Renovare Environmental, Inc.
Q4 2020 Earnings Call Transcript

Published: 20 Apr 2021

[Operator:]

Good afternoon and welcome to the BioHiTech Global Year End 2020 Financial Results and Corporate Update Conference Call. At this time, all participants are in a listen-only mode. Participants of this call are advised that the audio of this conference call is being broadcast live over the Internet and is also being recorded for playback purposes. A webcast replay of the call will be available approximately one hour after the end of the call through July 20 2021. I'd now like to turn the call over to Scott Gordon, President of CORE IR, BioHiTech Global's Investor Relations firm. Please go ahead.

[Scott Gordon:]

Thank you, Sarah. Good afternoon and thank you for participating in today's conference call. Joining me from BioHiTech Global's leadership team are Tony Fuller, Chief Executive Officer and Brian Essman, Chief Financial Officer. During this call, management will be making forward-looking statements, including statements that address BioHiTech Global's expectations for future performance or operational results. Forward-looking statements involve risks and other factors that may cause actual results to differ materially from those statements. For more information about these risks, please refer to the risk factors described in BioHiTech's most recently filed periodic reports on Form 10-Q filed with the SEC, April 16, 2021 and BioHiTech's press release that accompanies this call, particularly the cautionary statements in it. The content of this call contains time-sensitive information that is accurate only as of today, April 20, 2021. Except as required by law, BioHiTech disclaims any obligation to publicly update or revise any information to reflect events or circumstances that occur after this call. It is now my pleasure to turn the call over to CEO, Tony Fuller. Tony?

[Anthony Fuller:]

Thanks, Scott and good afternoon to everyone on the call. Welcome to BioHiTech Global's year-end 2020 financial results and corporate update conference call. I would like to start off by providing a brief overview of our business achievements in 2020, followed by a more detailed discussion of our financial results, as well as an overview of our growth strategy as we move through 2021. This past year, despite the challenges we all faced in quarantine as a result of COVID-19 BioHiTech grew its business. We learned more about ourselves and about our customers. We proved that we could execute at scale, receiving and fulfilling orders during the third and fourth quarters that exceeded level seen in previous years. During the year, we grew consolidated revenue at a rate of 39.3% to $5.9 million. Revenues from digester and equipment sales were 3.9 million, an increase of 1.7 million or 81% from 2019. The increase was largely as a result of the equipment purchases from Carnival Corporation. We also expanded our relationship with Carnival and began to receive purchase orders from their UK-based Cunard Cruises and their Italy-based Costa Group. These are new brands and geographies under the Carnival umbrella. For 2020, revenues from our high efficiency High Efficiency Biological Treatment Services grew 69% to $1.9 million. In January of 2020, we announced the receipt of a purchase contract from Carnival worth up to $14 million. To date, we've announced $8.4 million worth of orders. We continue to receive orders from Carnival on a monthly basis and anticipate continued orders under the contract throughout the balance of 2021.

[Brian Essman:]

Thanks, Tony and hello everyone. Financial results for the year-ended December 31, 2020. Recurring revenue, which includes digester and HEBioT increased by 77.4% or 2.5 million for the year ended December 31, 2020 due to a 2.1 million increase in equipment sales that were primarily driven by digester sales to Carnival Cruise Lines and a $767,000 increase in the HEBioT revenues. On a fully consolidated basis, which includes revenue from a management agreement that we previously announced was ending during 2020, grew at the rate of 39.3% to 5.9 million. Consolidated operating expenses before depreciation, amortization and impairment charges increased by 42.4% or 4.2 million, which were driven by an increase in HEBioT direct costs of 1.5 million resulting from a full year of operations and high maintenance and repairs; an increase of 1.6 million in selling, general and administrative, which consists of 290,000 from the digester and corporate line, and 1.3 million from the HEBioT line, which also includes a one-time settlement charge of $647,000; and an increase in equipment sale cost of 1.1 million related to the increase in equipment sales that also resulted in an increase in the contribution margin from 39% in 2019 to 46% in 2020.

