Thank you, Louisa, and thanks everyone for joining us on Babcock & Wilcox Enterprises second quarter 2023 earnings conference call. I’m Sharyn Brooks, Director of Communications.

Joining the call today are Kenny Young, B&W’s Chairman and Chief Executive Officer; and Lou Salamone, Chief Financial Officer, to discuss our second quarter results. During this call, certain statements we make will be forward-looking.

These statements are subject to risks and uncertainties, including those set forth in our safe harbor provision for forward-looking statements that can be found at the end of our earnings press release and also in our Form 10-Q that was filed today and our Form 10-K that is on file with the SEC and provide further detail about the risks related to our business. Additionally, except as required by law, we undertake no obligation to update any forward-looking statements.

We also provide non-GAAP information regarding certain of our historical and targeted results to supplement the results provided in accordance with GAAP. This information should not be considered superior to or as a substitute for the comparable GAAP measures.

A reconciliation of historical non-GAAP measures can be found in our second quarter earnings release published this afternoon and in our company overview presentation that was filed on Form 8-K this afternoon and posted on the Investor Relations section of our website at babcock.com. I will now turn the call over to Kenny.

Thanks, Sharyn. And thanks everyone for joining us this afternoon.

Well, as mentioned in our earnings release, we exceeded our company expectations in revenues and adjusted EBITDA for the second quarter of 2023, demonstrating the continued momentum we've experienced across all business segments. Revenues across all segments posted a second consecutive quarter of double-digit revenue expansion on a year-over-year basis with renewable, environmental and thermal increasing by 31% and 54% and 36%, respectively.

In tandem, we recognized an underlying improvement in revenue adjusted EBITDA and net loss on a year-over-year basis, despite increased spending in support of our emerging and new technologies in our renewable energy segment. These investments include sales, marketing, engineering, research and development and back office services and are all important to support future growth from our clean energy segments.

We are seeing our pipeline increasing to $9 billion of new projects over the next three years, which again, does not include our continued strong parts and services platform. In fact, we are seeing more than $1 billion in Bright Lube opportunities alone, and we'll be sharing more about that later in this call.

Our bookings in renewable increased by 28% in Q2 of 2023 versus Q2 of 2022. Our Environmental segment was consistent and helped approximately the same amount of bookings and backlog year-over-year.

Thermal bookings were lower quarter-over-quarter, primarily due to a large equipment supply construction project that we announced in 2022. However, thermal parts bookings increased by 17% year-over-year, quarter-over-quarter.

Overall, our backlog was lower quarter-over-quarter by 6%, again due to the large thermal project mentioned previously in 2022, but our outlook for new booking opportunities remains robust, and we are projecting backlog to grow significantly to a range of $850 million to $1 billion by year-end 2023, which includes key projects in both thermal and renewables. If achieved, this would represent a growth of 20% to 40% in total company bookings and backlog by year-end 2023.

Our parts and services business in the second quarter continued to support our revenue generation, accounting for nearly 37% of the company's total revenues. The Thermal segment was a large driving factories we maintain a vital role in supporting the broad demand for energy security among global expansion and gas conversion efforts.

We see thermal parts and services returning to normal levels, which is reflected in our revenues and full year expectations. In addition, our global reach and our renewable services, especially in Europe was in line with our outlook at the start of the year and is expected to remain strong through the remainder of 2023.

As I mentioned earlier, our project bookings within our clean energy technologies continues to grow. And most notably, the interest across our Climate bright decarbonization platform continues to increase.

In July, we announced that B&W received a contract award from North Star Clean Energy to conduct an engineering study of our SolveBright carbon dioxide capture process to convert a coal-fired power plant to biomass fuel. This study is the first phase of a commercial scale project partially funded by the US Department of Energy and marks an integral step towards our anticipated large-scale commercial project to retrofit Filer City's stations power plant with biomass and decarbonization technologies to replace coal.

