Fuel Tech [FTEK] Conference call transcript for 2022 q1
2022-05-11 14:48:10
Fiscal: 2022 q1
Devin Sullivan: Thank you, Rob. Good morning, everyone. And thank you for joining us today for Fuel Tech’s first quarter 2020 financial results conference call. Yesterday after the close, we issued the press release. A copy of which is available at the company's Web site, www.ftek.com. Our speakers for today will be Vince Arnone, President and Chief Executive Officer; and Ellen Albrecht, the company's Principal Financial Officer. After prepared remarks, we will open the call for questions from our analyst and investors. Before turning things over to Vince, I'd like to remind everyone that matters discussed on this call, except for historical information, are forward-looking statements as defined in Section 21-E of the Securities Exchange Act of 1934 as amended, which are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995, and reflect Fuel Tech’s current expectations regarding future growth, results of operations, cash flows, performance and business prospects, and opportunities, as well as assumptions made by, and information currently available to, our company's management. Fuel Tech has tried to identify forward-looking statements by using words such as anticipate, believe, plan, expect, estimate, intend, will and similar expressions, but these words are not the exclusive means of identifying forward-looking statements. These statements are based on information currently available to Fuel Tech and are subject to various risks, uncertainties and other factors, including, but not limited to, those discussed in Fuel Tech's annual report on Form 10-K in item 1A under the caption risk factors and subsequent filings under the Securities Exchange Act of 1934 as amended, which could cause Fuel Tech's actual growth, results of operations, financial conditions, cash flows, performance and business prospects and opportunities to differ materially from those expressed in or implied by these statements. Fuel Tech undertakes no obligation to update such factors or to publicly announce the results of any forward-looking statements contained herein, to reflect future events, developments or changed circumstances or for any other reason. Investors are cautioned that all forward-looking statements involve risks and uncertainties, including those detailed in the company's filings with the SEC. With that said, I'd now like to turn the call over to Vince Arnone, President and CEO of Fuel Tech. Vince, please go ahead.
Vince Arnone: Thank you, Devin. Good morning. And I want to thank everyone for joining us on the call today. After a strong end to 2021, I am pleased to be able to report an improved beginning to the new year versus prior year performance. For the 2022 first quarter, our revenues improved by 10%. SG&A reflected a continuing commitment to cost control measures. Backlog improved and our current balance sheet reflects total cash of more than $35 million and no debt. APC revenues increased by about $1.3 million from last year's first quarter. While still well below historical levels, we continue to believe that APC revenues for the year will exceed the $6.9 million reported for full year 2021. To that end, our backlog at March 31, 2022 was $9.6 million, approximately $7 million of which is expected to be realized over the next 12 months. We announced $5.3 million of new orders during the first quarter of the year and are pursuing a global sales pipeline of $50 million to $75 million. We are tracking projects with a contract value of $5 million to $10 million that are expecting to be awarded before the end of Q2 or early in Q3, and we are optimistic regarding the outcome. FUEL CHEM revenues declined due to a decrease in power generation demand in the areas of the country that our units serve, and margins were down slightly as a result. As we head into the warmer summer months, we are expecting to see a seasonal increase in demand as the end of Q2 and all of Q3 are typically the best performing months for our FUEL CHEM business segment. When we last spoke, I had noted that we had expected FUEL CHEM revenues to be in the $13 million to $15 million range for 2022 and that the reduction from 2021 was due to one known plant shutdown as of 12/31/21 from a long term customer in the business segment; the return of a more normalized maintenance outage schedule in 2022; and to the continued pressure on the remainder of our customer base to optimize program usage. We are still expecting revenues to be in this range. And I'm pleased to report that we recently started up a FUEL CHEM program on a new coal fired unit this past month in the Western United States and thus far the program is working well. The new customer is using our program to burn a challenging coal as they seek to generate power at full capacity levels during the high demand summer months. If the program continues to be successful, we would expect to see revenues of $500,000 to $1 million for the full year 2022. Overall, when taken in combination with the improved outlook at APC, we continue to expect that total revenues for 2022 will show a modest improvement from 2021. For the APC segment, we continue to pursue opportunities for our SCR and ULTRA product offerings. Recent contract awards and current discussions have involved the application of our SNCR emissions control solution to reduce nitrogen oxides from stationary combustion sources for domestic and international applications, and also our fuel gas conditioning technology to improve the performance of electrostatic precipitators for an international client. Additionally, decarbonization is top of mind for many industries, and we are closely watching the planning of the steel industry and others as they pledge to invest in technologies to improve their global carbon footprint. Fuel Tech has longstanding relationships with technology suppliers and end users that will assist in our ability to capitalize on these opportunities as they develop. Of note, we have been receiving a noticeably higher volume of inquiries from potential new and former utility and industrial customers regarding EPA’s proposed update to the cross-state air pollution control rule also known as CASPER that was published on April 6th of this year