[Anthony Fuller:]

Thank you, Brian. Before I turn the call over to questions, I would like to thank each and every one of our employees for their dedication and helping us to position the company for sustainable long-term growth. I would also like to thank our investors for entrusting a portion of their investment dollars in our company. Operator, please open the call to questions.

[Operator:]

Our first question will come from Barry Sine with Spartan Capital Securities. Please go ahead.

[Barry Sine:]

Hey, good afternoon, folks. A couple of questions if you don't mind, please. First of all on the HEBioT plants, West Virginia, obviously very strong, probably your strongest quarter ever, seems like it's back on track at about a $4 million a year annual run rate. How, if at all, do we get that up to the $7 million run rate that at one point you were talking about? Also on HEBioT, the status on Rensselaer, the last I heard you were still in the appeal process, any update? And then finally on HEBioT, any other sites that you're in process looking at that we might hear something about soon.

[Anthony Fuller:]

All right, Barry, thank you for your questions. Let me kind of take them in the order that you that you gave in. We are happy with the progress that we're seeing in West Virginia. We recognize that it's a path that is probably longer than what we thought it would be but we are encouraged by the recent developments. So it was good to show you the plant a few weeks ago too by the way. I think that as we look at driving the plant to full production, to that $7 million level, we have to understand that we need to walk first and then we're going to run. If you said - if you took what we're doing and you kind of projected it out and gave us a $4 million number in revenue for this next year, I tell you that, that I think that's in range of what I'm thinking about actually.

[Barry Sine:]

And then on digester business, could you discuss in a little more detail the status of the sales funnel, especially beyond Carnival and maritime and then other cruise lines and perhaps other large retailers? Where are you in that process? Are you in discussions? Has COVID shut that down? Are you closed? Might we see some other new logos announced this year?

[Anthony Fuller:]

I'm not going to give COVID credit for shutting that down or put all the blame on COVID either. But I will tell you that it slowed things down with other retailers or other businesses, everybody was obviously distracted. The other funnels and the other pieces of business that we need to bring to the table are absolutely out there for the taking. The maritime business, everybody I've talked to talks - asked me when we're going to do that. And I think it's clear that there's opportunity in the maritime sector. I think it's beyond the cruise lines. And I'm encouraged by the conversations that we're having in that regard. So I do think there's room to grow there. From a retail perspective, Barry, we are engaged in some tests with a retailer or two. We're working - trying to get some retailers' attention to do some other tests of their products. So we certainly have not abandoned that vertical and we feel hopeful about that. But you know, there are other things that we're doing to from a marketing and sales perspective. We are doing more from a web-based or direct marketing and trying to use that vehicle to market our products than we ever have, and we're seeing lots of inquiries in that regard. And we're doing more with, I guess, I could say representatives or distributors or kitchen manufacturers, or people like that, that we can work in collaboration with them and their network to sell our product. So our strategy really for sales, which I think is at the heart of your question, is that we have a strategy, number one, we're going to execute on major accounts very diligently, very intentionally, very purposely and we're going to do that and manage that ourselves. For other avenues of sales, we're going to grow relationships with existing customers, because we think that is a place that is logical that we should go. And now that we've proven we can execute at scale, we believe that that should open some doors. And then the third part of it is we really are going to enhance our work with distributors, and other people who have networks already developed that we don't need to go out and recreate the wheel to do. So those are the things that we're working on and believe me, we recognize the need for that, and are very optimistic in this area as well that there's good news to come.

[Barry Sine:]

And my last question, if you don't mind, is a financial question. Obviously, you're in a negative EBITDA situation presently, could you talk about the path towards getting to breakeven EBITDA, obviously, some combination of revenue growth, margin enhancement. I don't know, if you - now that you've been CEO for a while can see any areas in SG&A where there may be room for economies? What's the glide slope in the path to get this company to breakeven EBITDA? And if I'm really lucky, maybe I can even get a timeline on that. I guess not.