When complete, the 75-megawatt power plant would use sustainable biomass as a fuel to generate power with net negative CO2, providing power to more than 70,000 homes. We are excited to bring our clean energy technology to the market and further advance NorthStar's decarbonization efforts.

In addition, you should watch for an important announcement from the Governor of West Virginia about a hydrogen project developed by our partners at Fidelis. This new opportunity is based on previous Fidelis H2 announcements, and we are excited to be part of this developing next step in clean power generation in West Virginia.

That announcement will be made tomorrow morning around 10:30 a.m. Eastern time.

With regard to our renewable project developments, we are pleased with the recent demand we've had within our solar business as well, despite the headwinds within the residential solar space that you probably read about recently, the tailwinds across the US for both community and commercial solar projects continues to grow. Our recent contract award totaling over $20 million by Summit Ridge Energy for roughly 25 megawatts of community solar energy projects in Illinois reinforces this point.

This contract marks another successful collaboration between BMW and Summit Ridge Energy and demonstrates the increasing demand in community and utility-scale solar projects. We are in negotiations on additional solar projects that when combined with the recent Summit Ridge Energy announcement, would equate to approximately $100 million in solar bookings in the second half of 2023, that is roughly double the amount of bookings in 2022.

We are also increasing our investments in solar business, which in the long run will help position the company for improved gross margin and operating margins on a run rate basis by year-end. This includes back-office systems and support, increased self-performance, as well as site management.

Transitioning to our BrightLoop hydrogen generation technology, we are pleased to report several key developments, including announcing a dedicated organization within Babcock & Wilcox, led by our Chief Strategy and Technology Officer, Brandy Johnson, to drive our execution and ramp-up of our initial commercial projects in Wyoming and Louisiana. For market clarity, we are redefining our BrightLoop systems as small, medium and large for now, to demonstrate their ability to meet demand at all sizes.

Initially, we are planning to deliver medium platforms in Wyoming and Louisiana with scale up to the larger platforms planned for both sites. Just yesterday, we announced an offtake agreement with General Hydrogen to acquire both hydrogen and CO2 from our medium-sized biomass BrightLoop platform.

We are also in formal discussions with another global syngas company to sign an additional offtake for hydrogen from both a medium and large platform. The Louisiana projects will produce an initial hydrogen output of approximately 10 to 15 tons per day for industrial use with an anticipated scale up to large unit hydrogen production by the second half of 2029.

This timeline closely reflects the development plans in place for our Wyoming project with initial hydrogen production output of approximately 10 to 15 tons per day by mid-2025, with anticipated scale-up to a large unit hydrogen production by the second half of 2028. Also, we had demand for one or two smaller platforms, roughly one to three tons of hydrogen per day and are determined to have one of those sites producing hydrogen by the end of 2024.

For our upcoming small and medium-scale projects, we've outlined projected development plans with the timeline for initial hydrogen production in 2024. Meanwhile, while BrightLoop's financing efforts continue to develop, our confidence remains strong.

We anticipate funding coming from state and local governments as well as investments from various pension funds and end customers as well as Babcock & Wilcox. We are seeking direct financing either at the project level or through B&W directed towards specific projects.

Longer term, we continue working with various Department of Energy and DOE loan program offices including progressionally-approved appropriations funding directed towards the funding of hydrogen demonstration using chemical looping. Our pipeline as previously mentioned, is over $9 billion across all three segments, and we currently have, as mentioned previously, approximately $1 billion in BrightLoop opportunities alone.

We believe this puts us on a pathway to reach $1 billion in bookings by 2028 with combinations of small, medium, and large projects. We feel confident that could lead to $1 billion in revenues by 2030 and beyond.

That will still only represent roughly 1% of the market share of total hydrogen spend by 2030. To give more clarity, roughly, and of course, depending on specific site factors, the revenues associated with the small projects will equate to roughly $5 million to $40 million per unit; revenues for the medium units will be roughly $40 million to $100 million per unit; and revenues for large units will be approximately $150 million to $400 million per unit.

