Earnings Transcript for EVGO - Q4 Fiscal Year 2022

Operator: Good day, and welcome to the EVgo Fourth Quarter and Full Year 2022 Earnings Call. Today’s call is being recorded. I would now like to turn the call over to Heather Davis, Vice President of Investor Relations. Please go ahead.

Heather Davis: Hi, everyone, and welcome to EVgo’s fourth quarter and full year 2022 earnings call. My name is Heather Davis, and I am the Head of Investor Relations at EVgo. Joining me on today’s call are Cathy Zoi, EVgo’s Chief Executive Officer; and Olga Shevorenkova, the Company’s Chief Financial Officer; Jonathan Levy, EVgo’s Chief Commercial Officer will join us for the Q&A portion of the call. Today, we will be discussing EVgo’s financial results for the fourth quarter and full year 2022 and initial outlook for 2023 followed by a Q&A session. Today’s call is being webcast and can be accessed on the Investors section of our website at investors.evgo.com. The call will be archived and available there, along with the Company’s earnings release and investor presentation after the conclusion of this call. During the call, management will be making forward-looking statements that are subject to risks and uncertainties, including expectations about future performance. Factors that could cause actual results to differ materially from our expectations are detailed in our SEC filings, including in the Risk Factors section of our most recent Annual Report on Form 10-K. The Company’s SEC filings are available on the Investors section of our website. These forward-looking statements apply as of today, and we undertake no obligation to update these statements after the call. Also, please note that we will be referring to certain non-GAAP financial measures on this call. Information about these non-GAAP financial measures, including a reconciliation to the corresponding GAAP measures can be found in the earnings materials available on the Investors section of our website. With that, I’ll turn the call over to Cathy Zoi, EVgo’s CEO.

Cathy Zoi: Hello, everyone. And thank you for joining today. EVgo achieved record revenue in 2022, reflecting the continued growth of our ultra-fast DC charging network, our blue-ribbon partnerships and our industry-leading technology offerings. In our first full year as a public company, revenue and adjusted EBITDA were at the high end of our guidance range. This accomplishment is something I’d like to thank the entire EVgo team for. We look forward to continuing to grow and deliver in 2023. On today’s call, I’ll focus on a few themes from the year that we see as the building blocks to EVgo’s long-term opportunity