in the federal register. The previous CASPER rule was based on 2008 Ozone National Ambient Air Quality Standards where NOX is a precursor pollutant to ozone. The EPA entered into a consent decree early this year to update the CASPER rule to make it compliant with the 2015 national ozone standards, while meeting the good neighbor requirements of the Clean Air Act. These CASPER revisions could impact utility and industrial sources requiring additional NOX control starting as early as 2023 for utilities and 2026 for industrials, and we are receiving inquiries related to these potential new standards as we speak. For our FUEL CHEM segment, we are continuing to explore ways to broaden the application of our chemical technology. We are preparing to do a fresh reach out to all domestic coal-fired utilities to reintroduce our FUEL CHEM program benefits, including the following; lowering the cost of dispatch by offering fuel flexibility and the ability to burn lower cost fuels of opportunity; extending facility life and improving overall facility profitability; and lastly, our program can be structured to be utilized only when the union owner wants to capitalize on high demand and related high capacity opportunities. Additionally, as we have discussed in prior calls, we continue to investigate providing our chemical technology solution to address the emissions created by the burning of high sulfur fuel oil in Mexico, which is being undertaken without the necessary and environmental remediation and at the expense of the health of surrounding communities. We are continuing to support our partner in Mexico as they engage with local officials to advance the solution. The current Mexican government supports utilizing indigenous fuel sources for power generation to ensure that they can move towards becoming energy independent. There is currently a glut of high sulfur fuel oil in Mexico as the international market for this product has been significantly reduced with the adoption of the new International Maritime Organization restrictions, which prohibit the use of this fuel for ocean transport. We will continue to watch the development of this activity closely. However, we do believe that political pressure is building in favor of the implementation of our FUEL CHEM program at additional facilities in Mexico. And our partner is currently in discussions with the state owned utility CFE regarding application of the technology at several units at one plant site. With respect to our developmental dissolved gas infusion or DGI business initiative. We continue to have high expectations for this technology, which focuses on industrial and municipal water and wastewater treatment. I'm pleased to report that we have made progress towards advancing this nascent business towards commercialization. DGI offers an innovative alternative to current aeration technologies, utilizing a patent pending saturator vessel, DGI infuses gas into a liquid at high operating pressure, which allows the gas to be dissolved into the liquid with greater than 95% efficiency. The gas infused liquid is then injected to an end use reservoir using a patent pending zoned injection array that delivers best-in-class gas transfer efficiency. This delivery system enables our DGI technology to provide fast, precise and controllable dosing of dissolved gas, augmenting underperforming traditional technologies and providing real time response to varying process needs. The modular, compact and scalable system configuration of DGI technology allows for rapid deployment. The system can be used as a standalone operation or to augment aeration assets for increased treatment capacity without significant capital investment. On our last call, we laid out our 2022 goals for DGI. Today, I want to give you an update on where we stand with respect to those objectives and provide some additional information. The first goal was the completion of documented DGI performance testing that is independently verified by experts in the fields of aeration and wastewater treatment. While supply chain difficulties delayed our ability to start our testing by about six to eight weeks, we have made good progress in this area and expect to have the results of our testing before the end of the second quarter. I'm pleased to report that DGI is performing favorably. Second, we targeted to identify our addressable markets in conjunction with our water and wastewater treatment marketing specialists. Our addressable markets consist of municipal wastewater and water utilities, agricultural applications, food and beverage facilities, including dairy farms and soft drink manufacturers, landfills and natural bodies of water and reservoirs. Across these end markets, DGI can address a variety of issues, including regulatory compliance, water preservation as a replacement for chemicals to treat wastewater, odor reduction and improving overall water quality for humans and wildlife. We have begun to identify potential customers in each of these business verticals and we’ll create specialized marketing campaigns that address the individual concerns of these customers. Our third goal was to construct an internal resource base specifically in support of DGI. Goals number one and two were intended to be a precursor to this third goal. But now that we have confidence in the performance of the DGI technology and also in our belief that there are viable end markets for the technology, we will begin to plan for the build out of our resource base in support of DGI as we move throughout the remainder of 2022. As I have indicated previously, we have been very measured in our approach towards our investment in DGI, and this approach will continue as we evaluate resource requirements prospectively. Our current goal for DGI is to have one to two commercial applications before the end of 2022. That's ambitious. But we are working diligently to achieve this objective, and we look forward to keeping you apprised of our progress as we work throughout the year. In closing, I want to again thank the Fuel Tech team for their continued hard work and dedication. We remain excited about 2022 and we look forward to keeping you apprised of our progress. With that said, I'll now turn the discussion over to Ellen. Ellen, please go ahead.