These revenues should bring 20% to 25% gross margins plus, following revenues of -- I'm sorry, 25% gross margin. The follow-on revenues of approximately 200,000 to 250,000 per ton of hydrogen produced in services and particle support per day will produce even higher margins.

You will find more details in the new Bright Lube deck posted to our website today, and we've also included some of the new Bright Lube slides in our investor deck as well. Given the strong financial performance that has continued throughout the year, paired with our seasonally strong third and fourth quarter results, which are cyclically second half weighted, we are confident in our ability to achieve our full year 2023 adjusted EBITDA target of $100 million to $120 million, while continuing to balance our investments in future growth along with adjusted EBITDA performance.

I'll now turn the call over to Lou to discuss the financial details of the second quarter in 2023. Lou?

Thanks, Kenny. I'm pleased to discuss our second quarter results, further details of which can be found in our 10-Q that was filed with the SEC today.

Our second quarter consolidated revenues were $305.2 million, which is a 38% improvement compared to the second quarter of 2022. This is primarily attributable to higher volumes in our renewables segment due to renewable service and our solar based businesses, higher overall volume in our Environmental segment and increasing thermal segment volume due to higher levels of construction and parts activity.

Our net operating income in the second quarter was -- of 2023 was $7 million as compared to an operating income of $3.7 million in the second quarter of 2022. This second quarter included a onetime gain on the sale of an asset.

Our adjusted EBITDA was $21.9 million compared to $22.9 million in the second quarter of 2022, which when adjusted for the onetime sale of the asset in the second quarter of 2022, represents a significant improvement in adjusted EBITDA from $15.9 million to $21.9 million. Bookings in the second quarter of 2023 were $191 million, and we had an ending backlog of $567 million.

Our loss per share in the second quarter was $0.10 compared to a loss per share of $0.07 in the second quarter of 2022 or a loss of -- in 2022, a loss per share on an underlying basis when excluding the noncash pension benefit of $7.4 million, and this also included the onetime gain on the sale of the asset, which I previously mentioned. I'll now discuss our second quarter segment results.

Within our Babcock & Wilcox Renewable segment, revenues were $98.9 million for the second quarter of 2023 and which is an increase of 31% compared to the $75.2 million in the second quarter of 2022. This increase in revenue is primarily due to higher volume associated with our renewable services business and our solar businesses.

Adjusted EBITDA in the second quarter of 2023 was $500,000 as compared to $4.2 million when excluding a nonrecurring $7 million gain from the sale related to development rights of a future solar project in the second quarter of 2022. Within the Babcock & Wilcox Environmental segment, revenues were $48.7 million in the second quarter of 2023, which is an increase of 54% when compared to $31.6 million in the second quarter of 2022.

This increase is primarily driven by overall higher volume of dry cooling technology projects across the Environmental segment. Adjusted EBITDA was $3.4 million for the quarter compared to $600,000 for the same period last year, again, primarily driven by higher revenue volume as described above.

Turning to our Babcock & Wilcox Thermal segment. Revenues were $158 million in the second quarter of 2023, which represents an increase of 36% compared to the $116.3 million in the second quarter of 2022, and this was primarily attributable to the higher level of volume in our construction projects and our packaged boiler business.

Adjusted EBITDA in the second quarter of 2023 was $24.4 million, which is an increase of 49% compared to the $16.4 million in the second quarter of 2022. This is again primarily driven by the higher revenue volume described above as well as better project performance.

I'll now turn to our balance sheet, cash flow and liquidity. Total debt at June 30, 2023, was $358.2 million, and the company had a cash, cash equivalents and restricted cash balances of $83.9 million at the end of June -- at June 30, 2023.

I'll now turn it back to Kenny.

Thanks, Lou. Well, in closing, we continue to position Babcock & Wilcox as the leader within the broader clean energy transition, further developing our suite of decarbonization solutions while continuing to support our thermal customers.