[Anthony Fuller:]

I don't know if you're going to be that lucky. I will tell you, you've heard me - and Brian can chime in here in a minute if he wants to. But you heard me, as we take a look at this company, as I've taken a look at this from a standpoint of really managing our SG&A and doing the things to manage our expense level to get us there, there had to be some things internally that we needed to do. We made some difficult decisions in regard to the way we structure our sales organization. We've made some other difficult decisions, which we think are correct but nonetheless were difficult. But those were all done within toward managing our expense level. The biggest expense that we bear and the biggest place that we can change that trajectory for us, is with the plant in West Virginia. There's no denying that. So if you look at where we are now, and you look at the period that we just talked about, my opinion is, the numbers that Brian went through, they include some extraordinary items, they include some things that were startup items, they include some things that would be non-recurring. But it's kind of back to what I was saying a minute ago, we have to grow the revenue level at that plant to the level we thought we were going to get to, and we're really confident that we will get there. Is it two years? Is it three years? I'm not going to give you a glide path. I can't do that today. I want to do that eventually but I will tell you this, we will get there. And it is so important. It is so important for us to make sure that we produce a fuel that has multiple uses and that we effectively market that. That's the biggest single thing that we can do today, Brian, in my opinion.

[Brian Essman:]

Yes, it is.

[Anthony Fuller:]

Anything you want to add to that? He is shaking his head no, Barry. Okay.

[Barry Sine:]

Thank you very much.

[Anthony Fuller:]

Thank you.

[Operator:]

Our next question comes from Edward Woo with Ascendiant Capital. Please go ahead.

[Edward Woo:]

Congratulations on the quarter. I wanted to just go a little bit into the Carnival contract. You mentioned that you got about 8.5 million in order from Carnival so far. Have you disclosed how much of that have you already recognized and how much do you think you're going to recognize in 2021?

[Anthony Fuller:]

You know, we didn't break it down that way. I think that what you can see from what is publicly disclosed, as you can see the revenue growth in the fourth quarter. And I think we have clearly indicated that we're executing on tight Carnival contracts during that period. I think we also said that, the rest - we anticipate receiving more orders throughout the balance of this year from Carnival. So we are in the midst of it. We are building and shipping and filling orders and receiving orders on a day-to-day basis but we haven't publicly disclosed how that breaks out between the years yet.

[Edward Woo:]

Great. And then, in terms of these digesters sales, is it just upfront sale, you sell it? Is there any other costs or revenue opportunities after that, other than selling more digesters?

[Anthony Fuller:]

There, they do have a - thank you for that question. They do have a recurring revenue feature that comes with them. The digesters have to be fed and there is a BioMedia chip that has to be inserted into the digester, so that is a recurring revenue feature of each sale. There's also software, we have - and I mentioned that just a little bit in my prepared remarks, but our technology that allows a user of the product to measure their waste stream, manage their waste stream that is also something that carries a recurring fee and creates a recurring revenue piece for us. So those are recurring revenues after the sale. That answered your questions?

[Edward Woo:]

Yes, it does. And then what is the expected life of these digesters? How long do they last?

[Brian Essman:]

They're five to 10 years depending upon how they treat them. Carnival has their own maintenance crews, they tend to do a good job at it. We've had other clients get to the end of a five-year lease term with a pretty banged up machine.

[Edward Woo:]

Great. Well, thank you for that detail. Then my last question is on the West Virginia plant, what are the biggest risks you see possibly and the biggest opportunity in 2021?

[Anthony Fuller:]

You know, that plant, when I look at risk factors on it, I think the biggest risk in 2021 relates to our off-take partner, really, and the ability to have a consistent place to go with the product there in Martinsburg. We have spent a lot of time and a lot of efforts, working out the process, modifying what we do for the US waste stream. I talked about that a little bit at last quarter's call. So I think, at this point in time, the thing - and that's why we're working so hard on alternative uses for the fuel, is we think that that's in the best interest of the plant, and it gives us a broader base to go with the product. So I guess I would tell you that I'm less concerned about our ability to make the fuel. We make a good field. We make a consistent fuel. It has got a high Btu value, it has proven to do that. We just have to make sure that we have plenty of places to go with it and that's why we're working so hard on that.

[Edward Woo:]

Great. Well, thank you for answering my questions and good luck.

[Anthony Fuller:]

Thank you. Appreciate it.

[Operator:]

Our next question comes from Richard Molinsky with Max Communications. Please go ahead.

[Richard Molinsky:]

Hey, Tony, how you doing?

