Tate Sullivan

Tate Sullivan asked about the primary end-market uses for large natural gas compressors, reconciling the majority demand for gas lift in the Permian with growing opportunities from data center and LNG infrastructure.

Answer

Justin Jacobs, CEO, confirmed that gas lift in the Permian remains the significant majority of new unit demand. He clarified that compression needs for data centers, AI, and LNG represent incremental opportunities for future growth, utilizing similar large horsepower equipment.

Tate Sullivan inquired about the primary end-market uses for large natural gas compressors, reconciling the majority demand for gas lift in the Permian with growing demand from data centers. He also asked if NGS compressors are suitable for pipeline applications and if they currently have units placed for midstream compression.

Answer

CEO Justin Jacobs clarified that while gas lift in the Permian is the significant majority of new unit demand, data centers, AI, and LNG infrastructure represent incremental opportunities that create market tightness and future growth potential. He confirmed that NGS compressors (north of 1,000 hp) are large enough for pipeline applications but stated that NGS does not currently have midstream applications.

Tate Sullivan of Maxim Group sought clarification on the potential proceeds from asset monetization, the level of real estate activity in Midland, the trend in month-to-month horsepower rentals, and whether the company's LNG commentary pertained to small or large horsepower applications.

Answer

CEO Justin Jacobs confirmed the total monetization opportunity from the tax receivable, real estate, and inventory is at least as large as the $25 million gained from accounts receivable in 2024. He stated the month-to-month rental percentage should continue to decline with new long-term contracts. Jacobs also clarified that LNG export growth primarily boosts demand for small horsepower units and keeps the large horsepower market tight.

Tate Sullivan questioned the decline in the total number of rented compressors, asking about the costs of retiring smaller units, and also inquired about the time lag between CapEx spending and unit deployment.

Answer

CEO Justin Jacobs explained that the drop in the number of units is due to smaller, unutilized compressors coming offline. The company is currently reviewing these assets to determine the best economic path, which could include selling or scrapping them. Regarding deployment, Jacobs detailed a significant lag time of approximately 9 to 12 months from ordering a new unit to its fabrication and readiness for field deployment, with capital spent via progress payments over that period.

Tate Sullivan, a Senior Research Analyst at Maxim Group, inquired about the recent disruption affecting the California boron mine, specifically asking for details on the announcement cited by management. He also sought clarification on the process and timeline for boron to be included on the U.S. Geological Survey's critical minerals list.

Answer

Paul Weibel, CEO of 5E Advanced Materials, explained that Rio Tinto, following the appointment of a new CEO, announced a business streamlining where industrial minerals, including borates, are now under strategic review. Regarding the critical minerals list, Mr. Weibel detailed the process, noting the draft list publication, the 30-day public comment window, and the company's submission along with other groups.

Tate Sullivan asked about the specific announcement regarding the disruption to the California boron mine and the timeline and process for boron to be added to the U.S. Geological Survey critical minerals list.

Answer

CEO Paul Weibel explained that Rio Tinto announced a strategic review of its industrial minerals segment, including borates, following a business streamlining. He also detailed the U.S. Geological Survey's critical minerals list process, noting the recent draft list publication, the 30-day public comment window, and the submission of comments by 5E Advanced Materials and other groups.

Tate Sullivan from Maxim Group inquired about the specific announcement regarding the disruption at the California boron mine and the timeline and process for boron to be added to the U.S. Geological Survey's critical minerals list.

Answer

Paul Weibel, CEO of 5E Advanced Materials, clarified that Rio Tinto's recent restructuring placed its industrial minerals, including borates, under strategic review. Regarding the critical minerals list, Mr. Weibel explained the 30-day public comment period following the draft list's release, noting that 5E Advanced Materials and eight other groups submitted comments advocating for boron's inclusion.

Tate Sullivan of Maxim Group asked for clarification on the company's first revenue-generating sale, its accounting treatment, and the production status of the calcium chloride byproduct. He also inquired about the timeline for the FEED engineering study, the meaning of covering 80% of global borate demand, future operating cost trends, and the production ratios of key products.

