Hudson Technologies, Inc. · NASDAQ:HDSN
Hudson Technologies — Investor Presentation (May 2024)
16 slides from Hudson Technologies's investor presentation, May 2024
Slide 1: Investor Presentation May 2024
Investor Presentation May 2024
Slide 2: Safe Harbor Statement
SAFE HARBOR STATEMENT Statements contained herein which are not historical facts constitute forward-looking statements. Such forward-looking statements involve a number of known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the
Slide 3: Investment Considerations
INVESTMENT CONSIDERATIONS • Revenues of $65.3M for first quarter 2024; Gross • Refrigeration and cooling systems are integral to 2024 margin of 33% Unprecedented operating residential and commercial buildings Cooling Industry Season • Installed base of >125M HFC units will be required to Underway •
Slide 4: Strategically Positioned in Refrigerant Supply Chain
STRATEGICALLY POSITIONED IN REFRIGERANT SUPPLY CHAIN • Largest independent source for refrigerants (CFC, HCFC, HFC, HFOs) – Broadest product range: Legacy CFCs, HCFCs, HFCs and next generation HFOs – Longstanding customer and supplier relationships • DoD contract with maximum value of $400 million o
Slide 5: National Presence
NATIONAL PRESENCE • Diverse customer base: - 7,000+ customers • 40+ facilities and stocking points • 3 reclamation facilities • One of few companies with Stock Point, Reclamation Center, or Government Fulfillment Center AHRI certified laboratories Corporate Office 5
Slide 6: HFC Opportunity Begins
HFC OPPORTUNITY BEGINS • AIM Act* implemented in December 2020 created Virgin HFC phase down to combat climate change – Bipartisan legislation promotes use of reclamation to meet industry demand • AIM Act creates 40% reduction in HFC virgin supply in 2024 – As mandated by AIM Act, EPA published fina
Slide 7: AIM Act Mandates Virgin HFC Phase Down; Driving Demand for Reclaimed HFCs
AIM ACT MANDATES VIRGIN HFC PHASE DOWN; DRIVING DEMAND FOR RECLAIMED HFCS EPA to Implement Unprecedented Virgin Production Step Down 2024 Begins 40% Supply Reduction 7
Slide 8: Benefits of HFC Phase Down vs. R-22 Phase Down
BENEFITS OF HFC PHASE DOWN VS. R-22 PHASE DOWN HFC Phase Down R-22 Phase Down – Accelerated phase down process – Lengthy phase down process • Refrigerants phased out ~5 years ahead of • Equipment banned in 2010 equipment • Refrigerant banned in 2019 – EPA has legislated mandate to support • Allowanc
Slide 9: A Leader in the Fragmented Reclamation Industry
A LEADER IN THE FRAGMENTED RECLAMATION INDUSTRY Hudson Captures Approximately 35% of U.S. Reclaim Activity Ability to Reclaim Other ~30 Different and Recycle ALL Companies Types of Refrigerants 9
Slide 10: Hudson Reclaim Solutions & Leadership
HUDSON RECLAIM SOLUTIONS & LEADERSHIP • Industry pioneer: One of the first companies to pay for recovered refrigerant – First purchased refrigerants in 1990 • Size: Largest reclaimer ~35% market share of U.S. reclaim – Handle in excess of 300,000 cylinders per year • Quality: Own 2 of the only 4 AHR
Slide 11: Implications to Supply Chain
IMPLICATIONS TO SUPPLY CHAIN Limited by Allowances Limited by End-Use Restrictions Supply End Customer ~20% virgin New (Virgin) Gas gross margin • Residential Honeywell Homes Chemours Arkema • Light ~50% reclaim Commercial gross margin • Industrial Reclaimed Gas • 24/7 Cooling (Supermarkets, Chemica
Slide 12: Federal and State Regulatory and Legislative Impact
FEDERAL AND STATE REGULATORY AND LEGISLATIVE IMPACT • EPA’s Refrigerant Management Rulemaking Promoting Reclaim Growth is Being Finalized – Supports better management and reuse of existing HFCs: • Establishes maintenance schedule to reduce wasteful leaks from equipment • Mandating the use of reclaim
Slide 13: Pursuing Strategic Relationships
PURSUING STRATEGIC RELATIONSHIPS Proposed federal and state legislation promotes the use of reclaimed refrigerants by OEMs • Hudson Pursuing Partnerships Focused on Sustainable Recovery, Reclamation and Reuse of Refrigerants – Enabling the reduction of waste and greenhouse gas emissions • Contractor
Slide 14: Working Together to Reclaim the Future
WORKING TOGETHER TO RECLAIM THE FUTURE 90.0 Cumulative Impact of Hudson Reclaimed Refrigerant Since 2000, Hudson has 84 reclaimed more than 72 million Million mTCO2e 80.0 70.0 pounds of refrigerant 60.0 or 50.0 84 million tons of CO2 40.0 equivalent GHG emissions 30.0 20.0 10.0 Every pound of reclai
Slide 15: Disciplined Acquisition Strategy
DISCIPLINED ACQUISITION STRATEGY • Focused on complementary acquisitions to expand product and service offerings – 1+1 = >2 • Target multiple of ~6X EBITDA Case Study: Airgas Refrigerant Acquisition Airgas Business Model Today • Different customer base and product • HFC EBITDA contribution of ~$5/lb
Slide 16: Positioned for Growth
POSITIONED FOR GROWTH Market Leader in Refrigerant Sales and Reclamation – Hudson sells and reclaims all types of refrigerants – AIM Act mandates reduction of virgin HFC production and requires EPA to promote reclamation opportunities – Hudson reclamation efforts support infrastructure needs for ins
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