Olga Shevorenkova: Thank you. EVgo ended the year with strong growth momentum as we continued to rapidly build out our network and execute on our projects. I will first cover results for the fourth quarter and then for the full year of 2022. EVgo’s active engineering and construction stall development pipeline grew by 29% in 2022 versus 2021, ending the year at approximately 4,000 stalls. EVgo added over 180 new stalls to our network during the quarter and installs in operation or under construction were over 2,800 at quarter-end. Fourth quarter revenue of $27.3 million grew 283% year-over-year. This substantial increase was driven by increased retail charging revenue and continuous execution of our EVgo eXtend contract with Pilot Flying J in partnership with General Motors. Under this multi-hundred million dollar multiyear contract, we recognized revenue in four phases for every site. The first one pre-engineering work being done on site. The second one, charging equipment delivery. Revenues recognized when charging equipment changes title upon arrival at our facilities and subsequent payment by PFJ. The third one, construction. Revenue recognized proportionally to work being done on the site. And then finally, the fourth one, operational months [ph] we see once the site goes operational. In the fourth quarter, we accomplished 33 engineering works and took delivery of the first charging equipment shipment. Adjusted gross margin declined from 28.2% in Q4 2021 to 18.3% in Q4 2022 due to a decrease in the percentage contribution of regulatory credit sales to the revenue mix and the year-over-year reduction in LCFS prices. We reported adjusted EBITDA of negative $20.1 million in Q4 2022 versus negative $16.3 million in Q4 2021. Adjusted G&A as a percent of revenue declined from 257% in Q4 2021 to 92% in Q4 2022, illustrating the leverage EVgo started realizing from its investments in G&A, both administrative and growth-driven payroll and non-payroll investments. CapEx was $66.4 million during the fourth quarter as EVgo accelerated charger deployments and continued to execute against our long-term strategic plans. As a reminder, all our charging infrastructure deployment goes through a rigorous underwriting process and our targeted financial returns. EVgo raised $10.4 million in net proceeds by issuing 1.6 million shares of Class A common stock through an at-the-market equity offering in the fourth quarter. We anticipate using the ATM opportunistically going forward. Now turning to our full year 2022 results. EVgo added nearly 670 new stalls to our network during the year versus approximately 290 added in 2021, an increase of 131%. Again, stalls in operation under construction were over 2,800 at year-end, with approximately 2,200 of those being operational. Customer accounts increased by 63% year-over-year and year-over-year throughput growth of 69% exceeded year-over-year operational stall growth of 29%. 2022 revenue of $54.6 million grew an impressive 146% year-over-year, driven by an increase in retail charging revenue, eXtend revenue, primarily through execution of the PFJ contract and the full year contribution of PlugShare revenue versus partial in 2021. Adjusted gross margin of 24.3% improved by 90 basis points over 2021, driven by accelerated LCFS credits in the first half of 2022 and the full year of contribution from the PlugShare acquisition. Full year adjusted EBITDA was negative $80.2 million compared to negative $51.4 million in 2021. Adjusted G&A as a percent of revenue declined from 255% in 2021 to 171% in 2022, illustrating the leverage EVgo started realizing from its investments in G&A. We relentlessly look to optimize and leverage our investments in the Company and remain agile in our cost structure as the industry growth projections evolve. In 2023, we are optimizing our G&A spend around charger pipeline growth and execution and delivering of contractual commitments. CapEx was $200.3 million in 2022, led by the new stall deployments and including $4.6 million of new CapEx, $15.9 million of land purchases and $14.3 million of capitalized payroll and non-payroll expenses. Turning to network trends in the year. As you may know, EVgo’s revenue is leveraged to increasing EV adoption as greater number of EVs on the road help drive throughput and increase utilization at EVgo’s chargers. For the year 2022, EVgo’s throughput growth significantly exceeded stall growth. Again, 69% growth for throughput versus 29% growth for operational stalls. EV sales continued to climb throughout the year with over 2.2 million EVs in operations compared to 1.5 million in 2021 and we have observed increased utilization across our network. This was driven by an increase in retail throughput of 74% year-over-year and fleet of 65% year-over-year. For fleet, rideshare partners continues to add EVs, leading to addition of high-frequency customers to EVgo’s public network. EVgo’s partnerships with autonomous vehicle companies are also positioning us to benefit from the emerging adoption of self-driving robotaxis and delivery services. We are also off to a great start in 2023 with average daily throughput volumes quarter-to-date in Q1 2023 approximately 20% higher than in the previous quarter, Q4 2022. As Cathy mentioned, as of the end of 2022, EVgo has several markets that have double-digit utilization. Looking at these markets more deeply, we’ve seen that each of them is fairly developed with high re-EV penetration rate and the strong EV station footprints. This reinforces our strategy to deploy stations in markets with strong accelerating EV penetration and offering charging in the best locations, an excellent customer experience, flexible pricing plan and additional data-driven services. In an environment where competition intensifies, it is even more important to focus on delivering the best customer experience, which includes enhanced reliability and convenient interfaces and services, such as ultra charge. Sales of EVs outside of California continues to increase. In 2022, 63% of all EV sales were in markets outside of California. These markets are important to EVgo as we continue to build out our fast charging network. In 2022, 41% of our kilowatt hours were dispensed outside of California, up from 32% in 2021, demonstrating that the market for EV electrification and consequently EV charging is becoming truly national. EVgo is well prepared as two-thirds of our 2022 new stall additions were outside of California. And in 2023, we expect to continue to build across the country. Now, let me give an overview of EVgo’s charging network pricing strategy. Philosophically, our strategy is centered around flexible pricing tariffs for our customers versus one-size-fits-all approach. We are working towards introducing fully dynamic pricing over time, in order to -- approaches and are already offering certain elements of such dynamic today. We have time of use pricing with early burden off-peak hours, allowing drivers to unlock lower prices at certain times of the day. There’s also location-based pricing to incorporate attributes like availability of other businesses in the area, utility specific tariffs, traffic intensity, overall attractiveness and other market attributes. EVgo’s subscription plans offer value for drivers based on their frequency of expected charging. Our subscription plans have been gaining traction among our customer base, and we continue to experiment with such plan designs. Turning to 2023 guidance. EVgo is introducing 2023 full year revenue guidance of $105 million to $150 million. This guidance range is informed by the Buy America requirements for NEVI-funded projects issued at the end of February, which are more extensive than previously expected, given the nascent state of domestic fast charging manufacturing capacity. As a result, inputs on specific project time lines remain uncertain and are dependent on domestic capacity coming on line. EVgo’s current main suppliers, including the Pilot Flying J projects have factored under construction with U.S. charger production planned for late 2023. These developments have affected our 2023 PFJ execution plans and shifted some anticipated revenue from 2023 into 2024. Other factors informing the guidance range are the implications a potential economic recession may have on EV sales, the LCFS price environments and the speed of rideshare electrification. We expect to provide quarterly updates to our annual guidance and anticipate updating the market accordingly in our earnings calls. We expect full year 2023 adjusted EBITDA of negative $78 million to negative $60 million. We expect to have a total of 3,400 to 4,000 DC fast charging stalls in operation or under construction at the end of 2023. This metric includes PFJ stalls. With this, I will turn the call over to the operator for questions.