Answer

CEO Paul Weibel confirmed the first sale of 22 super sacks occurred in the current quarter, with the revenue being credited against the small-scale facility's production costs to optimize cash flow. He clarified that the facility is currently producing gypsum but has produced calcium chloride in the lab, and the shift to calcium chloride in the commercial design is expected to reduce CapEx. Weibel also stated the 7-8 month FEED engineering timeline is consistent with plans. VP of Commercial Products Mark Zamek explained that covering 80% of global demand refers to having commercial leaders focused on the high-margin U.S. and APAC markets, which constitute 20% and 60% of global demand, respectively.

Tate Sullivan of Maxim Group asked about the customer qualification program, operating costs, and recent maintenance at the small-scale facility. He also followed up on the timing of the 10-K filing and the strategic benefits of having boron added to the USGS Critical Minerals list.

Answer

CEO Paul Weibel and CSO Jason Starzecki explained that the 1 ton per day production rate is sufficient for customer qualification, which prioritizes specific purity and particle size over sheer volume. Weibel noted fixed costs are the main driver of opex and that the 10-K filing is expected early the following week. Starzecki added that inclusion on the USGS Critical Minerals list would unlock significant additional federal funding opportunities, particularly from the Department of Energy.

Inquired about the specifics of the incremental $5 million CapEx for the SSBF, the status of the dispute with contractor Matrix, and what portion of the SSBF's initial output is allocated for customer qualification.

Answer

The $5 million is for finalizing piping, electrical work, and leased equipment. The company declined to comment on the Matrix dispute due to active litigation. A non-significant portion of initial production will be used for customer qualification, with the rest available for sale once cleared.

Inquired about the specifics of the incremental $5 million in CapEx for the SSBF, the status of the ongoing dispute with contractor Matrix, and what portion of the initial SSBF production is allocated for quality testing versus sales.

Answer

The incremental $5 million CapEx is for finalizing piping, electrical work, and leased equipment. The company declined to comment on the active litigation with Matrix. A non-significant portion of initial production will be used for customer qualification, with the remaining volume available for sale once cleared.

Inquired about the geographic mix of the energy storage business and its international potential, as well as the revenue contribution from newer product lines like desalination and bike charging.

Answer

The CEO confirmed the energy storage business is currently majority U.S.-based but will be expanded internationally. He noted that while other products like desalination and bike charging are a small portion of revenue, the bike charging product in particular is generating significant interest.

Tate Sullivan inquired about the availability of government funding for EV charging infrastructure in Europe compared to the U.S. and asked about potential product certification challenges in Europe similar to the UL process in the U.S.

Answer

Desmond Wheatley, President, CEO, and Chairman, stated that Europe is expected to see tremendous spending on electrification, driven by grid capacity issues and aggressive timelines, making it a larger market than the U.S. He explained that certification is an evolving process globally, and the work being done for U.S. UL certification will directly benefit the parallel CE certification process in Europe. While the UL process has caused some order delays, it is also forcing product improvements that will lower costs and is expected to be completed by the end of Q1.

Tate Sullivan sought clarification on the rollout plan for the Beam Spot product across the U.S. and Europe and asked if the company was actively selling to the existing customer base of its acquired European business.

Answer

President, CEO and Chairman Desmond Wheatley confirmed the plan is to introduce the Beam Spot product in 2024 and begin generating revenue from both U.S. and European markets in 2025. He also affirmed that the company is 'definitely aggressively selling' both legacy and new products to the existing European customer base, noting that the legacy business itself is seeing growth.

Tate Sullivan of Maxim Group asked for specifics on production units per day, the structure of the Regulation A offering, the reason for the recent increase in shares outstanding, and the commercialization timeline for the AetherLux heat pump compared to other new products.

Answer

Senior Business Consultant Faran Ali provided production figures, stating Worksport produced roughly 4,700 units in Q2 and 2,500 units in July alone. He detailed the Reg A offering as a preferred share with an 8% dividend and a $4.50 warrant, noting that the increase in shares outstanding is from a mix of conversions and new investors. Founder & CEO Steven Rossi added that the AetherLux commercialization is expected to be faster than previous products due to lessons learned in efficiency, supply chain management, and testing from the development of the CORE power station.

