Q2 2022 Research Frontiers Inc Earnings Call
Yes.
Yeah.
Good afternoon, ladies and gentlemen, welcome to research Frontiers Investor Conference call to discuss the second quarter of 2022 results of operations and recent developments.
Good afternoon ladies and gentlemen. Welcome to Research Frontiers Investor Conference Call to discuss the second quarter of 2022 results of operations in recent developments.
During todays presentation, all parties will be in a listen only mode and following the presentation. The conference will be opened for questions by pressing star one.
During today's presentation, all parties will be in a listen-only mode and following the presentation, the conference will be open for questions by pressing star 1. This conference is being recorded today. A replay of this conference will be available starting later today in the investor's section of Research Frontier's website at www.smartglass.com and will be available for replay for the next 90 days. Please note that some of the comments made today may contain forward-looking-
This conference is being recorded today.
A replay of this conference will be available starting later today in the investors section of research Frontiers website at Www Dot smart glass dotcom and will be available for replay for the next 90 days. Please.
Please note that some of the comments made today may contain forward looking information. The words expect anticipate plans forecasts and similar expressions are intended to identify forward looking statements statements that are not historical facts are forward looking statements that are made pursuant to the safe Harbor provision.
<unk> that are part of the Securities Litigation Reform Act of 1995. These.
These statements reflect the company's current beliefs and a number of important factors could cause actual results for future periods to differ materially from those expressed.
factors could cause actual results for future periods to differ materially from those expressed.
Significant factors that could cause results to differ from those anticipated are described in our filings with the SEC research frontiers undertakes no obligation to update or revise these forward looking statements to reflect new events or uncertainties. The company will be answering many of the questions that were emailed to it prior to.
Significant factors that could cause results to zipper from those anticipated are described in our filings with the SEC. Significant factors that could cause results to zipper from those anticipated are described from those anticipated are described from those anticipated are described
Research Frontiers undertakes no obligation to update or revise these forward-looking statements to reflect new events or uncertainties. The company will be answering many of the questions that were emailed to it prior to this conference call, either in their presentation or as part of the Q&A session at the end. In some cases, the company has responded directly to email questions prior to this call or will do so afterwards in order to answer more questions of general interest to shareholders on this call.
This conference call either in their presentation or as part of the Q&A session at the end in some cases. The company has responded directly to email questions. Prior to this call or will do so afterwards in order to answer more questions of general interest to shareholders. On this call. If you find that your question has been substantially answered as a.
Courtesy and to allow time for other shareholders to ask their question. Please remove yourself from the queue by pressing star two.
Also we ask that you keep your question brief in the interest of time I would now like to turn the conference call over to Joe <unk>, President and Chief Executive Officer of Research Frontiers. Please go ahead Sir.
Thank you Carolyn <unk> welcome to our call. It's great to have you and Hello, everyone and welcome to our second quarter of 2022 Investor Conference call.
Great to have you and hello everyone and welcome to our second quarter of 2022 investor conference call
Research Frontiers remains in strong financial condition, we continue to have no debt and as of June 32022, The company had cash and cash equivalents of $1 9 million working capital of $2 $3 million and total shareholders' equity of $2 $4 million.
Research frontiers remains in strong financial condition.
We continue to have no debt and as of June 30th, 2022, the company had cash and cash equivalents of $1.9 million, working capital of $2.3 million, and total share all this equity of $2.4 million.
The company expects to have sufficient working capital for at least the next two years of operations, which would take us into the middle to late 2024.
The company expects to have sufficient working capital for at least the next two years of operations which would take us into the middle to late 2024.
This is based upon our lower quarterly burn rate of 300 to $350000 per quarter with higher projected revenues during that period, mostly from new car models.
This is based upon our lower quarterly burn rate of $300,000 to $350,000 per quarter with higher projected revenues during that period, mostly from new car models.
In our last conference call, we spoke about new car models coming into production in Q3, and Q4 of this year with our SPD Smart glass technology in it.
In our last conference call, we spoke about new car models coming into production in Q3 and Q4 of this year with our SPD Smart Glass technology in it.
This is still on track despite the supply chain and other disruptions around the world.
