Devin Sullivan - SVP, Equity Group Vince Arnone - President and Chief Executive Officer James Pach - Corporate Controller.

Pete Enderlin - MAZ Partners.

Greetings, and welcome to the Fuel Tech Inc. Reports 2017 Second Quarter Financial Results Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded.

I would now like to turn the conference over to your host, Mr. Devin Sullivan, Senior Vice President of the Equity Group. Thank you. You may begin..

Thank you, Audrey. Good morning, everyone, and thank you for joining us today for Fuel Tech's 2017 second quarter financial results conference call. Yesterday after the close, we issued a copy of the release, which is available at the company’s website www.ftek.com.

The speakers on today's call will be Vince Arnone, President and Chief Executive Officer; and Jim Pach, the company’s Controller. After prepared remarks, we will open the call for questions from our analysts and investors.

Before turning things over to Vince, I'd like to remind everyone that matters discussed in this call, except for historical information, are forward-looking statements as defined in Section 21 E of the Securities Exchange Act of 1934 as amended which are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995 and reflect Fuel Tech’s current expectations regarding future growth results of operations, cash flows, performance and business prospects, and opportunities, as well as assumptions made by and information currently available to our company’s management.

Fuel Tech has tried to identify forward-looking statements by using words such as anticipate, believe, plan, expect, estimate, intend, will, and similar expressions, but these words are not the exclusive means of identifying forward-looking statements.

These statements are based on information currently available to Fuel Tech and are subject to various risks, uncertainties, and other factors, including, but not limited to, those discussed in Fuel Tech’s Annual Report on Form 10-K in Item 1A under the caption Risk Factors, and subsequent filings under the Securities Exchange Act of 1934 as amended which could cause Fuel Tech’s actual growth, results of operations, financial condition, cash flows, performance and business prospects and opportunities to differ materially from those expressed in, or implied by, these statements.

Fuel Tech undertakes no obligation to update such factors or to publicly announce the results of any forward-looking statements contained herein to reflect future events, developments, or changed circumstances or for any other reason.

Investors are cautioned that all forward-looking statements involve risks and uncertainties, including those detailed in the company’s filings with the SEC. Having said that, I'd now like to turn the call over to Vince Arnone, President and CEO of Fuel Tech. Vince, please go ahead..

A significantly narrowed operating loss, when compared to an operating loss of $7.4 million in the first half of 2017; a target of slightly positive adjusted EBITDA, as compared to an adjusted EBITDA loss of $4.1 million in the first half of 2017; and finally, cash balances that we expect to remain stable to slightly higher from the June 30, 2017 year-ending period.

In the second quarter of 2017, revenues of $9.7 million, while down from $15.2 million in the second quarter of 2016, increased by $1.2 million or 15% sequentially from the first quarter of 2017 representing the initial conversion of our backlog to revenue. This supports our outlook for significant revenue growth in the second half of the year.

Our backlog at June 30, 2017 was $21.4 million, as compared to $8 million at March 31, 2017, a nearly three-fold increase from year end 2016. As noted, our effective backlog as of the end of the second quarter is approximately $25 million.

We have announced more than $22 million of new contracts this year and we expect to announce an additional $10 million to $15 million in new contracts before the end of 2017. In terms of our overall global sales pipeline, we are pursuing many promising new projects in all geographies with an estimated total value of approximately $100 million.

SG&A in the second quarter of 2017 declined to $5.9 million from $6.8 million in the second quarter of 2017. Excluding charges, SG&A in the second quarter of 2017 was $5.1 million, a 25% decline from the same period of one year ago and slightly below the SG&A we reported in the first quarter of this year.

Our operating loss in the second quarter of 2017 included $4.5 million of charges as did our loss from continuing operations. Backing out those charges, our operating loss from the second quarter would have been $1.1 million, as would have our loss from continuing operations, each in improvement over the prior quarter.

Our balance sheet remains quite strong. At June 30, 2017, we had cash and cash equivalents of $12.6 million or $0.53 per share and no debt. Now, let’s take some time to review our business segment performance in more detail.

In the Air Pollution Control segment domestically we continued to pursue opportunities focused on ULTRA and SCRs for industrial applications. SNCR technology is applicable for units requiring compliance with the latest round of CSAPR, regional haze, and state-specific requirements for Reasonably Available Control Technology, also known as RACT.