Tate Sullivan asked for specifics on production unit volumes, the structure of the Regulation A offering, the reason for the increase in shares outstanding, and the commercialization timeline for the Aetherlux heat pump compared to other new products.

Answer

The company produced approximately 4,700 units in Q2 and 2,500 in July alone, showing a significant ramp-up. The Reg A offering is a preferred share with an 8% dividend and a $4.50 warrant, convertible to common stock, which has led to some increase in shares outstanding. The Aetherlux heat pump is expected to have a faster path to market because the company is applying lessons learned from the development of the Core and Solis products, making the process more efficient.

Tate Sullivan inquired about the expected mix of online sales between Worksport's own platform and third-party marketplaces, the demographic and geographic profile of online buyers, and the launch strategy for the SOLIS solar cover and COR battery system.

Answer

CEO Steven Rossi stated the goal is a 50/50 split between direct online sales and B2B channels, with a strategic focus on driving traffic to Worksport's own website over marketplaces like Amazon. He described customers as primarily individual DIY consumers and small businesses, with concentrations in Texas, Florida, and California. Rossi detailed a three-pronged launch strategy for the new energy products: the SOLIS cover sold alone, the COR power system sold alone, and a bundled 'Go kit' combining both, which is expected to be the most popular offering.

Tate Sullivan of Maxim Group inquired about which of Star Equity's business divisions currently possesses the strongest pricing power and asked about the planned timeline for closing the merger with Hudson Global following the shareholder vote.

Answer

CEO Richard Coleman explained that the Building Solutions division has opportunities to manage pricing during lumber market volatility, while the Energy Services division has been able to implement gentle price increases for in-demand tools. Executive Chairman Jeffrey Eberwein added that the company plans to close the merger as quickly as possible after the shareholder votes on August 21st.

Tate Sullivan of Maxim Group inquired about the gross profit margin of the newly acquired Alliance Drilling Tools (ADT), noting a difference between its 2024 performance and the Q1 2025 results. He also asked for details on ADT's equipment rental terms and the structure of its revolving credit facility.

Answer

CFO David Noble attributed the Q1 margin variance to the timing and ramp-up of integrating ADT's results post-acquisition. Executive Chairman Jeff Eberwein added that ADT's consistently high margins and low maintenance CapEx were key attractions. Eberwein described the rental model as project-based with high equipment turnover, like a 'razor blade' business. Noble confirmed the ADT credit facility is a revolver similar to EdgeBuilder's, with a $3 million limit based on a borrowing base.

Tate Sullivan of Maxim Group asked about the specific business characteristics of Alliance Drilling that were attractive post-Enservco, the customer mix of Alliance Drilling, and the sourcing of timber for the KBS operation in relation to potential Canadian tariffs.

Answer

EVP Richard Coleman highlighted Alliance Drilling's experienced management and growth potential. Executive Chairman Jeffrey Eberwein added that Alliance serves major energy companies, minimizing credit risk, and is diversified into geothermal and water wells. Regarding tariffs, Coleman stated that KBS primarily uses domestic lumber, while other businesses like EdgeBuilder have more exposure but employ hedging strategies to mitigate risk.

Tate Sullivan of Maxim Group asked for details on the composition of the Building Solutions division's quarterly revenue, the practice of receiving deposits for large projects, and the specific drivers of the sequential improvement in gross margin.

Answer

CFO David Noble explained that Q3 revenue included contributions from all businesses, with Timber Technologies being particularly steady. Executive Chairman Jeffrey Eberwein added that an anticipated increase in large KBS projects should boost future revenue. Executive Richard Coleman confirmed that receiving non-refundable 10% deposits on large projects is standard procedure. Eberwein attributed the sequential margin improvement primarily to the full-quarter contribution from the high-margin Timber Technologies business, which was acquired during Q2.

