Agilyx ASA (AGLX) Earnings Call Transcript & Summary

As soon as Ranjeet does the introduction, I just want everyone to know that this meeting will be recorded as of now. So please be aware that the recording is starting.

Very good. Thank you, everyone. Sorry for that brief delay there. We had some technical difficulties. Welcome to the Agilyx H1 Business Update First Half '24. It's a pleasure to share our current activities. It's been an exciting time, a transformative time for the business. So it's a pleasure to be here tonight or this afternoon. I'm also very pleased to have with me our colleagues, Joe Vaillancourt, CEO of Cyclyx; Bertrand Laroche, who's been our SVP for Corporate Development and recently stepped in as our Chief Financial Officer; Christopher Faulkner, who is Chief Technology Officer of Agilyx and has been with us for -- in that position for over 10 years. So we'll go through some slides today. We have about 30 minutes of content and then we'll leave time for questions afterwards and certainly allow any time required to do that. And I think Ana is with us today. She's going to be flipping the slide, so I appreciate that, Ana, for helping out there. Maybe just -- maybe we can go ahead and just advance, then I'll kick us off. So firstly, I think it's important to -- there's been a lot of messages in the market. We've done -- there's been a lot of changes around the business. And we just thought it was helpful to summarize for our shareholders and our analysts and those out there looking at the business the investment rationale when it comes to Agilyx. So firstly, we are a first-mover in a market that is very significantly short of product. The volume of bounced chemical recycling projects, what it requires greatly in excess of the supply of feedstock. Secondly, we have large blue-chip strategic partners who have made repeat investments through us into Agilyx Cyclyx. And I think that really speaks to the potential of the market and also perceptions of the company's potential to deliver significant value to the market. Thirdly, we have a very clear path to profitability. The projects for which we've already secured capital, now that capital already committed generates $18.5 million a year in annual profits to Agilyx and allows importantly for a self-funding growth model. And then lastly, we're a unique opportunity that our feedstock business is technology agnostic. So that means that the company offers exposure to a growing industry that consists of a basket of different actors. And collectively, we really represent a derisked opportunity in the aggregate. So then shifting gears for a moment now. Agilyx Cyclyx to go into the H1 summary. We wanted to just focus on what our priorities have been over the last 6 months and where we spend a lot of our resource [Technical Difficulty] earlier and we've been transforming the business over the last more than 18 months to focus on feedstock management specifically. The industry, in general -- I'd say, the chemical recycling industry in general has seen headwinds in the rollout of chemical recycling projects. That's partly due to economic conditions as part -- uncertainty around new technologies coming to market. And it's certainly due to concerns about feedstock availability. And so that said, I would say that we are seeing more recently some acceleration in the market for conversion systems especially as 2030 targets come into view the urgency to make investments to reach targets is really increasing. So we have some positive view of where that's going, but it's been -- there have been headwinds, and I think that is improving. But I would also say that we have -- we are also seeing and we have seen a tremendous increase and interest around the sourcing of feedstock for advanced recycling. So therefore, we've pivoted our business to deploy resources to meet that opportunity. And that's really important for us over the last period and moving forward. And then secondly, we have closed on a really truly transformative private placement and financing package, which fully funds the business until CCC2 commissioning in 2026. While that transaction did close after the period that we're reporting on, it has been a meaningful focus and time expenditure over the course of the last 6 months and the balance of the last year. The financing commitments do allow us to move quickly on executing our plans, and so that's a fundamental progress for us. And thirdly, we have reorganized Agilyx to make it more efficient. We've simplified the organizational structure significantly. We've greatly decreased overhead, something that Bertrand will speak to for sure later. At the same time, we have retained our research and development and engineering capabilities necessary to protect and advance our intellectual property. So we remain focused there. We have in fact, entered into a new lease in the last few weeks with the laboratory space in Portland so that our engineering staff is really consolidated into a single location. And then lastly and related, I think to say is that we -- while we're focused primarily on Cyclyx and our feedstock management business, we do remain very optimistic about our polystyrene recycling conversion technology and we continue to work towards its adoption. Our approach to the market has certainly shifted. We are focused less on a large pipeline of licensing targets. But instead focus more on developing a cornerstone project and a partner to deploy that technology. And especially now that we've completed and built a smaller skill system for Toyo Styrene in Japan, where we started operations earlier this year, that project really serves now as a pretty effective showcase for us to bring new partners into the business. So Chris will touch on that later as well in the presentation. On the next slide, please. So just looking more closely at the market opportunity that I was referring to, third-party research is confirming what we ourselves are seeing in the market, which is the announced chemical recycling projects lead supply significantly by over 60%. The chart here on the top of the page is from Wood Mackenzie. You can see the green columns are demand for analyzed chemical recycling capacity. And the orange is the -- which is significantly less is the identified estimated capability to really feed those plants' circular supply. So really that difference between green and orange is where the opportunity is that we really focus on. Emerging regulations, consumer preferences are pushing the industry forward. So there's a lot of positive momentum, but a critical component is access to appropriate feedstock. So that's really paramount to us in terms of importance. And I think we have a great head start with leadership of ExxonMobil and Lyondell supporting and investing through Cyclyx to create the infrastructure we need to deliver feedstock. So that's a tremendous boost for us, and we continue to work with them very closely on capitalizing on that opportunity. I would add to that, that all 3 partners: Lyondell, Exxon and Agilyx are really committed to building an industry solution where offtake in feedstock is provided to all parties. So this is really an industry platform that we're building to meet this gap in supply. On the bottom of the page, I'd just like to first call out to Helena from DNB. So we've lifted, with her consent, one of her diagrams for use. It's actually a really great way to identify the value chain and sort of explain how it fits together. So you can see on the left side that in the waste of feedstock, Cyclyx is really sourcing and we're