Geoff Williams – General Counsel and Secretary Pat Gruber – Chief Executive Officer Brad Towne – Chief Accounting Officer

Amit Dayal – H.C. Wainwright

Hello, and welcome to Gevo's Third Quarter 2018 Earnings Conference Call. My name is Michelle, and I will be your operator for today's conference. [Operator Instructions] And please note that this conference is being recorded. I will now turn the call over to Mr. Geoff Williams, Gevo's General Counsel and Secretary. Sir, you may begin.

Good afternoon, everyone, and thank you for joining Gevo’s third quarter 2018 earnings conference call. I would like to start today by introducing the participants from the Company. With us today is Pat Gruber, Gevo’s Chief Executive Officer and Brad Towne, Gevo’s Chief Accounting Officer. Earlier today, we issued a press release that outlines the topics that we plan to discuss. A copy of this press release is available on our website at www.gevo.com. I would like to remind listeners that this conference call is open to the media and we are providing a simultaneous webcast of this call to the public. A replay of today’s call will be available on Gevo’s website. On the call today, you will hear discussions of certain non-GAAP financial measures. Non-GAAP financial measures should not be considered in isolation from or as a substitute for financial information presented in accordance with GAAP. Reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures is contained in the press release distributed today and which is posted on our website. We will also make certain forward-looking statements about events and circumstances that have not yet occurred, including, but not limited to, projections about Gevo’s operating activities for the remainder of 2018 and beyond. These forward-looking statements are based on management’s current beliefs, expectations and assumptions, and are subject to significant risks and uncertainties, including those disclosed in Gevo’s Annual Report on Form 10-K for the year ended December 31, 2017, and in subsequent reports and other filings made with the SEC by Gevo, including our Quarterly Reports on Form 10-Q. Investors are cautioned not to place undue reliance on any such forward-looking statements. Such forward-looking statements speak only as of today’s date and Gevo disclaims any obligations to update information contained in these forward-looking statements, whether as a result of new information, future events or otherwise. On today’s call, Pat will begin with an overview of Gevo’s business and strategy. Brad will then review Gevo’s financial results for the third quarter of 2018. Following the presentation, we’ll open up the call for questions. I’ll now turn the call over to Pat. Pat?

