Heliogen (HLGN) 9 Aug 232023 Q2 Earnings call transcript

Good morning, and welcome to the Heliogen, Inc.

Second Quarter 2023 Conference Call.

As a reminder, today's call is being recorded. [Operator Instructions]

I would now like to turn the call over to Louis Baltimore, Heliogen's Vice President of Strategic Finance and Investor Relations, for opening remarks and introductions.

good everyone. and operator, you, morning to Thank We're second quarter could join for our us today XXXX glad you conference call.

With Kurada, Officer. are Officer; us Christie Obiaya, Heliogen's call on Chief and our Sagar Financial Chief today's Executive

that Heliogen issued afternoon our found yesterday its of the section at can press Investors in on website be the results release heliogen.com.

operations contract of reminder, which strategic statements company's of initiatives, various future plan for to solar customers and uncertainties. These plans progress. growth financial are projects, include the commercial discussions scale steam our to and scaling and installation risks prioritize and on regarding call technology, this implementation company's sales company's concentrated comments a potential including thermal subject As the include statements, project assumptions the expectations expectations of forward-looking industrial with commercial and performance, and company's the

future could Actual today, to Any we statements by a statements time time. in that differ Factors those forward-looking and on of as update documents release yesterday's the or as the be from results this based statements. results no contemplated obligation forward-looking we are undertake assumptions on materially events. materially make from information these in call new and actual press that could found with filed other the to differ company result SEC cause can to of

available with furnished not release addition from website and to detailed is financial most isolation issued These GAAP measures. on More about section of to should is a press or our refer contained the considered reconciliation Form in a measures Investors to non-GAAP may measures certain the U.S. SEC. information this X-K the also and in yesterday, we results. the During which is call, non-GAAP and in measures substitute comparable GAAP be these in as for

the available of this website this A be replay also will Investors afternoon. of on section call company our

Christie. the pleased with call to I'm over turn that, to And

to morning joining Good you Thank you you, all, us. for Louis. thank and

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capacity So, customer per the average has increased.

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Board for may of projects, the their to some take need the approval. customer example, For Directors for to decision

an move our we partner contract, Energy, Woodside final hydrogen stage for That project. have execution in currently green of Capella the We in this project backlog. a stage. contract booked with the executing customers the exceptionally well continues the Proxima as who includes the into two phase be strong enter After Projects us. to revenue as order

pipeline, quarter reoriented on are augmented those our numbers testament a our team to I sales we to improvements. mentioned this last page that the grow and and

on As updating look to we our quarters. we in to work additional progress coming forward close contracts, you the

express to like to discussion Interim new industrial backlog now growth I'd implementing returned to a and this Officer. Head served for Sagar deep decarbonization financial Strategy, energy, Kelly in Chief and has of and we of he experience our and on our Before financial Kurada, Accounting results, as in has brings space. developing to decades more track to move our my of introduce our graciously appreciation and Rosser, record than who Sagar CFO CFO proven serving and strategies disruptive renewable as and companies two the of

Sagar, over to you.

morning, Thanks, Christie. Good everyone.

the of second to your review our me Page performance, to business quarter Continuing XX. attention allow direct

backlog, and As Christie X, anticipated our mentioned today projects million have sales. contracted in in Page X on representing we megawatt $XX three

million $XX approximately grown since has the backlog first Our call. quarter earnings

this will fuel On It will XXXX, the second This in XXXX. hydrogen in green project. the be as fleet. municipal first to of first Lancaster, quarter backlog June of of we will $XX.X California, project at City Proxima. our X, and in quarter. in be the the completion installed expected adding refer announced our contract, to mechanical Project XXXX their We production Proxima first end with achieve is million

Additionally, $XX.X production of contract backlog our Department develop of million at We on facility green quarter, a of end original this we energy as sponsored Woodside Energy. the to by by and funded partially Capella. the Project have second refer to turnkey remaining

aviation a have a for we develop partnership with $X.X to Energy remaining Lastly, of million sustainable Dimensional backlog fuel.

revenue, Project largely second attributable for In million. to $X.X the quarter, million recognized Capella $X.X we of

the been the aims have associated limestone. cement with DOE from receive addition In heating $X.X emissions award selected decarbonizing carbon of $XX to the to we million manufacturing reduce that a to million, the by

We in paving development to way purchase commercial-scale them with NantG a Power design for technoeconomic up include of and calcination $X services, provide a model services to engineering contract a to also field have testing, services. facility. the These million

talk I two second you next pages, the quarter will the financials. In through

in direct of side million Capella. $X.X to XX. revenue Page earned on We right-hand your the second me Let quarter in attention the

will of lifetime $XX.X the contract, earn Over we this million.