pretreating and custom compounding plastic waste, which we're then delivering to the companies in the feedstock to product column, which is the second column. And in the case of CCC1 and CCC2, we're really -- what we're doing is delivering physical pellets. Sometimes we get questions, what is the product it's a physical pellet that has the correct chemical profile to feed the Exxon and Lyondell's recycling facility. So it's -- we're creating that pellet knowing what spec they need. We have the chemical understanding to build that feedstock to feed their systems. And so those are the companies -- those companies are in that feedstock and product space as our Agilyx polystyrene technology, for example, Plastic Energy, who many of us have heard of, have talked to you and others. And they all take feedstock -- potentially take feedstock from Cyclyx and then they create a liquid product, which is really the pyrolysis oil that's produced at the end of the conversion system. And that's the substitute for fossil fuel crude oil. And when used by companies in the third column, which is the plastic manufacturing, it's used to make green recycled plastic resins. So -- and that's -- the third column is the traditional large global industrial players who are plastic manufacturers looking to start selling to their customers recycled product. And at the end of the value chain, of course, is the brands and the packaging companies and they're looking to include recycled plastic content in their products, and they're really pulling -- these are the companies that are really pulling demand through the value chain, and that pool is increasing really day by day. So we're seeing that every day additional demands and opportunities. So while -- going back to the beginning, while there are for certain individual efforts or individual projects to source feedstock for particular facilities, I'd say that Cyclyx is really unique and that it's positioned as an industry scale solution and sourcing platform, and we really don't see anyone else currently doing that at the scale that we're doing and proposing to do. The other thing I would note on this slide, which I think is interesting is that while Agilyx was previously competing with these companies in the second column, the feedstock product, Cyclyx really now counts all these companies as potential customers. So we're technology agnostic in that way. And that adjustment of positioning in the value chain really connects us to the overall success of the industry rather than to the success of a specific technology or a specific project. So if there's -- those who thrive and succeed there, we expect to be able to work with them and so we're a little bit derisked in terms of betting on individual successes. And so we feel that's a derisked business model and at the same time, very scalable, highly scalable. And so we're pretty excited about that repositioning of the business. Next slide, please, Ana. And then switching for a moment to a little bit more deeply into not just the macro environment but also Cyclyx specifically. There are various studies and market forecasts that we've all read, you can see here, there are several of them, but we focus on the Mackenzie case, which states that are -- that calls for demand of -- projects that demand for chemical recycling is expected to grow at 33 million metric tons by 2030. So that's in a Cyclyx world where we have 100,000 tons a year of output capacity, that's 314 CCCs. Now we're only projecting 5 into development over the next 3 years, including the 2 that we're currently discussing but it's obviously a huge market. And then closer to home, on the right, you see a graph, which is from the 50 or so consortium members we have at Cyclyx with whom we work on a regular basis to try to advance the industry. There are 6 million tons of demand announced, publicly announced in those -- within that group, which is 60 CCCs. So again, we're only projecting 5 at the moment in our current growth plan, but you can see there's really a tremendous opportunity to scale the business further and move quickly to meet near-term demand. I mean, the demand is there. And our task is really to build the infrastructure and develop the product supply to feed that acknowledged and recognized demand. Ana, next slide, please. And then bringing it down a step further in granularity to the actual business case that were Cyclyx is operating in terms of economics, the cash flow to Agilyx from CCC2 which is the funding we recently raised in the market to fund the project is really a good example of what we expect we'll see with further CCCs. So the return on capital to Agilyx in the offtake agreement is a 15% IRR. And that comprises $10.5 million which is paid directly to Agilyx as profits from off-tick sales. And there is a management fee charge to Cyclyx charges of profit margin to the CCC and which Agilyx is a 50% shareholder, so we participate 50% of those profits. So the combined flows there between the management fee profit and the $10.5 million is the 15% return. And then in addition, on top of that return, we do receive a $2.5 million annual royalty per project and that's from the -- that's really derived from the technology license that we provided to Cyclyx at formation of the company. And so we received that for every project that the Cyclyx will deploy. And so relative to project status, as we've mentioned in our financing, we are well advanced in terms of development of the project. We are working through final site-specific engineering and we expect Cyclyx Board approval of the FID in the relatively near future. On next slide, please. And then take a little larger picture for a moment, if we flash forward to using CCC -- we're not putting dates in forecast here in terms of revenue forecast, but we did want to show what the business looks like when the full complement of 5 CCCs is up and running at full capacity. So if we flash forward to a snapshot here of 5 CCCs, we see that the -- and we're using CCC2 economics as the template, Agilyx would generate $55 million in profits from the 5 facilities, and then we forecast another $16 million in profits from management fee accruing at Cyclyx for a total of $71 million in annual income. So we do see strong demand for volumes and we're quite comfortable with our ability to scale the model. And importantly, these facilities -- these future facilities can be really primarily financed through means other than what we've done recently. So we've obviously just raised a large amount of debt and equity to fund CCC2. Moving forward, we're seeing in the market an appeal and interest in capacity reservations from petrochem companies who would like access to offtake and are willing to pay upfront for infrastructure in order to get offtake agreements. We expect there to be project-level debt available to finance these companies -- these projects and similarly, internally generated cash flow from Cyclyx will be a contributor to the equity component. So we really do feel like these future facilities can be funded in other creative ways than what we've done in CCC2 and therefore, decrease the burden on the existing shareholder base. So this is a pretty great business for us. We're really motivated to build these. You can see from the cash flow, we're motivated to build these facilities as fast as we can. We believe the market is there for us, and we're very well positioned to capitalize on the opportunity. So next, I'd like to just turn this over to Joe Vaillancourt, CEO of Cyclyx so he can share us an update on current activities at Cyclyx. Joe?

