Investor Presentation
September 2015
1
Disclaimer
This presentation contains statements that constitute “forward looking statements” under the Private Securities Litigation Reform Act of 1995. All statements
other than statements of historical facts contained in this presentation, including statements regarding our short-term and long-term growth strategies, efforts
to develop and commercialize our products, future operations, future financial position, future revenue, projected costs, prospects, plans, objectives of
management and expected market growth are forward-looking statements. These statements involve known and unknown risks, uncertainties and other
important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or
achievements expressed or implied by the forward-looking statements. The words “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,”
“plan,” “potential,” “predict,” “project,” “should,” “target,” “will,” “would” and similar expressions are intended to identify forward-looking statements, although
not all forward-looking statements contain these identifying words.
These forward looking statements are only predictions and we may not actually achieve the plans, intentions or expectations disclosed in our forward-looking
statements, so you should not rely on our forward-looking statements. Actual results or events could differ materially from the plans, intentions and
expectations disclosed in the forward-looking statements we make. We have based these forward-looking statements largely on our current expectations
and projections about future events and trends that we believe may affect our business, financial condition and operating results.
The information in this presentation is current as of September 2015 and speaks only as of such date. We expressly disclaim any obligation to release any
updates or revisions to any information presented herein, including any forward-looking statements, to reflect any change in our expectations or projections
or any changes in events, conditions or circumstances on which any such information or statements are based for any reason, except as required by law,
even as new information becomes available. All information and forward-looking statements in this presentation are qualified in their entirety by this
cautionary statement.
In addition to results presented in accordance with U.S. GAAP, this presentation and related tables include Adjusted EBIDTA, a non-GAAP financial
measure. We have provided a reconciliation of this measure to the most directly comparable GAAP measure, which is available in “Reconciliations” starting
on slide 20. We use Adjusted EBITDA as a measure of operating performance, because it does not include the impact of items that we do not consider
indicative of our core operating performance, for planning purposes, including the preparation of our annual operating budget, to allocate resources to
enhance the financial performance of our business and as a performance measure under our bonus plan. We also believe that the presentation of Adjusted
EBITDA provides useful information to investors with respect to our results of operations and in assessing the performance and value of our business.
Although we believe this non-GAAP financial measure enhances investors’ understanding of our business and performance, this non-GAAP financial
measure should not be considered an alternative to or substitute for accompanying GAAP financial measures.
The risk factors set forth in our Annual Report on Form 10-K for the year ended December 31, 2014 and filed with the SEC on March 13, 2015 pursuant to
the Securities Exchange Act of 1934, as amended, are incorporated by reference into this presentation and should be read in their entirety alongside this
presentation.
2
Disclaimer
This presentation contains market data and industry forecasts that were obtained from industry publications, third party market research and publicly
available information. These publications generally state that the information contained therein has been obtained from sources believed to be reliable, but
the accuracy and completeness of such information is not guaranteed. This presentation also contains estimates and other statistical data made by
independent parties and by us relating to market size and growth, size of insulation opportunity at various types of energy infrastructure facilities and other
data about our industry. We obtained the industry and market data in this presentation from our own research as well as from industry and general
publications, surveys and studies conducted by third parties, some of which may not be publicly available. For example, this presentation includes statistical
data extracted from an off-the-shelf market research report (World Insulation - #2956) by The Freedonia Group, an independent international market
research firm, and a separate custom market research report by Freedonia Custom Research, Inc., a wholly-owned subsidiary of The Freedonia Group, or
Freedonia, which was commissioned by us and was issued in February 2014. Such data may be outdated and involves a number of assumptions and
limitations and contains projections and estimates of the future performance of the industries in which we operate that are subject to a high degree of
uncertainty. We caution you not to give undue weight to such projections, assumptions and estimates.
The Freedonia Custom Research, Inc. Report, or the Freedonia Report, represents data, research opinion or viewpoints developed independently on our
behalf and does not constitute a specific guide to action. In preparing the Freedonia Report, Freedonia used various sources, including publicly available
third party financial statements; government statistical reports; press releases; industry magazines; and interviews with manufacturers of related products
(including us), manufacturers of competitive products, distributors of related products and government and trade associations. The Freedonia Report speaks
as of its final publication date (and not as of the date of this presentation).
3
Experienced Leadership Team
Donald R. Young

