Half Year 2022 VivoPower International PLC Earnings Call
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Sure.
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Ladies and gentlemen, thank you for standing by and welcome to Veeva Power International plc.
Wanted to have your results conference call at this time all participants are in a listen only mode. Later, we will conduct a question and answer session and instructions will follow at that time.
Finally, I should require assistance during the conference. Please press star zero on your thoughts on the telephone.
As a reminder, this conference call is being recorded.
I would like to turn the conference over to your host Mr. Kevin Sheehan. Please go ahead.
Thank you and welcome everyone to the half year results presentation.
Straight to page four.
Second a tsunami.
Headline is we've made good strategic progress over the last six months.
So.
Been affected by.
Extended COVID-19 Lockdowns in all key markets, particularly Australia.
So the six months revenue decreased 11% year on year to $18 5 million.
Reflecting the lockdown regime that so we had to contend with principally in Australia.
It's extended to July 21.
Just finished now.
February 22, and that's caused delays to sugar whoops.
As well as significantly cut Sally ship deliveries.
Gross profit on GP margin both.
Declines as a result of that.
You drop.
In addition, we incurred a $1 1 million.
One off driven.
Loss on the bluegrass solid projects in Australia.
Was principally due to.
Queensland border closure, which prevented us from Sunday.
Opt to Queensland.
Additionally, we have Jeff.
Covid outbreak on sorts Unfortunately in January as well.
EBIT wise, our adjusted EBIT declined to minus $4 9 million, which was positive $1 two mill.
As far as profitability.
Operating loss increased to $7 3 million.
For more price.
Prior year.
So this reflects.
Drug as I mentioned before.
<unk> also increased corporate costs and invested in the growth opex, such global scaling up particularly in the timber business.
In terms of balance sheet cash that's declined from $8 6 million to $3 3 million.
Reflecting the investments the bluecross loss.
And as far as being in place.
<unk>.
Opex costs.
But that has increased post balance date as we started to see that.
Collections come in as well as some strategic funding.
We've seen it.
The next shareholder.
As mentioned a key strategic initiatives, we have executed upon a number of those over the last six months. Despite the disruptions that we've got to do it.
We've expanded distribution partner network to six continents.
Our recently established.
Our subsidiary in the UAE, which is the largest off road market in the world.
We've also prioritized the development of the 72 kilowatt hour battery chip.
Which is a significant upgrade on the previous search on the.
Kilowatt power.
And we achieved full control of our U S solar joint venture foreshadowed at the full year results presentation last year.
We have now.
And <unk> launched renewable power.
Because you have less money because this person.
Contributed an initial 206 five megawatts DC.
Muscle portfolio at a valuation of $20 million.
So materially above.
<unk> of $12 one for the entire portfolio.
Last but not least importantly, we have.
When re certified as a B Corp.
Thanks.
Typical process so following dimension.
But we view that.
We're pleased to.
I have been reset bonds.
And also to have been recognized again.
Top global impact company for the second year in a row.
Moving on to page five.
Wanted to also go through some updates post.
Jeremy.
So firstly on the beach front.
As mentioned the difficult last six months.
Please and usage.
<unk>.
It was actually up 72% year on year.
<unk>.
At this time last year.
<unk> pent up work and additional projects and a solid data center and infrastructure sectors.
Cash flow is also improving with material cash inflows since mid January as I just mentioned.
On the timber front, so we secured a new facility. So it will be moving to an expanded facility next October airports on the close in May.
The new facility comprises just under 30000 square foot.
<unk>, which.
Which is more than double the current facility.
Potentially accommodates assembly of up to 5000.
Kits per annum.
That is solid the subject to the Microfracture strategy, but so we're working on at the moment.
<unk> to how best to.
Scale up assembly on a global basis going forward.
On a couple of collaborations that have been.
Outstanding CMC.
Swaps sufficient on MCA.
That collaboration has experienced delays.
Negotiations in the agreement.
At CN CA.
The exclusive supplier of <unk>.
It's focused on the mining sector in Australia remain ongoing.
The Arctic trucks to <unk> has been extended to the end of June .
To allow time for their assessment.