$XX.X a work $XX.X backlog project. have thus recognized leaving complete to we XXXX far recognize as million, million, the through which We expect to we of

items million recorded to and $XX.X Moving relative project reduction $X.X in This of fourth of comparable to projects. includes Proxima and in for recorded non-recurring Adjusted related XXXX. of costs quarter is We a million to we million million the SG&A unusual on SG&A. GAAP $X.X these other costs of long-term expenses, items, a the non-cash million $X.X XX% basis. SG&A. $XX.X

customers to our to methodical our to to pipeline. product existing in on our commitments R&D efforts future development continue focus manage We on deliver and

cash XX. $XX.X We for and million. in engagement. project was items, including expense for year-to-date. received items cash liquidity, million $X.X $X.X to Adjusting This spent sales project $XX Moving the million of in on to and in to Page include spend expanded and We and million million million. second we quarter we investments. underway non-cash and $X.X $XX.X does Year-to-date, SG&A in costs support million expenses million in ended in with $XXX $XX million marketing SG&A efforts related commercial unusual projects $X.X our development

As Capella is on from of included the Project million. hand the of DOE the $XX.X and for a contracted remaining reminder, for Woodside backlog not million liquidity in our $XXX

on working hand We address both liquidity half project through expect our of XXXX. our needs to capital and first the

me With that, for it to back hand XX. Christie let Page

Sagar. you, Thank

a strides we significant we've for I to it Before made. reflect moment want up to take on the open Q&A,

springboard have that a growth. We backlog revenue million over contracted a future $XX as serves for of our

demand pipeline the Our it. a progress market since addition of our megawatts of XXX our aggressive capturing toward to May sign and is

groundbreaking mechanical completion year-end year-end our installation by is track XXXX Our goals by XXXX. of toward project first on and

our is energy California to automation our Long excellence possible engineering, Our this operational manufacturing to Beach, without fresh in world-class be commitment of bringing None represents and facility in robotics. the team strong will who challenge. fully

of are priorities to that laid team's out All the at actions aligned call. of strategic our the I beginning the

And transition. demand, to months way energy three reimagined effectiveness on differentiated of ahead. just shines clean of our light advancing we've strategy made but also the a past that Heliogen's the is response market the to it's the path the our energy over a and approach not highlights progress

Heliogen for mission. your belief want our to your support I you of and continued So, in thank

to questions that I'm open have. line now may any you pleased address to the

Melius Rob Wertheimer with comes [Operator Instructions] question from the line first of Research. Our

I a one and the on pipeline couple product on then funnel. the question had

that X, integrated Slide you wonder expand on hybrid little sure mentioned I means not I'm You design. fully what just could bit. I'm if a if familiar, fully on

combining of that you concentrated the be outside intelligence Yes, When Heliogen's solar further. do and in that And certain hybrid plus parts the combine we Rob, off use PV PV. these benefit the two, is technology of the what during to there talk can can parts world PV solar that the solar design, bring energy actually daytime artificial storage projects energy dispatchable the concentrated And in is night. we uniquely the time fact and solar world day at uplevel thermal low-cost then then through leverage that for absolutely. are storage during the our have and technology about of with of solar to charge then the concentrated exist that innovations U.S. solar to the and hardware elevation other the

find of that actually with great lot in fit for for that So, looking a we energy. along found and availability a interest many could be round-the-clock customers solution, that that low-cost consistent

one And energy I'm you little that your add was storage does interesting. it a that strategic heat is then into more seems the Or solar that That's that focuses, really, would it? gathering? inbound not have sure if Is you interest? new. concentrated it include of bit just

as been it, lot It's of something exploring. access storage is terms integration the thermal, we then, or a in that we in it energy some storage, and we that we've the storage, we've interest potential would battery the market to with have found solar the as most a be been necessary. and way And solution. combine with have our of of testing thermal so concentrated of would extent that the either for And grid

XXX% power be too. we customer's to are meet firm option to a firm if up would looking it an to So, that need,

storage. the focused depending their again, be the So of But requirements. our really most serving would on on thermal operational we're customer CST storage

Perfect.

