Edward Richardson: No, we fully understand. I have a saying, you can’t fall off the floor. So with all of these things we have going, we think that the company, 50% of our business will be green energy going forward. And we think within five years, it will be $500 million and extremely cash flow positive.
P. Ross Taylor: And that — really that — this is, as you said, that you can’t fall off the floor. This is a point from which you don’t think you can fall from.
Edward Richardson: No, we’re absolutely amazed that it’s — it’s just like you falling off a cliff that the business went to this level. But it did and that’s where we are, but we have the backlog, we have the inventory, so it’s a matter of timing, not if but when.
P. Ross Taylor: And can you give a little bit of background on the opportunity in hydrogen? Market size or…
Edward Richardson: Yeah. We are just starting to work in that area. So they are buying 100 kilowatt generators that we make and they’re converting methane gas into hydrogen and acetylene. And actually at this point, the acetylene has more value than the hydrogen. But a lot of companies, including Caterpillar, are talking about having their equipment run on hydrogen in the future. And one of the most profitable ways to generate that hydrogen is using 100 kilowatt microwave generators that we manufacture. They use a tube that’s about $10,000 and the generator is like $100,000. So that could be a profitable business for us in the future.
P. Ross Taylor: And how many tubes do you need?
Edward Richardson: There’s one tube in each generator. We have one customer that we mentioned that’s making this crystalline or synthetic diamonds for industrial applications and they are talking about buying 200 generators over the next two years.
P. Ross Taylor: Over the next two years?
Edward Richardson: Several years.
P. Ross Taylor: Several years.
Edward Richardson: Yeah.
P. Ross Taylor: Okay. And then, so we look at this and I guess part of what that business model is you end up — you sell the acetylene and if you sell the acetylene, then actually it reduces or eliminates the cost of making the hydrogen and then you have the hydrogen as a benefit beyond it.
Edward Richardson: Yeah, that’s correct.
P. Ross Taylor: Okay, well as I said, I think it’s fascinating. This isn’t the most bullish call I’ve heard you guys have and, don’t get discouraged by the fact that investors look at — basically drive by looking at the hood of the car.
Edward Richardson: Well, we’ve only been around for 76 years. And in my history, the stock has been $375.29. So we’ll get there. It’s Just a matter of when.
P. Ross Taylor: Let’s get back to new highs.
Edward Richardson: Okay. Thank you.
Wendy Diddell: Thanks, Ron.
P. Ross Taylor: Congratulations.
Edward Richardson: Thanks.
Operator: And thank you. And one moment, please. One moment for our next question. And our next question comes from [Ronald Richards] (ph). Your line is now open.
Edward Richardson: Good morning, Ronald.
Unidentified Analyst: Hey, guys. I got a question. Good morning. I saw you got those orders coming in India and I was wondering about GE’s penetration in other foreign markets, what kind of progress you’re making.
Greg Peloquin: Yeah, the biggest opportunity is the Suzlon multi-brand specific to Suzlon in India, but that also is going to be tested at their facility to make it an OEM product, meaning it will be designed and it won’t be replacing lead acid batteries in their wind turbines. It’ll actually be the PEM system within their turbines. That is by far the biggest opportunity. We have numerous opportunities, not nearly as large, with Enel in Italy, with Nordex in Germany. So, it’s getting — because of these relationships and the new products, getting the North American GE market, not 100% exclusive, but grabbing all the market share we can now, and we continue to train our global sales force on these products because again, they’re brand new to them too.
So we are seeing opportunity, but the biggest probably in the next 12 months is going to be Senvion globally. Because once we go into production for India, that’ll transcend to all their turbines and owner operators throughout the world. Suzlon, I’m sorry.
Unidentified Analyst: Okay.
Greg Peloquin: They sound so much alike.
Unidentified Analyst: Okay, thank you.
Greg Peloquin: Thank you.
Operator: Okay, thank you. And I am showing no further questions. I would now like to turn the call back over to Ed Richardson, CEO, for closing remarks.
Edward Richardson: Thanks, Justin. Well, we want to wish you all a very happy and prosperous new year and we appreciate your investment, interest in Richardson Electronics. We assure you that it’s only up from here and not a matter of if but when and we look forward to discussing our fiscal year 2024 third quarter with you in April. And we’re available to take your calls at any time, so don’t hesitate to call us. Thank you very much.
Operator: Thank you. This concludes today’s conference call. Thank you for participating. You may now disconnect.