President, CEO and member of Board of Aspen Aerogels since 2001

Prior to 2001, worked in the U.S. and abroad in a range of senior operating
roles for Cabot Corporation

Graduate of Harvard College and earned an MBA from Harvard Business
School

Has served as CFO since 2006

More than 10 years of service as a SVP of New England Business Service, in
senior financial and operating roles

Earned a B.A. in Economics from Middlebury College and an MBA from the
Wharton School of the University of Pennsylvania
President & CEO
John F. Fairbanks
Vice President, CFO &
Treasurer
4
Aspen Aerogels: An Energy Technology Company



Designs, develops and manufactures innovative, high-performance aerogel insulation primarily used in largescale energy infrastructure process facilities
 Offers a superior combination of performance and long-term value
 End users save money, reduce energy use, preserve operating assets and protect workers
 Global network of energy-focused distributors, contractors and engineering firms
Proven market adoption
 Used by 24 of the world’s 25 largest refining companies; 20 of 20 largest petrochemical companies
 Initial installations in approximately 30% of the world’s 640 refineries
 Installed base of >170 million sq. ft., >$400 million of product sales since 2008
Expanding capacity to meet demand
Targeted Energy End Markets
Geography
2014 Product Revenue by Region
Europe
14%
REFINERIES
P E T R O C H E M I C AL
P L AN T S
USA
36%
L N G & G AS
PRODUCTION
Asia Pacific
35%
O I L S AN D S
OFFSHORE
POWER
G E N E R AT I O N
Latin
America
9%
Canada
6%
5
Unique Technological Advantages
What are Aerogels?
Our Breakthrough Technology
Advantages vs. Traditional
Insulation

Aerogels are an amorphous
silica solid

Industrially robust


Characterized by impressive
material properties

Best thermal performance of any
widely used insulation product
Unique product form


Proprietary manufacturing
process
Reduced corrosion under
insulation


Patent-protected – 78 issued
and 54 pending patents owned
or co-owned worldwide
Compact design and faster
installation

High durability and fire protection


Lowest density solid -- ~97%
air
Lowest thermal conductivity
Proven Manufacturing Process
Our Aerogel Products
Step 1:
Fill fibrous batting with a liquid-solid solution
Step 2:
Extract solvents with supercritical carbon
dioxide
Step 3:
Resulting dry,fiber-reinforced aerogel
blanket
Pyrogel XT / XT-E / XTF
(hot insulation)
Cryogel Z
(cold insulation)
6
Disruptive Products with Compelling Value Proposition
Best Thermal
Performance
Thermal
Conductivity
Traditional Insulation
Pyrogel XT
 Two to five times better thermal performance
 Broad range of applications from -200°C to 650°C
Temperature Range
Reduced
Corrosion Under
Insulation
Vapor Permeable
Hydrophobic
 50% to 80% reduced volume
 Space savings
Compact Design
& Faster
Installation
High Durability
and Fire
Protection
 Enhances plant safety
 Improves reliability
 Reduces a major maintenance expense
Traditional
Insulation
 Faster installation time with improved safety
and logistics
 Excellent compression resistance, tensile
strength, and vibration resiliency
 Fire protection
Traditional Insulation;
Installed on site
Transport-ready;
Supports modular construction
7
Overview of The Energy Insulation Market
Energy Insulation End Markets – by Sector
Energy Insulation End Markets – by Region
$ Millions
$ Millions
$4,000
$4,000
$3,546
$3,546
$3,500
492
$3,000
523
$3,000
$2,814
$2,814
494
$2,000
$2,443
384
327
418
366
69
176
81
199
102
239
619
$2,500
$2,443
402
1,485
342
$2,000
1,089
903
$1,500
484
418
603
$1,000
$1,000
1,600
1,087
1,248
$0
2010
Power Generation
Onshore Oil Production
Gas Production
$500
512
541
278
104
198
73
226
86
415
470
553
2013
2018
Canada
Europe
Middle East Africa
$0
2013
2018
Petrochemical
Offshore Oil Production
Refinery
2010
USA
Latin America
Asia Pacific
Source: Freedonia Custom Research Report - February 2014.
8
Global Distribution Network and Installed Base
Distributor
Contractor
OEM
Installed Base


