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Investor Presentation
May 2016
2
Disclaimer
This presentation contains statements that constitute “forward looking statements” under the Private Securities Litigation Reform Act of 1995. All statements
other than statements of historical facts contained in this presentation, including statements regarding our short-term and long-term growth strategies, efforts
to develop and commercialize our products, future operations, future financial position, future revenue, projected costs, prospects, plans, objectives of
management and expected market growth are forward-looking statements. These statements involve known and unknown risks, uncertainties and other
important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or
achievements expressed or implied by the forward-looking statements. The words “anticipate,” “believe,” “could,” “estimate,” “expect,” “guidance”, “intend,”
“may,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “will,” “would” and similar expressions are intended to identify forward-looking statements,
although not all forward-looking statements contain these identifying words.
These forward looking statements are only predictions and we may not actually achieve the plans, intentions or expectations disclosed in our forward-looking
statements, so you should not rely on our forward-looking statements. Actual results or events could differ materially from the plans, intentions and
expectations disclosed in the forward-looking statements we make. We have based these forward-looking statements largely on our current expectations
and projections about future events and trends that we believe may affect our business, financial condition and operating results.
The information in this presentation is current as of May 26, 2016 and speaks only as of such date. We expressly disclaim any obligation to release any
updates or revisions to any information presented herein, including any forward-looking statements, to reflect any change in our expectations or projections
or any changes in events, conditions or circumstances on which any such information or statements are based for any reason, except as required by law,
even as new information becomes available. All information and forward-looking statements in this presentation are qualified in their entirety by this
cautionary statement.
In addition to results presented in accordance with U.S. GAAP, this presentation and related tables include Adjusted EBIDTA, a non-GAAP financial
measure. We have provided a reconciliation of this measure to the most directly comparable GAAP measure, which is available in “Reconciliations” starting
on slide 20. We use Adjusted EBITDA as a measure of operating performance, because it does not include the impact of items that we do not consider
indicative of our core operating performance, for planning purposes, including the preparation of our annual operating budget, to allocate resources, to
enhance the financial performance of our business, and as a performance measure under our bonus plan. We also believe that the presentation of Adjusted
EBITDA provides useful information to investors with respect to our results of operations and in assessing the performance and value of our business.
Although we believe this non-GAAP financial measure enhances investors’ understanding of our business and performance, this non-GAAP financial
measure should not be considered an alternative to or substitute for accompanying GAAP financial measures.
The risk factors set forth in our Annual Report on Form 10-K for the year ended December 31, 2015 and filed with the SEC on March 4, 2016, pursuant to
the Securities Exchange Act of 1934, as amended, are incorporated by reference into this presentation and should be read in their entirety alongside this
presentation.
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Disclaimer
This presentation contains market data and industry forecasts that were obtained from industry publications, third party market research and publicly
available information. These publications generally state that the information contained therein has been obtained from sources believed to be reliable, but
the accuracy and completeness of such information is not guaranteed. This presentation also contains estimates and other statistical data made by
independent parties and by us relating to market size and growth, size of insulation opportunity at various types of energy infrastructure facilities and other
data about our industry. We obtained the industry and market data in this presentation from our own research as well as from industry and general
publications, surveys and studies conducted by third parties, some of which may not be publicly available. For example, this presentation includes statistical
data extracted from an off-the-shelf market research report (World Insulation - #2956) by The Freedonia Group, an independent international market
research firm, and a separate custom market research report by Freedonia Custom Research, Inc., a wholly-owned subsidiary of The Freedonia Group, or
Freedonia, which was commissioned by us and was issued in February 2014. Such data may be outdated and involves a number of assumptions and
limitations and contains projections and estimates of the future performance of the industries in which we operate that are subject to a high degree of
uncertainty. We caution you not to give undue weight to such projections, assumptions and estimates.