Tate Sullivan of Maxim Group asked whether the completion of the Gulf Coast liquefier is the primary catalyst for finalizing new marine contracts and inquired about the types of customers involved in these discussions, specifically if they extend beyond the cruise industry.

Answer

Executive Chairman and Interim CEO Casey Crenshaw clarified that the process is reversed: securing long-term contracts is the necessary step to underpin the project financing and Final Investment Decision (FID) for the new Gulf Coast facility. He explained that Stabilis is already conducting marine bunkering via a truck-to-ship process. Regarding customer types, Crenshaw confirmed discussions with multiple end markets within the marine space but preferred not to disclose specific customer details beyond their current work in the cruise sector.

Tate Sullivan asked for clarification on the marine bunkering downtime, what leading indicators the company tracks for broad demand, and whether increased launch activity from companies like SpaceX is a primary driver for its aerospace business.

Answer

Executive Chairman and Interim CEO J. Crenshaw clarified the downtime was a single planned, non-sailing maintenance week for a cruise customer. He noted that demand indicators are sector-specific, with increased bidding and customer inquiries in their core markets. For aerospace, Crenshaw and CFO Andrew Puhala confirmed that rising commercial launch and testing schedules, along with LNG's use as a propellant, are key growth drivers.

Tate Sullivan of Maxim Group asked about the dynamics of LNG gallon volumes delivered in Q4 and sought details on the significant capital expenditures planned for growth investments.

Answer

CFO Andrew Puhala clarified that full-year gallon volume growth was driven by the marine bunkering contract. Executive Chairman and Interim CEO J. Crenshaw added that Q4 volume dynamics were a mix of shifting end-market demand. Puhala confirmed that recent growth CapEx was primarily for relocating a liquefaction train and expanding storage capacity at the George West facility.

The analyst inquired about the capital commitment for the new offshore vessel, the schedule for remaining cash payments, and the expected financing terms and lenders for the project.

Answer

The CFO confirmed the total equity commitment increased to approximately $10.5 million, with a final $2 million payment due in November. The remaining construction costs will be financed with debt. The lending terms are expected to be similar to previous financings, with an advance of 65-75% of the contract price, depending on employment developments.

Tate Sullivan from Maxim Group asked for clarification on the capital commitment for the new offshore vessel, inquiring about the payment schedule and the expected financing terms for the project.

Answer

CFO Stavros Gyftakis confirmed the total equity investment is now approximately $10.5 million, with a final $2 million payment due in November 2025. He added that subsequent costs will be debt-financed, with expected terms similar to existing facilities, targeting a 65-75% advance on the contract price depending on employment developments.

Tate Sullivan of Maxim Group LLC inquired about the delivery schedule and remaining capital commitments for the new offshore vessel, the potential impact of geopolitical events on the dry bulk market, and the financial details surrounding the sale of an older Capesize vessel.

Answer

Stavros Gyftakis (executive) clarified that the offshore vessel is scheduled for a Q1 2027 delivery, with $4.5 million in equity commitments remaining for 2025. Stamatios Tsantanis (executive) noted that while the Red Sea disruption persists, a potential ceasefire in Ukraine could positively impact the Panamax segment in the second half of 2025. Mr. Gyftakis also confirmed the sale of the Gloriuship will enhance cash by approximately $7 million after debt repayment and fees.

Tate Sullivan from Maxim Group asked for clarification on the duration of the most recent torpedo order and whether submarine and torpedo work constitute the majority of the defense backlog.

Answer

President & CEO Matthew Malone clarified that the $136.5 million Virginia-class order extends to the mid-2030s, while the recent Mark 48 torpedo order is for a single option year with three more potential option years. CFO Chris Thome confirmed that torpedo and submarine programs make up the bulk of the defense backlog, with a small amount remaining for the CVN-81 aircraft carrier.

Tate Sullivan from Maxim Group requested details on the contract length for the recent torpedo order and asked for confirmation that submarine and torpedo work constitute the majority of the defense backlog.

Answer

President & CEO Matthew Malone clarified that the $136.5M Virginia Class order extends to the mid-2030s, while the recent Mark 48 torpedo order is for a single option year with three additional options available. CFO Christopher Thome confirmed that submarine and torpedo programs comprise the bulk of the defense backlog.