Thank you Geoff, and thank you all for joining us today. We continue onward, executing the strategy of decarbonizing our plant at Luverne and developing the business opportunities for renewable isobutanol, jet fuel and isooctane. This quarter, we began the installation of the Shockwave technology. This technology will take ground corn and separate it into germ, bran and starch streams. The germ has lots of protein and oil in it. We'll be installing equipment to capture the oil on the front end of our production process, and this oil would be food grade. Additionally, the technology and equipment allow us to do some process optimizations, which help to reduce our carbon footprint, and we have the opportunity to make what's called high-protein animal feed, which is value-added. We expect that this technology will get an uplift in revenue and EBITDA at our plant. We expect to start up around the first quarter, or maybe it might go into the early second quarter of 2019 and then to have it operating in normal mode as compared to start-up mode by the end of the second quarter of 2019. We continue to implement the decarbonization of our plant by taking steps to get off the grid. What I mean here is we want to replace the fossil-based energy sources, the electricity and steam, that power our plant. And as we do this, we expect that to improve our margins for ethanol, and it creates the opportunity for isobutanol as well. Our plant is strategically located with access to reliable supply of lower-carbon, sustainable corn; various transportation options to market; plentiful wind sources; and good relationships with farmers who supply us. All of this matters as we decarbonize. Recall that as we decarbonize, again, removing fossil-carbon energy sources from our production processes, our carbon index score, that's the CI, goes lower. We can earn incrementally more revenue with each point reduction in our CI score. Decarbonization is expected to help the profitability for both ethanol and isobutanol. We see the opportunity to make the Luverne facility the lowest CI score production facility in the U.S. for ethanol and IBA. We intend to continue down that path. We are also in the midst of expanding our hydrocarbon plant for jet and isooctane down at South Hampton Resources in Silsbee, Texas. This plant has been expanded to about 100,000 gallons of total hydrocarbon production per year. The product from this plant is being sold commercially in the jet market and into the specialty gasoline blend stock markets. Substantially, all of the Silsbee plant production capacity is under contract for 2019 and 2020. We're developing plants to produce even more jet fuel and isooctane as an intermediate step prior to building out the Luverne Facility Expansion that I have discussed before. We see that there is demand to be met in the near term and that the market may not want to wait for us to build out our really big Luverne Facility Expansion. So we're developing the ideas to filling the gap between now and the big plant. As these plants come together and we make decisions, we'll inform you. On the business front, recall that the overall goal is to obtain a set of financeable offtake agreements for jet fuel, isooctane and/or isobutanol. Our approach to these contracts is to put forth pricing that allows for us to have returns suitable to attract lenders and project investors. We continue to make progress. Now as you know, Avfuel is a good example of a company. They looked at all the opportunities and technologies for renewable jet and picked ours. Why? Because of the combined economics and scalability. Likewise, Haltermann Carless has signed a long-term offtake agreement for isooctane. Our price point works for Haltermann and for Avfuel. We have several other contracts in negotiation where red lines are being passed back and forth. Having been in this business for 30 years, I've learned to count things only after they're signed, but I can say it sure looks like Tim Cesarek, our Chief Commercial Officer, is making progress with customers in securing larger-volume contracts for isooctane, jet and isobutanol. We will announce these agreements when they get signed. IBA is continuing to develop with Buc-ee's down in Houston. We are working with them to expand the regions and moving to other cities. The plans are being worked out. Our partner Praj continues to develop opportunities for isobutanol and jet fuel in India and other parts of the world. We are still working with them with the goal of entering a commercial license agreement. It's a lot sort out. We want to get it right. Recall, Praj has learned how to use molasses as a feedstock to produce isobutanol under license from us. And molasses is relevant in Asia, South America and other parts of the world. Together, we expect to license Gevo technology to companies with whom they have stronger relationships, especially those with a cane sugar molasses as a feedstock. They are, as we understand, the world's largest technology supplier for ethanol plants worldwide, and they have good access to potential customers and partners. Together, we're try to pin down the right opportunities for our technology deployment in licensing. And this takes work. In the third quarter, we stepped up our engineering efforts for the larger isobutanol hydrocarbon plants. We have enough line of sight with customers that it's time to pin down more details and figure out our best options for expanding Luverne. In the third quarter, we also entered into MOUs with companies in other regions of the world, independent of anything we're doing with Praj. These companies are interested in licensing our technology and entering into strategic relationships with us. These are at an early stage. We shall see how these relationships unfold. And as fossil-based companies, these strategics are just learning what's possible in the bio-based renewable world. Ours is interesting because they can see that we're very far along in the technology, having de-risked it, and they can see that customers are interested in our products. We have technologies and products that work, and we can prove it. And that's what got us to this MOU stage. Now the questions are about how to develop the complete business system: the size, CapEx, feedstock, cost structure, product mix, energy sources, et cetera. We will disclose more about these companies once we are further along in the relationships. We finished the third quarter with more than $38 million in cash. And we will spend several million in capital on projects designed to improve the EBITDA and reduce our burn. As we look forward, we can see past reducing and eliminating much, if not all of our burn, even while we continue to develop commercial opportunities for isobutanol, jet fuel and isooctane. So what is coming at us? I expect additional contracts. Tim is making progress, and I want to see them all get done. I expect contracts in the airlines. I expect additional contracts in isooctane, more commitments regarding isobutanol. And I expect we'll make some progress with relationships with partners. I – of course, I don't know when any of these things will actually occur. But I believe they're going to happen relatively soon. I'll turn it over to Brad.

Thank you, Pat. Gevo reported revenue in the third quarter of 2018 of $8.6 million as compared to $7.7 million in the same period in 2017. The increase in revenue during the third quarter of 2018 is primarily a result of the production and sale of approximately $8.1 million of ethanol, isobutanol and distiller grains at the Luverne plant as compared to $7.4 million in the third quarter of 2017. This increase in revenue was mainly due to increased ethanol production and higher distiller grain prices in the third quarter of 2018 versus the same period in 2017. During the third quarter of 2018, hydrocarbon revenues were $0.5 million as compared to $0.2 million in the third quarter ended 2017, principally as a result of differences in the timing of shipments of isooctane during the quarter. Cost of goods sold was $10.6 million in the third quarter of 2018 versus $9.7 million in the same period in 2017. Cost of goods sold included approximately $9 million associated with the production of ethanol, isobutanol and related products and approximately $1.6 million in depreciation expense. Gross loss was $2.1 million for the third quarter of 2018 versus a gross loss of $2.0 million for the third quarter of 2017. R&D expense for the third quarter of 2018 was $1.9 million compared to $1.2 million for the comparable quarter in 2017, due primarily to the ongoing expansion of the South Hampton facility. SG&A expense for the third quarter of 2018 was $2.2 million, compared to $1.9 million for the comparable quarter in 2017, due primarily to an increase in employee-related expenses. Within total operating expenses for the third quarter of 2018, we reported approximately $0.3 million for noncash stock-based compensation. For the third quarter of 2018, we reported a loss from operations of $6.1 million compared with a loss from operations of $5.1 million in the third quarter of 2017. In the third quarter of 2018, cash EBITDA loss, a non-GAAP measure, which is calculated by adding back depreciation and noncash stock-based compensation to GAAP loss from operations, was $4.2 million compared to $3.4 million in the same quarter of 2017. Interest expense for the third quarter of 2018 was $0.8 million, consistent with interest expense for the comparable quarter of 2017. For the third quarter of 2018, we reported a net loss of $6.9 million or a loss of $0.85 per share based on the weighted average shares outstanding of 8.6 million. This compares to a loss of $4.2 million in the third quarter of 2017, a loss of $5.03 per share based on a weighted average shares outstanding of 0.8 million. In the third quarter of 2018, Gevo recognized a net noncash loss totaling $2,000 due to changes in the fair value of certain of our financial instruments, such as warrants and embedded derivatives. Adding back these net noncash gains resulted in a non-GAAP adjusted net loss of $6.9 million in the third quarter of 2018, or a non-GAAP adjusted net loss per share of $0.85. This compares to a non-GAAP adjusted net loss of $5.9 million in the third quarter of 2017 or a non-GAAP adjusted net loss per share of $7.18. With that, I would like to thank our shareholders for their continued support of Gevo. We will now open it up for questions. Operator?