Next generation batteries.
We continue to work on non dilutive funding work streams and have made good progress in that regard so.
Q1's, there mostly in the U K R&D tax offsets were up to 33% of R&D spend.
And there are other UK government mobility, automotive innovation and green grass.
Qualified for so going through a process there in terms of.
Getting access to <unk>.
Funds.
In the EU.
We have access to the European innovation constant grants of up to $2 8 billion of there's also potential equity investments to fund start up costs of up to 17.
And last but not least on the global scale and this is the most important.
Aspects of funding, which is working capital.
There are numerous facilities did a finance supply chain and trade finance fund of which we've already secured we continue to look for.
All of that up so as I mentioned.
Last year.
Funding through the equity markets.
Something.
We will look to do.
Especially given the current share price levels that are at some market sentiment is that.
And there are others.
The leaders.
<unk> talked about.
We're very focused on.
Next out of the GBP OXXO LOI.
It's being extended.
For now Thats been disruption on RMS since December which caused delays to the due diligence programs.
But.
Extension is expected to provide a buffer.
And for the disruption.
And last but not least Cal addressable has also executed LOI to acquire a testament to you which is our partner on the mining side.
And that will deliver.
<unk> thousand latest generation mining rates.
That will be for initial consideration of $14 million.
We will accelerate the path to revenue generation for characters. So fundraising has already commenced at the current decimal level. This is not it.
The power level.
Capital raising advisors engaged.
Yes.
$50 million for us on that front.
As mentioned last year ultimately, we see this business essentially spinning off.
And Alex of female talent.
Joining us on the next slide these are the objectives, we set out back in back in August last year, when we announced our full year.
The clean outs and so what we've completed.
Orange is still in progress.
We remain on track despite disruptions.
Thanks.
Yes.
And to get as many of these objectives.
Before the end of our fiscal year.
In June .
So now moving on to the specific business units and I'll take these projects of which is timber.
Vehicles.
Timber revenues were up versus last year with $9 billion.
However.
Got it.
Lower than budget due to operational disruption of delays in assembly and delivery.
Kits.
Underlying EBITDA loss of $2 3 million as mentioned reflects primarily growth in opex investments.
And work is progressing on the next generation semi executable in Alabama platform.
Moving on to critical power on page nine and prepping the numbers a bit more so you did business itself recorded $18 million revenue, which is down 14% year on year.
I really do to sort of the.
That's a very long and sort of thoughts locked.
Lockdown in Australia.
Gross profit was down.
208 mill versus three three in the prior year.
Does however include a one off for $1 1 billion.
Core to bluegrass solar projects, so excluding that it would have been one nine.
Underlying EBIT, excluding the Bronx is one.
$1 3 million.
We remain very positive on this business going forwards.
Then.
Even ahead of works that I mentioned and given that the.
Australia for all intensive purposes is now open.
Sure.
It's a country in each state Lockdowns hoped subset for Western Australia, which hasnt.
As announced that Inspiringly reopening.
In early March.
And also international borders now reopened.
Thats a good fit for Monday, the 20 <unk> three.
Three days ago.
We have been awarded to electrical works for the 119 megawatt post on solar pumps.
What's been very positive developments in the last call Speedway.
Speedweeks install.
Moving on to page 10 with respect to SCS. This is obviously a newly established segments.
Revenues are immaterial at this point, we've not included a significant cost to date.
We are on track with partnering with respect.
What they wanted to the training ground and adjacent to the study.
In addition to that we've come install lawsuit mentioned mining import infrastructure.
Companies to commence feasibility studies for whole of facility electrification projects that could lead to.
Mark just.
Vehicle.
Doing all of that also.
Micro grids charge stations et cetera.
We also signed the Mou with new electric a leading supplier of battery energy storage system systems.
Utilizing something like EV batteries.
And we are collaborating further.
To explore.
Redeployment of timber batteries.
We electrify.
And last but not least the more developed tools to allow total cost of ownership and ROI.
To be assessed.
At a more sustained level.
Customers.
Going on to page 11, with some <unk>.
Solemn.
Which is the $3 million for our solar business.
