Ladies and gentlemen, thank you for standing by. Welcome to the Aspen Aerogels First Quarter 2015 Earnings Results Conference Call. During the call all participants will be on a listen-only mode. After the presentation we will conduct a question and answer session. [Operator Instructions] Please note that this call is being recorded today Thursday, May 7, 2015 at 5:00 PM Eastern Time. I would now like to turn the meeting over to your host for today's call, Shawn Severson of the Blueshirt Group. Please go ahead.

Thank you for joining us for the Aspen Aerogels conference call. I'm Shawn Severson from Blueshirt Group. Before turning the call over to Don Young, Aspen's President and CEO, there are a couple of housekeeping items that I would like to take care of. First, Aspen’s management will take questions at the end of our prepared remarks. And as the operator indicated, an archived version of this webcast will be available in the investor section of Apsen’s Web site. The press release announcing Apsen’s first quarter 2015 results and business outlook as well as a reconciliation of management's use of non-GAAP financial measures as compared to most applicable GAAP measures is available on the investor section of Aspen’s Web site. There you will also find a statement of operations, a summary balance sheet and a summary of key financial and operating statistics for the first quarter of 2015. Please note, that management’s discussion today will include forward-looking statements including any statements regarding outlook, expectations, beliefs, projections, estimates, targets, prospects, business plans and any other statement that is not a historical fact and such statements are subject to risk and uncertainties. Aspen Aerogels’ actual results may differ materially from those expressed in the forward-looking statements. A list of factors that could affect our actual results can be found Aspen’s press release issued today and are discussed in more detail in the reports Aspen’s filed with the SEC, particularly in the company’s most recent annual report on Form 10-K, Company’s press release issued today and our filings with the [technical difficulties]

I apologize for the technical difficulties, it appears the line of Mr. Severson has disconnected.

I’ll take over Dan, it’s John Fairbanks. I’ll just finish up Shawn’s prepared remarks. So the Company's press release issued today and filings for the SEC can also be found in the Investor section of Aspen’s Web site www.aerogel.com. Forward-looking statements made today represent the company’s views as of today May 7, 2015. Aspen Aerogels disclaims any obligation to update these forward-looking statements to reflect future events or circumstances. During this call, we will refer to non-GAAP financial measures including adjusted EBITDA. These financial measures were not prepared in accordance with the U.S. Generally Accepted Accounting Principles or GAAP. These non-GAAP financials measures are not intended to be considered in isolation or as a substitute for results prepared in accordance with GAAP. The definitions of reconciliations of these non-GAAP financials measures to the most directly comparable GAAP financial measures and a discussions why we present these non-GAAP financial measures is available on today's press release, which is also available on Apsen’s Web site. I will now turn the call over to Don Young, President and CEO of Aspen Aerogels.

Thank you, John. Good afternoon everyone. Thank you for joining us for our Q1 2015 earnings call. I will provide comments about the business and our performance and John Fairbanks our CFO will present financial details of our first quarter and update guidance for 2015. We will conclude the call with a Q&A session. As we have stated in the past, our IPO proceeds will enable us to expand capacity. Our initial focus has been the build out of the third manufacturing line in East Providence to increase capacity by approximately 25%. This additional manufacturing capacity is critical in order to alleviate our immediate capacity constraint and to meet to growing customer demand for our product. Our commitment was to have the new capacity contribute to operations during the second quarter of 2015. We are pleased to report that we have commenced operation of the new manufacturing line during the second half of March. We produced high quality product from outset of operations. We are now confident that we will achieve our output and revenue projection for the third line and for the East Providence plant overall for the year. We also met the goals with the project by completing the third line safely on schedule and within budget at $26.5 million, down from recent estimate of $27 million and from our original estimate of $30 million. The successful execution of the line three expansion projects has validated our confidence in our team. We are now preparing to site and build plant II to attempt to meet substantial demand for our products; more on this topic later in my comments. Our Q1 financial performance was solid especially considering the disruptions to our manufacturing facility due to unusual winter storms and its high end of our third manufacturing line to the…