XX seems evolved, to strategy smaller the you've the and of which Christie, this move put to of and I off, place, of where the kind megawatts, got the by size seem be to paying more you, the in so as downscaled to which like you it be seems frame wanted kind in XX you rest megawatts I Great. footprint. [indiscernible] Okay. activity commercial that mean

pipeline, metrics So megawatts bit megawatts and you buckets, which complexity speed talk those permitting forth? is all XX on a couple ones the bucket on how not the do than fast to big can to sure of project maybe And whatever move could and move that to fast lower you there. or step the projects and about I'm of about it so actually to in this about the the mining talk bite-sized, the complexity how is be being completed on one to XX in stuff questions the you can just and assume and fair more smaller is you but next could are? have proposals it so know the little other if I seem the [indiscernible]? Can does from new, a it talk

Yes, Rob, absolutely.

see. So quite range we a it's that

megawatts XX the the the have per pleased out larger general, be across point projects increase prospective and customer average six that less projects capacity would able in than true, been And we're customers. complex say potentially the your pointed that, we to You smaller I the to pipeline. that's tend in

that's the range efficiency, tens that in positive spot, to megawatts a the for especially make for direction. to find turbine leverage We you really So where projects of that have sweet there to is sense. a power be

actually And likely heat or fact, to projects. so projects you more see steam be the smaller tend that in

on I'll that your question. provide context one that's So

really timing, as looks projects through we're projects, able terms a large XX move pipeline. to you say smaller depends. looking XX it for of of like. prospect at customers, for that nimble months takes yes, our as But I really terms could what it customer something And sales then like quickly and the be the move to to in in would

advancing look of we to to forward completion. projects so, these And some

metrics maybe then to many into to a customers because that about kind that you're on different you fall I of work numerically, but vet the XX stages if you customer are hard or the question know funnel And don't think fruition? the I likely on come do you answer megawatts a the how it to the comments commitment wonder it any and/or much how to how so goes out here, I into XX at it. megawatts goes of the on but have you or that's yet know have give can the building of funnel fast background

Yes, certainly.

-- I of going So think in for background the I forward, projects, that be capital built, outside that nature reasons moves are the those be the sometimes the that is, project some look, that there's our customer's And and forward. some for always energy on of go both every of because can don't any fall every that's And are just think there capital gets that outside world that there control. to are business control by and often project for project the wayside.

to from reason, will progressions that I will that's see away of and but that be there for to that change for of rather business things we're pipeline both the they something would course in than so pipeline the process be sales where the specific to are any that net natural Heliogen. the type And pipeline, you time, added the to of over consider fall

would to pre-FID so, look terms activities, submitted we that pipeline of be to pipeline from of way for, that's proposals the more health is moving And shaped forward I regeneration to the our look to. going general, in that in the progression forward, the the

necessarily And going ever that so the only to be adding not it's pipeline. to we're

and ideal the that and reduction. someone of is prioritize going for consistency cost a provides an solution of question, availability the customer same then, for worried looking is piece how fossil second not And about greater that customers, carbon having your of and with certainty increasing we volatility us, fuels of to emissions who cost of different in terms

with us look of customer in combination for think customer a requiring probably power footprint And we of so our how and some heat at definitely a base. terms is global a I priority

left and there. end a of And then Perfect. more of But, lead get tremendous one on progress obviously, the the I'll back ask Okay. amount I'll the generation, in chart, line.