Thanks, Ranjeet. So Ranjeet did a fantastic job sort of framing up fundamentally the 2 elements that sometimes get confused. And I know that there's a lot of folks on the call who have been following the case, and I suspect there are some new folks. So I thought what we would do is just review at sort of a high level what Cyclyx is and is doing and how it's delivering its value. And then along the way, just add some operating updates. And this slide just sort of pictorially shows what Ranjeet just described, for the advanced recycling industry to sort of mature as it needs to, you need 2 fundamental components. You need the conversion technology partners to scale their infrastructure, but they need to be fed separately by feedstock management systems. Cyclyx believes we have something unique and that the systems currently today, as we've talked about in the past, just are not sufficient in the way they've been designed to handle the complexity of waste plastics. And so therefore, they only accept a certain level of high quality. Cyclyx with the help of Agilyx over the last 15 years has developed a competency to manage that chemical complexity through what we sort of call chemical fingerprinting which then we use predictive models, which then allows us to custom compound. With that sort of base capability then we filled in the gaps to provide sourcing, aggregation and preprocessing. And so Cyclyx, as Ranjeet said, is sort of positioned to be technology agnostic and able to be custom developing feedstocks for different downstream partners. Our primary focus initially is advanced recycling, they sort of anchor the production demand. But in the way that we're capturing all plastics, we are very aggressively also working with mechanical recycling offtakers as well. So we think this is a differentiated capability. And how we manifest that is through really 2 fundamental value proposition services. And if we go to the next page, the first one, you've heard us talk about circularity centers. So for us to scale, we really needed to look at designing new asset types. This asset is different in several fundamental ways. First off, it's of a scale dedicated to waste plastics. It accepts always plastics, which by itself is unique. But it's also very, very large to handle the diversity. And so we can handle C&I, so segregated material, and we can handle very complex mixed plastics from existing infrastructure as well as taking back new material from landfill that we'll talk about here in a minute. So we take all plastics in. And what we've done is we've integrated our capability to manage the complexity to custom compound very specifically responsive to the offtakers demand. That is a key piece. So if you were to walk into this facility, it would look sort of similar, if not bigger. But really, fundamentally, what's different is we're tracking all the material through the system from the source, from its chemical profile, and we're mixing it together in agglomerated pellets and then mixing and final blending to our customer specification. And we're doing all of that with the ability to track ISCC Plus certification, which is really critical for our downstream partners to get proper credit for the recycled content. As it relates to sort of an update, we've talked about CCC1. It's been out there for a while. As you know, we've selected a facility in the Tradeport in Houston. It's a 500,000 square foot under roof. It will be expected to produce 150 [indiscernible] material, 100,000-ish for events recycling and 50,000 for mechanical recycling partners. Happy to report, it is progressing on time, on budget. All of the equipment is procured and are starting to be mobilized. Construction is starting actually this week, so we expect our commissioning date to be set. While we're doing that, we've had a development plan to start to source and procure material. So prior to procuring and obviously, we have to test it, and so at this point, we've tested over 2,000 samples very specifically for the site. We've qualified 750 sources already that all will be -- and we're about 20% under contract with those sources. So we're making very good progress. We're out of schedule actually on the procurement. And we're starting the staffing. So this CCC1 will have approximately 113 employees, and so we're staffing now to get the training programs in place. So super exciting time for the CCC development. CCC2, which we've sort of mentioned in various detail is progressing as well. We've done the waste shed analysis. We are targeting also CCC2 to be in the Gulf Coast region. We've finalized or are finalizing the engineering design and hopefully progress to FID here in the short term. So this is fundamentally one of the primary ways we deliver value. But for this to scale, obviously, we now need to focus in on how do we source material. So if you could go to the next page, I'll talk a little bit about the 10 to 90 programs that we have. So for folks who are familiar with this, we have developed a branded 10 to 90 set of take-back programs to divert as much waste plastics from landfill as possible. And they have manifested themselves in a bunch of different -- a handful of different programs ranging from residential curbside to residential drop-off, closely associated with other community-based drop-off like universities. We have quite a few corporate take-back programs ongoing, and we certainly are looking forward to other C&I take-back programs. We have 10 of those in process now with some Tier 1 brands, and so it's exciting. As it relates to sort of the status update there, I think you're all aware that we have launched all plastics in a bag, bag that will bring it through the 10 to 90 with the city of Houston. We currently have 9 drop-off locations, community-based locations migrating to 34 here in the near future. We're currently in various stages of activating similar programs with the school system. We have 22 currently with the expectation that we would migrate to all 274. Relative to additional municipalities and cities, we are now in discussions with every city in Texas with the population over 65,000. That gets us somewhere around 9.1 million population to introduce these similar programs. So as of right now, we're very excited that for CCC1 and 2, we think we have more than sufficient identified volume to feed these plants. So with that, I'll stop my update and hand it back to Ranjeet and Bertrand, but I suspect we can get into more detail here in the Q&A.