ESP upgrades are being driven by maintenance requirements and increased particulate loading from dry sorbent injection systems installed to help units meet the Boiler MACT requirements. While we do not expect significant impacts from specific regulatory drivers in 2017, I would like to comment on a couple of items that will likely impact our future.

On the Clean Power Plan, the Supreme Court of the United States stayed this regulation in February of 2016. The DC Circuit Court heard arguments in September of 2016 and was expected to rule this spring. However, the administration issued an executive order in March to repeal the Clean Power Plan and send it to the EPA for review.

49 gigawatts of coal-fired generation was projected to retire based on the original Clean Power Plan. If the Clean Power Plan does not re-establish or it comes back in a different form, many marginal coal units could avoid retirements.

However, the pressure on coal units, based on natural gas prices is still expected to limit the recovery of coal unit capacity factors. President Trump's Regulatory Executive Order requires a Two-for-One rule making policy that removes two regulations for every new one that is proposed, which includes the EPA.

The executive order calls on the Office of Management and Budget to craft guidance on how to implement that mandate, including procedures for calculating the cost of each individual rule for purposes of the budgets. Rules that EPA is required by law to issue may not be subject to the Two-for-One order.

The administration is reaching out to industry, including air pollution control companies for input on regulatory reform and more details on any proposed changes are expected later this year. Earlier this month, EPA withdrew its plan to delay implementation of the 2015 ozone National Ambient Air Quality Standards, also known as NAAQS.

NOx and VOC emissions are pre-cursors to increases in ground level ozone levels and the new standard of 70 parts per billion, down from the 2008 level of 75 parts per billion is expected to impact utility and industrial sources.

EPA had intended to delay designations of counties across the country until 2018 and will now work to issue the designations by October of this year. This will require states, and sources to work on compliant strategies starting in 2018.

It is important to note that there are still a number of states who are not in compliance with the 2008 ozone NAAQS standards and those areas may require additional NOx reduction. In June, the DC Circuit Court rejected a proposed stay by the EPA of rules for methane capture for oil and gas operations.

So all of that, at a high-level, these examples show that while there is still regulatory uncertainty on an overall basis in the near-term, there has been some clarifying improvements over the past few months.

That said, we are pleased with the project bidding activity and contract awards over the past few months and industrial project activity is encouraging.

We will continue to capitalize on the increasing deployments of new natural gas-fired turbines being used where SCR technology is required as best available control technology which creates opportunities for our SCR and ULTRA technologies in the Industrial segment.

We are also establishing strategic business relationships with multinational industrial end-users and partnering with companies that require our technology portfolio to complete a broader bid package.

In China, we have generated almost $6 million in new contracts thus far in 2017 and see an improving sales trend for the balance of this year when compared to 2016. Regarding the market in China, it is important to note that existing power plant utilization is less than 50% in some areas causing a dramatic slowdown in new power plant construction.

In fact, 100 coal-fired projects in 11 provinces representing greater than 100 gigawatts of power were cancelled in January of this year and these cancellations occurred after $60 billion had already been invested in their construction.

That said, China continues to promote more stringent NOx reduction standards, which will require upgrades to the existing SCR systems, including parallel upgrades to the ammonia production and delivery technology tied to those SCRs.

For Fuel Tech, this presents an opportunity to couple our SNCR systems with existing SCR systems in order to meet those more ambitious reduction standards. Based on our current market analysis, SNCR implementation on utility boilers will continue for at least the next two years.

While the market is competitive, we believe that we will win our share of the work. Lastly, we are closely watching two other developments in the China market that could provide opportunity for Fuel Tech in the near future.

First, we are following the timing of emissions compliance for the industrial sector, and second, we are watching a trend towards the elimination of aqueous ammonia as the reagent for use with SCR system applications to reduce NOx.

Currently, we estimate that approximately 80% of the 2000 plus power generation units that have SCR installations for NOx reduction use aqueous ammonia as the reagent for the SCR, as opposed to using a safe urea to ammonia conversion technology like our ULTRA process to avoid the hazardous transport and storage of ammonia onsite.

We currently have an installed base of greater than 225 ULTRA systems in China and if the elimination of the storage and transport of aqueous ammonia becomes accepted practice, or a regulated requirement, we would expect to benefit from this market change.

In Europe, the European Union’s Industrial Emissions Directive continues to drive compliance behavior. Opportunities exist in the UK for the remaining coal-fired fleet and for units that are converting to biomass.