Operator: [Operator Instructions] We’ll take our first question from James West with Evercore ISI.

James West: So, a quick first one for me, and I think you’ve gone through most of this, but I want to make sure I’m getting this correct. The guide for the number of stalls that will be installed -- installs in operation or under construction of 3,400 to 4,000. I think the low end is kind of similar growth to this year; the high end, obviously, is accelerated growth. Is it -- are there any other factors more than kind of the NEVI definitions and the NEVI scaling up process that influence that? And does that also include kind of, Cathy, what you said about utility -- some utilities delivering slower than they had been?

Olga Shevorenkova: Yes, James, thanks for the question. Yes. So first of all, this number dose include PFJ stalls, not just if you go own stalls, just to confirm that. And the range is informed by both -- all of the above, by both the potential uncertainties within the NEVI rules as we just described to the market, but also our normal volatility as with utilities and the timing of constructions and whatnot, which was true last year and it’s true today. So both of them are included and informing this rate.

James West: And then the follow-up for me, we’ve seen some recent pricing changes from your competition. In fact, they’re raising pricing to -- really to come to your level of pricing or where you guys have been mostly pricing as I understand it. Are you seeing any other -- I mean, are you seeing any other competitive moves on pricing that either kind of make you think you can raise pricing further or the pricing is going to be stable at this level, given what the other competition is doing? Because it seems like we’re in a little bit of an elastic market at least now.

Cathy Zoi: Yes. So James, I think as Olga mentioned in the prepared remarks, I mean we have a pretty sophisticated approach to pricing. First of all, pricing, we have to make money on every kilowatt hour to spend, that’s sort of a given, right? So, that’s -- we’ve always priced to make money, period, full stop. But interestingly, as the market evolves, we’re leaning into the dynamic pricing capabilities and our early forays into that where we’re offering early bird pricing in certain markets and location-based pricing, the customers seem to like it. So we’re going to continue to develop sophistication of that, and we think that’s going to actually please customers and give us more upside headroom as we go forward.

Operator: We’ll take our next question from Gabe Daoud with TD Cowen.

Gabe Daoud: I was maybe hoping to get a little more color on the ‘23 guide, maybe just on the revenue side. Could you indicate how much is stemming from eXtend versus just the legacy charging business?

Olga Shevorenkova: So, we will probably [indiscernible] charging. This is our core business, rather than legacy, Gabe. But we don’t disclose -- we don’t disclose the split for the guide. What we could say and to reiterate that the range, which is -- which you see $105 million to $150 million is mostly informed by time line uncertainties within the execution of PFJ contracts. So nearly all of it is informed by potential volatility and expend. So again, we won’t be disclosing how much of the total guide is the PFJ revenue, but we will be reporting it as we go through the year.