Thank you, Joe. Thanks, Joe. Chris was going to speak to this now just relative to status of the conversion business. Chris, do you want to take it?

Yes. Thank you, Ranjeet. So as mentioned, as we've been continuing to pivot the company to focus on our deployed technology through Cyclyx and the opportunities there that Joe mentioned, we are still able to support the conversion business and the IP that we've developed over the past 15 years plus or so. And one of those is what we've been discussing for the past 1.5 years with the market, and that's our Toyo Styrene project. And so Ranjeet mentioned that we did indeed with Toyo produced on-spec products within first days of operations earlier this year and it was a pretty exciting milestone for both Toyo Styrene as well Agilyx. And we're continuing to support them through their ongoing operations through the remainder of the year, getting them up to speed and providing them with sufficient support and training so they can continue to be successful in their circularity pursuits and their sustainability programs. Additionally, we mentioned that we finished our front-end engineering design for a commercial scale system. This has been done on a U.S. location for U.S. project and enables us to have a substantially base package for replicating that design and other areas. And enables us to attract strategic partners to really commercialize the technology we've developed with Technip Energies that we've branded through TruStyrenyx and move that IP forward into commercialization. And that's what we've been focusing on more recently as we pivoted the company is finding that strategic partner kind of leaning away from a pure licensing model into a more flexible structure that will enable us to meet the market demand that's been highlighted. Some of that chemical recycling demand from offtakers that was highlighted in the Cyclyx opportunity is indeed in the Styrene space. And so we now have that proven closed-loop circular Styrene solution with our partners, leverage our partnership and collaboration with Cyclyx on the feedstock and able to provide integrated solution to the market. As we've already been able to circle 220,000 tons of offtake demand for the circular Styrene, so we're going to be continuing to work the offtake demand and find the right strategic partners to deploy assets and meet that market demand going forward. So the team is excited that we have this technology and that we're going to differentiate our offering beyond just a pure licensing model to exploit this opportunity.