Additionally, through the use of strategic partners with local presence and project execution capability, we are also continuing to strengthen business ties with local entities in Turkey, Poland and the Czech Republic to take advantage of project opportunities when they arise in these geographies.

Thus far in 2017, our European office has been awarded greater than $5 million in contracts covering our SCR and ULTRA Technologies and also utilizing our expertise in ammonia Reagent Delivery Systems. We continue to pursue opportunities associated with our various licensing agreements.

In India, we continue to remain optimistic about the long-term prospects of our exclusive licensing arrangement for our SNCR technology with ISGEC Heavy Engineering Limited, one of India's leading engineering and construction companies, although required emissions compliance timeframes are currently being delayed.

Currently, the cement industry is moving towards SNCR implementation and we will assist ISGEC in this market. The Indian government is currently backing off on the aggressive compliance targets originally set for the power generation industry due to the high associated cost of compliance.

They are considering a phased approach prioritizing particulate matter first, then SOx and finally NOx control.

We will push to demonstrate our low capital cost through gas conditioning solution as a means to address particulate issues as we believe that many units will seek to avoid costly electrostatic precipitator rebuilds to meet compliance targets.

Also, the demand for urea to ammonia conversion systems similar to that seen in China for the past ten plus years is expected to grow. For our FUEL CHEM business segment, revenues declined by just under $1 million for the second quarter versus the prior year and gross margin was 49%.

We expect that the revenue and gross margin reported for the first half of 2017 will approximate the revenue and gross margin that we expect for the second half of this year.

As we have stated previously, there is simply less demand for our products in our traditional end-markets due to declining energy prices and fuel switching from coal to less expensive natural gas. In response to these market changes, we continue to pursue a variety of avenues that leverage our FUEL CHEM Technology solutions.

In the U.S., we continue to introduce this technology to utilities to assist them in adapting to a new operating paradigm marked by a reduced load profile that affects the manner in which they operate.

We are also continuing to support operators that utilize coal blending as a cost reduction strategy as in many instances blending can cause on what is slagging and fouling in the boiler and our program can assist in these cases. We are also starting to see opportunities for biomass-fired units in the industrial sector.

In Europe, we remain excited about the opportunity to offer FUEL CHEM to the operators of biomass-fired units and municipal solid waste units, both of which are known to have severe and costly slagging and fouling issues.

We are currently providing our program on one biomass-fired unit and one municipal solid waste unit at this time, both in Italy and the results from both clients are currently favorable. We are watching the results of these two accounts closely and we look to use the favorable references to expand our application base.

On a worldwide basis, we have expanded our industrial reach into the pulp and paper industry, where FUEL CHEM, more specifically, our proprietary Recovery CHEM technology can address the issue of slagging and fouling in black liquor recovery boilers. In the U.S., we have completed a technology demonstration with a large multinational company.

Although our demonstration produced the promised benefits which the client acknowledged. They opt to not to pursue the implementation of Recovery CHEM at this point in time. However, this successful demonstration validated the technology and supports our belief that the Recovery CHEM has broader commercial applications.

In terms of the order of magnitude, generally, we would expect revenues from this technology application to be in the range of $300,000 to $600,000 per unit on an annualized basis and we are currently assessing the addressable market for this technology on a global basis.

In the third quarter of 2016, we announced the signing of an exclusive agreement, under which Fuel Tech has licensed its proprietary Recovery CHEM technology to Amazon Papyrus Chemicals Group, a leading supplier of specialty chemicals to the pulp and paper industry into Asia.

Amazon currently manufactures and sells a variety of industry-specific chemicals to greater than 350 pulp and paper units on that continent. We have solidified our source of chemical supply in the region and identified several target candidates for a demonstration.

We currently have an agreement with one of these target customers to commence a demonstration in October of this year and we look to utilize a successful technology demonstration as a springboard towards accelerating business activity thereafter.

In closing, I want to mention that research and development has always been an important factor in Fuel Tech's historical growth and evolution. We still remain committed to investing for our future and are looking at technologies and businesses that will guide our path forward.

We are currently investigating technology applications in the water treatment and renewables market and I am optimistic that I will be able to speak with you regarding initiatives in both of these areas in the very near term. As I had noted earlier this year, 2017 remains a pivotal year for our company.

We expect to see significant benefit during the second half of this year and into the future, from the impact of our corporate initiatives and I look forward to reporting improved financial performance for the remainder of 2017 and into 2018 as we continue to look to bring value to our shareholder base.

With that, I will now turn the conversation over to Jim. Thank you, Jim..