Ellen Albrecht: Thank you, Vince and good morning, everyone. For the first quarter 2022 consolidated revenues rose 10% to $5.5 million from $5 million in last year's first quarter. The increase was driven by $1.3 million increase in APC segment revenue to $2.2 million from $0.9 million in last year's first quarter, reflecting project execution timing and revenue generation from new orders booked in late 2021 and the first quarter of 2022. The FUEL CHEM product line revenue declined to $3.4 million from $4.1 million in last year's first quarter, primarily due to a decline in power generation demand in the regions our unit serve and to the sale of equipment to a FUEL CHEM customer in the first quarter of the prior year. Consolidated gross margin was 41.4% of revenues compared to 46.9% in the first quarter of 2021, reflecting lower gross profit margins from both operating segments. APC gross margin was 35.2% compared to 41.5% in last year's first quarter due to shift in project and product mix, while gross margin for FUEL CHEM declined from 45.5% from 48% in last year's first quarter, driven by higher material, freight and labor and administrative costs. Consolidated APC segment backlog at March 31, 2022 rose to $9.6 million from $9.1 million at December 31, 2021. Backlog at March 31st included $4 million of domestic delivered project backlog and $5.6 million of foreign delivered project backlog as compared to $3.4 million of domestic delivered project backlog and $5.7 million of international project delivered project backlog at December 31st. We expect that $6.7 million of current consolidated backlog will be recognized in the next 12 months. SG&A expenses were stable at $3.1 million for the 2022 and 2021 quarterly period. As a percentage of revenue, SG&A in the 2022 first quarter declined to 55.2% compared to 61.6% in the 2021 first quarter. For 2022, we are targeting SG&A between $12 million and $12.5 million exclusive of any additional investments that will be required to grow our business, specifically our DGI segment. Research and development expenses for the first quarter declined to $220,000 from $415,000 in last year's first quarter. While our project specific initiatives remain our top priority, in particular our DGI initiative, the decline was primarily attributed to a reduction in administrative resource expenditures. Our operating loss narrowed to $984,000 from $1.2 million in last year's first quarter, reflecting higher revenues, improved margin and lower operating costs. Our net loss for the quarter was $998,000 or $0.03 per share compared to net income of $398,000 or $0.01 per share in last year's first quarter. Net income for the first quarter of 2021 included a $1.6 million of other income, reflecting full forgiveness of the loan proceeds from the paycheck protection program established pursuant to the Cares Act. Absent this other income, net loss for the 2021 first quarter, would've been $1.2 million or $0.04 per share. Adjusted EBITDA loss was $868,000 compared to an adjusted EBITDA loss of $943,000 in the same period last year. Moving to the balance sheet. I'm happy to report that our financial condition remains strong. As of March 31st, we had cash and cash equivalents of $34.2 million and our restricted cash was $1.1 million. Working capital was $37.5 million or a $1.24 per share. Stockholders equity was $45.3 million or a $1.49 per share, and the company had no debt. We were off to a solid start in 2022 and we continued to remain focused on improved financial performance, cost control initiatives and efforts related to our core and expanding businesses. I will now turn the call back over to Vince.
Vince Arnone: Thanks very much, Ellen. Operator, let's please go ahead and open the other line for questions.
Operator: Our first question comes from the line of Amit Dayal with H.C. Wainwright.
Amit Dayal: Just with respect to how we should sort of think about revenue cadence for the rest of the year. Could you give us some sense of whether you are anticipating sequential improvements given sort of the strength you've seen recently through 2022?