The Freedonia Custom Research, Inc. Report, or the Freedonia Report, represents data, research opinion or viewpoints developed independently on our
behalf and does not constitute a specific guide to action. In preparing the Freedonia Report, Freedonia used various sources, including publicly available
third party financial statements; government statistical reports; press releases; industry magazines; and interviews with manufacturers of related products
(including us), manufacturers of competitive products, distributors of related products and government and trade associations. The Freedonia Report speaks
as of its final publication date (and not as of the date of this presentation).
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Experienced Leadership Team
Donald R. YoungPresident & CEO
John F. FairbanksVice President, CFO &
Treasurer
President, CEO and member of Board of Aspen Aerogels since 2001
Prior to 2001, worked in the U.S. and abroad in a range of senior operating
roles for Cabot Corporation
Graduate of Harvard College and earned an MBA from Harvard Business
School
Has served as CFO since 2006
More than 10 years of service as a SVP of New England Business Service, in
senior financial and operating roles
Earned a B.A. in Economics from Middlebury College and an MBA from the
Wharton School of the University of Pennsylvania
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Designs, develops and manufactures innovative, high-performance aerogel insulation primarily used in large-
scale energy infrastructure process facilities
Offers a superior combination of performance and long-term value
End users save money, reduce energy use, preserve operating assets and protect workers
Global network of energy-focused distributors, contractors and engineering firms
Proven market adoption in $3 billion global energy infrastructure market
Used by 24 of the world’s 25 largest refining companies; 20 of 20 largest petrochemical companies
Initial installations in approximately 30% of the world’s 640 refineries
Installed base of >200 million sq. ft., >$500 million of product sales since 2008
Expanding capacity to meet demand
Aspen Aerogels: An Energy Technology Company
Targeted Energy End Markets
USA34%
Canada5%
Asia Pacific34%
Latin America
2%
Europe25%
Geography
2015 Product Revenue by Region
REFINERIESPETROCHEMICAL
PLANTS
POWER GENERATION
LNG & GAS PRODUCTION
OFFSHOREOIL SANDS
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Unique Technological Advantages
What are Aerogels?
Aerogels are amorphous silica
solids
Characterized by impressive
material properties
Lowest density solid -- ~97%
air
Lowest thermal conductivity
Best thermal performance of any
widely used insulation product
Reduced corrosion under
insulation
Compact design and faster
installation
High durability and fire protection
Advantages vs. Traditional
InsulationOur Breakthrough Technology
Industrially robust
Unique product form
Proprietary manufacturing
process
Patent-protected – 86 issued
and 78 pending patents owned
or co-owned worldwide
Proven Manufacturing Process
Pyrogel XT / XT-E / XTF(hot insulat ion)
Cryogel Z(cold insulat ion )
Our Aerogel Products
Step 1:
Fill fibrous batting with a liquid-solid solution
Step 2:
Extract solvents with supercritical carbon
dioxide
Step 3:
Resulting dry fiber-reinforced aerogel
blanket
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Disruptive Products with Compelling Value Proposition
Best Thermal
Performance
Two to five times better thermal performance
Broad range of applications from -200°C to 650°C
Compact Design
& Faster
Installation
High Durability
and Fire
Protection
Reduced
Corrosion Under
Insulation
Th
erm
al
Co
nd
ucti
vit
y
Temperature Range
Pyrogel XT
Traditional Insulation
Enhances plant safety
Improves reliability
Reduces major maintenance expense
50% to 80% reduced volume
Space savings
Faster installation time with improved safety and logistics
Excellent compression resistance, tensile strength, and vibration resiliency
Fire protection
Traditional
Insulation
Vapor Permeable
Traditional Insulation;
Installed on site
Transport-ready;
Supports modular construction
Hydrophobic
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End Markets & Products
Used by 24 of the world’s
25 largest refining
companies
REFINING
Installed by 20of the top 20
petrochemical companies
PETROCHEMICAL
Preferred by LNG & FLNG
for space saving design
LNG
Maximum efficiency for
power generation
POWER
Thin and durable for pipe-in-pipe applications
OFFSHORE
• Building Materials
• District Energy
• Transportation
• Footwear and Apparel
OTHER
Pyrogel®
Spaceloft®
Cryogel®
Hot Process
Applications
Cold Process
Applications
Ambient & Low
Temperature
Applications
9
Global Distribution Network and Installed Base
Source: Company Management.