The U S and so thats been rebrand assess the rebrand.
<unk> strategy, which was foreshadowed last years being progressed.
Yeah.
As mentioned contributed $206 five megawatts or more advanced projects.
Out of the 682, but we have to kind of destiny.
At a valuation of $22 million.
Also.
Convinced re assessments of previously mothballed projects totaled one one gigawatts and so were reevaluating the developments.
What we're seeing across the U S is.
Very strong interest in <unk>.
Renewable power sites.
Creating from crypto.
Crypto hosting companies.
At the moment.
Facing lead times 12 months plus.
To accommodate future customers wanting to mine picture on the on their platforms.
So they're looking for more sites.
A number of parties portions.
But we're very much focused on the account decimal opportunity fund raising at that level at the moment.
The next few slides.
Slide 12.
That's an important thing.
Show you some schematics.
The initial sites that we are looking to.
Develop.
They are all in Texas all of those.
TX one five to one <unk>.
All relatively close to each other.
One of those sites also has the option is significantly upsized loans.
Which will create incremental value.
On page 13, 14 and 15.
You can see the designs genetics of these sites.
Practically we are ready to build subject to financing.
Being completed.
And we would look to commence.
Commence construction later this year.
So these such primarily comprise the solar arrays, but you can see as well as.
Data centers.
Yes.
<unk>.
And.
All very strategically located.
Now moving on to the financial review I'll take care of that as well so going on to page 17, which unpacks the P&L further.
So you can see the numbers that I shared before in terms of both critical power.
Vehicles.
And.
Sort of stepping down into the group gross profit level of five more but that is after the $1 one bill.
One off loss attributable to bluegrass.
Compares to $3 three.
In the prior year.
And so the same passcode.
Test goes down and so the underlying EBITDA of negative $4 nine.
This is one two.
For the previous corresponding period.
So again as mentioned.
Looking for a rebound now in terms of the.
Particularly the weakest business and being a being on shackled on the PDP.
Sean as well.
We will have two however, navigated supply chain issues. So just like everyone else, we're starting to see that.
Really come to the floor.
So.
That is something we will need to navigate.
Next two slides are really just a reconciliation of adjusted EBITDA and adjusted EPS too.
Two interests mentioned measures.
And then on <unk>.
Page 22, the last slide.
Set up with the balance sheets so.
As mentioned.
The first line option that project investments that represents.
Principally.
Alright.
For which those 13.
Carrying value.
And unrestricted cash of $3 three asset balanced state has mentioned just now.
Increased.
So.
With respect to borrowings to increase.
Slightly offset the balance date.
So translating into a net debt free business.
It's now 21 nine versus $14 five.
Important to note that.
It's practically no external debt per se. This is shareholder loans from the largest shareholder has been very supportive of these accounts.
A number of years.
So on that note I think key takeaway, it's been a tough six months.
We really felt like it's been running.
Against the hard wins.
But.
Please now so you have.
Further restrictions and lockdowns removed in our key markets.
Some positive developments in the post balance date period in terms of pipeline in terms of cash in terms of funding and in terms of the strategic developments.
I'll end on that medicine, and happy to open it up to Q&A. Thank you all for tuning in.
Thank you Mr. Chen ladies and gentlemen, if you have a question at this time. Please press Star then the number one key on your question on telephone. If a question has been answered or you wish to remove yourself from the queue. Please press the package.
The first question comes from the line of Jim Jeffrey Campbell from Alliance Global Your line is open.
Hi, Kevin.
How much of the timber.
Timber roofline expansion in the Netherlands of Andrist wanted if theres still interested in creating timber facilities.
Closer to Southeast Asia, Australia.
That definitely is.
I think I've mentioned that.
Thailand was one market.
We have looked at in the past.
We're very close to and have good relationships with some of the leading families in Thailand.
As well as source that governments.
Officials.
Part of it's been a very good optionality ecosystem. So.
<unk> has also been closed.
<unk>.
Just starting to reopen again.
So definitely we will look at our module factory strategy.
Close to our key markets.
<unk>.
The United Arab Emirates, as another potential location.