Vince Arnone: In general, Amit, I mean, we normally expect to see a little bit of an improvement, driven by chemical technologies late in Q2 and then in Q3. Before going to look at what I would say might be our best revenue performing quarter it's less likely to be Q3. But as we had noted, we are working off some APC backlog as well. And depending on timing of us working off that backlog that could easily shift quarter-to-quarter. So overall, as I had noted, we are looking at an uptick in revenue a year-on-year from ‘22 versus ‘21. Timing of how that falls into Qs 2, 3 and 4 could shift a little bit, but generally I would expect to see Q3 probably being the best performing quarter.
Amit Dayal: And then on the gross margin side, it looks like there is some pressure relative to sort of last year. How should we think about margins this year? And can you give us a sense of historically what sort of average APC and FUEL CHEM margins have been, and maybe what you are anticipating for those in 2022?
Vince Arnone: Let's talk about the business segments independently, so let's talk about FUEL CHEM first. As Ellen noted, first quarter of ‘22 was approximately 46%. Our revenues for the quarter were a little bit lower than we had thought they were going to be due to demand predominantly. But generally speaking, FUEL CHEM margins have historically been approximately 50% on an overall basis. And I would expect to see that FUEL CHEM for all of ‘22, once we start generating more revenue moving into Q2 and Q3 and offset some of the fixed costs that are associated with that program, that 46% is going to start to increase and push towards 50% once we get to a full year outcome basis. We've been fortunate in that a good percentage of the price increases or I should say the pricing pressure that we felt on our chemical technology side, we have been able to have absorbed by our customer base. So again, we should approximate historical FUEL CHEM margins on a full year basis. APC margins vary by product line. And I should say by product technology solution mix, historically, anywhere between 30% and 40% on average. So for full year 2022, probably somewhere in between, 30% to 35% is probably what I would target for APC margins for the full year as we look at that.
Amit Dayal: Are you expecting power generation demand to be up, we're already seeing you added a new customer, it looks like for FUEL CHEM. Just seems like there maybe an uptake on the power generation demand. Are you seeing similar sort of developments taking place for that segment for FUEL CHEM especially?
Vince Arnone: Well, I mean, our number of what I would call base customers is obviously down from what it was historically. So when we have one of our base customers that has reduced dispatch during a quarterly period of time, because of impact on demand, we feel it as a company. In general, as we look for the remainder of the year, we're not expecting any anomalies. I mean, we're here in Chicago -- the Chicago area, we're in the 90s today and tomorrow, as our weather warms up and as our client base also starts to feel the impact of the summer weather coming dispatch is going to pick up and we'll be able to capitalize on that. We did, as I noted, we were able to go ahead and pick up a new FUEL CHEM customer, very pleased to be able to see that. And this is a customer that's in the Western US that they want to be able to ensure that during the heavy demand a high dispatch summer month that they're not going to have any issue at all burning the fuel that they're looking to burn. So they came to us. And so our program started up with them actually at the end of last month, and so far so good. And again, this is a customer that likely won't use our program for the full year. But even if they use our program for a solid four to five, to six months, that's excellent incremental revenue and margin for us. As I noted in my commentary, we are going to do a, call it, a revisit to the marketplace relative to the benefits that our FUEL CHEM program can offer. We are seeing some new dynamics in markets whereby many of the utilities are not necessarily looking to lock into longer term coal contracts. They're looking at spot market opportunities to lower their cost of dispatch. When they do that, they maybe looking to bring in house coals that their units may not have been designed to burn. And when that happens, that's where our FUEL CHEM program can be beneficial to them. So we're looking at some of the change in dynamics closely, don't know exactly what incremental opportunities are out there for us but we're definitely going to scour the marketplace.
Amit Dayal: And then just last one, you said you are targeting one to two applications for DGI by the end of 2022. I don’t know if I heard that correctly. Could you elaborate a little bit on what those applications could be?