[Anthony Fuller:]

Good. How are you?

[Richard Molinsky:]

Good. First of all, good job. And I want to say Barry Sine did a great job with his questions. And - but I almost dropped my phone when you said, yeah, could pick two or three years before maybe we take profit but I don't know if you're joking around with that or not. But I hope it doesn't take that long, you know, based on things that you're doing. But a quick question here. First of all, congratulations taking advantage of the volume to raise $7 million the day you came out with some news. I'm wondering the $7 million plus the other $2 million you had in the bank at the end of last quarter, will that give you enough leeway to execute on that. If the stock doesn't run up during the next 12 months or so, would that give you enough to execute on the plans that you're visualizing right now and telling your team?

[Anthony Fuller:]

Good question, Rich. First, let me back up to the first part of what you said. When I was answering Barry, a lot of that is really a function of how you get to the revenue level you want to get to, to maximize it; not as much profitability as is just maximizing it and so don't read too much into that.

[Richard Molinsky:]

Okay. Thank you. Thanks.

[Anthony Fuller:]

Got to be cautious, okay.

[Richard Molinsky:]

I know. I understand that. I understand completely.

[Anthony Fuller:]

In regard to your last question, we are proud that we got the ATM in place. We are, as we say, grown strong of a cash position as we've ever been. We've got Carnival cash flow coming, we're not in a situation where we need to go out tomorrow or in the near future and raise money at this point in time. So we're really happy with where we are. We think that putting that ATM in place, gave us the ability to go to market at a very affordable price for us as a company and also with some space, so you can really manage it better. So, we think we have greater ability today to manage our cash needs than we've ever had. And we're excited to be in that position.

[Richard Molinsky:]

And thank you so much. The last question, the companies that you are dealing with, whether it's Carnival Cruise Line, or other companies that you're selling to, has that ever come across your desk where they say, you know, we love your product? You know, we'd like to be a part of this company, maybe take an equity stake in the company. Has that ever been approached by companies in the past? That doesn't bother me, if someone wants to put money in that strategic. Well, that's not something that you've been looking for at this point, you know?

[Anthony Fuller:]

That's not a conversation that I've had. I've got -

[Richard Molinsky:]

Okay.

[Anthony Fuller:]

I've got less experience here at the company than others, so that's not a conversation that I've had myself. I think we've all heard of companies recently where investors or people that are buying the product, have taken stock or done some things with stocks. Now, that's not something that we pursue and .

[Richard Molinsky:]

No problem. Continue to execute. Thank you so much. Appreciate it.

[Anthony Fuller:]

Thank you.

[Richard Molinsky:]

Thank you.

[Operator:]

Our next question comes from Joel Marcus with Network 1 Financial. Please go ahead.

[Joel Marcus:]

Yeah. Hi, thank you so much for an excellent presentation, and an excellent year. Unless I missed, I didn't hear anything about Altapure, about the Altapure systems and the company's role with that. It seems to be an extremely timely and promising technology. Could you, maybe, say a little bit about where you are with that? Do you have anything in the pipeline, any projected sales of the Altapure system? And, as far as the HEBioT system is concerned, I mean, it is such a logical system, I mean, every time I go out, I see all these trucks on the road going to landfills, which is 70%, I mean, the trucks are 70% of water. I mean, I just actually saw something, a video about recycling, that most of what everybody puts in their recycling containers isn't recyclable and it's just pulled out and goes in landfill where you can accommodate so much and reduce the waste stream by so much, the landfills are choking. I mean, it just seems such an elegantly logical process and an elegantly logical product that I mean, I, for the life of me, don't see why you don't have 20 people banging down your door to put one up. So, I mean, could you maybe make a projection as to by when you think you're going to put a spade in the ground somewhere else and basically have two, three, four or five, or 10 of these at an operation? So, I guess those are my two questions; Altapure and maybe a little more clarity on the future of the recycling process.