This is still on track despite the supply chain and other disruptions around the world.
In aircraft last year, there were significant new projects in the aircraft industry, including the AC J two 'twenty program by Airbus, Tom Lux and vision systems <unk>.
In aircraft last year there were significant new projects in the aircraft industry, including the ACJ 220 program by Airbus, Comlux and Vision Systems. SPD electronically dimmable windows by Vision Systems and the new epic aircraft and in the DIRTBM 960 aircraft. The new epic aircraft and in the DIRTBM 960 aircraft.
P D electronically dimmable windows by vision systems in the new Epic aircraft and then the diary TBM 960 aircraft.
You know a lot of people are worried about the recession and inflation. Some of asked me. How these items will affect research frontiers business going forward.
You know, a lot of people are worried about the recession and inflation.
Some have asked me how these items will affect Research Frontier's business going forward.
Okay.
Some of you may know that I started my professional career as an economist at the Federal Reserve Bank of New York.
Some of you may know that I started my professional career as an economist at the Federal Reserve Bank of New York.
That experience taught me to look for broad macroeconomic trends and also to look for and act upon based on leading economic indicators.
That experience taught me to look for broad macroeconomic trends and also to look for and act upon based on leading economic indicators.
When I was at the New York Fed we were experiencing high levels of inflation like today that was driven by disruptions in the labor market and international debt crisis high energy prices and a variety of other factors. That's all familiar Ronald Reagan had just become president and my Ultimate boss was Paul Volcker.
When I was at the New York Fed, we were experiencing high-levels inflation. Like today, that was driven by disruptions in the labor market and international debt crisis, high energy prices, and a variety of other factors. So that's all familiar. Ronald Reagan had just become president, and my ultimate boss was Paul Volker.
But with some pain in focus and applying basic principles I learned studying economic tools in history.
But with some pain and focus and applying basic principles I learned studying economic tools and history we're able to fix things.
We're able to fix things and even though we went through this for decades ago.
Never lost the lessons I learned from that period.
And even though we went through this four decades ago, I never lost the lessons I learned from that period.
Research Frontiers has been through eight recessions and probably the most recent one that had many of us worried other than perhaps the current situation with the world economic crisis in 2008.
Research frontiers has been through eight recessions.
Probably the most recent one that had many of us worried other than perhaps the current situation was the world economic crisis in 2008.
But if you look back on that period companies that produced high end products, such as Mercedes Porsche and Audi and BMW.
But if you look back on that period, companies that produced high-end products such as Mercedes, Porsche, and Audi, and BMW, they're not going to be able to produce high-end products.
<unk> reported in some cases, even record profits.
Nothing is totally immune to reduced economic activity such as the recession, but some of the business that we are in are felt to be recession proof and history has supported this.
had reported in some cases even record profits.
Nothing is totally immune to reduced economic activity such as the recession, but some of the business that we are in are felt to be recession-proof and history has supported us.
I of course, do not wish high energy prices on anyone but.
But we're also seeing in the United States gas prices that only existed in Europe historically.
I of course do not wish high energy prices on anyone.
But we're also seeing in the United States gas prices that only existed in Europe historically.
If you look at how Europe reacted to that over the last few decades, they tended to be on the forefront of energy efficiency in cars homes and offices.
If you look at how Europe reacted to that over the last few decades, they tended to be on the forefront of energy efficiency in cars, homes and offices.
Our SPD technology makes a major contribution in this area.
Our SPD smart technology can increase the gas mileage of cars lower C. O two emissions by four grams per kilometer and extend the driving range of electric vehicles by five 5%.
RSPD technology makes a major contribution in this area.
Our SPD Smart Technology can increase the gas mileage of cars, lower CO2 emissions by 4 grams per kilometer and extended driving range of electric vehicles by 5.5%.
The data also shows that we can lower heat inside a vehicle by 18 degrees Fahrenheit.
The data also shows that we can lower heat inside a vehicle by 18 degrees Fahrenheit.
So we expect that even though there is uncertainty and turmoil in other parts of the market if history and experience as a guide research frontiers, and our well run licensees will actually do quite well.