Installed in more than 40 countries worldwide
30 direct sales employees and 45 distributors
Source: Company Management.
9
Industry-Leading End Users
10
Revenue Growth
Revenue Growth 2009 to 2014
($ in millions)
$102.4
$86.1
$63.5
$43.2
$46.0
$28.6
2009
2010
2011
2012
2013
2014
11
Financial Overview
12
Financial Highlights
Technology company with significant market adoption
 History of top-line growth
 Sufficient scale for positive cash flow from operations
 IPO proceeds are funding capacity expansions
 Expansions expected to offer attractive return on capital
 Modest ongoing maintenance capital expenditure requirements
13
2014 Financial Performance
Strong top and bottom line growth
Year Ended
12/31/14
12/31/13
$ 102,399
85,319
$ 86,094
75,363
$ 16,305
9,956
19%
13%
17,081
33,123
10,731
30,703
6,350
2,420
59%
8%
(16,042)
(19,972)
3,930
20%
10,183
8,781
119
10,061
4,426
3,670
122
4,355
(3,551)
1%
98%
-97%
($ in thousands)
Total Revenue
Cost of Revenue
Change
Gross Profit
Operating Expenses
Operating Loss
$
%
EBITDA Add-backs:
Depreciation & Amortization
Stock-based Compensation
Other Items
Adjusted EBITDA
$
3,041
$
(1,815)
$ 4,856
N.M.
See slide 20 herein for a reconciliation of net income (loss), the most directly comparable GAAP measure, to Adjusted EBITDA for the periods presented.
14
First Half 2015 Financial Performance
Revenue constrained, but solid bottom line growth
Six Months Ended
Change
6/30/15
6/30/14
$ 53,596
43,972
$ 48,978
42,207
Gross Profit
Operating Expenses
9,624
15,066
6,771
17,789
2,853
(2,723)
42%
-15%
Operating Loss
(5,442)
(11,018)
5,576
51%
4,759
2,699
-
5,179
6,344
15
(420)
(3,645)
(15)
($ in thousands)
Total Revenue
Cost of Revenue
$
%
$ 4,618
1,765
9%
4%
EBITDA Add-backs:
Depreciation & Amortization
Stock-based Compensation
Other Items
Adjusted EBITDA
$
2,016
$
520
$ 1,496
-8%
-57%
-100%
288%
See slide 21 herein for a reconciliation of net income (loss), the most directly comparable GAAP measure, to Adjusted EBITDA for the periods presented.
15
Quarterly Adjusted EBITDA
History of Positive Adjusted EBITDA
For the Three Months Ended
LTM
($ in thousands)
3/31/14
6/30/14
9/30/14
12/31/14
3/31/15
6/30/15
6/30/15
Total Revenue
Cost of Revenue
$22,363
19,017
$26,615
23,190
$25,437
20,365
$27,984
22,748
$23,500
18,986
$30,096
24,987
$ 107,017
87,086
Gross Profit
3,346
3,425
5,072
5,236
4,514
5,109
19,931
Operating Expenses
6,244
11,546
7,437
7,895
7,259
7,807
30,398
(2,898)
(8,121)
(2,365)
(2,659)
(2,745)
(2,698)
(10,467)
2,631
339
15
2,547
6,006
-
2,513
1,054
-
2,492
1,382
104
2,184
1,295
-
2,574
1,404
-
9,763
5,135
104
432
$ 1,202
$ 1,319
734
$ 1,280
Operating Loss
EBITDA Add-backs:
Depreciation & Amortization
Stock-based Compensation
Other Items
Adjusted EBITDA
$
87
$
$
$
4,535
See slide 22 herein for a reconciliation of net income (loss), the most directly comparable GAAP measure, to Adjusted EBITDA for the periods presented.
16
Capacity Expansion Plan
Annual Capacity
(MM ft2 / year)
Historical
Projected
100
Plant 2 - Line 1
80
60
Line 3
Line 2
40
20
East Providence
Line 1
Line 1
Expansion
0
2008A
2009A
2010A
2011A