Tate Sullivan from Maxim Group sought clarification on the contract length for the most recent torpedo order and asked if submarine and torpedo work constitute the majority of the defense backlog.

Answer

CEO Matthew Malone explained that the large Virginia-class submarine order extends to the mid-2030s, while the recently announced Mark 48 torpedo order is for a single option year with three additional option years possible. CFO Chris Thome confirmed that submarine and torpedo programs represent the bulk of the defense backlog.

Tate Sullivan from Maxim Group asked about active opportunities to scrap older vessels, changes in average voyage length due to trade tensions, potential port delays, and the specific commodities contributing to high stockpiles in China.

Answer

Chairman & CEO Aristides Pittas explained there are no immediate scrap candidates as the older vessels have passed their special surveys. He noted that while overall market scrapping has seen a slight pickup, EuroDry has not yet experienced port delays from tariffs. The primary change in trade patterns has been avoiding the Suez Canal. Pittas specified that the high stockpiles in China primarily consist of coal and iron ore.

The analyst asked for an update on the joint venture with NRP Project Finance and inquired about the nature of the current weakness in the dry bulk market, specifically if it was concentrated in certain regions.

Answer

The company stated that the relationship with NRP is progressing well and they are open to future projects together; the JV's financials are consolidated with NRP's portion reported as minority interest. Regarding the market, the weakness is described as uniformly poor across all trade routes, largely driven by China's economic slowdown, with no particular region showing significantly more strength than others.

Tate Sullivan asked about the adoption rate of geospatial technology in U.S. refineries and chemical plants and whether NV5 possesses its own sensor technology or relies on partners.

Answer

Ben Heraud (Executive) confirmed that while NV5 already has clients in the industrial sector, the opportunity to leverage Acuren's large client base is immediate, especially since Acuren currently subcontracts some of this work out. Heraud clarified that NV5 has strong, in-house capabilities, including its own sensor technology for data capture and advanced proprietary analytics, and does not need to outsource these core functions.

Tate Sullivan inquired about recent regulatory developments for natural gas infrastructure supporting Florida's space industry and sought an update on the expansion of the unregulated Marlin virtual pipeline business.

Answer

President and CEO Jeffrey Householder noted ongoing discussions with state, NASA, and launch company stakeholders for the space industry but no substantive updates. He confirmed that the Marlin business is being capitalized appropriately to meet growth opportunities, particularly in Ohio, but there are no major expansion programs to announce, describing it as 'business as usual'.

Tate Sullivan asked if the recent hurricanes would lead to increased future spending on storm hardening infrastructure and questioned if the customer growth opportunity at Florida City Gas is similar to the broader Florida natural gas distribution market.

Answer

Beth Cooper, EVP & CFO, stated that hurricane impact was minimal and existing storm protection plans are sufficient, as the system proved resilient. Jeffrey Householder, Chair, President & CEO, confirmed that Florida City Gas's residential customer growth of 3.9% is very similar to their legacy Florida operations, with Port St. Lucie being a key growth driver, while commercial and industrial opportunities are significant in the Miami area.

Tate Sullivan questioned if more significant retirement expenses are planned for 2025, asked about the connection between higher Q4 labor costs and electricity availability, and inquired about the greatest cost variable for 2025.

Answer

Executive Mark Learmonth stated that future retirement expenses will not be of the same magnitude as in 2024. Both Learmonth and COO James Mufara explained that severe electricity supply issues early in Q4 necessitated significant overtime and bonuses in December to meet production targets. Learmonth identified unpredictable electricity supply as the biggest cost risk for 2025, as interruptions force the use of expensive diesel generators.

Tate Sullivan sought clarification on whether two large contract wins were separate, the operational status of the new NYC office building contract, and if there was an opportunity for backup power work on that specific project.

Answer

President and CEO Scott Salmirs confirmed the contracts were separate. He stated the NYC building is new construction that will be fully occupied by early next year, with ABM's work already underway. He clarified that backup power for new builds is typically handled by the general contractor, making ABM's opportunity in that area focused on existing facilities.