So we expect that even though there is uncertainty and turmoil in other parts of the market, if history and experience is a guide, Research Frontiers and our well-run licensees will actually do quite well.
Am I worried about inflation.
Well personally, yes, but professionally know our license agreements have built in inflation hedges. In addition to certain CPI adjustment provisions in our license agreements that benefit us more importantly, remember that we get paid on the percentage of sales by our licensees.
Am I worried about inflation?
Well, personally yes, but professionally no. Our license agreements have built in inflation hedges.
In addition to certain CPI adjustment provisions and a license agreement that benefit us. Dadlav Reagan,
More importantly, remember that we get paid on the percentage of sales by our licensees.
Put the higher those sales the higher our license royalties.
And going back to my experience at the fed I mentioned that we look at broad macroeconomic trends and today, we spoke about some of the bigger ones such as recession and inflation.
Simply put the higher those sails, the higher our license royalties.
And going back to my experience at the Fed, I mentioned that we look at broad macroeconomic trends, and today we spoke about some of the bigger ones, such as recession and inflation.
Now, let me talk about leading economic indicators, which is the other thing that I used to focus on as an economist to get a clearer look at the future.
Now let me talk about leading economic indicators, which is the other thing that I used to focus on as economist.
In our last conference call I reported on multiple car models that were expected to come out in the near term using our SPD smart glass technology, starting in the second half of 2022.
to get a clear look at the future.
In our last conference call, I reported on multiple car models that were expected to come out in the near term using RSPD smart glass technology, starting in the second half of 2022.
And as I mentioned Thats still on track also the information that we have received now that even more cars than originally expected we use SPD near term.
As I mentioned, that's still on track. Also, the information that we have received is now that even more cars than originally expected will use SPD near term.
Okay.
My internal estimate is that these near term automotive introductions can use more than double the amount of SPD films sold by Hitachi and their best year So far.
My internal estimate is that these near-term automotive introductions can use more than double the amount of the best-per-de-film sold by Hitachi in their best year so far.
I may be wrong, looking and get at the leading indicators Galaxy has made substantial additional investments in expanding production capacity.
I may be wrong, looking at the leading indicators, Gauss has made substantial additional investments in expanding production capacity.
So the area that I may be incorrect about is not whether our business will extend but by how much.
So the area that I may be incorrect about is not whether our business will expand, but by how much.
I spoke about a doubling of the levels of SPD film from our best year Galaxy is almost done with quintuplet their production capacity.
I spoke about a doubling of the levels of SPD film from our best year. Gauzie is almost done with quintupling their production capacity.
I think that investment by Galaxy and also the follow on production capacity increases by other key licensees.
I think that investment by GALSI and also the follow on production capacity increases by other key light and trees. And I think that investment by GALSI and also the follow on production capacity increases you
And the need for a five X increase in SPD film capacity is the most important leading predictor of economic activity in our industry.
and the need for a 5x increase in SPD film capacity is the most important leading predictor of economic activity in our industry.
And <unk> has been a productive and many other areas on the business side.
And Gauss has been productive in many other areas on the business side. On the personal side, I want to take this moment to send a special congratulations to Gauss CEO , Eyal Peso, and his wife Sapir on the birth of their new son earlier this week.
On the personal side I wanted to take this moment to send a special congratulations to Gal G CEO El peso and his wife's up here on the birth of their new Sun earlier this week.
Nothing makes me happier than to see the photo view holding your new Sun that you sent me from the hospital that day.
Yeah, nothing made me happier than to see the photo of you holding your new son that you sent me from the hospital that day.
Brooke Mazel Tov and congratulations.
So did that in three languages.
Mabruk, Mazel Tav and congratulations.
With that I look forward to answering your questions Kevlar.
Did that in three languages?
Let me take a few that were E. Mailed to me and then we'll open the queue up for <unk>.
With that, I look forward to answering your questions.
Kayla, let me take a few that were emailed to me and then we'll open the queue up for additional questions. And then we'll open the queue up for additional questions.
Additional questions.
First Jarrett Albert.
Can you explain how you are generating the prospective cash burn guidance, what revenue streams are you, including and excluding what is the forecast period.