With our line of sight into expanding new bookings, opportunities and expanded pipeline of over $9 billion in identified global projects, including our BrightLoop hydrogen generation technology, we are excited about the remainder of 2023 and the industry tailwinds in place for 2024 and beyond. Our momentum in the first half of the year wouldn't have been possible without the dedicated team of B&W employees driving these initiatives behind the scenes.

I would like to thank all of our employees for your continued efforts in moving these innovations forward and also supporting our customer projects, both domestically and abroad, while working safely and providing the highest quality performance and operational success. In addition to thanking our employees, we also want to extend our appreciation to our valued customers, shareholders and trusted partners for their continued support and belief in our company.

Our commitment in driving innovation forward is central to B&W's mission, and we look forward to working with you and building upon our accomplishments in the years to come.

Hi, Kenny and Lou, thanks for taking the questions. Maybe first on my end, can you just talk a little bit about the NorthStar Clean Energy project and just kind of what the opportunity on the revenue side is there and maybe time line milestones as we look to kind of Phase 1 to Phase 2?

And then is there anything else you can share there on the opportunity with this customer or other customers on like the biomass side of things?

Sure. Yes, I'd be happy to.

Thanks, Aaron, first of all, for joining today. So the key kickoff project, which we announced was the -- obviously, the engineering study and phase, and that's -- it's small revenues for us, probably roughly $1 million for that phase of the project overall.

The intent would be that, that's complete here in probably early fourth quarter and finalizing that by year-end with the client. We anticipate once they move past that phase when they -- if they move into the full project phase of the project, which is a 75-megawatt biomass facility, our efforts in this regard on this project will be more focused towards the decarbonization aspect of that plant and site.

So the SolveBright Technologies will be positioned well there for that, and we're excited about that opportunity. Ballpark, if we were to move to a full project phase, we think about the revenues being somewhere in the $90 million to $100 million-ish range, plus or minus, depending on exact scope and finalizing that particular contract.

And that probably would be something that would be if we get to that range or that step would be a booking that we would realize somewhere mid next year, third quarter, maybe something like that. So -- but that's the exciting part is one of the early opportunities around our SolveBright Technology, and we're excited to see that move forward.

Got it. Thanks for the color there.

And then maybe just second, can you just -- on the backlog and kind of the guidance, can you just talk a little bit about the confidence you have in the second half and kind of reaching the guide? And then just you kind of laid out the $850 million to $1 billion.

Just any color on what areas drive that?

Yes. No, that's -- I think I said $850 million to $1 billion, but I want to clarify, you're right, it's $850 million.

So thanks for clarifying that. But there's obviously a number of projects that we have that we're in negotiations on that are sizable projects in both thermal as well as in the clean energy technology that we're involved in today.

Some of those -- obviously, when we give a range, we're anticipating some of those to happen and some may get pushed into early next year. But we've got a number of those projects that we're in negotiations on right now.

From an internal planning perspective, we thought 1 or 2 of those may move into bookings more in the Q2, Q3, but there they're slipping into Q3, Q4. But we're -- and 1 or 2 of those may slip into next year.

That's why we provide the range of the $850 million to $1 billion. But we see a pathway to those opportunities, and we're in discussions and negotiations on those as we speak.

So that's what gives us the confidence in those numbers. Hopefully, that helps, but happy to answer more if I can.

No. I think that's good.

Thanks for taking the questions. Appreciate it.

No, no problem. Thanks, Aaron.

I appreciate it.

Hi, Kenny and Lou. On the Bright Lube pipeline, you've gotten -- you've gotten more bullish on the Bright Lube pipeline and sort of scoped it out a little bit more definitively here.

What's sort of driving all that comment? I assume, it's a number of customer interactions, but where are the customers at?

And is it driven by some of the IRA and other legislation?

Yeah. Well, combinations of all that.

So it is more bullish because of the interactions that we're having, both on the Wyoming aspect and the Louisiana aspect initially on those two. There's excitement for us anyway, and I won't -- can't comment much further, but in and around discussions we're having in the oil and gas industry on potential projects using petroleum coke or pet coke as a fuel source as well to, plus a number of other projects.