Thank you, Chris. Next slide. I think Bertrand, do you want to pick up from here?

Sure. Thank you, Chris and Ranjeet, and good afternoon, everyone. For those of you who may not know me, my name is Bertrand Laroche. I joined the company in December 2023, initially leading Corporate Development and was just promoted to CFO. So on Slide 12, we can discuss the $40 million equity raise and bond guarantee that together secured the necessary funding for our 50% interest in CCC2. So last week, we successfully completed $40 million equity raise by issuing 14 million shares at [indiscernible] per share. This transaction increased our total share count to 109.7 million, building on our strategic shift to the feedstock management. This equally raises a strong word of confidence from our investors in our new direction. This capital injection enables us to advance our ambitious plans with CCC2 in collaboration with our strategic partners, ExxonMobil and LyondellBasell. The equity raise was complemented by a $40 million bond guarantee underwritten by DNB. The bond will be placed in the market in the fall. Energetics also secured a $7 million unsecured loan from Saffron Hill Ventures at the same interest rate as the bond. So the total capital raise of $87 million covers the estimated construction cost of CCC2 of $71.5 million with an additional $15.5 million earmarked for working capital and transaction fees. Securing the funding for our capital contribution in CCC2 really positions Agilyx for long-term success with strong cash flow generation from the second half of 2026 when CCC would reach its design capacity. This milestone is a key component of our broader vision to become the leading global provider of plastic waste feedstock to the recycling industry with Cyclyx at the core of our strategy. Now let's turn our attention to Slide 13, Ana, where I can walk you through the key financial metrics from the first half of 2024. So these numbers reflect both the challenges and opportunities that come with a strategic shift we've undertaken. The reported results for the first half show material reduction in conversion, project revenues and associated operating costs. So revenue of $0.4 million for H1 was significantly lower than the previous year, reflecting the strategic pivot from licensing conversion projects to feedstock management through Cyclyx. Despite the revenue decline, our operating expenses have been reduced by 23% year-over-year, demonstrating the company's commitment to cost management during this transitional period. Excluding a onetime impairment charge of $0.9 million, it's a reduction in OpEx, which is 35% from 7.8% in the first half of '23 million to $5.1 million for this period. With the headcount at Agilyx reduced by more than half since the beginning of the year and some reduction happening at the beginning of Q3, we expect the financials of the second half to further reflect the continued cost rationalization efforts. Despite this small footprint, Agilyx continues to fully support Cyclyx shared services while retaining critical IP and engineering competency. Our net loss for the period was $11.5 million, a slight increase compared to last year, primarily due to our continued investment in scaling Cyclyx. Over the first half, Cyclyx revenue increased 60% from last year from $3.5 million to $5 million, mainly driven by post-use plastic feedstock sales, pre CCC and the loss, I'd say, increased to $3.9 million net to Agilyx for the first half as Cyclyx team continue to grow rapidly to bill CCC1 in time and on budget, as Joe mentioned. And also prepare CCC2 and continue to execute on its way sourcing strategy. The cash position was at $1.7 million as of June 30, but was substantially improved by the $40 million equity raise completed last week. Thank you for your attention.

Thank you, Bertrand. I think that brings to the end of the prepared comments, and we're happy to open up to any questions people have.

People are unmuted, so they just need to unmute their own microphone.

Okay. Thank you. Go ahead, Adam. I think you need to unmute your microphone. There's some technical difficulties over there. So if anyone else has any questions, we can try to work that out.

Ranjeet, maybe encourage the chat to ask questions.

Yes. Ana?

Yes. So I have a couple of questions. Just starting on Slide 5, you mentioned some selected client relationships. I was just wondering if that was some sort of redec to the 10% of offtake for CCC2 that could be reserved for a third-party client? And I was also wondering when we should expect to hear more about any potential third client for the offtake and then when that could be announced for CCC2?

Slide 5 is the one that Ana has up on the screen here?