First, Jared Albert.
Can you explain how you're generating the perspective cash burn guidance? What revenue streams are you including and excluding? What is the forecast period?
Sure.
Okay, well from an accounting standpoint, we look forward 12 months.
Okay, well from an accounting standpoint, we look forward to all months.
A typical look forward period from an accounting standpoint.
From having a clear visibility on where our licensees and their customers are you know I look forward to at least 12 months to 18 months. So we're talking about cars that are coming out the second half of this year and next year.
That's a typical look forward period from an accounting standpoint.
from having a clear visibility on where our licensees and their customers are, I look forward at least 12 to 18 months. So we're talking about cars that are coming out, the second half of this year, next year.
Another question from John Nelson.
Another question from John Nelson.
Our carmakers using or planning to use SPD film and heads up displays yes.
Are car makers using a plan to use SPD film and heads up displays? Yes. Yes.
Any provision and the congressional inflation reduction act that would encourage use of SPD, yes actually the.
Any provision in the Congressional inflation reduction act that would encourage use of SPD? Yes, actually the Dynamic Glass Act provisions are still in there, and that would benefit us because it gives us tax credits for smart glass like ours.
The dynamic Glass act provisions are still in there and that would benefit us because it gives us tax credits for smart glass side cars.
Is the transparent OLED market led by LG and Panasonic are growing significantly.
Is the transparent OLED market led by LG and Panasonic growing significantly?
It's expected to and they're making substantial moves in that area.
And are there any significant rise in costs to make SPD film no.
It's expected to and they're making substantial moves in that area.
and are there any significant rise in cost to make us be the film uh... no
There aren't.
Jeff Harvey passed that I talk about Hey, Leo is a competitor with a competitive technology I had the opportunity to actually see Helios product that the CES this year.
There aren't.
Jeff Arby asked that I talk about Halio as a competitor with a competitive technology. I had the opportunity to actually see Halio's product at the CES this year.
And you know they like all the other smart glass companies are using a variant of an electric chromic technology, where they have an electrochemical reaction.
And they like all the other smart glass companies are using a variant of an electrochromic technology where they have an electrochemical reaction inside the glass. And it has the same limitations that all electrochromic devices have, which is it's slow and non-uniform. Now what they do to try to mask that, and you can't see it unless you go up to the window to look through it, but that's where people can actually see the glass is there.
Side of the glass and it has the same limitations that all electrochromic devices have which is it slow and non uniform now what they do to try to match that and you can't see it unless you go you know.
Up to the window to look through it.
But that's where people can actually see the glass is there.
You see little grid lines, what they do is they put micro wires or micro grids inside the glass.
And you see little grid lines. What they do is they put micro wires or micro grids inside the glass to trick it into a somewhat of a honeycomb pattern to make it think that it's a bunch of small windows. But it's very visible when you come close to it. I don't think it's going to really have...
Trickett into a somewhat of a honeycomb pattern to make it think that it's a bunch of small windows, but it's you know very visible when you come close to it. So I don't think it's going to really have the aesthetic quality that we have in terms of of clarity.
the aesthetic quality that we have in terms of clarity.
Jeff Harvey also mentioned, we have not heard about architectural wins, what is holding up adoption of SPD. In this market view is won some large applications and they are in terrible financial condition.
Jeff Harvey also mentions we have not heard about architectural wins. What is holding up adoption of SPD in this market? Viewers want some large applications and they are in terrible financial condition.
Okay. There's a couple of things to unpack from that question first of all about architecture. We've had architectural projects use the new gas the film the backlog that we're having there too which is why also they're expanding their production capacity.
Okay, there's a couple things to unpack from that question. First of all, about architecture, we've had architectural projects use the New Galsy film. The backlog that we're having, which is why also they're expanding their production capacity, is really focusing where their film is going right now to the automotive market and the train market, in particular automotive, though. Architecture of the great market will probably be our biggest market within three years.
He's really focusing.
Where their film is going right now to the automotive market and the train market in particular automotive, though and architectural is a great market will probably be our biggest market within three years, but right now.
The most predictable large market is automotive and trains.