Cathy Zoi: But let me just underscore, Gabe, just build on what Olga said is, let’s just be really, really clear that the PFJ, it’s a multi-hundred million dollar multiyear contract. What we’re talking about with that variability means that things that might make -- things that could happen in 2023 would just get simply shifted to 2024. So, there’s -- it’s a forecasting thing for you and for us, I suppose, but it doesn’t materially affect the overall health of the business in any way.

Olga Shevorenkova: Correct.

Gabe Daoud: And then maybe just a follow-up. If I look at capital spend in ‘22, call it, $200 million or so, if you, I guess, kind of spend that again in ‘23, the $200 million relative to what’s on the balance sheet. Just how do we think about capital needs in funding that program this year? And are there any other forms of capital, whether it’s like a DOE loan program? Just are there any other levers that you can pull to fund the deployment this year? Thanks everyone.

Olga Shevorenkova: Yes. So as of now, where we stand with our cash balance today, we are signed for the duration of this year and most of next year. So, we do not -- our growth plans are sized to be able to go through again the most of next year and, of course, this year. We remain opportunistic -- capital raising opportunity presents itself, and we feel it’s the right thing to do. And we like how the markets look like, we will take that opportunity. So, that’s what I would say about the capital stretch. Regarding other sources of funds, as part of our G&A, we have the whole team focusing on looking at securing grant funds. So that is part of our strategy. And that some of it is baked into our forecast as well. And I don’t know, Cathy, if you have anything to add on that?

Cathy Zoi: Yes. I mean, I think, Gabe, you mentioned the DOE loan program, and that is certainly an exciting possibility. The timetables on that are, as you can probably imagine, very, very long. So that’s an interesting possibility, but it’s probably not a 2023 possibility for us or anybody for that matter, right? I mean, it’s just -- it’s a long lead time.

Operator: We’ll take our next question from Maheep Mandloi with Credit Suisse.

Maheep Mandloi: Just following the previous question on -- or maybe tackling the margins from a different angle here. In terms of OpEx, how should we think about that in the year here, like a similar run rate to Q4? I know in February, you talked about some structural changes of the Company, but just curious how to think about that going forward.

Olga Shevorenkova: Yes. Thanks, Maheep. So, we did go through some payroll efficiencies earlier this year. However, we still will be fulfilling certain positions, mostly in operations teams needed to help us close on execution of our pipeline and existing commitments. So, I would -- Q4 is a fine proxy, but you’d see some movements throughout the year as the effect of efficiencies we introduced earlier this year come into play and as we continue to ramp up, probably not as significant as last year, but yes, there will be a ramp up on operations headcount, which you would also see throughout this year as well.

Maheep Mandloi: Got it. And on this domestic content question earlier. How early do you think the suppliers can move into the U.S.? Have they given you a time line yet, predominantly Delta, or PFJ?

Cathy Zoi: So, we have two major suppliers for our fast chargers both Delta and Signet. And they both have domestic production facilities under construction right now and are aiming for the latter part of this year to have those go on line. And once they go on line, we need to obviously test the equipment that comes out because for us, safety and reliability is of utmost importance. So, we like we’re hopeful end of this year that we’ll be able to sort of get access to those U.S. manufactured 350 chargers, 350-kilowatt chargers and get them moving. But that’s why you see the variability in our revenue range there.

Maheep Mandloi: Got it. And then just one last housekeeping, I’m sorry if I missed this. Did you talk about CapEx needs for this year?

Olga Shevorenkova: We don’t explicitly guide to the CapEx, but we do guide to total stalls in operation on the construction as of year-end, and you can infer from there.

Operator: We’ll take our next question from Andres Sheppard with Cantor Fitzgerald.

Andres Sheppard: Congrats on the quarter. It looks like the stock is reacting very well. So, congrats again on the news. Most of our questions have been asked, maybe touching on revenue guidance once more. It’s a pretty decent range on the guidance. So, maybe if you could just help us better understand kind of what are the main assumptions driving this variance? And also, what kind of seasonality might we expect? I think historically, Q1 has been a little bit on the lower end, but it sounds like it’s progressing well with the network throughput. So, just wondering on seasonality there as well.