Tate Sullivan of Maxim Group asked if the growth in the microgrid business was primarily from new clients or cross-selling to existing ones. He also questioned if these projects lead to additional electrical subcontracting work for ABM.

Answer

President and CEO Scott Salmirs responded that the growth is a strong mix of both new and existing clients, with significant future opportunity to cross-sell into ABM's large customer base. He confirmed that this work complements their existing electrical services division and that recent acquisitions like Quality Uptime Services are helping ABM become a turnkey data center and mission-critical service provider.

Tate Sullivan asked about the outlook for the coal trade, considering geopolitical shifts and demand in Asia, and also inquired about the status of newbuild vessel orders in the market.

Answer

Executive Stamatios Tsantanis expressed strong optimism for the coal trade, citing rising global energy needs and over 100 gigawatts of new coal-fired power plant capacity being built globally. He confirmed that newbuild activity for Capesize vessels remains very limited, with shipyard slots largely unavailable until late 2028, posing no immediate threat to the supply-demand balance.

Tate Sullivan of Maxim Group asked about the impact of coal trade dynamics, particularly demand shifts between Europe and Asia, and inquired about the level of newbuild activity for Capesize vessels.

Answer

Executive Stamatios Tsantanis expressed strong optimism for the coal trade, citing rising global energy needs for data centers and the construction of new coal-fired power plants, suggesting demand will continue to rise. He also confirmed that newbuild activity is extremely limited, with zero new orders year-to-date, due to uncertainty and shipyard slots being full until late 2028, which limits near-term supply threats.

Tate Sullivan from Maxim Group questioned the rationale behind the dividend increase, the cash outflow for recent vessel acquisitions, the balance of iron ore supply versus demand, and the company's leverage targets.

Answer

Executive Stavros Gyftakis explained the dividend increase was based on a strong market outlook, a solid cash position, and favorable Q4 coverage, leading the Board to distribute 50% of operating cash flow without extra reserves. He also clarified that cash outflow for recent acquisitions was minimal due to favorable financing. Executive Stamatios Tsantanis added that the 2025 market outlook is favorable due to a limited order book, heavy dry-docking schedules, and strong commodity demand.

Tate Sullivan questioned the liquidity of the Forward Freight Agreement (FFA) market for hedging into 2025. He also asked about charter renewals, inquiring whether Seanergy typically extends contracts with existing charterers or if there is frequent turnover.

Answer

Stamatios Tsantanis, an executive, confirmed that the FFA market is quite liquid, providing Seanergy the flexibility to hedge more of its fleet if favorable rates appear. He also stated that the company generally tends to extend contracts with its current charterers, highlighting the long-term partnerships it has established and noting a recent acquisition was fixed for a period covering 2025.

Tate Sullivan inquired about Seanergy's forward hedging strategy for the second half of 2024, visibility into 2025 given low fleet growth projections, and the current state of scrapping activity for older Capesize vessels.

Answer

Executive Stamatios Tsantanis explained that Seanergy employs a dynamic hedging strategy, capitalizing on spikes in the FFA market, and has already fixed about one-third of its H2 2024 ownership days at approximately $30,000/day. He emphasized that the Capesize order book is at a 20-year low with no newbuild slots available before 2027, which supports a strong market outlook. Tsantanis also noted that even vessels over 20 years old are earning strong rates (around $23,000-$25,000/day) due to the tight supply.

Inquired about the number of deployed school buses and customer feedback on their performance. Also asked about the drivers for throughput in the truck body division and the key factors for future gross profit margin improvement.

Answer

Brendan Riley explained their conservative deployment strategy, with about 10 buses delivered from the West Virginia facility and more being delivered weekly, noting solid performance and follow-on orders in California. Michael Sieffert clarified that the truck body division, which faced overcapacity, is being consolidated, but the primary driver for gross profit improvement will be higher manufacturing throughput, especially from West Virginia, rather than just consolidation efficiencies.