Vince Arnone: They, in all likelihood, I mean, they could be commercial demonstrations. They could be the sale of a smaller scale system. It's a goal that we set internally for the company as we're looking to push DGI forward. Not expecting any material revenues from DGI in 2022, that's something that I have stated previously. But as we look to take steps to move DGI forward, we're looking at building upon where we are today and again, the three goals that I had laid out for DGI, for us for 2022, they're moving forward. And once they start to move forward, once we're able to come out a little bit more publicly regarding the capabilities of DGI, that will enable us to talk a little bit more deeply about what commercialization looks like. So for us for this year again the sale of one to two systems that's a target. As we learn more specifically about the end market demand and how DGI is going to fit into the markets of our opportunity that I outlined, we'll be able to talk more about that in the future. But right now, one to two systems is a goal. And again, not expecting material revenues in 2022.
Operator: Our next question is from the line of George Caspar, Private Investor.
Unidentified Analyst: I'd just like to press a little bit more on the water treatment situation. I'm a little surprised that it's taking it this long to actually get a delivery completed. What's underway in terms of the process of your goal to satisfy customers that the water treatment process is represents an opportunity for them to take it on? Is there something that you're still doing in terms of the technology that you haven't got to the end of yet? Could you just explain a little bit more about the process here?
Vince Arnone: Keep in mind that we first started talking about DGI pre-COVID, if you will, pre-2020, and we licensed the technology on or about early parts of 2019. So at the beginning, we spent a lot of time actually looking at the technology and looking to develop some enhancements to the technology itself. Just when we were looking to go ahead in and jump into the marketplace a little bit further with DGI is when COVID hit. And there were sites that were looking to go ahead and put the equipment out there for demonstration purposes, to be able to develop and better understand the actual performance impacts of the technology. So we lost time in ‘20 and ‘21 as it relates to COVID. But what it also did for us, George, it enabled us to approach our development of this technology in a very structured way whereby we've done incremental development of the technology. We've worked with outside firms, experts in water and wastewater treatment, to identify segments of end use markets where DGI could be applicable. Those studies were just finished the beginning of this year. And we're now working with a marketing company to go ahead and determine how we're going to go to market publicly with DGI. The one primary item that we haven't had in hand that we really need to go forward is, what I would call, documented supportable, verifiable, DGI performance results. Whether it’d be a commercial demonstration or something set up in a test environment that we have certified by experts in the field. That's what we're in the process of finalizing right now. As I said in my commentary, we're expecting to finalize that by the end of the second quarter. Once we have that in hand, once we ensure that the system performance deliverables are indeed what we expect them to be, we'll be able to go ahead and go-to-market with DGI's capabilities. And at that same point in time, we're going to be looking to further address how we're going to support DGI internally via a resource base. So we've been very structured in our approach towards building out DGI. We're mindful obviously of utilization of our financial resources in support of DGI. But we're getting close to the point in time whereby we're going to push this forward at more pace. So we're getting close to it.
Unidentified Analyst: Yes, it just seems like it's a tremendous opportunity in the market considering both in California, particularly and even in Florida, the reduction in water processing capacities are really starting to show particularly in more in California right now, because it's dry. And it just looks like they're really going to be looking for more effort on the kind of equipment that you potentially could supply into the market, I would hope that you can really take advantage of that.
Vince Arnone: George, actually you’re spot on. We are seeing that waste water treatment infrastructure, whether it’d be municipal or anything industrial related is indeed in short capacity. And so as we look at markets of opportunity, we are going to be look at areas whereby DGI could be an augmented enhancement to some of those facilities. But you're right, it's a market that is -- it's further developing as we look, not just at this country in many parts of the world as well.
Unidentified Analyst: And then one quick question on the natural gas turbine market. Anything materializing there for you at this point in time that would be larger than what it has been in the past. It just looks like natural gas turbine is going to get further pushed here.
Vince Arnone: We're definitely pursuing any and all of those opportunities that look to come our way. As you know, our technology definitely works well with in support of NOx reduction for the installation of natural gas turbines. We have not seen the advent of additional data center opportunities that we had discussed post our 2017, 2018 installation on 20 units out in the Western US. What we haven't seen is the additional development of that marketplace, but that's not to say that it won't continue to develop, because data center needs are forever growing. And so we're watching it closely but we are in good positions with relationships with natural gas turbine OEMs. So that puts us in a good place. So we're ready to respond when those markets continue to further develop.
Operator: Next question comes from the line of William Bremer with Vanquish Capital Partners.
William Bremer: Can you provide an update to us on your sales initiatives and how you go into market across your platform?