Distributor
Contractor
OEM
Installed Base
Installed in more than 40 countries worldwide
34 sales & marketing employees and 45 distributors
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Industry-Leading End Users
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Key Business Highlights
1) Disruptive insulation products offering superior value and performance
2) Attractive energy infrastructure end markets are the foundation
3) Substantial installed base with industry-leading end users
4) Significant growth opportunities: expanded market penetration and new products
5) 23% 5-year revenue CAGR through 2015, EBITDA positive, growing profitability
6) Protected technology platform and proprietary manufacturing capability
7) Proven, scalable business model with attractive returns
8) Experienced management team with a demonstrated track record
12
Financial Overview
13
Three Months 2016 Performance
Growth Supported By Third Production Line
Three Months Ended Change
3/31/16 3/31/15 $ %
See slide 20 herein for a reconciliation of net income (loss), the most directly comparable GAAP measure, to Adjusted EBITDA for the periods presented.
($ in thousands)
32,821$ 23,500$ 9,321$ 40%
26,294 18,986 7,308 38%
6,527 4,514 2,013 45%
Operating Expenses 8,285 7,259 1,026 14%
(1,758) (2,745) 987 36%
Adjusted EBITDA Add-backs:
2,410 2,184 226 10%
Stock-based Compensation 1,370 1,295 75 6%
2,022$ 734$ 1,288$ 175%
Gross Margin 20% 19%
Adjusted EBITDA Margin 6% 3%
Total Revenue
Adjusted EBITDA
Operating Loss
Depreciation & Amortization
Cost of Revenue
Gross Profit
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Annual Revenue & Adjusted EBITDA
History of Top and Bottom Line Growth
For the Year Ended December 31,
See slide 21 herein for a reconciliation of net income (loss), the most directly comparable GAAP measure, to Adjusted EBITDA for the periods presented.
($ in thousands) 2012 2013 2014 2015
63,453$ 86,094$ 102,399$ 122,518$
71,421 75,363 85,319 97,870
(7,968) 10,731 17,080 24,648
Operating Expenses 25,005 30,703 33,123 30,883
(32,973) (19,972) (16,043) (6,235)
Adjusted EBITDA Add-backs:
9,684 10,061 10,183 9,887
1,654 4,426 8,781 5,413
Other Items 2,489 3,670 119 -
(19,146)$ (1,815)$ 3,040$ 9,065$
Revenue Growth 38% 36% 19% 20%
Gross Margin -13% 12% 17% 20%
Adjusted EBITDA Margin -30% -2% 3% 7%
Depreciation & Amortization
Stock-based Compensation
Adjusted EBITDA
Operating Loss
Cost of Revenue
Gross Profit
Total Revenue
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Financial Guidance
Profitability Projected To Improve in 2016
2016 Guidance(1)2015
(in thousands, except EPS) Actual Low High
122,518$ 117,000$ 125,000$
9,065$ 11,500$ 13,000$
EPS (0.28)$ (0.16)$ (0.09)$
Shares Outstanding 22,987 23,200 23,200
Depreciation & Amortization 9,887$ 9,600$ 9,800$
Stock Compensation 5,413$ 5,200$ 5,400$
Gross Margin 20% Mid-Twenties
(1) This 2016 financial guidance specif ically excludes litigation costs and expenses of our patent enforcement actions including
at the U.S. International Trade Commission and in Germany. The amount of these litigation costs may be signif icant and the
timing of such costs w ill be diff icult to predict. We may incur other charges, realize gains or losses, incur f inancing and
interest expense, or experience other events in 2016 that could cause actual results to vary materially from this guidance.