Thanks, Vince, and good morning, everyone. Revenues for the second quarter of 2017 totaled $9.7 million, reflecting our historically low APC backlog figure of $8 million at December 31, 2016 and the timing of new project starts derived from the new contracts we have signed thus far in 2017.

Revenues did increase on a sequential basis from the first quarter of 2017. As we have previously noted, we expect backlog to revenue conversion to accelerate with our third quarter results, which will help drive the anticipated revenue increase that Vince referenced earlier in the call.

Our FUEL CHEM revenue for the second quarter of 2017 declined to $4.2 million from $5.1 million in the prior year and were about $400,000 below the first quarter of 2017.

We continue to pursue opportunities at FUEL CHEM and we expect our FUEL CHEM revenue and margins for the second half of 2017 to be consistent with those reported in the first half of the year. Our gross margin percentage was 37.2% for the second quarter of 2017, which is effectively the same level of 36.8% in the second quarter of 2016.

We continue to expect to report a blended gross margin between 35% and 38% in 2017.

As Vince mentioned previously, our second quarter results included $4.5 million in charges consisted of the following, $3 million non-cash building impairment charge, $0.8 million non-cash accelerated stock vesting charge included in SG&A, $0.4 million in accruals associated with foreign operations included in cost of sales, $0.2 million in non-cash incremental inventory reserves included in cost of sales, and $0.1 million in severance charges.

For the second quarter of 2017, our selling general and administrative expenses declined to $5.9 million or 12.4% from the comparative prior year quarter of $6.8 million. Excluding the $0.8 million of non-cash charges, SG&A was $5.1 million, a 24% decline from the second quarter of 2016.

With the impact of our recently executed corporate initiatives, and those still planned for the remainder of this year, we will have removed more than $19 million of costs over the last three years. Our research and development costs for the first half of 2017 totaled $600,000, down slightly from $800,000 in the last year’s second quarter.

This decline was due to prudent reductions in our overall research and development spending. As Vince mentioned, we are continuing to support new product developments and exploring ways to diversify our products and markets through our research and development efforts.

Our balance sheet at June 30, 2017 remains debt free and we have cash and cash equivalents including restricted cash of $6 million totaling $12.6 million. This is a decline from $16.2 million we reported at the end of the first quarter and was a result of the use of cash in light of our historically low backlog at December 31, 2016.

Thankfully, our backlog has grown considerably over the last seven plus months and we therefore expect that cash will begin to trend upwards in the second half of 2017. Our working capital balance at June 30 was $18.1 million, which will continue to support our ongoing operating needs of the business.

Working capital does not include $5.0 million of restricted cash that was reclassified on the balance sheet to long-term during the quarter as a result of our two year renewal of our cash secured U.S. domestic credit facility.

With respect to valuation, our book value per share was $1.49, our tangible book value per share was $2 and our working capital per share was $0.76 at June 30, 2017. In addition, we have another $0.69 per share in deferred tax assets, which have been fully reserved and are not included in any of the per share amounts quoted above.

During the quarter, we amended our existing credit facility in the U.S. to extend the maturity date for two years. As was the case with the previous facility, the credit availability in U.S. is $5 million and it’s secured by cash from the company. The $1 million facility in China was also renewed for one year during the quarter and is also cash secured.

Now, I would like to turn the call back over to Vince..

Thanks, very much, Jim. Operator, we can now open the line for questions..

[Operator Instructions] Our first question comes from the line of Pete Enderlin with MAZ Partners. Please state your question..

Good morning. .

Hey, good morning, Pete..

Thanks for taking my questions. .

My pleasure..

You had said, the company had said earlier that you expected to get something like $10 million to $15 million of new contracts in the second quarter. You announced $5 million I guess.

And so, the question is, you now talk about $10 million to $15 million more by year end, is that some of the same contracts that have just been deferred? Are there other large new contracts that are pending? Or can you just shed a little more light on the flow of those contracts? And are they related to the total pipeline..

Certainly, Pete, and thanks for the question. It’s a good one. First of all, the answer is yes. We’ve had a little bit of a deferral on the timing of some awards that we had expected to be coming in a little bit earlier of the year.

And they are awards that are still very active and as I said in my commentary, I expect that we will be announcing some additional contract awards here in the very near term and they will be material awards.

The figure that I quoted in my script of $10 million to $15 million between now and the remainder of the year, we believe is a very, very viable and achievable target for us at this point in time. .