We're also seeing discussions and we're moving into specific long-term planning around, as I mentioned in the call, scale up from the initial medium-sized projects in both those locations, Louisiana and Wyoming, to large size units, both those locations, the need for hydrogen on both of those are much bigger than the medium units will provide, but the scale-up is in discussions right now, and we see pathways to move those forward a little bit. Further once we get the medium size up and running.

So we've got pathway into large units and see visibility into those. We see visibility into other projects, like I said, in the oil and gas industry as well as a few others that are around the world.

That's on, I would call it, I'm saying immediate opportunities, meaning opportunities that we're actively engaged in. We're in early discussions with on other projects potentially in Europe and elsewhere, that give us confidence in those around our ability to get to those bookings and backlog that I mentioned.

I'm sorry, our bookings and revenues that I mentioned on the call associated with Bright Lube. So the uniqueness for us is we're one of the only technologies that can leverage a, a solid fuel aspect on a scale-up environment to produce hydrogen and also isolate the CO2.

The second aspect is we're unique in our ability to be able to blend fuels on Bright Lube. That really comes into play in these opportunities.

If you look at, for example, in Wyoming, the possibility exists and we're planning on introducing a mixture of biomass with in that particular case, coal as a fuel source. That will, to your point, will allow us to leverage some of the IRA credits, 45 credits on that -- or us or the customer depending on how we finalize that.

But still the drivers from the IRA standpoint to blend the biomass and with the coal to leverage those credits. And that's something that we're in dialogue and discussions right now directly with the customer to make a final determination there.

But ours is the only real technology that can have that dual blending. We'll be looking at similar aspects on either natural gas and biomass and other locations and yet in other locations, it will strictly be biomass and yet in others, it will be strictly natural gas.

So we have that runway. When you look at -- just to expand on that, I'm going to go a little bit further, when you look at our technologies versus a steam methane reform or autothermal reform, technologies, we vastly different in the fact that we can produce hydrogen from natural gas, but our process using the chemical looping will actually create and isolate the CO2 on the front end of the process rather than in a very expensive post-combustion environment.

And SMR and ATR by their definition, and the way the technology works actually requires a post-combustion carbon capture, which is very expensive from a capital standpoint to be able to provide. So long-term, we believe the market for hydrogen being produced from natural gas will remain strong for many, many, many, many years and the fact that we can produce hydrogen from natural gas, but we automatically isolate CO2 for either other beneficial use or sequestration puts us in a real competitive advantage from a cost profiling standpoint versus traditional SMR and ATR technology.

So if you combine all of those elements together, it gives us confidence in our technology and where we see it going.

Okay. Thanks.

And then in general, on your pipeline growth or your increase in your pipeline estimate, how much of that or how is the European waste energy market at this point? Has that increased as well?

Yes. We're seeing some opportunities in waste synergies, still strong in the European market.

UK, in particular, is still strong for new build projects. We're starting to see more demand, I think, which is great for our renewable services business and platform in Europe, where older plants are requiring upgrades and new services, either to expand their size or platform or just update the technologies and/or various parts and services that traditionally B&W hadn't been involved in.

So we're seeing that as well, too. And we're -- obviously, I think we tried to show that excitement in the release and on the call, but our renewable services group in Europe is doing a great job and we're seeing the increase in revenues on that platform as well.

So we mentioned earlier an announcement, I guess, late last year that were involved in the low stock project, which I think now is the largest in the United Kingdom presently from a plant size standpoint, there will be others, and we're involved in discussions on some other projects as well, which would be potentially part of that backlog that we talked about, but clearly in our pipeline, too.

Okay. Thank you.

I’ll turn over.

I will add to that. But no, that's good, Rob.

I'll just add to it because I think it's important. We're starting to see early, early on but we're starting to see a number of potential projects emerge in the US as well in the waste energy segment, and that's exciting for us, and we're in discussions with a number of partners on those projects, but we're starting to see some early demand around waste energy here in the US, and I think that's an exciting development.