But right now, the most predictable large market is automotive and trains and also aircraft. So we are focusing the efforts there. You asked about view and their financial condition.
Trains and also aircrafts. So we are focusing the efforts there.
You asked about view and their financial condition.
There's a lot of things going on there and you know I think I was probably one of the first people to pick up on the fact that they had a warranty issue and that ultimately led to.
There's a lot of things going on there and I think I was probably one of the first people to pick up on the fact that they had a warranty issue and that ultimately led to a very extended period of time when they had an accounting fraud going on and they couldn't file their financial statements and finally got everything in shape. When they did file their numbers again though, they were able to file their numbers again though.
A very extended period of time, when they had an accounting fraud going on and they couldn't file their financial statements and finally got everything in shape when they did file their numbers again no.
It was kind of some interesting things so in their last financial filing in the next one is on the eighth of August so not too far away.
There was kind of some interesting things. So in their last financial filing, and their next one is on the 8th of August , so I'm not too far away.
They were talking about their revenues being up from $9.7 million to 17 million sounds like a nice increase.
They were talking about their revenues being up from $9.7 million to $17 million. It's a time like a nice increase. It's a time like a nice increase.
Except that they bought two companies that are.
In facilities management, and electronics, Theyre Smart glass revenues actually went down 37%.
except that they bought two companies that are in facilities management and electronics. Their smart-class revenue actually went down 37%.
So a fairly substantial decline.
In the first quarter of 2022 versus 2021 of 37%.
So a fairly substantial decline in the first quarter of 2022 versus 2021 of 37%
They were kind of saying well our revenues went up quite a bit and our cost of revenue only went up a little bit the cost of revenue went up 12% and we believe that almost all of that if not all of it is in the smart glass area. So what they were doing is in my opinion.
They were kind of saying, well, our revenues went up quite a bit and our cost of revenue only went up a little bit. Their cost of revenue went up 12% and we believe that almost all of that, if not all of it, is in the smart class area. So what they were doing is, in my opinion, fully subsidizing even to a larger extent than before.
Fully subsidizing even to a larger extent than before.
There their customers' purchases and.
That's good if you can do that in <unk>.
their customers purchases. And that's good if you can do that and reduce your cost and gain market share and things like that. But with their smart class sales where they are, we actually in our licensees have higher sales levels historically and we didn't spend $2 billion to achieve it. By my estimate, unless they raise capital, view will be out of cash by mid-October. I'm sorry mid-November.
Reduce your cost and gain market share and things like that but you know with their smart glass sales, where they are we actually in our licensees have higher sales levels historically.
Historically, and we didn't spend $2 billion to achieve it.
Estimate unless they raise capital.
View will be out of cash by mid October I'm, sorry mid November .
Or other public competitor Crown electric kinetics, I believe by my estimate will run out of cash even though they did too.
our other public competitor crown electric genetics i believe by my estimate will run out of cash even though they did
Two offerings, including one that a pretty high dividend rate of 12%.
two offerings including one that a pretty high dividend rate of 12 percent.
With a redemption premium of 25%.
Even with all of that and a million.
with a redemption premium of twenty five percent uh... even with all of that in a and a uh... a million uh... million share public offering they're probably run out of cash unless they raise more capital and you know when they file their financials maybe will no more by uh... uh... August twenty-fifth so you know they all have pretty short runways there to um... to come out against
A million share public offering.
They're probably going to run out of cash unless they raise more capital and you know when they filed their financials, maybe we'll know more by.
August 25th so they all have pretty short runways, there too to come out against it.
Let me see what other questions we had believes that.
Let me see what other questions we had. I believe that.
Might've been most of them.
That were emailed and I. Thank everyone that took the opportunity to email us the questions. So that we can either incorporate them into our presentation or or answer them efficiently. So kayla. If you wouldnt mind opening up the floor to any questions that might exist.
Might have been most of them that were emailed. And I thank everyone that took the opportunity to email us the questions so that we can either incorporate them into our presentation or answer them efficiently. So, Kayla, if you wouldn't mind opening up the floor to any questions that might exist.