Olga Shevorenkova: Sure. So, the first -- on the first question on the range, it is mostly informed by the timing of eXtend revenue and namely PFJ contract execution and to be more precise, the timing of the charger delivery on our facilities. This is when they change title, as I mentioned in my prepared remarks, and we effectively record revenue. We do expect to start seeing NEVI qualified chargers being delivered end of the year. But depending on specifically how many chargers will hit us this side of the year versus next side of the year, just to give a little more detail, we will see a different revenue number. That is the main factor in the range. And then you have other factors which are also important, but maybe less in magnitude, which is actual construction time lines for PFJ contract. And then on the core business, it’s EV sales. So, our retail business is quite correlated to a number of electric vehicles on the U.S. roads. And depending on how many will be sold to the market this year, it will create some volatility. And then on top of it, we don’t know what’s going to happen with LCFS price, and we would have baked in there as well. So, all of those factors do affect the size of the range. And then, do you want to repeat the second question? Sorry…

Andres Sheppard: Yes, no problem. The second is just part on seasonality, what kind of seasonality…?

Olga Shevorenkova: Yes. So you know what, it is interesting, because every year, we -- there is a seasonality pattern, which is a normal seasonality pattern on how EVs are driving, so -- not EVs, it’s all cars are driving, and that’s a stable pattern and you could see how FQ1 is a little weaker, picked up by the summer, then you again see a pick up around like holidays later in the year. However, every single year, there are some factors which are overriding the seasonality or come on top of seasonality. Last year, for example, the Q1 was even worse than seasonality would suggest because there were some COVID spikes and people were like restraining themselves from going out. This year, we see a lot of growth because we see actually pretty strong sales in Q1 and pretty strong sign-ups on the EVgo network and a kind of marked seasonality. My perspective, and I’m looking at this number pretty much daily that for such an early-stage high-growth industry, we won’t be seeing stable seasonality pattern for a while because you would always kind of have some other factors overriding the seasonality or coming on top of the seasonality which masks it a little. But we will continued to monitor and report back to the market and explain why and what is happening. But you’re absolutely right, it’s -- the last Q1 didn’t see as much of growth versus previous quarters we probably would see this one.

Andres Sheppard: Got it. That’s very helpful. Olga, I appreciate all that context. Maybe as a quick follow-up question for Cathy here. I’m curious, there’s been some consolidation in the sector. I’m curious to maybe get your views on M&A or if you might expect any further consolidation in the sector, either this year or next year? Thank you.

Cathy Zoi: Yes. Look, Andres, I’m not exactly sure. Look, what we know is with $1.2 trillion going into making of the cars and that whole thing that there’s a whole lot of interest in entering the charging space as well. So -- and that comes from new entrants and that comes from the big guys, like you’ve seen some oil companies taking some actions there. I suppose that will -- I’m guessing that will continue to be of interest. I think probably in the near term, M&A activity may be impacted by recessionary fears that are looming, so that might time it a little bit. So in any case, look, we at EVgo, we’re just going to go and execute our business and continue to do what we do well. And we’ll just watch that space just like you will.

Operator: We’ll take our next question from David Kelley with Jefferies.

David Kelley: Maybe just a couple of follow-ups from my end, and I wanted to start with earlier CapEx discussion. As we think about mix contributors to that implied stall growth in 2023, should we expect any meaningful change in per stall pending relative to 2022?

Olga Shevorenkova: Yes. So, not meaningful, yet we do see a trend coming down a little bit. We are now looking at numbers in vicinity of $140,000 per stall versus last year we saw $140,000 to $145,000, mostly coming from our efforts on negotiating equipment prices and also because we are now focusing on a bit of a larger size, meaning more stalls or sites, which creates efficiencies. And we’ll continue to update the market as that substantially changes.