long to a been time. talking You've for folks

I or are little give or you changed such XXX us from to just give have the it make what assume could conversations intangible into screen you background us to bucket? the why we what [indiscernible] of on of megawatts was criteria Maybe a the bit tangible? what sort could So, a

a that to is of what the we in customer nature are of, of looking screening more include they also number or customer's There's There or of needing criteria and the of some one Yes. fuel, do criteria sites. the physical screening terms or use. that are heat power aspects then both --

if customer for of And is what urban be strong location, fit land just they're going there. requirement their so for middle space, example, there's a many consumer in the a making that's projects not good the middle types in that's whether that's energy of because of a have and -- where it's to or a an in downtown, you,

example, where for their diesel energy cost otherwise of kind and importing remote places But and that's paying a or cost serving certainty where you way [indiscernible] a help independence you're to consumption grid differentiated help in customers provide and Heliogen fossil talk need your you're truly if we requirements. mining of meet otherwise them are something to companies for requirements, who fuel high in energy that fuels to can location

see that? outreach folks, is I what talking in qualified past But entry to mean backlog? if you some more it I the slide, then commercial your [indiscernible] makes that assume, long you've successful into way the for been the while, been into lead

Yes.

Okay.

first a And I are both came needs that's There we've we earlier, of ones question. in to since to are a focus customers' another opportunity way the do that May. about with our talked CSP XXX offering, solar to time, new being our period the brand great think available is has are of really some are actually we way in which, the then of Many what customers been that PV, talking new, been with that to the the and unit. power. we've to a for able able offering that's [indiscernible], as CST to So power megawatts or for out and different market steam more the meet combine

see you're way the so, meeting towards course that -- think And that term medium I the more significant. is market think the because of is of have power will a pipeline demand time, shift over demand. the to And we in I unique going market just so our

it. Thank Got you.

Thanks, Rob.

Thank you.

next the of Grampp line Our question Jeff with Alliance from comes Global Partners.

to to for lot That's a more Continuing detail just that last more want on pipeline. shift that growth what's the way the wanted to transparency on but that the so each super the of over and peel there I the all exciting for shift those, -- driving over in more discretely of the sales a on in helpful attributable months. first, few just last derisking know kind the the looking much see. A the that onion comment, to and probably of to you visibility pipeline technology? bit the for commend Christie, of a robust Is kind forth attribute to a of offering? strategy? on Is months. I And kind of just putting purely growth in back it's Is hard last to several

question. on more for say that the it could that thanks perspective. and our If fit to one more And on word, It's well down focus. the of the Yes, focused having our in and I that commercial customers would overall the out team from with are a quickly capitalize there team's carbon a hitting on offering be and really it's product reduction as moving effort in market boil to focused type customers sales opportunity Jeff, then on consistent. financial what's I effort both interested about the being and

include any term software that something little very That's the when I'm helpful. curious that we AI about? within just megawatts, use a little Is there. hoping on bit detail as on earlier bit more PV the to yes, if your hybrid the guys XXX including about it. And get you side stage think Got well? should of component And things of kind pipeline, a PV integrating as a and PV to the those a component? think current Or project, of currently that --

Sure. this prospects that In hybrid are XXX with dialogue megawatts, on having approach. we're the there

And that of the purely in our our haven't is traditional novel both There's to that perspective. this from core to novel so technology, off-the-shelf, yes, PV and so to integrate PV is looked solar applying PV. at the Heliogen's CST point, This commercially And easy include a and we the sort IP Really, anything Heliogen's integrate available that terms offering. our novelty and AI does that applied in hardware, proprietary of hybrid not offering. way we just technology at, thing. are those focused on of concentrated

long Great. more can Okay. to What you you XX one milestones Is things it in. milestones would I the timing kind that of just nature? if would are main that XX, any just as looking of are of Kind lead of relates sourcing the purely to to risks Capella items, characterize normal achieve it next kind you risks main sneak over months? on guys permitting say project? how the or XX And the

that Jeff, nail I out, ones called think the Yes, head. the on you the hit you

developing an the also, milestones kind traditional process. approach phase. development of referred development testing that And of then think we're I the it's of if some project how the are during just of those often