So Netherlands is not be on the site so that will be.
We'll be looking at.
Great. Thanks for that color I'd like to ask a couple of questions and then I'll be done.
Sure Fair, Therefore press release indicated that the primary endpoints.
For developing the 260 megawatts of solar power was crypto currency mining.
And other power intensive blockchain computing applications.
To add some color on these other blockchain applications, that's referring to.
Yes, no problem so.
You actually see character smallest principally infrastructure business.
Underpinned by renewable science that we have.
The data centers that will be built on them.
And in future. This will accommodate launches crypto mining and if you look at blockchain.
Really the blockchain and the process of photography that is very energy intensive.
And the way I'd look at it there are basically three sees in terms of segments.
Blockchain, so one as quickly as it fits our model.
Two is content and we Couldnt includes Susan that you can include.
We are.
Most of this and all of that.
All of that set of products that are being developed still very energy intensive.
And then last but not least contracts so 36.
Content contracts contracts being smart contracts.
And numerous.
Pushing pipeline with companies and rated corporates globally.
Now getting into smart contracts in a big way.
So that is also very energy intensive so we're looking to do is create an infrastructure debt.
Goes beyond this crypto mining that is able to effectively.
HBC facility that accommodates.
Other applications such as wondering just mentioned.
Okay, Great and finally bear.
Bearing in mind, the crypto has undergone.
Increasing regulatory scrutiny.
Refer to matters recent failed effort as an example.
How does your strategy.
Current strategy.
Take this into account.
Sure.
Something untoward change what.
What do you think of as the best.
Backup uses for the infrastructure that you are developing should crypto somehow become uneconomical.
Regulated in some ways it makes it less attractive than it is now.
Good question, Jeff So our own view is that.
We'll be regulated.
It's not necessarily a bad thing.
However to your point there is the risk that.
And is it an economic.
Mining.
But thats sort of get us back to our strategy, which is really this is infrastructure.
Designed ultimately for blockchain applications and related.
Hi energy intensive.
Heating applications as well.
So you can see from the designs there.
Data centers in place adjacent to the salary range.
So these slots are very strategically we can see one of them is very close to it as well as substation.
Yeah.
Ultimately our view is and our strategy is to build these things so the.
Theyre not dependent on crypto mining it just so happens that crypto mining.
Our highest and best use for now.
But there are multiple use cases for.
For these sites, even without even without crypto.
The trend here as the megatrend is snatched crypto mining, but blockchain and other high energy intensive computing applications.
I appreciate that color.
Yes.
Im not sure there are a lot of investors really appreciate that.
<unk> is actually quite mature.
Offshore drillers, we are using.
Blockchain to pull together all the disparate parts that.
Go onto a drillship or onto a production platform for <unk>.
Five years ago. So.
Yes, I appreciate that answer very much. Thank you.
Well I mean, you're spot on Jeff and <unk>.
Today.
Sure.
The.
The computing high performance computing industry contributes.
Two to three 7% of global emissions.
As you can create cyber mobility, including auto industry, which is north of 11%.
Highest in production of steel and iron ore is number two.
Right.
Okay.
Should we see computing is going to be the fastest growing in terms of emissions.
And with the amount of content, that's being generated for online consumption, whether it is Medicare so are you going to with Netflix.
And then sort of computing power associated with that and the energy intensity of that.
<unk> sort of widely widely understood.
Yes, that's a great point I mean, we didn't really hit our question that way, but I'm certainly seeing increasing ESG.
<unk> me of computing in general data centers in general and crypto and the rest so.
What you just said makes perfect sense.
Thank you for the color.
No.
Yes.
Operator, we'll take the other questions Joel.
Thank you once again to ask a question. Please press Star then the number one on your telephone keypad.
Okay.
Yes.
Once again that will be fine and then the number one on your telephone.
I am not seeing actual further question at this time you may continue in this session.
Thank you.
Again, thank you everyone for joining another smaller a lot going on in the world at the moment.
We ship the silent.
Sure well.
We'll close this meeting now thank you.
Thank you everyone. This concludes today's conference call you may now disconnect.
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Hello, everyone.