David Kelley: Okay. Got it. That’s helpful. Thank you. And then, one quick follow-up on fleet. We are seeing a bit slower rollout of EVs in the U.S., mainly due to supply chain shortages, but they’re out there. And then we have the growing macro uncertainties. So, curious if you’re seeing any impact on or hearing of any kind of increased near-term hesitation from some of your fleet customers, understanding the longer-term plans of rollout are fully intact. But have they pulled back at all on kind of expectations for the next 6, 12 months here?

Cathy Zoi: Yes. So I mean, we think of fleet in kind of three buckets. We have rideshare fleet, which is on our public network, and that’s going great. I mean, that’s back post-COVID. There are passenger vehicles that are light duty. So they’re finally -- Uber and Lyft, for example, their drivers are able to get access to EVs. So, that’s really, really going very, very well. Our second bucket of like sort of fleet partnerships is the autonomous vehicle companies. And again, good progress there. We have a really lovely business model on hubs with them that is growing well. The one that I think you’re referring to is the delivery folks and they have been unable to get very many vehicles, and that’s happening a little bit more slowly. We don’t see a pullback. We just see that the -- that their first forays, their first investments in pilots are just moving along more slowly than we might have guessed a couple of years ago. And that really is, I think, as you’re alluding to, a function of accessing the vehicles themselves. I mean, I’m guessing that, that’s going to shake loose sometime probably in the next 24 months. This year, I think we’ll just continue to see progress on fleets, large and small, buying their first batches of EVs and working with charging partners like EVgo to gain some experience on electrification of transportation.

Operator: We’ll take our next question from Alex Vrabel with Bank of America.

Alex Vrabel: I hate to sort of go back to something we’ve talked about already. But just on sort of the capital markets future here. Olga, can you perhaps just help a little more as far as you mentioned the line of sight on the next two years. If I take just the $140,000 million number you mentioned per stall and just assume half of the sold year to do this year are within, I guess, your core business model that would take sort of half your cash position away with the EBITDA burn as well. What -- I guess, is there any further color you can offer? And also to understand, is there any use of the ATM, I guess, embedded in that statement that you made earlier?

Olga Shevorenkova: Yes, sure. So, -- we spent roughly $200 million last year on CapEx and the majority of it was growth CapEx. So a lot of stalls we plan to put in operations this year were already pre-spent money last year, including prepaid equipment and some of the construction as well. So -- and that’s normal for our business. You have to spend money kind of sometimes up to 3, 4 quarters earlier than the stalls go operational. So that might affect your math. So, we’ve already done quite a bit of work last year was a big push year for us on that front. The second point, when we think about our capital needs, let us not forget that a lot of times when we deploy our assets, we do take advantage of incentives, which exist and now with 30C coming in place and other incentives available that does affect CapEx quite a bit. So, it’s not overall capacity, it is offset by certain incentives. On ATM, we did raise $10.4 million end of last year. And we continue to be opportunistic. We -- ATM will not probably be the main source of our capital. However, when the situation permits and there is an open trading window, we will take advantage of it.

Alex Vrabel: Got it. That’s actually super helpful. And then, maybe one for you, Cathy. I know you mentioned there’s obviously a litany of things going on in Washington as far as the moving policy pieces. I think the key piece of drama this week is really the EV tax credit and certainly some gyrations we can see there. I mean how, I guess, important is that or not to what you see as far as future demand trends? I know there’s a lot of debate about what may or may not qualify. Just curious kind of on your perspective, given how close you are to the issue over many years.

Cathy Zoi: Yes. Well, actually, Alex, I’m going to take the opportunity to introduce my marvelous colleague, Jonathan Levy, to answer this one, Jonathan. Jonathan and I got to know each other in that Washington world, and he’s our Chief Commercial Officer, and he’s going to be joining us for these calls going forward. So I want you guys to get to know him. This is totally in his zone. So, Jonathan, over to you.