So nothing, I don't think we would see anything in any potential bookings until the latter part of 2024 or early 2025, somewhere in that neighborhood. But those take time, obviously, to develop, but there's a number of them beginning to develop here in the US, and I think that's exciting news for us.

It's been a while. Anyway--

Thanks.

Hey great. Thanks and good afternoon or evening.

I guess, Kenny, you gave us a little flavor for the financial prospects around BrightLoop, we appreciate the added color there. Since you gave us kind of the revenue opportunity, I got to ask how we ought to think about maybe the margin opportunity from the business such a unique sort of technology to you in terms of what you're offering here.

I presume at least margin opportunity may be in excess of kind of the legacy B&W businesses, but any thoughts there?

Yes. No, we fully anticipate and expect it to be a strong margin uplift to B&W overall.

As we mentioned, the different sized platforms, rough order of magnitude, we're fully anticipating those to be in the 20% to 30% gross margin range on those new build projects that we're involved in. The other key piece that I mentioned -- or tried to mention anyway, was that we also anticipate follow-on on an annual basis of about, call it, $200,000 to $250,000 roughly of additional revenues on per ton of hydrogen produced.

So, if we deploy several, I don't know, 400, 500 tons of hydrogen, you could multiply that out times $200,000, $250,000 a year in additional incremental revenues from follow-on parts services and particle and we fully anticipate that to be a much higher margin than the initial projects. So, hopefully, that helps.

But that's how we're thinking about it in terms of our future cash flows and we wanted to reflect that in the call.

Got it. Appreciate that.

Just back on the visibility toward the backlog figures. You talked about potentially by year-end $850 million to $1 billion.

Maybe just what stages these various opportunities are? I guess I'm getting at Kenny, are these things that you've been selected for, but not -- just not signed yet.

I just wanted to understand that a little more.

Some of -- that's both. Some of those were -- we've been selected for and we're in discussions on our negotiations in contracts.

Some of those are where we're down to us versus one other, and we're highly confident that, that will come our way for either technology purposes, competitive purposes. We've got strength in -- if we go to some of the thermal projects and the fact that we provide union construction opportunities combined with our technologies and we're involved in a couple of projects on the thermal side that would require both unit construction and the technology component, and we're really in a strong position to provide that.

And that -- and it's with customers that we've got -- also customers that we've got strong prior history in performing services and work forward. So, those all give us the confidence that we can reach those backlog numbers if that makes sense.

It does. And maybe just lastly, the solar arena for you.

I know that's a business you've been ramping up quite a bit. Maybe just an update on the progress you're seeing there?

Yeah. As we mentioned on the solar side, we're starting to see for us, not the market.

The market demand has been there, but we're starting to slowly pick up our share of opportunities. And as mentioned, with what we have either been awarded just -- we just announced in July or projects that were well and part of that $850 to $1 billion, but projects that were well into discussions on, we fully intend and plan and should be able to announce at least $100 million in bookings in solar for the second half of 2023, which would double from last year.

There are more opportunities than that in the solar market on the community and utility scale. Clearly, we are improving or working to improve the margins on those projects, primarily as we've expanded that business.

And as I mentioned on the call, we're investing in some back-office systems as well as a critical part is more self-performance on those projects around those solar services. And so those are two areas that we're actively involved in and we'll continue to invest in.

But we are seeing that growth on the solar opportunities. And as we mentioned before, the key thing that we're seeing constantly as we get into these renewable energy projects, many at the state level and some of the state funding and the IRA require solar aspects as well as clean energy aspects and/or CO2 sequestration and some of those are opportunities long term that we're starting to see that would blend some of those services where we're pulling together solar in conjunction with possible other green energy or clean energy projects in the marketplace.

So we'll see that in full probably next year more as the IRA kicks in fully, but a lot of the developers that we're in discussions with are starting to acquire or we're answering RFPs and other aspects in and around some of those combined technologies. So -- but there's a ramp on solar.