Nameplate Capacity(1), Year-End
2012A
2013A
2014A
Effective Capacity(2), Annual
2015E
2016E
2017E
2018E
Actual Production, Annual
1.
2.
Nameplate capacity represents our projected maximum sustainable annual output
Effective capacity is the capacity at which we can operate while maintaining the quality of our products and efficiency of our operations in a given period. Actual effective capacity is also impacted
by the date within a given year on which we add the capacity.
The projected nameplate and effective capacity for the years 2015 through 2018 are based on certain assumptions that the Company’s management believes are reasonable, but these assumptions
could prove to be incorrect, which could result in actual capacity differing materially from the projections above.
17
Key Business Highlights
1)
Disruptive insulation products offering superior value and performance
2)
Attractive and growing energy infrastructure end markets
3)
Substantial installed base with industry-leading end users
4)
Significant growth opportunities: expanded market penetration and new projects
5)
29% 5-year revenue CAGR, EBITDA positive, growing profitability
6)
Protected technology platform and proprietary manufacturing capability
7)
Proven, scalable business model with attractive returns
8)
Experienced management team with a demonstrated track record
18
Appendices
19
Reconciliation
Year Ended
12/31/14
($ in thousands)
Net loss
$
Interest expense
Depreciation and amortization
Stock-based compensation
Loss on disposal of assets
Gain on extinguishment of convertible notes
Loss on exchange of convertible notes
Costs associated with postponed public offering
Write-off of construction in progress
Adjusted EBITDA
(66,324)
12/31/13
$
50,281
10,183
8,781
119
$
3,040
(47,611)
30,599
10,061
4,426
230
(8,898)
5,697
241
3,440
$
(1,815)
Note: The table above presents a reconciliation of net income (loss), the most directly comparable GAAP measure, to Adjusted EBITDA for the periods presented.
20
Reconciliation
Six Months Ended
6/30/15
6/30/14
($ in thousands)
Net loss
$
Interest expense
Depreciation and amortization
Stock-based compensation
Loss on disposal of assets
Adjusted EBITDA
(5,532)
$
90
4,759
2,699
$
2,016
(61,196)
50,178
5,179
6,344
15
$
520
Note: The table above presents a reconciliation of net income (loss), the most directly comparable GAAP measure, to Adjusted EBITDA for the periods presented.
21
Reconciliation
Three Months Ended
($ in thousands)
Net loss
3/31/14
6/30/14
9/30/14
12/31/14
3/31/15
6/30/15
$ (19,049)
$ (42,148)
$ (2,412)
$ (2,715)
$ (2,790)
$ (2,743)
Interest expense
Depreciation and amortization
Stock-based compensation
Loss on disposal of assets
Adjusted EBITDA
16,151
2,631
339
15
$
87
34,027
2,547
6,006
$
432
47
2,513
1,054
$
1,202
56
2,492
1,382
104
$
1,319
45
2,184
1,295
$
734
45
2,574
1,404
$
1,280
Note: The table above presents a reconciliation of net income (loss), the most directly comparable GAAP measure, to Adjusted EBITDA for the periods presented.
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Investor Presentation
September 2015
23