Thanks Don and good afternoon. As Don highlighted during his comments, our first quarter performance has positioned us for a strong 2015. We achieved an eighth consecutive quarter of positive adjusted EBITDA. Our gross profit and adjusted EBITDA increased significantly versus the first quarter of 2014. We completed the third line in East Providence ahead of schedule and on budget and we commenced our operation of the third line in the second half of March in Aerogel blanket output, yields and quality from our third line have met or exceeded our expectations to-date. I’d like to start by running through our financial results for the first quarter at a summary level. First quarter revenue grew 5% year-over-year to $23.5 million, despite downtime related to record snowfall in the Northeast and construction of the third manufacturing line. First quarter GAAP net loss was $2.8 million or $0.12 per share, which represented a significant improvement over last year. And first quarter adjusted-EBITDA was $734,000 compared to less than $100,000 a year ago. Redefined adjusted EBITDA is net income or loss before interest, taxes, depreciation, amortization, stock-based compensation expense and other items that we do not believe are indicative of our core operating performance. Overall, we’re pleased with this performance. First quarter revenue and adjusted EBITDA each met our guidance and the completion and start-up of the third line in East Providence represented the achievement of a significant milestone for our company I’ll now provide additional detail on the components of our results. First, I’ll discuss revenue. Total first quarter revenue was comprised of product revenue of $23.2 million and research services revenue of $289,000. As Don mentioned, our product revenue remains well diversified across geographies, sub-segments of the energy market and all phases of maintenance and project work. During the first quarter,…

[Operator Instructions] Your first question comes from the line of Chip Moore with Canaccord. Your line is now opened.

I guess just first on the guidance. Maybe you could talk a little bit about what’s giving you the increased confidence particularly on raising the profitability side? Is that better yields on the third line or what do you see in there?

So Chip is really three pronged. We have greater confidence in our revenue projection. It's based upon the initial output that we’ve gotten out of the third line. So we just have an increasing confidence in our ability to ultimately achieve those revenue projections. Secondly we’ve had really solid operating expense control in the first quarter and then into the beginning of the second quarter, which once again makes us really feel that our expense budgets are very reasonable and give us some upside. And then finally the yield out of that third line has exceeded our expectations as well. So all total, just strong operating performance on the manufacturing side, good operating expense control -- that's allowed us to be able to take up those estimates. And we're just having more confidence in our ability to deliver this year.

Okay, that’s helpful. And in terms of capacity, I think you talked about last quarter again I think it was 45% next quarter and 80% is that similar type of ramp, is that what you’re looking for?

Overall -- now that the third line is in place. We’re really looking an output from the whole plants across the three lines. And so far the third line is really going well. It’s early, but we’re operating ahead of the plan. It’s actually allowed us the flexibility to do a little maintenance on our line 1 and line 2 here in the second quarter. But overall, we’re absolutely confident that we’ll meet to exceed our 2015 output targets across the whole plant. And that then allows us to reaffirm that 2015 revenue guidance.

I think it's really going well.

That’s great. And just in terms of product mix and pricing, 264, would you just talk about -- how you see that plan on the year in terms of mix?

So that the 264 -- we didn’t have any offshore business during the first quarter, which tends to come at a higher price point. We do expect to have significant contribution on offshore projects in the second quarter and in the second half of the year as well; that ought to takes our ASPs up ultimately for the year. Q2 probably fairly leveled with Q1, but Q3 and Q4 we'd expect an uptick in the ASP.

Okay. So a little upper bias on mix with the offshore. And then I guess one more, and will opt out of the queue. Outlook for the Cryogel, I think you’ve been tracking some larger projects, trying to get that penetration up more towards industry average -- just bring us up to date on what you’re seeing there?

Chip, the LNG business in particular has been focus of our, as I said in the last call, we were following an adaption path very similar to the Pyrogel product, which was introduced about a year earlier, that is going in and solving problems, making our way into maintenance opportunities, gaining confidence, working our way into specifications and qualifications. And we’ve been tracking products both -- projects I should say, both export facilities and receiving terminals and we remain very confident that we will break into a couple of projects this year of good size which as you suggest will bring our Cryogel revenue towards the industry average. It’s about an 80-20 mix in the industry. We were closer to 10% last year and we’ll continue to move that number towards the industry average with these anticipated, but highly expected wins.

[Operator Instructions] And there are no further questions at this time. I’ll now turn the call back over to Aspen CEO Don Young.

Thank you, Dan. Overall, I’m very pleased with our results for the first quarter of 2015, with the contribution from our new manufacturing line and then strong demand for our products. We believe we’re well positioned to continue to build on the momentum from 2014 and to perform in 2015 at record levels. Thank you for your interest in Aspen Aerogels. We look forward to reporting our second quarter results to you in August. Have a good evening.

This concludes today’s conference call. You may now disconnect.