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Ladies and gentlemen, thank you for standing by and welcome to Veeva Power International plc, FY 'twenty two half year results conference call. At this time all participants are in a listen only mode. Later, we will conduct a question and answer session and instructions will follow at that time and find out I should require assistance during the conference. Please press star zero.
And you touched on the telephone as a reminder, this conference call is being recorded I would like to turn the conference over to your host Mr. Kevin Sheehan. Please go ahead.
Thank you and welcome everyone to the ultimate results presentation.
Let's jump straight to page four seconds.
Second a stomach.
Headline is fruit makes a good strategic progress over the last six months.
Shops have been affected by that.
Covid lockdowns in auction.
Markets, particularly Australia.
So the six months revenue decreased 11% year on year to $18 5 million.
<unk>.
Blocked out there, saying that so we actually contributed principally in Australia.
Oh, that's extended from July 21, and so it really just is finished now.
On February 22 lets close the rights to sugar whoops.
Spinach as well as significantly cut Sally chip deliveries swap.
Gross profit on GP margin.
<unk> declined as a result of that.
They drop.
In addition, we incurred a $1 1 million.
One off kind of a trigger.
Loss on Newco are solid projects in Australia.
That was principally due to the Queensland border closure, which prevents us from Sunday.
Opt to Queensland.
And Additionally, we had to cope with athletic ourselves Unfortunately in January as well.
EBITA wise, our adjusted EBIT declined to minus $4 9 million positive 1.2 mill.
Previous corresponding period.
Operating loss increased to $7 three more questions.
For more than prior year.
So this reflects.
Oh drivers as I've mentioned before and in addition, we've also increased corporate costs and investing in the growth opex scaling up and particularly at the time of their business.
In terms of balance sheet cash that's declined from $8 6 million to $3 3 million.
<unk> investments.
Gross loss.
As far as being increased.
Our opex costs.
But that has increased post balance date.
To see a better.
Debtor collections come in as well as some strategic funding.
Understood.
Make shareholder.
Oh.
As mentioned in our key strategic initiatives, we have executed upon a number of those over the last six months. Despite the disruptions that we've had to deal with.
We've expanded our distribution partner network to six continents.
Our recently established.
Our subsidiary in the UAE, which is the largest off road market in the world.
World.
We've also prioritized the development of the 72 kilowatt hour battery chips.
There is a significant upgrade on the previous search probably a kilowatt hour.
And we achieved full control of our U S solar joint venture and as foreshadowed at the full year results presentation last year.
We have now.
And all our watch in voluntary renewable power.
Did you ever lost money because this kind of Tesla only contributed an initial 206 five megawatts DC.
So we'll follow at a valuation of 20 million.
Is it materially above.
<unk> of $12 one four.
The MSR portfolio.
Last but not least and importantly, we have.
<unk> been re certified as a B Corp.
That's a difficult process. So following a demerger training assessment review.
Pleased to.
Have been reset bonds.
And have you all set to have been recognized again as a top global Internet company secondary in Iraq.
Moving on to page five so.
I wanted to also go through some updates from post this journey.
So firstly on the beach fronts.
As mentioned, they're difficult last six months.
Ladies and leaves us well ahead of what.
It was actually up 72% year on year.
On this.
This fund last year.
Reflecting pent up work and additional projects and a solid data center and infrastructure sectors.
Cash flow is also improving with material cash inflows since mid January as mentioned.
On the timber front, so we secured a new facility. So it will be moving to an expanded facility at Mexico until the airports on the person right.
The new facilities comprises just under 30000 square foot.
<unk>, which.
Which is more than double the current facility.
Potentially accommodates assembly of up to 5000.
Kits per annum.
That is followed a subject to the micro factory strategy. So we're working on at the moment.
<unk> to how best to.
Scale up assembly on a global basis going forward.
A couple of collaborations that so good.
And outstanding CMC E auction.
That's a sufficient MCA MCA.
Collaboration has experienced delays.
Our stations and an agreement with MCA.
For the exclusive supplier of all secrets are focused on the mining sector in Australia remain ongoing.
The Arctic trucks to L. O. One has been extended to the end of June and to allow time for the assessment of next.
