Origin Materials, Inc. Q3 FY2024 earnings call

• Caps and closures: Achieved product market fit. First CapFormer System had successful Factory Acceptance Test. Plan to have 8 or more CapFormer Systems by end of 2025. Prospective customers in qualification phase with commercial production starting Q4 2024. R&D progress on equipment upgrades and rapid prototyping.
• Technology and expansion: CapFormer System offers breakthrough in recycling circularity. Scalable business with minimal changes to customers' operations.
• Furanics: Origin 1 operating on demand with reduced staffing; focus on caps and closures for cash flow before reallocating resources to furanics.

The main segment is caps and closures. In the caps and closures business, the first CapFormer System had a successful Factory Acceptance Test, producing several million fully functional PET caps with over 98% efficiency during the test. Revenue expectations for caps and closures are on track, with initial revenue expected in Q1 2025 and significant gross profit projected to begin in 2025. For furanics and biomass conversion technology, Origin 1 in Sarnia is operating on demand with reduced staffing to preserve cash burn while exploring scale-up with strategic partners.

• Caps and closures revenue expected to start in Q1 2025, with significant recurring revenue in 2025. Anticipated to be EBITDA positive on a run rate basis in the first half of 2026 without accessing equity capital markets.
• Plan to have 8 or more CapFormer Systems by end of 2025.

• Risks related to forward-looking statements, where actual results could differ materially from expectations.
• Reallocation of resources from furanics to caps could impact progress in furanics technology.

Q: Frank Mitsch asked about the $100 million MOU ramp and whether there have been discussions on Origin 2 taking place in Asia.

A: Rich Riley said the $100 million MOU has an initial two-year term and expects aggressive ramp into year two; John Bissell stated Geismar isn't the likely spot for Origin 2 and Asian brownfield scenario is a possible path but no detailed info on current Asia discussions.

Q: Steve Byrne asked about selling caps technology and the operating rate of the Sarnia plant.

A: John Bissell said there's interest in licensing the technology and the Sarnia plant's operating rate is lower due to resource reallocation to caps opportunity, with mild pickup in interest on HTC.

Q: Ryan Smith asked about caps margins and furanics OM1.

A: Matt Plavan discussed caps margins noting premium product and cost advantages vs injection molding; John Bissell talked about furanics OM1 being a flexible asset with learning from operations to be leveraged once caps business is profitable.