[Anthony Fuller:]

Okay. Joel, thank you. Thank you for your questions. First on Altapure, yeah, I didn't have anything in there on it. You will see it is still in our investor deck on our site. We continue to have discussions. In fact, I think there's a call scheduled later this week with some folks. It is a product that we continue to work on. It is a distribution arrangement that we have for this product. Just a bit of a reminder for everyone, we entered into that last year in the early days of COVID. It was a leverage on our customer relationships and our rolodexes, if you go back to the old days. And we believe it provides a very solid solution to problems that are out there. So yes, we continue to have conversations with people. We're hopeful that there is some new news on it. I guess there wasn't any new news on it, so that's probably why it didn't make the script this time. Hopefully next time it will. It's certainly a solution that is needed in this day and time. Regarding to putting a shovel in the ground for additional locations, I may want you to come along with me and talk to a couple of additional locations someday, because you're right. It is a solution that's needed. It is a solution that is just logical and makes sense. And as I said earlier, we're getting a lot of contact from other municipalities in regard to the possibility of bringing this solution to their location. The problem is, the development cycle for a plant is a long one, we see it with Rensselaer, not every state or every time, will it be that long, there'll be other places where we can build it where it will be quicker. But I'll tell you, that it may not be 20 but it's probably about asset number of different projects and possibilities that we have had the opportunity to look at in recent weeks and months for the plant growth. The landfill problem is a real problem. We can't, as a society, keep hauling liquid waste around, as you say, and create the carbon emissions that are created by that. We can't bury the stuff in the ground and let more emissions come out or bury something that could be used as a fuel, none of that makes sense. So there's a certain logic to what we're doing that I think gives us a mandate for growth. And we're working hard to achieve that. So I'm not - I can't promise you. It wouldn't be wise and you probably be disappointed in me if I gave you a specific day but we're working hard to get to the point to where make that specific announcement.

[Joel Marcus:]

Previous management, in conversations with them, and I mean, don't forget, I was an investor in the preferred stock offering, had extensive exposure to previous management. And they mentioned two sites, specifically one in New Jersey and one in Philadelphia that were tremendously interested in going forward with a project. Could you comment on the possibility of doing something at one of those two sites?

[Anthony Fuller:]

Joel, I wish I could but I can't. I built a lot of distribution centers in my career, I did a lot of economic development work in my career and the one thing that I learned early on was that if your lips are too loose about talking about where you're looking at doing something, you're not going to get to do it. So I can't provide that level of detail for you. I'm sorry. I don't think it would serve us all well, if I did.

[Joel Marcus:]

Okay. Unless I - I hope I didn't make a mistake in bringing it up and I'm sorry, if I did, but I mean, I'm just really so excited about the HEBioT process. I mean, it's something needed all over this country and all over the world. And I mean, it's just so elegantly logical. I mean, that's why I put the money into this that I did. So, I mean, I still think that has an unlimited multi-billion-dollar future.

[Anthony Fuller:]

We're working to solve big problems. And there's no mistake in the question, the mistake would have been if I'd answered it. Thank you so much.

[Joel Marcus:]

Okay. Thank you so much. Thank you for a great year. And thank you for doing a great job. Thank you very much, Tony.

[Anthony Fuller:]

Thank you, Joel.

[Operator:]

Our next question comes from Stewart Flink with Dillon Capital. Please go ahead.

[Stewart Flink:]

Hi, Tony and Brian, congrats on a great year and what looks like to be a pretty dynamic first quarter. So I had three questions and I'll just ask them one at a time, so you don't have to write them down. The first question is, I'm looking at first quarter announcement of 3.8 million in Carnival Cruise Line orders. What percentage of that is going to actually be booked and/or delivered in Q1 versus Q2?

[Anthony Fuller:]

I don't have a specific percentage for that, Steve. I mean, obviously, there's a pipeline, there's a supply chain or lead times for certain items to fulfill it. We are looking at Carnival orders now that will be fulfilled anywhere between now and third quarter. It is what we have in house at the moment. So there's a there's a spread throughout that but I don't think we've released publicly kind of the schedule for that. Clearly, you'd see in the fourth quarter numbers, there was an impact from Carnival, based upon orders, and perhaps some deliveries, but not many.