The next generation batteries.
We continue to work on non dilutive funding work streams and have made good progress of adoption.
Tier ones there.
In the U K R&D tax offsets with up to 33% of R&D expense.
And there are the U K government mobility automotive innovation grant grants.
Qualified for so going through a process there in terms of.
Getting access to those funds.
In the EU.
We have access to the European innovation constant grants of up to $2 8 million.
There's also a potential equity investment so it's upon startup costs of up to 17.
And last but not least in our global scale and this is the most important so.
The funding that just working capital.
There are numerous facilities data finance supply chain trade finance some of which we've already secured we continue to look for.
Build that up.
So as I mentioned.
Last year.
Funding through the equity markets is not something new.
We will look to do.
Especially given the current share price levels of racks in market sentiment is that.
And there I.
I believe it's.
<unk> talked about primarily focused on.
Next out of the GBP OXXO LOI.
Staying extended.
For now Thats been disruption on our end since December which caused delays to the delivery programs.
But.
The extension is expected to provide a buffer.
Any sort of disruption.
And last but not least <unk> has also executed LOI to acquire personal digital which is our partner on we did.
There are some mining side.
And that will deliver over a thousand latest generation mining rates.
B for initial consideration of $14 million.
We will accelerate the path to revenue generation for characters.
So fundraising has already commenced at the counter decimal level. This is not at.
All of it.
Capital raising advisors engaged two ways.
50 million.
With us on that front.
And as mentioned last year ultimately, we see this business essentially spinning off.
And Alex of Yoga apparel.
Yeah.
Joining us on the next slide these are the objectives.
Sets out back in back in August last year, when we announced our full year.
The clean outs and so what we've completed.
The Orange is still in progress.
We remain on track despite disruptions.
<unk> two.
And to get as many of these objectives.
Before the end of our fiscal year.
In June .
So now moving on to the specific business units and I'll take what's called shape, which has a symbol.
Vehicles.
Timber revenues were up versus last year <unk> 90.
However.
Taxes.
Lower than budget due to operational disruption or delays in assembly and delivery.
With kits.
Underlying EBITDA loss of $2 3 million as mentioned reflects primarily growth in opex investments.
And.
<unk>.
Question on the next generation <unk> platform.
Moving on to critical power on page nine unpacking the number should take more so we've experience itself recorded $18 million revenue, which is down 14% year on year.
I really do it sort of sort of the effects of <unk>.
Very long and hard.
Down in Australia.
Gross profit was down 208 versus three three in the prior year.
It does however include a one off $1 1 billion.
Core to bluegrass solar projects, so excluding that it would have been one nine.
Underlying EBITDA, excluding $3, one 3 million.
We remain very positive on this business going forwards.
Given given ahead of works that I mentioned and given that.
Australia for all intensive purposes is now open.
More.
It's a country in each state lockdowns of notes, except for Western Australia, which.
Has announced that it's finally reopening.
In early March.
And also international borders.
We opened.
That took effect from Monday, the 20 <unk> three.
Three days ago.
We have been awarded to electrical works for the 101, two megawatt <unk> solar farm so.
What's been very positive developments in the last gasp.
Speedweeks install.
Moving onto page 10.
Respect to SCS. This is obviously a newly established segments.
Revenues are immaterial at this point simply ignore it could have a significant cost to date.
We are on track with taught them with respect.
What they wanted to training ground and adjacent to the study.
In addition to that we've commenced dialogue with major mining infrastructure.
<unk> commenced.
Commenced feasibility studies for hall facility.
Electrification projects that could lead to.
<unk>.
Vehicle, it's being ordered but also.
Liquids charge stations et cetera.
We also signed a Mou with new electric long awaited supplier battery energy storage system systems.
Utilizing a second life EV batteries.
And we are collaborating.
To explore.
Redeployments of timber batteries.
We electrify.
Last but not least the more developed tools to allow total cost of ownership and ROI.
To be assessed.
At a more steady level for our customers.
Going on to page 11, which is carriage solar.
Which has been remained for our solar business.
So thats been rebrand assess the rebrand.
