Origin Materials, Inc.

Thank you for standing by. This is the conference operator. Welcome to the Origin Materials fourth quarter 2022 earnings call. As a reminder, all participants are in listen-only mode and the conference is being recorded. After the presentation, there'll be an opportunity to ask questions. To join the question queue, you may press star then one on your telephone keypad. Should you need assistance during the conference call, you may signal an operator by pressing star then zero. I would now like to turn the conference over to Ashish Gupta, Investor Relations. Please go ahead.

Thank you and welcome everyone to Origin Materials' fourth quarter 2022 earnings conference call. Joining the call from Origin Materials are co-CEO Rich Riley, co-CEO and co-founder John Bissell, and CFO Nate Whaley. Ahead of this call, Origin issued its fourth quarter press release and presentation, which we will refer to today. These can be found on the investor relations section of our website at originmaterials.com. Please note on this call, we'll be making forward-looking statements based on current expectations and assumptions, which are subjects to risks and uncertainties. These statements reflect our views as of today, should not be relied upon as representative about views of any subsequent date, and we undertake no obligation to revise or publicly release the results of any revision to these forward-looking statements in light of new information or future events. These statements are subject to a variety of risks and uncertainties that could cause actual results to differ materially from expectations. For further discussion of the material risks and other important factors that could affect our financial results, please refer to our filings with the SEC, including our quarterly report on Form 10Q, dated November 3rd, 2022. In addition, during today's call, we will discuss non-GAAP financial measures, which we believe are useful as supplemental measures of origin materials performance. These non-GAAP measures should be considered in addition to and not as a substitute for or in isolation from GAAP results. You'll find additional disclosures regarding the non-GAAP financial measures discussed on today's call and our press release issued this afternoon and our filings with the SEC, each of which is posted on our website. The webcast of this call will also be available on the Investor Relations section of our company website. With that, I'll turn the call over to Rich.

