Gevo, Inc.

Good day, and thank you for standing by. Welcome to the GVO Incorporated Quarter 3 2024 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 1 on your telephone. You will then hear an automated message advising that your hand is raised. To withdraw your question, please press star 1 1 again. Please be advised that today's conference is being recorded. I would now like to turn the conference call over to your speaker for today, Dr. Eric Frey, Vice President of Finance and Strategy. Eric, you may begin.

Good afternoon, everyone, and thank you for joining us on today's call to discuss Jivo's third quarter 2024 results. I'm Eric Frey, Vice President of Finance and Strategy at Jivo. With me today are Jivo's CEO, Dr. Patrick Gruber, and CFO, Lynn Small. Earlier today, we issued a press release that outlines the topics we plan to discuss. A copy of this press release is available on our website at www.jivo.com. Please be advised that our remarks today, including answers to your questions, contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act. These forward-looking statements are subject to risks and uncertainties that could cause actual results to be materially different from those currently anticipated. Those statements include projections about the timing, development, engineering, financing, and construction of our sustainable aviation fuel projects, our recently executed agreements, our renewable natural gas project, and other activities described in our filings with the Securities and Exchange Commission, which are incorporated by reference. We disclaim any obligation to update these forward-looking statements. In addition, we may provide certain non-GAAP financial information on this call. The relevant definitions and GAAP reconciliations may be found in our earnings release, which can be found on our website at www.givo.com in the investor relations section. Following the prepared remarks, we'll open the call for questions. I'd like to remind everyone that this conference call is open to the media, and we're providing a simultaneous webcast to the public. A replay of this call and other past events will be available via the company's investor relations page. I'd now like to turn the call over to the CEO of Jivo, Dr. Patrick Gruber. Pat?

Thanks, Eric. Good afternoon, everyone, and thanks for joining us on our call. We have filed our Form 10-Q today. We ask that you refer to it for more detailed information after this call. During the third quarter and shortly after the close of the third quarter, we achieved several important milestones. Not only did these milestones enhance our financial outlook, but they also reinforced GEVO's commitment to advancing drop-in, cost-effective, scalable carbon abatement solutions for those difficult-to-electrify market sectors and industries. Two of the milestones we achieved are transformative to our company, even when you consider them individually. Let's start with our acquisition of Red Trail Energy's low-carbon ethanol and carbon capture sequestration assets in North Dakota. This acquisition, which we expect to close by the first quarter of next year, brings a well-operated low-carbon ethanol plant along with an active CCS site into our portfolio. Red Trail assets will be a valuable addition to GEVO. In fact, they generate approximately $200 million in revenue in the fiscal year of 2023. They're going to be a great addition to our company. It's transformative. This positions us for long-term success, providing a platform for further growth by developing our carbon abatement capabilities. For example, We are exploring converting low carbon ethanol at the site to SAF using our Verity business to track the farms and count carbon and make sure that we can account for all the carbon abatement that occurs throughout the business system. We also, by acquiring this site, provides our Net Zero One project in South Dakota with access to a wholly owned CCS site that could be important for the future. In short, this acquisition, once closed, is expected to accelerate our plans to scale SAF production, we call it Net Zero North, and strengthen our footprint in the region with abundant renewable resources, strong rural communities, and resilient domestic circular economies. Now let's talk about the other transformative milestone we achieved. That is the conditional commitment from the U.S. Department of Energy. This is a major milestone for our Net Zero One SAF project in South Dakota. This 1.63 billion loan facility marks the first large-scale alcohol-to-jet project to receive such a commitment. We believe this commitment validates the strength of our project, reduces our execution risk, and supports our financing plan. NET-01 is the largest economic development project in South Dakota history based on our and we expect to attract other capital investments to unlock SAP commercialization given the robust due diligence conducted by the DOE. We are grateful for the support from the DOE Loan Programs Office. We also recently acquired Cultivate Agricultural Intelligence LLC, or Cultivate AI. It's a proven business with expected 2024 revenue of $1.7 million and a correspondingly positive cash flow. Cultivate AI provides agricultural data, including that from drones with near-infrared sensors, to clients through a software as a service platform, a SaaS platform. We are combining Cultivate AI's digital agricultural data and analytics platform with Verity's carbon accounting and tracking solutions to provide the highest quality data-driven solutions for carbon abatement in food, feed, fuels, and industrial markets. while simultaneously helping farmers improve their operations, sustainability, and profitability. Finally, in the third quarter, we were granted not one, but two patents for our breakthrough ethanol to olefin process. We also monetized investment tax credits related to our R&G business, generating cash proceeds, and further bolstering our liquidity. So in summary, we've been pretty busy, and there's a lot more to come. We are looking forward to next year with this acquisition of Red Trail Energy Assets and in combination with our energy business, we believe this will help us achieve a positive adjusted EBITDA 2025. That's very exciting. This quarter's achievements reinforce our commitment to reducing the carbon footprint of the things we people need, that is food, fuel, materials, while transforming GEVO into a large scale platform for growth. With each milestone, We're advancing our vision to scale drop-in low-carbon molecules such as sustainable aviation fuel and, of course, to create value for our stakeholders.