Our power to X strategy, which was foreshadowed last year's being progressed.
We.
As mentioned contributed $206 five megawatts.
More advanced projects out of the 682 that we have to kind of destiny.
At a valuation of $22 million.
We also trimmed.
Commenced reassessment of previously mothballed projects.
So one one gigawatts, so we're reevaluating that and developments.
What we're seeing across the U S is.
Very strong interest in.
Renewable power sites.
Including from <unk>.
Crypto hosting companies.
At the moment.
Facing lead times 12 months, plus actually accommodate future customers wanting to mine picture on that.
On their platforms.
They are looking for more sites.
A number of parties approached us.
But we're very much focused on the current decimal opportunity and fund raising at that level at the moment.
The next few slides.
Slide 12.
<unk>.
That's an important thing.
And.
Show you some schematics.
The three initial signs that we are looking to.
Develop.
They are all in Texas all of those.
<unk> five <unk> hundred <unk>.
Relatively close to each other.
One of those sites also has the option, it's a significantly upsized the loads.
Which will create incremental value.
And on page 13, 14, and 15, you can see the designs genetics of these slides show.
Practically ready to build subject to financing.
Being completed.
And we would look to commence.
Commence construction later this year.
So these such primarily comprise the solar arrays, but you can see as well as.
Data centers.
<unk> links.
And.
All very strategically located.
Now moving on to the financial review I'll take care of that as well so going on to page 17, which impacts the P&L further.
So you can see all the numbers that I shared before in terms of both critical power and electric vehicles.
And so.
Staring down into the group gross profit level five but that is after the $1 one bill one off loss attributable to bluegrass.
And compares to three three.
In the prior year.
And that same.
Test goes down and so the underlying EBITDA of negative $4 nine.
This is one two.
For the previous corresponding period.
So again as mentioned.
Looking for a rebound now in terms of the.
Particularly the <unk> business and that being in shekels.
<unk> side as well.
What we will have two however, navigated supply chain issues. So just like everyone else, we're starting to see that.
Really come to the floor so.
That is something we will make some navigate.
Next two slides are really just a reconciliation of adjusted EBITDA and adjusted EPS too.
Two interests mentioned measures.
And then on <unk>.
Page 22, the last slide.
Set up with the balance sheets so.
As mentioned.
The first line option that project investments that that represents.
Principally.
So which of those.
<unk>.
Carrying value.
And unrestricted cash of $3 three asset balance state has mentioned.
Now.
Increased.
With respect to borrowings.
But increased slightly offset the balance date.
So translating into a net debt figure yet.
It's now 21 mine.
This $14 five.
And going to notebooks.
There is practically no external debt, let's say this is a shareholder loans from the largest shareholder has been very supportive of a fever cough.
Number of units.
So on that note I think key takeaway, it's been it's been tough for six months.
We really felt like it's been running.
Against the hard wins.
But.
Very pleased now to have.
Further restrictions and Lockdowns.
Move in our key markets.
Some positive developments in the post balance date period in terms of pipeline in terms of cash in terms of funding and in terms of the strategic developments.
I'll end on that note. Some then happy to open it up to Q&A. Thank you all for tuning in.
Thank you Mr. Sheehan, ladies and gentlemen, if you have a question at this time. Please press Star then the number one key on your question with.
Telephone if a question has been answered or you wish to remove yourself from the queue. Please press the package.
The first question comes from the line of Jim Jaffray, Kim <unk> from Alliance Global Your line is open.
Hi, Kevin.
How much of the timber.
The timber roofline expansion in the Netherlands of interest I wanted if theyre still interested in creating timber facilities.
Closer to Southeast Asia, Australia.
That definitely is.
I think I've mentioned that.
Thailand was one market.
We have looked at in the past.
We're very close to and have good relationships with some of the leading families in Thailand.
As well as versus government.
Officials.
Part of it's been a very good automotive ecosystem. So.
<unk> has also been closed.
And just.
Just starting to reopen again.
So definitely we'll look at our module factory strategy.
Close to our key markets.
<unk>.
The United Arab Emirates, as another potential location.