Absolutely if you would like to ask a question. Please press star one on your telephone keypad now will be placed into the queue. In order received please be prepared to ask your question. When prompted once again if you have a question. Please press star one on your phone now.
Absolutely, if you would like to ask a question, please press star one on your telephone keypad now. It will be placed into the queue in order received. Please be prepared to ask your question when prompted. Once again, if you have a question, please press star one on your phone now. And we will take our first question from Alan Jensberg. Your line is open.
And we will take our first question from Alan Jim Burke Your line is open.
Yes, hi, good morning, Hey, Alan how are you.
Fine thanks.
Yeah, hi
Just one question.
Just to clarify you said that galaxy has increased their capacity, but they also make P. DLC. So could you I'm talking about SPD.
I'm fine next.
Just one question.
Just to clarify, you said that Gauss-Z has increased their capacity.
but they also make PDLC.
Alright, I apologize Thats right right. That's a very good question, it's they they quintuple their production capacity for SPD.
So could you talk about that? Yeah, yeah. All right. I apologize. That's right. Right. That's a very good question. They quintupled their production capacity for SPD.
Okay, great. Thank you that's all I have.
Thanks Alan.
Okay, good. Thank you. That's all I have.
And our next question comes from August Berman and investment and Investor. Your line is open.
Thanks Alan.
And our next question comes from August Berman, an investor. Your line is open.
Yeah.
Hi, Joe Good afternoon.
Hey, Dr. Berman how are you.
Hi Joe, good afternoon.
Hey, Glenn.
One question I was walking my dog.
Hey Dr. Berman, how are you?
I'm good, I'm good. Hey, and just one question I was walking my dog last night, I was listening to a Bloomberg podcast talking about. I was listening to a Bloomberg podcast talking about.
Lindbergh.
Talking about.
Yes.
Natural gas prices.
Europe .
the potential oil crisis or not well, natural gas crisis in Europe .
Wintertime.
We.
Think about that.
Yes.
and the winter time, what do we, how do we think about that with
SPD factory out there.
Would that be an issue.
Gaussies SPD factory out there.
Add back of generators in case, it gets too cold.
Would that be an issue that they have?
Back in the mortgage space in the wintertime.
backup generators in case it gets too cold. I know it's not exactly the warmest place in the wintertime. How do we know that? No, no, Stuttgart, Germany. I've been to Stuttgart, Germany many times in the wintertime and you have to be careful.
No no its Stuttgart, Germany.
The Stuttgart, Germany, many times in the winter time, and you have to be careful.
You know galaxy is a very resourceful company they do have.
You know all of the normal precautions, you would see but remember they also scaled up there new film production facility in the middle of Covid when people could even come in and out of Germany. So they figured out how to do it.
you know, Gauzie is a very resourceful company. They do have...
you know, all of the normal precautions you would see. But remember, they also scaled up their new film production facility in the middle of COVID, when people couldn't even come in and out of Germany. So they figured out how to do it, you know, and this is not something that they've expressed to me as anything they're concerned about.
And this is not something that they have expressed to me as anything they are concerned about.
Got it and if and if and if theres an issue they could always shift things over to Israel, but obviously the production facility in interested card is.
And if there's an issue they could always shift things over to Israel, but obviously the production facility in interested gardens is much higher capacity, much more efficient and they'll optimize for S3D. And they'll optimize for S3D.
As you know much higher capacity much more efficient than they are.
Optimized for SPD.
Got it.
Okay, and then actually just one other question I had was looking at.
Okay, and then after just one other question I had, I was looking at GAUDEE's website and they talked to us kind of a promotional about us with the new integration between GAUDEE and the vision systems and they talked about in their official press release there were five manufacturing sites, but on GAUDEE's informational it says four manufacturing sites are they're four or they're five?
Yes.
Website and they talked.
It's kind of a promotional.
With the new integration between Gallagher.
Vision systems and they are talking about.
A press release.
Five manufacturing sites.
These information four manufacturing sites.
Therefore are there five.
We have to.
I guess, we have to be a little cautious.
We have to...
They are a company that is expanding in relevant areas of the world. So I don't know, what I can actually say or not say, but.