Thank you. We will now begin the question-and-answer session. [Operator Instructions] Okay. The first question in the queue comes from Amit Dayal from H.C. Wainwright. Please go ahead, sir.

Thank you. Hi, good evening, everyone. So Pat, with the expenditures and investments that are ongoing at this point, for shockwave, et cetera, like can you talk to us a little bit about the level or dollar amounts of what is going in and what you'd expect to, sort of, dig to get everything installed before you start at least normal productions?

Well, I'd say that I'd expect us to all-in-all, burn less money this year than we did last year, inclusive of the capital investments we're making, if that helps.

Yes, I just was trying to get – like is it $5 million going in, $3 million going in to install all this? Like what is the dollar amount, if you have – if you can help us with that?

It's about – it's in the several millions of dollars.

Okay, got it.

In that range.

Understood. And in terms of the low-carbon ethanol coming from this, say, by second half of next year, is this going to go to the same buyers and markets? Or are you looking for new customers for this product?

As we drive down the CI score, we'll be selling the product in the California. That's the plan. And so the step number one is we lower the CI, sell the ethanol into California. Now for the animal feed, in the – we'll be making like a high-pro animal feed. That will go to a slightly different market. We'd be working with Land O' Lakes or another market partner to deliver it to the right customers. But it's a specialty product, so we get a pay to premium for it.

Got it. And you had some comments on the jet fuels/hydrocarbon product. Is this capacity, the 100,000 gallons is – did you say this was contracted out till 2020 already?

Yes, it is. That's right. It's for the isooctane and jet fuel, both.

Got it. And what are the plans to sort of invest in this? I mean, are you going to keep it at these levels for the next, say, 12-month period? Or are you going to maybe increase capacity, et cetera, for this as well?

We've already deployed the capital to expand that plant this year. And so it's just getting started up and getting going. So I think for the next 12 months, we'll be kind of at that level. I mentioned in my comments that we might do something at an intermediate scale. There are some contracts that I've seen being negotiated that would cause us to want to take a step or even make, maybe, quite a bit more gallons, not a full build-out of Luverne, but expand our hydrocarbon capacity a bit so that they can do more seating in the market and skim the markets in niche markets. But that contract’s got to support that. And I have to see it signed.

Is this coming, maybe, before the end of – or is this maybe a 2019 event?

Sorry.

The contracts for this. Is it happening before the end of this year? Or is it likely to happen maybe in 2019?

Amit, I'm so wrong every time I predict. And so it's like I can say this, we have several customers where I can see the agreements going back and forth. I see the red lines going back and forth. When will they get done? I would like to think they get done now or soon, but what, I don't know. It will be done when they're done. And I'm always surprised at how long it takes.

Understood. Just one last one from me. Could you give us any color on what is in the inventory right now?

How much is isobutanol's inventory?

Per se, have about 125,000 gallons currently. Okay, got it. Thank you so much. That’s all I have guys. I’ll take the rest of my questions offline. Thank you so much.

Yes.

Sir, there are no further questions in the queue.

All right. Thank you, everybody, for joining us. I appreciate your participation. Have a great day. Thanks.

Thank you. Ladies and gentlemen, this concludes today’s teleconference. Thank you for participating. You may now disconnect.