Nevertheless, since not the other thoughts that will be.
We'll be looking at.
Great Thanks for that color.
I'd like to ask a couple of questions and then I'll be done.
Sure Fair, Therefore press release indicated that the primary endpoints.
For developing the 260 megawatts of solar power was crypto currency mining.
And other power intensive blockchain computing applications.
You add some color on these other blockchain applications, that's referring to.
Yes, no problem so.
You actually see character smallest principally infrastructure business.
Underpinned by renewable sites that we have and the data centers that will be built on them.
And in future. This will accommodate not just crypto mining and if you look at blockchain.
Really the blockchain and the process of photography that is very energy intensive.
And the way I would look at it because there are basically three sees in terms of segments.
Blockchain. So one is crypto as it fits our model.
Two is content and you can include Susan that you can include.
Sure.
In the midst of this and all that.
All of that set of products that are being developed they're all very energy intensive.
And then last but not least contracts traces.
Content contracts contracts being smart contracts.
And numerous.
Pushing pipeline with companies and rated corporates globally.
Now getting into smart contracts in a big way.
So that is also very energy intensive so we're looking to do is create an infrastructure of that.
Goes beyond this crypto mining that is able to effectively be.
HBC facility that accommodates.
Other applications, such as what I've just mentioned.
Okay, Great and finally bear.
Bearing in mind, the crypto has undergone.
Increasing regulatory scrutiny.
Refer to matters recent failed effort as an example.
How does your strategy Youre.
Current strategy.
Take this into account.
Sure.
Something untoward change.
What do you think kind of is the best.
Backup uses for the infrastructure that you are developing should crypto somehow become uneconomical.
Regulated in some ways it makes it less attractive than it is now.
Yes, good question, Jeff So our own view of the crypto will be regulated.
Not necessarily a bad thing.
However to your point there is the risk that renders.
When does it all the economic for mining.
That sort of goes back to our strategy, which is really this is infrastructure.
Design ultimately for blockchain applications.
And related.
High energy intensive computing applications as well.
So you can see from the designs there.
Data center is in place adjacent to the solar arrays.
So these thoughts.
Strategically we can see one of them is very close to it as well as substation.
Ultimately our view is.
Our strategy is to build these things so the.
We're not dependent on crypto mining it just so happens that crypto mining is the highest and best use for now.
But there are multiple use cases for.
For these sites, even without even without crypto.
The trend here is the the Mega trend is snatched crypto mining the blockchain and other high energy intensive computing applications.
No.
I appreciate that color.
Im not sure there are a lot of investors really appreciate that one.
<unk> is actually quite mature.
Offshore drillers, who are using <unk>.
Blockchain to pull together all the disparate parts that.
Go onto a drillship or onto a production platform for five years ago. So.
Yes, I appreciate that answer very much. Thank you.
I mean, you're spot on Jeff and <unk>.
Today.
Sure.
The.
Call it the <unk>.
<unk> performance computing industry contributes.
Two or three 7% of global emissions.
As compared to say the mobility liquidity will also industry, which is north of 11%. That's the highest in production of steel and iron ore is number two.
I think okay.
We see computing is going to be the fastest growing in terms of emissions.
And with the amount of content, that's being generated for online consumption, whether it's embedded there. So are you going to with Netflix.
And then sort of computing power associated with that and the energy intensity of that that's.
That's not sort of widely widely understood.
Yes, that's a great point I mean, we didn't really hit our question that way, but I'm, certainly seeing increasing ESG scrutiny of computing in general data centers in general and crypto and the rest so.
What you just said makes perfect sense.
Okay.
Thank you for the color.
No.
Operator, we'll take the other questions. So thank.
Thank you once again in order to ask a question. Please press Star then the number one on your telephone keypad.
Okay.
Okay.
Once again that will be star then the number one on your telephone.
Okay.
Yes.
I'm not seeing any further question at this time you may continue on this question.
Thank you.
Again, thank you everyone for joining another smaller a lot going on in the world at the moment.
Sure.
Island.
I wish you well.
We'll close this meeting now thank you.
Thank you everyone. This concludes today's conference call you may now disconnect.