I guess we have to be a little cautious. I think there are companies that are expanding in relevant areas of the world, so I don't know what I can actually say or not say.
Suffice it to say Theyre growing and you.
Most of that growth is coming from SPD.
Suffice it to say they're growing and...
And when I was there for there.
Most of that growth is coming from SPD.
When I was there for there are they actually had their companywide meeting in the middle of Covid and I happen to be there and the people in Israel, where.
and when i was there for their uh... when i was there for their uh... they actually had their company wide meeting at in the middle of kovat and i happen to be there and the people in israel were you know where they're physically the people from different parts of the world were dialing in and um... on zoom and
Where they're physically the people from different parts of the world, we're dialing in and and zoom and.
They were introducing all of the new people they hired and there just was one engineer after another one production person after another for the SPD project and this was way back you know in December 2019 2020.
They were introducing all of the new people they hired and it just was one engineer after another one production person after another for the SPD project. And this was way back, you know, in December 2019, 2020. So, and since then, you know, if you go on their website, you'll see they're advertising for more and more people. So, you know, once again, a leading indicator that I like to look at is hiring.
So and since then you know you if you go on their website youll see that advertising for more and more people. So.
Once again, a leading indicator that I like to look at is hiring.
Yes.
And that in a couple of them.
I would say with that is there are many hiring and then.
Yeah, I've seen that and a couple of other shareholders have noticed that too with the Germany hiring and then enrolled for SPE specifically. So that was great to see. Okay, well that's all I have. Thanks Joe.
Specifically.
Great to see.
Okay, well, that's all that's all I have thanks, Joe.
Thanks, a lot.
Great.
Next question comes from Leonardo, let Sal and Investor Your line is open.
Thanks a lot.
Great. And our next question comes from Leonard Litzow, an investor. Your line is open.
Good afternoon, Joe.
Hey, Matt how are you.
Thank you Sir.
Good afternoon, Joe.
I guess in your comments today, you talked about the near term markets would be mostly automotive transportation trains et cetera.
Hey, Len, how are you?
Doing fine, thank you sir. In your comments today, you were talking about the near-term markets would be mostly automotive, transportation, trains, et cetera. Plains, the only way in that there were several companies going to be using SPD now in the third and fourth quarters. The only one that I've seen publicly announced was the Cadillacs, so let's speak.
Yes.
The only.
Sure.
He is going to be using SPD now in the third and fourth quarters.
We won that.
Being publicly announced was the Cadillac I speak with.
I don't know.
Not that many cars.
Right.
you know, which is like, I don't know, not that many cars. Right. Are there, um, that's, uh, that's coming out. Yeah, that's coming out in 2023. So, you know, when the ones for this year were, were other ones.
Are there.
That's kind of got it yeah, that's coming out in 2023, So you know when the ones for this year, where where other ones.
Okay, and nobody's announce what that is can you give us any idea of the magnitude of sales.
Okay, and nobody's announced what that is. Do you give us any idea of magnitude of sales?
I think when I guess earlier on when I said that these near term introductions.
I think when I, earlier on when I said that these near-term introductions
And double our best year in SPD use and remember in the in the introduction, sometimes there for what some of these companies would consider test markets.
can double our best year in SPD use. And remember, in the introduction, sometimes there for what some of these companies would consider test markets. We consider test markets.
You know test regions of the world and things like that even with it just being test regions, you're talking about a substantial increase over our best year. So that's about all I can say.
test regions of the world and things like that. Even with it just being test regions, you're talking about a substantial increase over our best year. So that's about all I could say.
You know.
In an industry, where you've got to let the automakers speak first the tier one suppliers speak second and then research frontiers quickly speak third to draw the connection, but I think that in the past you've heard us talk about.
I'm in an industry where you got to let the automaker speak for us, the Tier 1 supplier speak second, and then research frontiers quickly speak third to draw the connection. But I think that in the past you've heard us talk about, you know.
Hum.
Some of the strategic investors and gals anywhere, where and you could probably get a good sense from that.
Who's some of the strategic investors in Galilee were and you could probably get a good sense from that.
Okay. So the next few quarters, and we should see that appear.