Tate Sullivan from Maxim Group inquired about the number of GreenPower electric school buses currently in operation, customer feedback on their performance, and the key drivers for improving gross profit margins, particularly regarding throughput in the truck body division.

Answer

President Brendan Riley explained that the company has taken a conservative deployment approach, delivering buses where they have the highest chance of success, and noted that performance has been solid, leading to follow-on orders. CFO Michael Sieffert clarified that the truck body division faced market overcapacity and lower-than-expected throughput. He stated that consolidating this division into a new single facility and increasing overall production throughput are the primary drivers for future gross profit margin improvement.

Asked for details on West Virginia state subsidies, the destination of the East Coast school bus orders, and the available credit on the EDC facility.

Answer

The company detailed various West Virginia subsidies, including for employee training, tax benefits, and a rent-to-own building deal, confirming they've received direct payments. They also noted that East Coast orders include deliveries to New York and confirmed approximately $2 million in availability on their $5 million credit facility at quarter-end.

Tate Sullivan of Maxim Group asked for details on West Virginia state subsidies, including their triggers and payment form, whether the 88 East Coast school bus orders are all for West Virginia, and for confirmation of the available liquidity on the EDC credit facility.

Answer

President Brendan Riley and CFO Michael Sieffert detailed multiple forms of state support in West Virginia, including employee training programs, a rent-to-own building lease, and support for pilot projects, with CEO Fraser Atkinson confirming the company has received actual checks. Fraser Atkinson also clarified that the East Coast orders include deliveries to New York. Michael Sieffert confirmed there was approximately $2 million in available liquidity on the $5 million EDC facility at quarter-end.

Tate Sullivan sought confirmation that no other federal agencies besides USAID had halted work, asked about the risk of this setting a precedent, requested quantification of USAID work in the backlog, and inquired about the decision to settle the Hunters Point litigation.

Answer

CEO Dan Batrack confirmed a minor amount of EPA research work was also paused but characterized it as small. He did not provide a specific backlog figure for USAID but noted it generally represents more than a year's worth of work. CFO Steven Burdick explained the Hunters Point settlement was a strategic decision to eliminate significant future litigation costs and uncertainty after a prolonged period.

Tate Sullivan asked why the international growth forecast of 5-10% seems conservative given the significant AMP 8 water spending cycle in the U.K. He also sought confirmation that the company's long-term fiscal 2030 targets from its Investor Day remain intact.

Answer

CEO Dan Batrack clarified that while U.K. water is growing rapidly, it's part of a large international revenue base, so its weighted contribution results in the 5-10% overall growth range. He also explained the current guidance is consistent with historical organic rates, as prior-year guidance was elevated by the RPS acquisition. He confirmed the 2030 targets are intact, noting that the plan is on track and does not even include the expected contribution from future acquisitions.

Inquired about the rationale for ordering larger 4,000 TEU newbuilds, the choice of the Chinese shipyard, and confirmation of the early January 2025 delivery dates for two other vessels.

Answer

The larger newbuilds were ordered due to the aging global fleet and low order book in that segment. The chosen shipyard, New Yangzi, is a top-tier private yard in China with which the company has prior experience. The early January 2025 delivery dates were confirmed and were intentionally delayed from late 2024 to secure a 2025 vessel notation.

Tate Sullivan from Maxim Group asked for the strategic rationale behind ordering larger 4,000+ TEU newbuilds. He also inquired about the choice of the Jiangsu New Yangzi shipyard in China and sought confirmation on the specific January 2025 delivery dates for two other new vessels.

Answer

Executive Aristides Pittas explained the newbuild strategy targets the intermediate vessel segment due to its favorable supply dynamics: a very low order book (4-5%) and a large portion of the existing fleet being over 15 years old (50-60%). He clarified that the shipyard is a top-tier, established private yard in China. He confirmed the early January 2025 delivery dates, noting the company intentionally delayed them from late 2024 to secure a 2025 build notation.

Asked about the remaining cash commitments and financing for the newbuild vessels, expected charter rates for upcoming deliveries, and the calculation for the gain on the sale of the M/V Astoria.

