Slide 1: Earnings Call FY 2023
OTCQX: TGEN EARNINGS CALL MARCH 14, 2024 FY 2023 1
Slide 2: Management
MANAGEMENT Abinand Rangesh – CEO & CFO Robert Panora – COO & President Roger Deschenes – CAO Jack Whiting – General Counsel & Secretary 2
Slide 3: Safe Harbor Statement
SAFE HARBOR STATEMENT This presentation and accompanying documents contain “forward-looking statements” which may describe strategies, goals, outlooks or other non- historical matters, or projected revenues, Income, returns or other financial measures, that may include words such as "believe," "expe
Slide 4: Agenda
AGENDA Key Takeaways 2023 • Market Changes • Strategy – What was achieved • Strategy – What remains to be achieved 4Q 2023 Results FY 2023 Results 2024 Plan Q&A 4
Slide 5: Market Changes 2023
MARKET CHANGES 2023 Headwind - Significant anti-gas sentiment in NY, MA, CA • NYC projects, especially in low-income housing cancelled due to anti-gas sentiment • Pivoted business to target gas friendly geographies nationwide Increasing Tailwind - Electrical capacity constraints, and expensive time
Slide 6: Strategy - What Was Achieved?
STRATEGY - WHAT WAS ACHIEVED? Continuing to execute on strategy to increase recurring cashflow to cover fixed costs and for profit to be generated irrespective of product fluctuations Service gross margin recovered to >50% in Q4 Generated $200k cash in Q4 Invested in site improvements for both servi
Slide 7: What Remains To Be Done
WHAT REMAINS TO BE DONE Need to close the large product orders we are specified on Lower rent costs after factory move in Q2 Operating cost reductions Margin expansion from service interval increases Utility programs and demand response Increased energy revenue – cooling as a service Service Year 1
Slide 8: Backlog and Cash
BACKLOG AND CASH Backlog is presently $5.25m. Although we have POs for another Backlog by Customer Type $3.5m, we feel the projects have a financing risk (cannabis) and Multi-Family have removed it from backlog. Other Residential 30% 15% Additional $4.5m project not presently in backlog. Tecogen fla
Slide 9: Revenue Segments
REVENUE SEGMENTS PRODUCT SALES SERVICES Sales of combined heat and We service most purchased power, and clean cooling Tecogen equipment in operation systems to building owners. through long term maintenance Key market segments include agreements through 11 service multifamily residential, health CLE
Slide 10: 4Q 2023 Results
4Q 2023 RESULTS $ in thousands 4Q'23 4Q'22 QoQ Change % Revenue Products $ 1,765 $ 1,000 $ 766 Key Points Services 3,591 3,015 577 • Revenue = $5.9 million up 30% Energy Production 542 517 24 • Net loss of $0.07/share Q4 2023 Total Revenue 5,898 4,532 1,367 30.2% Gross Profit • Net loss $1.85m Produ
Slide 11: YE 2023 Results
YE 2023 RESULTS $ in thousands YE 23 YE 22 YoY Change % Key Points Revenue • Revenue = $25.1 million Products $ 8,860 $ 11,156 $ (2,296) • Net loss of $0.19/share YE 2023 Services 14,523 12,060 2,463 Energy Production 1,756 1,786 (29) • Net loss of $4.6m Total Revenue 25,139 25,002 138 0.6% • Servic
Slide 12: 4Q 2023 Adjusted EBITDA Reconciliation
4Q 2023 ADJUSTED EBITDA RECONCILIATION Quarter Ended, Dec 31 Non-GAAP financial disclosure (in thousands) 2023 2022 EBITDA: Earnings Before Interest, Taxes, Net income (loss) attributable to Tecogen Inc. $ (1,846) $ (1,424) Depreciation & Amortization Interest expense, net 7 - Income tax expense 0 -
Slide 13: YE 2023 Adjusted EBITDA Reconciliation
YE 2023 ADJUSTED EBITDA RECONCILIATION FY Ended, Dec 31 Non-GAAP financial disclosure (in thousands) 2023 2022 EBITDA: Earnings Before Interest, Taxes, Net income (loss) attributable to Tecogen Inc. $ (4,598) $ (2,448) Depreciation & Amortization Interest expense, net 16 16 • EBITDA and adjusted EBI
Slide 14: 4Q 23 Performance by Segment
4Q 23 PERFORMANCE BY SEGMENT 4Q Revenues ($ thousands) 2023 2022 YoY Growth Revenues Cogeneration $ 892 $ 604 48% Product revenue increased 77% QoQ Chiller 612 47 1211% • Gross margin impacted by $319k inventory Engineered accessories 262 349 -25% adjustment Total Product Revenues 1,765 1,000 77% •
Slide 15: YE 23 Performance by Segment
YE 23 PERFORMANCE BY SEGMENT YE 2023 Revenues ($ thousands) 2023 2022 YoY Growth Revenues Cogeneration 2,762 5,280 -48% Product revenue decreased 21% YoY Chiller 5,304 5,035 5% • 5% increase in chiller shipments Engineered accessories 794 842 -6% • 48% decrease in cogeneration Total Product Revenues
Slide 16: Tecogen 2024 Plan
Tecogen 2024 Plan Phase 1 – Increase recurring service revenue and establish sales channels relationships January Increased recurring service revenue by assuming service agreements for 200+ cogeneration units 2024 Continuing to add additional service contracts Established multiple new sales channel
Slide 17: Self Learning Intelligent Control of Cogeneration and Chillers
SELF LEARNING INTELLIGENT CONTROL OF COGENERATION AND CHILLERS Based on our remote monitoring platform CHPInsight® Increases equipment run hours and savings • Learns from building load profile to optimize operations (output from CHPInsight Dashboard shown on left) Utility Demand Response Payments Po
Slide 18: Cooling as a Service
Cooling as a Service Targeted at buildings that need to upgrade their chiller or boiler plant In retrofit applications, buildings may have competing uses for capital, especially in a high interest rate environment. Buildings are likely to defer upgrades or choose systems that have a lower first cost
Slide 19: Summary and Q&A
SUMMARY AND Q&A Company Information Continuing to focus on cashflow Pivoting to adapt to changing market Tecogen, Inc Continuing to grow service division 45 First Ave Waltham, MA 02451 Continuing to expand margin on service www.Tecogen.com Opex reduction post factory move Close the larger projects C