Kenny Young : Yeah, I’ll add — yeah if I’ll add to that, just real quick though. But that $100 million to $110 million EBITDA range, it’s important to note and try to emphasize this that we were lessening, if you will, the reliance on large newbuild projects as it relates to that target. That that doesn’t mean that we won’t be entering into certain projects, if it makes sense for us to enter into. We’re trying to obviously allow those to be more upside to that target, rather than a necessity in order to achieve the target. So tried to be a little more conservative on that approach with putting that guidance or targets out there.
Brent Thielman : Okay, great. Thank you, Kenny.
Kenny Young: Yeah.
Operator: Thank you, Mr. Chairman. Our next question is from Rob Brown with Lake Street Capital Markets. You may proceed.
Rob Brown : Good afternoon. I just want to clarify a little bit more on your comments on the realignment and the and not sort of pursuing these larger projects. Sort of what kind of the — assuming the waste energy, but are you are you then no bidding projects? Or how do you sort of go to market with that and have you changed your focus there?
Kenny Young : Yeah, it’s not as complicated as it sounds. We were simply twofold and I’ll explain it further. We have certain opportunities in certain parts on waste energy particular international opportunities require certain security package levels. The certain security packages, i.e. LCs letters of credit, as it relates to us come with high interest rates, right. So a lot of in waste energy, the margins are not as high on newbuild, clearly not as high as our aftermarket parts and services on renewable services. But those letters of credit and the interest associated with the really compresses the margins, plus, you know, additional risks. So, as we look at going forward two aspects, there are opportunities and projects that we’re in discussions and negotiations on regarding waste energy, specifically, that would have higher margin potential or targets associated with them, that are well above and beyond the interest expense associated with the letters of credits.
So those are positive ones are opportunities for us to pursue that. But we want to remove the reliance of that in our forecasts so that they’re more upside rather than a necessity, if that makes sense. But secondarily, we do see an expansion opportunity on licensing, we have been licensing our waste energy technology in several markets, and that typically comes at even higher gross margins, and significantly lower amounts of letters of credit. So the interest rate expenses are, or the cost of that are much more attractive to us from a margin standpoint. So it’s not necessarily a no bid or zero bid, it’s just as we continue to focus will reduce the overhead down to match what we think is the hands one or two or three or whatever the projects that we think that are — a stronger opportunity for us from a margin and cash flow standpoint, as we also increase the licensing model that we have, particularly around our waste energy technologies.
So it’s — I don’t know if that makes sense, but it’s as simple as that sounds.
Rob Brown : Okay, got it. Thank you. The Bright Lube pipeline, I know you’ve given pretty good color on it over your last analyst kind of update. But how is that pipeline kind of at this point? Are you seeing more projects come into it? Are you seeing what’s the direction in terms of project certainty in some of those projects that we’re waiting for some of the government supports and financing incentives?
Kenny Young : Yeah. So we are excited about the opportunities in the pipeline building. When we announced the pipeline, we typically keep it to three year projects that we think will book in the next three years. So I guess, if we expanded that pipeline to total opportunities, you would see several more billions in those opportunities. And that’s mainly run a Bright Lube as it relates to those larger projects. So our overall opportunities on Bright Lube keep growing around that. We have as a result of that, we keep expanding that organization going forward in Bright Loop and Climate Bright. We haven’t got to a final decision on this yet. But we’re debating and discussing whether or not we should move Bright Loop and Climate Bright maybe to a separate, at least discussion, not necessarily segment going into next year.