So does that mean that, that’s what’s more or less assured right now and it could well exceed that depending on how the rest of the prospecting in the pipeline goes?.

It’s difficult for me to say assured, Pete. I wish I could say that, until we have a signed contract, there is always a little bit of doubt. But let me just say that, I do have a very good level of confidence that those contracts will come into Fuel Tech’s hands. .

And the accounts receivable level is basically the same as at year end, quite high in relation to revenues, because your revenues have dropped almost 50% and certainly well over 50% in the APC segment.

So, the question is, why are those accounts receivables are so high? And is that part of the projection or the expectation for improved cash generation in the second half?.

Right. Another good question, Pete, another good question. On the AR, what we are dealing with is the, call it, the timing of execution of some of our Air Pollution Control projects. Some of our projects are executed on very different timeframes. Some of them execute rather rapidly over a three to six months timeframe.

Many of them will execute over a one to two year timeframe, just depending on the execution requirements of the end-customer. So, we will have instances whereby we will have an ebb and flow in those AR balances that are specifically related to the timing of the mix of projects that we are executing at any given point in time.

So that’s why we see that higher level of AR at this point in time, vis-à-vis, the actual revenue generation. To your second point, yes, we look at the remainder of this year on a cash flow perspective. We are looking at a stabilized increase in cash from where we are today.

And yes, it is due to the timing of having some of that AR and that will start to flow through back into the cash line from that AR line..

Thanks, and Vince, you mentioned the potential especially in China for the ULTRA system, 225 installed based there now.

Do those units generate any significant recurring revenues which would make for the installed base relevant or is the installed base just a recognition of business that you’ve already done that makes it hard to get more business, if you understand the question?.

I very much understand your question. The installed base is really your latter comment. It is 225 units whereby we have installed our ULTRA system on contracts that we have won. And that does not repeat – that does not represent an opportunity for recurring revenue for us on that installed base today.

What we are looking forward to is the fact that, if indeed China does move completely away from the use of aqueous ammonia, that there could be another 1000 to 1500 units that don’t have a urea to ammonia conversion system installed on them today, that could represent additional capital project opportunities for our Beijing Fuel Tech entity. .

Vince you mentioned safety concerns with aqueous ammonia.

What are those? I mean, does this stuff has the potential to spill or explode or I don’t really know the chemistry of it?.

Yes, and yes. We don’t hear of too many incidences of, call it, a hazardous situation, but they are noted and we’ve had some in this country as well. But in this country, there are typically in much lower population areas.

In China, they actually did mandate in some of their higher population areas that aqueous ammonia cannot be transported nor stored on sites, because a leak or a spill can have a very detrimental hazardous impact to those folks that are nearby to that spill or leak area.

And so, it is a very hazardous chemical to both transport and store and again, we are seeing that at least, one of the big five utilities in China is starting to give consideration to moving away from its use, and if that’s the case, that just benefit for us, a good opportunity for us if you will..

Yes, on the charges, what was the genesis of the building charge? And also on the 800,000 of accelerated stock vesting, what do those involve?.

Pete, I am going to let Jim go ahead and address the comment on the building and on the charges related to the stock vesting, okay. Jim, please go ahead..

Thanks, Pete. The building impairment charge, the short answer to that is it’s due to the decline in our stock price; to get into more detail from a U.S. GAAP standpoint our market capitalization fell below our carrying value of our equity on our balance sheet.

So that triggered us to take a look at our impairment, both on our APC and FUEL CHEM’s business segments. While there is no impairment on either segment, there is this corporate-wide asset which is our building which triggered you to look at fair value accounting.

And the building’s carrying value was more than what the fair value was, so that triggered the impairment charge for the quarter. The long story short, in brief, it’s really due to the decline in our stock price. In terms of our….

Corporate headquarters?.

Correct. .

Okay..

Yes, it is..

Right..

In terms of the accelerated stock vesting, as we had mentioned in our press release around June – or July 5th, we took some actions as management to reduce our SG&A spending going forward and one of the actions was to accelerate vest remaining stock, take the charge in the quarter and then, it clears us a path forward as we had mentioned in that July 5th press release..

Got it. Okay, thanks very much guys. .

Thanks for the questions, Pete..

Thanks, Pete..

Thank you. [Operator Instructions] Our next question comes from the line of George Gasper, private investor. Please state your question. .

Good morning. .

Hi, George. .

Nice to hear your potential progress going forward here and what you have accomplished in the six months.