We've got to improve the margins. We know that, and we're working behind the scenes to do that overall.

I should have mentioned on the call and didn't, but I'll take the opportunity to put it here, so it's in the script. But we are -- based on -- this is beyond solar.

But based on decisions and actions that we've taken over the past couple of years to help create more optimization efficiencies in the business, we're working to take out roughly another $15 million of costs out of our platform that would be more incremental to whatever targets we put out in 2024. And those are just further optimizations based on actions that we have taken previously through a number of different areas.

So we're excited -- and we wanted to point to that because it's important that we continue to announce and discuss that we're constantly trying to optimize the business as we continue to invest in the future growth of the platform in the company. So we're looking to do both.

Okay. Thank you.

Thank you. Good morning, Kenny and Lou.

It looks like you've got a lot of exciting things going on here long-term. A couple of questions for you first.

Backlog, $567 million, your projection of $850 million to $1 billion by year-end is pretty fantastic growth. Can you just keep it simple and help us to bridge from $567 million to $850 million to $1 billion.

It sounds like $100 million is coming out of solar, but maybe give us a few other bigger chunks that can help walk us there?

Yes. We have -- a great question, Alex.

By the way, thanks for joining. We have a number of, I won't get specific because obviously, we're in negotiation discussions.

But we have a number of projects out that we're involved in. Some of those are larger projects that are in the $150 million to $200 million range that we're involved in, both thermal and in our, I would say, thermal and renewable energy to keep it simple primarily.

There's some smaller ones in environmental. But the larger ones that I'm referring to are in renewable and thermal both, and we're in discussions on those projects.

But some of those are new build opportunities in waste energy and biomass energy. Some of those are continued upgrades enhancements and conversion in the thermal sector.

But we have several large projects that are in the $100 million plus range. I guess, a couple that could be in the $200 million plus range that would be potentially part of that scale up from the $850 million to $1 billion.

That's very helpful. And then, with that said, can you talk about your comfort level and guidance of the $100 million to $120 million, and clearly, if backlog is at $850 million to $1 billion, I got to suspect you're going to have incrementally greater confidence in strong growth over that $100 million to $120 million this year out in 2024.

So maybe talk about those two points?

Yeah. No, I mean it would -- the backlog would come in, obviously, in timing of EBITDA, adjusted EBITDA impact this year will be greatly dependent on when that backlog hits, right?

Obviously, we're -- from a cost standpoint, we have to get those projects in and going. Obviously, some will happen before the end of the year and some will happen more in November, December.

So there's always a timing issue there around that. It would allow us to really focus on growth opportunities for 2024.

The offset to that would only be -- as we mentioned on the call, obviously, we continue to invest in these new technologies, BrightLoop as well as biomass with the carbon or oxy combustion, or carbon capture associated with that, as well as some of the new environmental Bluegrass treatment technologies we brought to marketplace. So we constantly have to balance, the expense and spend towards investing in the future growth of the platform to support those new technologies versus the run rate EBITDA in the business.

But that's -- try to indicate that on the -- in the call as well that we balance those two. But clearly, one of site, we've got growth that we see, obviously, getting the backlog in would support -- some of that backlog will be spread over 2024, 2025, 2026.

Some of that backlog will actually be 2025, 2026, 2027. So from a revenue timing standpoint, they'll vary depending on the specific project on the revenue impact and the timing of that revenue.

But I don't know Lou.

Yes. I think you'll see, Alex, when you look at the Q, the backlog runoff is about 60% of that $560 million, $570 million runoff this year and then about 30% next year.

And then as Kenny said, the rest thereafter. So that's the immediate backlog that we have literally under contract.

And then there'll be additional backlog. And then we don't include a substantial amount in backlog for the parts business, because that's kind of a book-and-bill business, so we don't really put much of that -- consider that in the backlog.

So that gives us the confidence of hitting these numbers for '23 and beyond.

Thank you.

Alex, thanks.

Thank you for joining us. That concludes our conference call.

A replay will be available for a limited time on our website later today.