Vince Arnone: As it relates to base business technologies, both for FUEL CHEM and for APC, it's the same approach that we've used historically relative to a combination of internal, direct sales force and then utilization of manufacturing representatives. So we use a combination of both for both FUEL CHEM and for APC today. One trend that we have seen is that our use of manufacturing representatives has been declining generally speaking here in this country. And I think that the overall market opportunities relative to our end markets for some of those folks that we're focusing solely on, pollution control technologies and working as reps for those technologies, they've looked to move on to other business lines. So we find ourselves utilizing reps a little bit less than in the past. As it relates to our outlook on water, we're going to have to look to build out what our approach is going to be from water. But it is all in all likelihood going to be a similar approach in nature, because from our discussions with those that are familiar with our end market space for water, representatives are used on an often end regular basis relative to the end use customers that we're looking to target. So in all likelihood, it's going to be a combination of an internal sales force and also manufacturers representatives as well, but representatives that are going to be very specific to the industries of choice. So probably a similar business model.
William Bremer: Has there been any change in your sales personnel since the beginning of the calendar year?
Vince Arnone: There has not.
William Bremer: I call upon this, because one of your key competitors and peers had extremely strong bookings yesterday. I mean, out of the pocket bookings. So there's definitely a market just seems as though you guys are need to pick it up on the sales side and the booking side. I want to go into DGI and can you give me an idea of the -- of your focus? I know it's going to be a modular type of infrastructure gearing towards wastewater. Give us an idea of how small a pool you believe could be performed, as well as how large and have we had the examination of our system for say a million dollar -- a million say gallon pool of water, wastewater that needs to be aerated?
Vince Arnone: So what's come our way relative to our studies in marketplaces is that we're going to require systems of varying sizes from the call it the million gallon -- multimillion gallon basins to something much, much, much smaller than that. Originally, when we first -- we’re discussing about market opportunities within our team and others outside of the company. We had thought that the majority of the systems where we’re going to need to be larger scale. And so we -- internally we went ahead and developed a larger scale DGI deliverable system, which is designed to deliver 2,000 pounds of oxygen a day, and we’d be looking to address your larger basins, if you will. When we've come to learn more about all of our possible end markets, we're going to have to have something in hand, that's going to deliver 25 pounds of oxygen a day. And so it's a much, much, much smaller scale system, something similar in size to the -- we have a pilot/lab scale system in house already. But that's something that we're going to have to -- we're going to have to strategize on what a Fuel Tech small scale delivery system is going to look like for our end markets, and that's something we're going to have to design. And in fact, we're going to be meeting on that next week. And so it's something that we're watching very closely. But what we found out is that A, to your point, they're going to be modular, but B, they're going to have to cover a fairly wide variety of application sizes as we look at our end markets.
William Bremer: And then I'd like to take this to the sales side. Is this going be a, or could we utilize the strength of balance sheet and perform a, say a MSA, a multiservice agreement with our end customer over a few years for recurring revenue, or is this going to be more in essence a sales type system?
Vince Arnone: I'm hoping to see that we're going to find that -- it's going to be a combination of both Bill. But I would love for us to be able to say that water treatment is going to be a service, a recurring revenue base whereby it's a lease arrangement plus a service component. But I think the end markets are going to drive that a little bit in terms of how they look at bringing this type of application into their waste water treatment environment. I I'm going to envision that it's going to be a combination of both. I think we're going to see capital sales that may have some follow on service component to it, but I'm hoping that we're going to see this as a possible recurring revenue opportunity. And to your point, use our balance sheet at this point in time as well. That would be opportune, I would enjoy that.
William Bremer: I echo George's remarks on the wastewater market. There's been a lot of acquisitions in the last two quarters, that potentially could be competition for Fuel Tech. So my essence and I agree with George is that we need to start really moving a lot quicker than we are.
Vince Arnone: Understood, point noted. And please know that the entirety of the Fuel Tech team has this as a priority.
Operator: Thank you. At this time, we've reached the end of our question and answer session. I'll now turn the floor back to management for closing remarks.
Vince Arnone: Thank you, operator. I would like to again, thank the entirety of the Fuel Tech team for their support. I would also like to thank all of our investor base for their patience as they provide the leadership team with the confidence in looking to bring Fuel Tech back to profitability and to generate shareholder value. Thanks everyone and have a good day.
Operator: This will conclude today's conference. You may disconnect your lines at this time. Thank you for your participation.