Could you break down the backlog of $25 million as to what area of activity it is?.

We’ll do this just sort of little bit off the cuff here. If you don’t mind, George..

Okay..

A little more than half of that is going to be domestic based, probably in that $14 million to $15 million and then, I’d go just about in equal split for the remainder between our European and Asian geographies. .

Okay, all right. And then, in the second half, now, you’ve taken this non-cash charge.

What might we be looking at in future charges in the second half, non-cash, other, to get you to out from under what you have to accomplish to get moving forward clean of charges?.

Right. As we sit here, right now, George, we are not expecting any, call it, incremental one-time charges in the second half of the year. .

Okay..

I’ll give you one caveat on that. We do have – we are still carrying an intangible asset as it relates to our Fuel Conversion business. And that does remain on our books as of the end of the second quarter of this year.

And it remains there because, as I noted in my commentary, we are aggressively pursuing ways to go ahead and monetize the assets that we’ve created over this past 2.5 years with our Fuel Tech team.

So – and I say caveat because it’s our expectation to go ahead and monetize that asset, but in the event that we do have difficulty doing so, there would be a chance in the future that that could be a part of a non-cash charge as well. But I don’t expect that as we sit here today..

Okay, all right.

And then, you have mentioned, there was – in the past quarter, I believe, previous quarter, there was some reference in terms of potentially expanding your business and with the reference to water treatment, can you give us any thoughts on what your objective might be there? What area of that activity would you be interested in?.

Hey, George, it’s water treatment really entices us just because of the depth and breadth of the space and because we believe that we also can leverage a lot of the – very, very strong technical resources that we have internally within our Fuel Tech team.

I really can’t be more specific in terms of specific areas that we are looking at in the water treatment space. But as I noted, I am hoping to be able to talk about that in more detail here in this, hopefully within this next quarter’s timeframe.

But it is something that, as a company, we need to move away from some of our traditional more fossil fuel-oriented areas. We know that at some point in time, those opportunities are no longer going to be with us and they are not going to provide value for our shareholders.

So we need to make the move into other areas of interest for our company as a whole and that’s what we are doing. There is a lot of work being done behind the scenes right now within the company to make that move. And so, that’s where we are definitely targeted.

We do have good runway left as it relates to our Air Pollution Control and Chemical Technologies businesses and we are going to capitalize on those opportunities. But we have to make a move towards the other market areas. It’s necessary for our long-term future. .

All right. I am intrigued by this, because with your chemical backgrounds and what you have done, there seems to be a very serious situation developing among companies that process, brewing companies, soda companies, there is a lot of ammonia used in the processing or cooling process in the beverage industry.

And we are hearing here in Wisconsin there is going to have to be some very serious change outs away from ammonia in terms of the cooling process that the plants do not meet specs going forward. So, that’s just an area that’s intriguing.

My last question is, now, depending some of the stocks – reverse stock split, what’s the status on that?.

It’s something that obviously we are watching very closely. We are currently on a – we are on a timeline right now. We do need to see our stock start to move up – up above a dollar and have stayed there for a period of time to avoid the split requirements.

And right now, the approximate timeframe whereby we would have to execute on the split is early to mid-November timeframe, so. .

I see..

So, we are watching it closely as a company, we are doing the necessary preparations that we need to, to get ready to be able to do that just in case we have to..

Right..

So, we are watching it. .

Okay, all right. Well, just in closing, what’s really interesting regarding FUEL CHEM and at this point in time is that, the lack of burden on the debt side and the capacity probably to borrow more when you need it and to get all this new innovation going considering where your stock price is, it looks pretty cheap. Thank you..

Thank you, George..

Thank you. There are no further questions. That does conclude our question answer session. And at this time, I’ll now turn it back to your President and CEO, Vince Arnone for closing comments..

Thank you, operator. As I noted in my commentary, 2017 is a very, very, very important year for Fuel Tech. We have taken many steps to stabilize our business operations over this past two - two and a half years. We believe we are in now better positioned financially to be able to prospectively show improved financial results.

And as I just noted in my answer to George’s question, we are really excited about taking Fuel Tech into new market spaces prospectively. It’s something that as a team, we are now geared up to do. And as I noted, we are looking forward to discussing some of those opportunities in the near future.

And I thank everyone for their interest in Fuel Tech and thanks to all of our shareholders. Have a good day..

This concludes today’s conference. Thank you for your participation. You may disconnect your lines at this time..