Answer

The remaining equity commitment for newbuilds is about $20 million, with an additional $100 million in debt to be added. The next newbuild is expected to be chartered at a rate similar to the M/V Monica's $16,000/day for about a year. Financing is secured upon delivery, with the next two vessels already financed. The gain on the M/V Astoria sale is the sale price minus its book value and commission expenses.

Tate Sullivan of Maxim Group inquired about the financial commitments for newbuild vessels, including remaining payments and debt financing plans. He also asked about the charter rate for the recently delivered M/V Monica, rate expectations for upcoming newbuilds, and the accounting for the gain on the sale of the M/V Astoria.

Answer

CFO Anastasios Aslidis estimated the remaining equity commitment for newbuilds is approximately $20 million and clarified that the company arranges delivery financing in advance, with the next two vessels already financed. Executive Aristides Pittas stated they expect to fix the next newbuild at a rate similar to the M/V Monica's $16,000/day for about a year. Regarding the vessel sale, Mr. Aslidis confirmed the gain would be the sale price less the carrying value and commissions.

Inquired about PVC pricing dynamics relative to resin costs and distributor behavior, the revenue mix in the Manufacturing segment, and clarification on the normalized earnings forecast for the Plastics segment.

Answer

The company declined to comment on PVC pricing specifics due to ongoing litigation. They confirmed BTD is the larger part of the Manufacturing segment and clarified that the $45-50M forecast for the Plastics segment refers to its future annual net income.

Tate Sullivan of Maxim Group asked for details on PVC pricing dynamics, specifically why distributors are paying above historical spreads, the basis for forecasting declining margins, the revenue mix between BTD and T.O. Plastics, and clarification on the $45-$50 million Plastics segment forecast.

Answer

President and CEO Chuck MacFarlane declined to comment on specific PVC pricing inputs or distributor behavior, citing ongoing class-action litigation. CFO Todd Wahlund confirmed that BTD is the significantly larger entity within the Manufacturing segment. MacFarlane clarified that the $45-$50 million figure represents the company's forecast for the Plastics segment's annual net income in 2026 and beyond.

Tate Sullivan of Maxim Group asked about the pricing dynamics in the PVC market, the drivers behind forecasted margin declines, the revenue mix within the Manufacturing segment, and sought clarification on the normalized earnings target for the Plastics segment.

Answer

President and CEO Chuck MacFarlane declined to comment on PVC pricing dynamics or its underlying drivers, citing ongoing industry litigation. CFO Todd Wahlund confirmed that BTD is the significantly larger entity by revenue within the Manufacturing segment. Mr. MacFarlane also clarified that the $45-$50 million figure represents the company's forecast for the Plastics segment's annual net income in 2026 and beyond.

Tate Sullivan inquired about BWXT's potential to be a sole-source supplier for the national security uranium enrichment franchise and asked about the next steps for the recently awarded study contract.

Answer

CEO Rex Geveden confirmed that BWXT was the sole awardee of the study contract, making it possible they could become the sole supplier for both centrifuges and the enrichment capability, depending on the government's long-term decision. He stated the next step is to deliver a report in late summer of next year on the concept for the manufacturing site, with the hope of then proceeding to Phase 1 of the project.

Tate Sullivan from Maxim Group asked for an update on international markets, including sales allocation and opportunities for water quality monitoring outside of North America.

Answer

Chairman, President and CEO Kenneth Bockhorst stated that the company has been growing globally, leveraging the international footprints of recent acquisitions like s::can and ATi. He noted that while this growth is sometimes muted by outstanding North American performance, the company is excited about expanded global relationships. He provided a specific example of engaging with U.K. utilities on their AMP8 cycle needs, offering a range of solutions from smart metering to leak detection.

Inquired about development collaborations with Blackstone's portfolio companies and whether the community solar growth strategy involves existing assets or is primarily focused on new projects.

Answer

The primary development partner is currently CBRE, though they have worked with Blackstone in the past. Community solar growth involves both the existing portfolio (290 MW already serve community solar) and a large pipeline of new opportunities, particularly on sites without on-site demand.