire and 'boomerang properties' drive demand. He also confirmed competitors added incremental spreads, and Helix is regaining personnel by adjusting rates.

Greg Lewis inquired about the Q4000's challenges in 2025, including customer deferrals, and sought clarity on the visibility and drivers for its 2026 outlook, particularly for mid-year. He also asked for elaboration on the shallow water abandonment market, specifically the expectation of increased activity but reduced rates in 2026, and the impact of competitor capacity additions.

Answer

Owen Kratz, President, CEO, and Director, explained that unexpected deferrals impacted 2025, but 2026 visibility is stronger, with plans to hedge risk through potential West Africa or Guyana campaigns. Scotty Sparks, Executive VP and COO, added that the Q4000's regulatory dry docking was accelerated to facilitate 2026 flexibility and highlighted the vessel's versatility for lower-rate ROV decommissioning work. Regarding shallow water abandonment, Mr. Kratz noted that 2023 was a banner year, but 2024-2025 saw excess supply and deferrals. He anticipates increased volume but competitive rates in 2026, with a stronger market by 2027 as deferral periods expire and 'boomerang properties' drive demand. He also confirmed competitors added incremental capacity, leading to rate pressure, but Helix is regaining personnel.

Greg Lewis inquired about the general trend in service contract durations in the MENA region and whether they are expected to expand.

Answer

CEO Sherif Fota explained that contract durations are stable and long-term focused, with most new tenders being for three, five, or seven years, and some extending to nine years. He noted that the five-year mark is common as it encourages service companies to make long-term, in-country value investments in manufacturing and R&D, which is a critical factor for customers when awarding contracts.

Greg Lewis from BTIG asked about the strategic opportunity for the Class A school bus business, a smaller part of Motive's portfolio, and how the merger with Workhorse's manufacturing capabilities could help accelerate growth in that market.

Answer

Motive CEO Scott Griffith affirmed that the school bus and shuttle market is a key opportunity and a 'nice sweet spot' for current EV technology due to favorable duty cycles, community support, and financial incentives. He stated that the combined company will pursue this segment, noting its high competitiveness against ICE counterparts on a TCO basis. He also highlighted the adjacent opportunity in the municipal space for work trucks, driven by similar urban demands for lower carbon impact.

Asked for color on the implied Q4 revenue step-up to meet guidance and inquired about the company's expanded M&A funnel, asking if the ITU acquisition was creating a flywheel effect and what other areas they might be looking at.

Answer

The company expects a slight, but not abnormal, revenue step-up in Q4 based on backlog scheduling, particularly in FVS, and is confident in its guidance. The M&A funnel has expanded because capital is being freed up as Blue Arc development spending ramps down. They are looking for strategic fits in their core business that add new capabilities and customer relationships, similar to the successful ITU acquisition, rather than looking far afield.

Asked about the focus of potential strategic partnerships (e.g., hydrogen infrastructure, international expansion) and the strategy for reducing cash burn beyond simply increasing volume and average selling price (ASP).

Answer

Strategic partnerships are focused on the entire hydrogen ecosystem, including H2 supply, cost reduction, and components, leveraging Nikola's position as the primary offtake. To reduce cash burn, the company is focused on improving the cash conversion cycle and optimizing the voucher process, with increased volume being the biggest lever. They are confident in securing investment to avoid cuts that would hinder growth.

Asked about vehicle uptime for a key customer (IMC), hydrogen volumes at refueling stations, and the reason for the BEV repurchases during the quarter.

Answer

The company declined to provide specific customer uptime or hydrogen volume data, citing customer sensitivity and competitive reasons. The BEV repurchases were explained as a one-off dealer network optimization, with plans to resell the vehicles.

Asked for clarification on the inventory status of the 100 BEVs, an update on the 2024 hydrogen station rollout plan, and the expected quarterly delivery cadence for fuel cell trucks.

Answer

The 100 BEVs are from existing inventory and will be sold for a positive cash contribution. The company is on track with its hydrogen station plan, with line of sight to 9 new sites. The quarterly delivery cadence for fuel cell trucks is projected to ramp up sequentially (e.g., 30, 60, 90, 120).

Inquired about the contracting strategy for the newbuilds, potential 2024 revenue from them, and the potential impact of Saudi Arabia's revised production targets on the rig market.

Answer

The newbuilds are being marketed for long-term contracts (18+ months) with minimal revenue expected in 2024. The company believes the impact from Saudi Arabia's revised plans will be manageable, as the market can absorb any rigs that might become available, and a significant level of activity is still required to maintain production.

Greg Lewis from BTIG asked about Nordic American Tankers' strategic vision for the next two to three years amid an improving tanker market, and followed up on the company's dividend policy and use of cash.

Answer

Chairman and CEO Herbjørn Hansson stated that the company is on an upward trajectory and will expand by capitalizing on the strong market, strengthening relationships with major oil companies, and prioritizing dividends. He emphasized a conservative financial approach, aiming to increase dividends as the market improves without taking on excessive debt, noting his family's significant investment in the company.