[Brian Essman:]

A lot of the orders in the fourth quarter started arriving in the third quarter and fourth quarter was a heavy quarter for orders that continued through today. And different of the brands are taking different delivery times, so we are manufacturing and delivering and keeping our customer happy, but we don't specifically look and say, oh, of the 3.8 million, this is exactly when it is going to be shipped out the door.

[Stewart Flink:]

Okay.

[Anthony Fuller:]

Fair enough?

[Stewart Flink:]

Yeah, it's fair. Second question is, in terms of Rensselaer, I obviously saw the announcement in October of 2020. And I was just curious, if maybe this is a better question for Brian, how much money inception to date has gone into the Rensselaer project?

[Brian Essman:]

About $400,000, it is in the footnotes to the financials.

[Stewart Flink:]

Okay. Thank you, I would have thought it had been more because of the legal process and everything else going on but if it's 400, it's 400. Last question is, and for the HEBioT, for the West Virginia plant, the numbers you were giving out on this call were, I'm assuming, numbers based on your percentage ownership of the plant. In other words, I think last time I checked you, BioHiTech owned about 60% of that plant, if I'm not mistaken.

[Brian Essman:]

In the consolidated financials, Steve, we consolidate 100% of the HEBioT numbers, inside West Virginia numbers. And then down at the bottom, we allocate the net loss between BioHiTech and non-controlling minority interests.

[Stewart Flink:]

So just to rephrase your answer, so I understand that, the 1.9 million in revenue from West Virginia last year that was 100% of the revenues from West Virginia, not BioHiTech's pro rata share.

[Brian Essman:]

That is correct.

[Stewart Flink:]

Okay. Thank you very much. Congrats again.

[Barry Sine:]

Thank you, Steve.

[Operator:]

Our next question comes from Tucker Andersen with Above All Advisors. Please go ahead.

[Tucker Andersen:]

Thank you. Most of my questions have been asked. But I'd like to congratulations, Tony, on the progress you've made. And I agree about the necessity of your solutions in both areas, as you know. I'd like to like to just drill down a little bit more on some of the financial data. And since they're sort of related, if I asked two or three things, you can sort of answer them in any detail in the way you want. Just sort of, at the current time with the current operations, what is the cash burn? And how do you see that progressing? In your own mind, you have sort of any data in getting to cash burn breakeven, which I'm really more interested than EBITDA breakeven or any of the other things, since that sort of talks about sustainability of using your balance sheet. And, more importantly, on the Rensselaer projects and other projects going forward, those are obviously big projects relative to the size of your wallet. And do you foresee them and I understand each one may be idiosyncratic, but sort of from an overview, do you see them as being project financing or do you perhaps think the best way to proceed since you have so many potential things on your plate were to get some sort of long-term JV partner? Could you talk a little bit about that and how that might affect your financial status?

[Anthony Fuller:]

Thank you for your question, Tucker. I will start with Rensselaer and I may let Brian help me with the other one here in a second. The project - I said, I would start with Rensselaer. The project in Rensselaer and the future projects clearly are representative of the fact that it takes a lot of money to build one of these plants. Our intent, our direction, our hope, what we're working hard on is position BioHiTech instead such a way that as we move down the road, we are more of an asset light technology, operational provider than we are a capital provider. So when you talk about the ability to bring someone in either as a JV partner or an equity partner or someone to work alongside us to build these plants, I think that - clearly that's an approach that will make sense for us. I think as we built the first plant, we had to realize that we're doing the first of its time, we are establishing a laboratory, we're proving a concept. And for us to do what we've done there, I have no qualms about where we are in Martinsburg, West Virginia. I don't know how much of that we can move off to someone else for unit number two or unit number three, or how we can make that work but we're certainly focused on that and believe that that's the right direction for us to take as a company. We think that best serves all of us, as we work down that path. I'm going to let Brian start off with your other question. Does that help you on Rensselaer, Tucker?

[Tucker Andersen:]

Yeah, yeah and it's music to my ears, because otherwise your wallet is going to limit the scope of your opportunity, it seems to me.

[Anthony Fuller:]

Well, yeah, anyone - a wise person realizes that your wallet always limits the scope of your opportunities. So yes, it does. So that's what we're working hard on. I mean, it's - we're going to make long-term appropriate decisions as we march towards the next plan but we believe that it's so important that we work hard on coming out of the ground with another plan, at some point in the future, you now, to be disclosed later.