Yes, I thought. I was just wondering about the one where you have -- you are saying on the right-hand side, selected client relationships with Exxon and Lyondell and the secured offtake and there are some other names there?

So those are the names of other members of the Cyclyx consortium who were either speaking to Cyclyx or through Agilyx even in the case for conversion technologies. So that's really a sampling of people who have different roles with the business. Relative to third-party offtake, it is really a clear priority for us for CCC2 to bring in third-party offtake, I would expect that it would take us still a few months to -- we are going through testing with a variety of parties. We are making sure they understand and we understand the specs that are acquired, and there needs to be a negotiation on terms. So I expect that it won't be this quarter, but probably in the next couple of quarters, we should be able to communicate some progress there.

Okay. And I was also just wondering if you could elaborate a bit more on sort of what the offtake for Exxon and Lyondell for CCC2 would go to, given that I understand that for CCC1, the chemical recycling offtake is primarily for Exxon. So I was wondering is Lyondell also taking chemical recycling feedstock? Or is it still on the mechanical side?

Joe, do you want to take that?

Yes, it's both. So for CCC1, Lyondell is immediately focused on some of the MR, but of course, you've seen through their public announcements, their advancement in the AR space. They take it into the details, but it's a similar pathway and that they're going to pyro oil intermediate to a virgin resin supplement. And so they would be for CCC2 expected to take similar offtake as Exxon would.

So hand up, but I don't know, Adam, the mute button seems to be broken on your side. I don't see any questions in the chat. Any other questions on the -- okay. Well, I guess if there's no other questions, we are -- Ana, go ahead.

Yes. I thought if no one else was in the line, I should take the opportunity sort of to ask. On the conversion side, you mentioned something about finding a partner that could potentially build out projects related to your technology. So I was just wondering if you could shed some more light on how you think such an agreement could look like and what that could look like financially from your point of view?

Sure. So we -- I guess a little bit of background also there is that, as you know, we've traditionally been licensing our technology to third parties, typically the offtaker, who would be licensing for their purposes. They're the offtaker. They come up with the balance of the plant and they develop the project. And what we've realized, of course, is that the -- is that just the time line for them to make a decision, some of the macroeconomic impacts, we should take control of the situation ourselves and make sure we can have more predictability. And so what we've done, and Chris has been particularly focused on is, going out and finding a book of business on the offtake side and that's going to, over the next short period, likely going to evolve into really firm commitments on pricing and volumes. And then taking that offtake, that book of offtake along with the finalized engineering plans, which have now been concluded as we've been working on for some time to a partner and say, we've got both the offtake and we have the technology, we need the capital to build these projects, Agilyx is not intending to make investments in the conversion and technology system. So what we'll be doing is taking a package, a full completed shovel-ready package to an investor and saying, would you like to participate. And our thought is that it's probably more interesting for them to do not just one, but have -- I mean, given the volumes that Chris has spoken about relative to 200,000 tons plus of volume identified, go to our partner and suggest that we're not only going to build a few perhaps with you as the financing partner, and we, Agilyx, will retain ownership in the operation in some manner by virtue of our contribution as a developer. To be determined whether that becomes a licensing arrangement where they're paying a master license and we're getting fees for every project that's built or it could be that we create a Cyclyx type venture where we retain ownership and our contribution, as I mentioned, and they're contributing to capital. I think that's to be determined as we go through these conversations with partners.

Ranjeet, I see Adam finally got a question in chat.

So Adam's question is, I wanted to ask about CCC3 to 4. Can these be developed in parallel? Have sites been identified and has work on sourcing already underway?

If you don't mind, Ranjeet. So in anticipation of the growth, we have initiated waste shed analysis in all of the major metropolitan areas. We certainly have done quite extensive work all up and down the East Coast, Mid-Atlantic, the Chicago area. And so we've got a pretty firm understanding of the potential feedstock supplies. At the same time, we've done a pretty rigorous scan on existing warehousing space that could be readily adaptable for future sites, but we're also in discussions with potential partners who want to build to suit that bring extra synergy around co-location with rail and things. And so we have a lot of predevelopment work in anticipation of that. So it's certainly possible that 3 and 4 could be done in parallel. The foundation of work will have been done.

Thanks, Joe. Okay. I think that's it. I don't see any other questions in the chat. I would like to thank the team here for the time and also all the investors and analysts and participants who have taken the time to listen to our presentation today. We're always available to talk any time, be in touch and we'll be happy to meet in person, sit down on the phone, et cetera, and ask any more questions people have. But for now, thank you, and we'll sign off.

Thank you, everybody.