Adjusted EBITDA
Total Revenue
16
Balance Sheets
Assets Available to Support Expansion
December 31,
2015
March 31,
2016
($ in thousands)
Assets
Cash and cash equivalents 29,357$ 32,804$
Accounts receivable, net 23,207 20,624
Inventories 6,139 6,532
Prepaids and other current assets 707 1,687
Total current assets 59,410 61,647
Property, plant and equipment, net 79,539 78,322
Other assets 94 105
Total assets 139,043$ 140,074$
Liabilities and Stockholders' Equity
Accounts payable 12,745$ 10,684$
Accrued expenses 3,441 5,568
Deferred revenue 431 681
Other current liabilities 295 476
Total current liabilities 16,912 17,409
Other long-term liabilities 166 191
Total liabilities 17,078 17,600
Total stockholders’ equity 121,965 122,474
Total liabilities and stockholders’ equity 139,043$ 140,074$
17
0
20
40
60
80
100
2008A 2009A 2010A 2011A 2012A 2013A 2014A 2015A 2016E 2017E 2018E 2019E
Annual Capacity(MM ft2 / year)
East Providence
Line 1
EP Line 2
EP Line 3
EP Line 1
Expansion
Statesboro, GA
Line 1 – Phase 1
Historical Projected
Capacity Expansion Plan
Nameplate Capacity(1), Year-End Effective Capacity(2), Annual Actual Production, Annual
1. Nameplate capacity represents our projected maximum sustainable annual output. The low end of the range of projected output is reflected in the graph.2. Effective capacity is the capacity at which we can operate while maintaining the quality of our products and efficiency of our operations in a given period. Actual effective capacity is also impacted
by the date within a given year on which we add the capacity.
The projected nameplate and effective capacity for the years 2016 through 2019 are based on certain assumptions that the Company’s management believes are reasonable from time to time, but these assumptions could prove to be incorrect, which could result in nameplate capacity, effective capacity, or actual capacity differing materially from the projections above.
18
Key Business Highlights
1) Disruptive insulation products offering superior value and performance
2) Attractive energy infrastructure end markets are the foundation
3) Substantial installed base with industry-leading end users
4) Significant growth opportunities: expanded market penetration and new products
5) 23% 5-year revenue CAGR through 2015, EBITDA positive, growing profitability
6) Protected technology platform and proprietary manufacturing capability
7) Proven, scalable business model with attractive returns
8) Experienced management team with a demonstrated track record
19
Appendices
20
Reconciliation
Note: The table above presents a reconciliation of net income (loss), the most directly comparable GAAP measure, to Adjusted EBITDA for the periods presented.
Three Months Ended
3/31/16 3/31/15($ in thousands)
Net loss (1,797)$ (2,790)$
Depreciation and amortization 2,410 2,184
Stock-based compensation 1,370 1,295
Interest expense 39 45
Adjusted EBITDA 2,022$ 734$
21
Reconciliation
Note: The table above presents a reconciliation of net income (loss), the most directly comparable GAAP measure, to Adjusted EBITDA for the periods presented.
Year Ended December 31,($ in thousands)
2012 2013 2014 2015
Net loss (56,142)$ (47,611)$ (66,324)$ (6,417)$
Interest expense 21,790 30,599 50,281 182
Depreciation and amortization 9,684 10,061 10,183 9,887
Loss on disposal of assets 2,489 230 119 -
Stock-based compensation 1,654 4,426 8,781 5,413
Gain on extinguishment of convertible notes - (8,898) - -
Loss on exchange of convertible notes - 5,697 - -
Debt extinguishment costs 1,379 - - -
Write-off of costs associated with postponed public offering - 241 - -
Write-off of construction in progress - 3,440 - -
Adjusted EBITDA (19,146)$ (1,815)$ 3,040$ 9,065$
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Investor Presentation
May 2016