[Brian Essman:]

Okay, on to cash flow and cash flow. For the full year, the cash used in operations was $8.8 million, third quarter was 7.5 million. So the fourth quarter was 1.25 million. As Tony had mentioned earlier, we have a focus on controlling expenses and growing revenue but I'm not giving you projections on either the growth and revenue or containment of expenses but it does point to the direction that at least the fourth quarter burn would go and you can sort of model out from there, just based upon history and the financials.

[Tucker Andersen:]

Okay, thanks, guys, and keep up the good work.

[Anthony Fuller:]

Thank you, Tucker.

[Brian Essman:]

Thank you.

[Operator:]

Our next question comes from Robert Smith with the Center for Performance Investing.com. Please go ahead.

[Robert Smith:]

Good afternoon, everyone. I appreciate the preceding questions that everyone has offered you. So, Tony, my question and thanks for taking it, kind of centers on giving a framework to the maritime and the total addressable market, both to Carnival's umbrella and the rest of the industry. What kind of numbers are we dealing with there? And what is the possibility of tapping into that major share?

[Anthony Fuller:]

Well, if you - okay, thank you. And it's good to take your question today. I would tell you that Carnival obviously is the largest player in the cruise industry themselves. They represent the lion's share of that. I've heard numbers that perhaps 40%, 50% of the total industry, I don't know exactly what it is. I just know that they're the biggest ones there. I will tell you that as you look at just the cruise part of it, you are dealing with an industry that was not generating revenue last year and did not - and shut down their capital expenditure programs, which I think, you and I and most - anybody else running a business would probably take that approach during that season. So, to knock on their door and get an answer to, hey, we're going to make a commitment do it today, I don't think that was necessarily a realistic expectation on BioHiTech to see that happen in 2020. I also though, will tell you that Carnival will sail with digesters deployed and they will sail with digesters deployed and they will have ships that deliver a stronger environmental footprint than their competitors. Competition should work to our advantage with that sector. And also the fact that Carnival is doing this in part in partnership with the United States government and EPA. It's, in my opinion, I think you'll see the other people will need to sail what the same standards that are employed up on Carnival. That may take a little while for that to happen but we think it will happen. But there are a lot of other ships on the sea. There - the militaries of the world have a lot of ships on the sea. There are lots of private transport and cargo top applications that are out there. There are individuals that create an awful lot of food waste on superyacht. There are many other avenues in the maritime sector itself that I think create opportunity for us. And, as not just Carnival resumed sailing, but as more people do more with sailing and the flow of goods and products, we really think that that is a strong vertical for us but it's not the only one. And it's not - we're not saying that that's - that we're just going to be a company that provides digesters to the maritime sector. These other sectors and verticals of ours are strong. You may have noted in the report about 40% of our revenue from last year came from the other verticals, they - and that was in a year of a pandemic. So as things come back, we believe we had the ability to grow these other verticals as well and are in a position to do that. That's part of our strategy for saying we're going to grow business with existing customers but we're also going to use other channels of distribution to help us grow our business. We think it just - more broadly, we can expose our product and the more often we can tell our story, we think it's strong enough that we're going to win some business and that's the way we're approaching that. Fair enough?

[Robert Smith:]

Certainly makes sense. Thanks for the color.

[Anthony Fuller:]

Thank you.

[Operator:]

I will now pass the call back to Tony Fuller for closing thoughts.

[Anthony Fuller:]

Okay. Well, I want to thank everyone for participating in our call today. I think it's been a good dialogue. We spend a lot of time on questions. I appreciate the questions. They've been great. As I close, I would just want to emphasize one thing and that is, I think that there are many catalysts present for the growth of this company. I think that in the year 2020, we needed to and we did establish our ability to execute and scale. That lays a foundation that you can build on, that lays the foundation that you can attract other customers if it's digesters or you can build other plants, if it's only be outside of the business. So we're really excited about the future. So we look forward and as we go forward, to sharing our progress with you in future updates. Thank you all and have a great afternoon.

[Operator:]

The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.