Thank you, Ashish, and thanks to everyone for joining us. For today's presentation, we will be referring to the slides that were posted to the investor relations section of our website earlier this afternoon. I will start by reviewing Q4 highlights, then provide a commercial and regulatory update. I will then turn it over to John, who will discuss construction progress on Origin 1 and Origin 2, our Origin 1 platform development and application strategy, and our new strategic partnership with Avantium to accelerate the mass production of FPCA and PEF. Nate will wrap up with a financial overview. We will begin on slide three. We continue to execute on our plan and make progress on our mission to enable the world's transition to sustainable materials. First, we have seen a more than nine-fold increase in our customer demand since our announcement to become a public company in February 2021, with offtake and capacity reservations increasing to $9.3 billion as of today. Customer demand remains strong and broad-based, and we continue to expand the breadth of industries and end markets that we serve. As previously disclosed, due to strong customer demand, we are substantially committed for our Origin 2 paraxylene and PET capacity. As such, beginning in the fourth quarter, our sales and marketing team has shifted its focus from active marketing of PET towards higher margin products such as carbon black and advanced CMF-derived products including FDCA and PEF for Origin 2 and beyond. Second, as announced in January, Origin 1 is mechanically complete and commissioning is underway. with the completion of plant commissioning and startup expected in Q2 2023. Since mechanical completion, work onsite has continued, including electrical work and further technology refinement. Third, continuing on the next slide, regarding Origin 2. In early January, we announced the final approval from the Louisiana State Bond Commission and preliminary approval from the Louisiana Public Finance Authority for the issuance of up to $1.5 billion of taxes and bonds, inclusive of the previously announced expected $400 million in private activity bond volume cap allocation for financing the construction of the plant. We continue to expect that Origin 2 can be fully funded from its existing cash on hand, previously indicated traditional project financing, and potentially strategic partnerships. As Origin has an ongoing global technology licensing effort and an active government affairs team, we anticipate potentially strategic partnerships and federal incentive programs to play a meaningful role in the financing of Origin 2. We continue to make progress on front-end design, construction planning, and financing. We've also made progress developing new products and applications, which may be incorporated into the design of the plant, such as FDCA, BEF, as well as biofuels from an oil and extractive stream co-produced alongside CMF and HTC, and which has not been included in previous plans. We expect to provide an update on new product offerings and construction plans for the Origin 2 plant in mid-2023. Fourth, as I just touched on, we are seeing significant opportunities outside of PET and paraxylene to leverage our versatile platform technology to commercialize pathways for higher value applications for our intermediate CMF and HTC, such as FDCA and carbon black. We are exploring or qualifying FDCA, epoxies and resins, surfactants, sustainable carbon black, bioasphalt, fuel pellets, as well as biofuel and biosolvents. As part of this development work, Origin has entered into a strategic partnership with Avantium to accelerate the mass production of the advanced chemicals and plastics, FDCA, and PEF, which John will discuss in more detail. And finally, we are providing 2023 guidance for revenue of $40 to $60 million and adjusted EBITDA loss of $50 to $60 million. Our estimates assume a gradual production ramp at Origin 1 as the new supply chain becomes established with revenue expected to be booked starting in Q3 2023. Now turning to slide five, I'd like to provide a brief overview of Origin for those who are new to the story. Origin was founded with the mission to help solve climate change by enabling the world's transition to sustainable materials. Our patented drop-in core technology, attractive unit economics, and carbon impact have gained the support of a growing list of major global brands and investors spanning an increasingly diverse range of consumer and industrial end markets. Our list of strategic partners includes industry leaders such as Danone, Nestle Waters, PepsiCo, Ford Motor Company, Mitsubishi Gas Chemical, Cologne Industries, Primaloft, Solvay, Mitsui & Co, Minifin Group, LVMH Beauty, Revlon, Mitsubishi Chemical Group, Karare, Intertex World Resources, and ATC Plastics. Our CPG partners have publicly disclosed their intent to migrate 100% of their current petroleum-based PET consumption to decarbonized and recycled materials. After extensively evaluating our technology and testing our products, these market leaders have made significant financial contributions to Origin, both as investors and customers, demonstrating their environmental commitment and confidence in our technology and products. They have signed multi-year uptake contracts worth hundreds of millions of dollars. Over the past year, geopolitical tensions, inflation, rising interest rates, and escalating energy prices have highlighted the urgency with which the world needs to transition to more sustainable and less volatile energy solutions. The carbon-intensive nature of the plastic industry, where over 99% of product is made from fossil fuels, has placed the industry under considerable pressure to dramatically transform the way it produces and uses plastic, both for environmental and economic considerations. Origin offers an entirely circular plastic solution. carbon-negative recyclable PET, which the world's plastic recycling infrastructure is already designed to collect, sort, and reuse, with the critical added benefit of removing CO2 from the atmosphere. With 91% of the global economy now covered by net zero pledges, the urgency with which businesses need to adopt more sustainable practices extends well beyond plastics. And while there has been some progress made in reducing greenhouse gases from shifts to renewable energy sources and electric vehicles, it is clear that reducing emissions from energy use alone is insufficient to achieve the goals and commitments established by companies and governments. As a result, in the near term, we believe that these companies will need to integrate decarbonized materials into their supply chains. As such, we expect demand to remain well ahead of our projected supplies for the foreseeable future. Further, we remain encouraged by the strong favorable tailwinds that we continue to see for our technology and business model. with some of the world's largest public companies committing to zero carbon mandates and governments increasingly enacting regulations and funding investments to tackle climate change. Turning to slide six, the Inflation Reduction Act, or IRA, which passed in August 2022, is expected to provide approximately $369 billion in direct investment related to climate solutions. As we detailed in our last call, we are excited by the support the bill has received and see multiple meaningful funding opportunities that we plan to provide more detail on as the legislation is finalized. We remain optimistic that the funding offered by the IRA is relevant to us and are exploring several paths of eligibility for programs, including the Section 48C Advanced Manufacturing Tax Credit and the Advanced Industrial Facilities Deployment Program. These programs are expected to start receiving initial applications in March with decisions anticipated by year-end. In addition to the IRA, we are exploring opportunities for funding and financing under the 2021 Infrastructure Investment and Jobs Act, or IIJA. ORIGIN has identified more than a dozen IIJA initiatives that may potentially assist in financing a variety of ORIGIN investments, most notably ORIGIN II and infrastructure improvements in and around the Geismar Louisiana site. Turning to slide seven, We continue to make steady progress commercializing the business and have grown customer demand by more than $300 million since our third quarter earnings call for a total of $9.3 billion today, made up of off-take agreements and capacity reservations. This represents a more than nine-fold increase since we announced our intent to go public in February 2021. As a refresher, capacity reservations are signed agreements designed to lead towards take-or-pay contracts and revenue once our plans are complete. They give us and our customers more time to negotiate a take-or-fay offtake agreement, which typically is a much longer document that meets the requirements for project financing. We are also pleased to tell you about a new strategic relationship with a major global chemical company. We continue to see considerable opportunities to expand into new in-markets and applications, and we look forward to providing more detail about this partnership, as well as others, when appropriate. As previously mentioned, we continue to expand the breadth of industries and in-markets that we serve. From global CPG brands like Pepsi, Danone, and Nestle Waters, to automotive leaders like Ford and specialty chemical innovators like Solvay and Mitsubishi Chemical Group, to ultra-luxury brands like LVMH Beauty and iconic cosmetic brands like Revlon. We also continue to see significant opportunities to direct our intermediates toward higher margin products, such as carbon black, For example, where new strategic partnerships in 2022 with Mitsubishi Chemical Group, Intertex, and ATC Plastics provided us with significant momentum in this promising new product category. Notably, as we approach the start of origin one operations, we expect to accelerate the development of high performance products through technology collaborations and joint development agreements, or JDAs. As we previously mentioned, our customers require more development and testing for some of these higher margin products than for drop-in ready, paraxylene, and PET. OriginOne will produce CMF, HTC, and other intermediates and volumes that will enable customers to explore and qualify products and applications beyond PET and HTC fuel pellets. In summary, our sales pipeline remains strong as reflected in over $9 billion in customer demand. We continue to make inroads into new industries and have numerous active discussions with existing customers to expand their current agreements and with prospective customers to adopt our sustainable products. With that, I would like to turn it over to John, who will provide an update on Origin 1 and Origin 2, discuss our Origin 1 platform development and application strategy, and our recently announced strategic partnership with Avantium.