just -- a demonstration technology. who folks And first our so for time, that and of for tuning folks next-generation give to the is first particular project project is that remind storage in context are

on site. partnering and of be really program that Energy actual whole as we testing parallel those risk our that we be continue the we're course efforts Woodside to to project project. have technology. the And over excited a we're with to customer of time, kind on so, develop And And deploying going reduction

that we think produce breaking an going and sometime move then to design proceed front-end milestones, study, updated we're as be with towards will engineering next completing which And our so, year. schedule and estimate, I these ground

next Our from Siebert Williams with Shank. of question the comes Jaden line Williams

able of do Or about ideal number qualified lead if Is you'd power capacity to to Just of those targeting? support? differently, a sort leads product cumulative think be question all sort of customers there ask of a qualified deals an you backlog. tomorrow, what or wanted portion sign that be you'd little

right the think to I is door. on our objective contracts our Look, focus getting in now, increase

that fully where are a terms will -- of today. contract have a lot our backlog and can do We in production than more entitled produce Heliostat we facility we

would -- get that to pipeline Christie's capacity more want So, lag on we increased deployment generating to than what are into What And excited is I first quick can that. to entitlement. better and But there reaching and to something we time that that of time, a we do are capacity. have contract that XXX% point. be you a at we'll say -- contracted have is complete how that the consider of reach we to that for equipped is the point, that would it answer to we today we getting within to between the translates lag

question Wertheimer next a with from is Our Rob follow-up Melius Research.

couple a recognition project? hydrogen small at what's The that on Just of like revenue ones. Proxima, the

kilogram we of Yes. paid On get project, revenue have $XX once in per the asset Rob, operation hydrogen produced. recognition be that would that we

over the course and so, be recognized contract asset underway And that is generating once of hydrogen. revenue the time is would

an at investor, acquired be example, and for the an equity recognition that recognize could project earlier stage. recognizing we would be be to revenue -- then revenue we if, would forward by Now that pulled were

in that And interest an from so inbound equity investor do we participating as parties have project. interested in

recognition on that's which is contract, currently structured, hydrogen revenue a based once the so offtake And being produced. the happens as is possibility. But

but of about ramp on how how you a about on early people Whether have how yet, brought are Anyway, gross And Perfect. you costs time. it's pricing margin know know early projects? know talk margin I come you do projects? backlog a haven't can about get in you you I this? up will on think your projects to over manufacturing that you -- that thinking early I do talent. lot fully down about far and have margins gross on think pretty the factory you gross

look, years love demand gross is coming next we three Yes, the view years, today the pricing. get production get up over presenting to came cost be down delivering over the We'll conversation we the that door up can And detail the curve back our margin as times a our are entitlement. of manufacturing when within we couple we as are that that course that I we on ramp back more we to we expect there. the of come of and forecasted had market My dialogue. three to facility the have contracts as next product we more this believe period on margin. periodically. think year to compelling you We in of the ramp But through over earlier, gross -- course. focused but I same that you intently to in question

the that But market term are considering our be project expanding would gross there on are long in we both projects yielding that a Today, and on not share. would we an basis. margin aggregate basis no be

level on margin in So and there keep reason, of versus that contracts revenue, a come a balance ensure present but order that that our as other to is door. more for we we'll versus technology demonstrate new incumbents. there flexibility is prominent between fine you is the posted And through

you. Thank

from We implemented questions, this submitted How potential have on the vital no one Is or must sales of use reaching alternative based later? more to we do your that technology than question technology an customers to the importance phone the potential technology? out have approach be sooner are the rather audience. but you

Thank you, operator.

question, the on we are absolutely -- selling We address to meeting necessity. of are basis that and

and industrial that own in of future. the driven our financially and have benefit look at their both in cost what value exception can We operational solutions and of that by looking their both found now terms consumers the do requirements reduction, economics, energy at of and assessment provide carbon they are includes without

be also emotion may involved. there Now

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hopefully, And investor. so from that the question addresses -- that's that

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today's concludes This teleconference. you. Thank

your and participation, for You disconnect this a your lines time. may you at day. wonderful Thank have