Jonathan Levy: Yes. Thanks, Cathy. And I guess, you may be referring in part to some of the comments that [indiscernible] made yesterday at a conference that I was speaking at, but we are expecting the clarifications from treasury on the 30D vehicle tax credit for some of the minerals content requirements. I think there’s a couple of things here, right? A lot of that has to do with where the automakers are planning some of the components and what happens with their supply chain. What we’re seeing near term, though, is demand from consumers is such that you still have reservation, availability. And I think that demand continues to outstrip the supply. Obviously, the tax credit can continue to be a really big tailwind, but we’re also as excited about the commercial and Used tax credit, and the commercial credit doesn’t have the same restrictions that they Used and the 30D credits have.

Alex Vrabel: Yes. No, that’s super helpful. And welcome to the team, Jonathan. I look forward to connecting forward.

Operator: We’ll take our last question from Bill Peterson with JP Morgan.

Bill Peterson: I wanted to kind of come back to seasonality and first clarification. On the network throughput, 20% higher, does that mean we should assume the network throughput in the first quarter is around, let’s say, 17% or so? And then, I guess, related to that, revenues have somewhat lagged network throughput. I wonder if you could kind of unpack how to think about that. I guess, related to pricing, you might probably -- either subscriptions, pay-as-you-go, different type of, I guess, charging needs that people are employing. So, try to unpack those for us would be very helpful. Thanks.

Olga Shevorenkova: Yes. So, we won’t comment on Q1 results just yet, stay with us. That comes relatively soon. But the 20% number on average daily volume is a good proxy for quarter-over-quarter sequential change. On pricing -- or sorry, on revenue lag and throughout, not sure, maybe you clarify what you exactly mean. But our retail business is -- there is no live, it’s exactly we recorded revenue and getting cash pretty much the moment the person charges. So there is no lag there at all.

Bill Peterson: I think the network throughput was somewhere north of 70% growth and the revenue was around 60% -- I don’t know, 60%, 69%. So I’m not saying lagging, I’m talking about the revenue growth, it doesn’t exactly match the network throughput growth. That’s what I meant by that. I’m trying to understand how to model that moving forward.

Olga Shevorenkova: Okay. So thanks for clarifying. It depends on kind of what kind of revenue you’re taking into account because we have retail revenue, you have commercial revenue, you have OEM revenue. Commercial revenue, the definition for kilowatt hour pricing would be lower because these guys get volumetric discount. So the moment that revenue line in proportion growth to the total revenue, you will see that effect, which you are mentioning. And the same, if you include LCFS pricing into this, that same concept, LCFS pricing went down quite a bit year-over-year. So, I don’t know which particular revenue line you run your numbers on, but that contributes to that effect as well.

Bill Peterson: And then obviously, it’s a wide range for the year, largely on eXtend. But I guess, can you help us understand, how we should have it run through in terms of, let’s say, the gross margin? How does it flow through the P&L? For example, if you come in the low end of the range, I presume your actual gross margin would actually be higher. But can you help us understand the -- how that flows to the P&L, that would be helpful as a reminder?

Olga Shevorenkova: Yes. That’s a good question. We do not guide on adjusted gross margin. However, even within eXtend, kind of different pieces have slightly different margin and depending if you have more charging revenue versus construction versus pre-engineering, the margin mix might change. So, I obviously do have certain forecasts which I look at, and it’s not necessarily that if you end up with a lower revenue number, your adjusted gross margin would be lower. There could be some other facts into play -- or so, it could be higher, could be some other effects into play. But again, we just don’t guide to adjusted gross margin. And we’ll be informing the market throughout the year as we go and explain which forces exactly play into a specific number for the quarter end results.

Operator: And that does conclude the question-and-answer session. I’d like to turn the call back over to Cathy Zoi for any additional or closing comments.

Cathy Zoi: Thank you. Well, thank you, everyone. In closing, let me just say that 2022 was about growth and execution at EVgo, culminating in the company achieving the high end of our revenue and adjusted EBITDA guidance and continuing to lead in the EV charging sector in the U.S. As we continue to expand as one of the largest fast charging public networks in America, we look to leverage our operational expertise from our decade-long track record and continue driving operational efficiency, deploying capital that meets our robust return requirements. I look forward to sharing our Q1 2023 results very soon. Thanks everyone for joining us.

Operator: And that concludes today’s presentation. Thank you for your participation. And you may now disconnect.