Okay, so the next two quarters and we should see that up here.
Yes.
Very good.
That's good news. Thank you very much that's great news. Thank you.
Yes.
Very good. Very good.
That's good news. Thank you very much sir. It's great news. Thank you.
And our next question comes from John Nelson of Investor. Your line is open.
And our next question comes from John Nelson and Vester, your line is open. The emergency she did not believe that she could receive the
Hi, Joe how are you doing hey, John I'm doing well how are you doing Jon. Thank you for the questions you sent them before.
Hi, Joe. How are you doing? Hey, John . I'm doing well. How are you doing, John ? Thank you for the questions you sent in before.
Pretty good and you're welcome I am yeah.
I'm, sorry ask nauseum, but just because it's such a ginormous market for Sun visors.
Pretty good, you're welcome. I have to ask, I've known them, but just because it's such a ginormous market for some visors.
One either.
Yeah, Tommy Diamine are progressing.
One either, I mean, how does it, Dome, Dime progressing on some, time-visor development and are any of your other licensees?
On Sunday Sun Visor in development and are any of your other licensees.
Working on a sun visor, because it seems like it's Glenn let me just say yeah, yeah, well, that's one of the Holy Grail is let me say, yes to your questions and I can't go into more detail about it.
working on a Sun Visor because it seems like it's kind of let me just say yeah yeah well that's one of the holy grails let me say yes to your questions and I can't go into more detail about it.
Okay.
But it's always been but by the way just if it's any comfort. It's always been one of my favorite applications in May he rest in peace, Bob Saxe and I used to drive back West from research Frontiers every evening into the bright Sun and every time the sun with it or is Bob I'd say, we got to get this advisers as soon as we can.
Okay. All right. But by the way, just if it's any comfort, it's always been one of my favorite applications and maybe rest in peace, Bob Sachs, and I used to drive back west from research frontiers every evening into the bright sun. And every time the sun would hit our eyes, Bob would say, we got to get this advisor as soon as we can. So it's a pet project for him, and I hope I can honor his legacy by getting that out in a big way.
So it's it's a pet project for him and I Hope I can honor his legacy by getting.
Getting that out in a big way.
Came in.
Ken <unk>.
Second question.
Can you explain or I'm, just kind of give.
Amen. Can, oh, second question. Can you explain or just kind of give us a general explanation of what the R&D spend is going to?
Give us a general explanation of what the R&D spend is going to.
Yeah.
Listed in the.
<unk> yeah.
that's listed in the income statement? Yeah, different things. So part of it is going towards new materials that might have different off-state colors. I think that's always been an important focus for the company to give our customers a broader range of colors besides the sapphire blue that we're currently at. And we've made good progress, but I don't wanna promise anything until it's commercial.
Yeah different things so part of it is going towards <unk>.
New materials that might have different off state colors.
That's always been.
An important focus for the company to give our customers a broader range of colors. Besides the sapphire blue that we're currently at and we've we've made good progress, but I don't want to.
Promise anything until its commercial.
It and other areas as well, including supporting our licensees.
You know what their effort as well so helping them do it better faster and you know and improving the technology consistently.
on that and other areas as well, including supporting our licensees.
With their effort as well, So helping them do it better, faster and improving the technology consistently.
Great. Okay. Thanks, very much it sounds like corner.
On the cost.
Great. Okay, thanks very much. It sounds like we're... It sounds like we're...
Yeah. Thank you John .
On the cusp.
And our next question comes from Art Brady and investors. Your line is open.
Yeah, thank you John .
Hi, Joe.
And our next question comes from Art Brady and Investor. Your line is open.
Yes.
Hey, art how are you.
Good.
I know what Brady is.
Hi, Walter.
The settlement.
Hey Art, how are you? Good.
Russia is supposed to start.
I want to do now December 6th.
Yes.
Russia is supposed to stop all this.
So these two Jeremy.
A lot of the companies are looking for a backup plans is that part of the.
facilities to Germany and a lot of the companies are looking for backup plans. Is that part of the endeavors that you're involved in?
When you say you were involved in.
Uh huh.
I'm not directly involved in that art, but our licensees are pretty good planners for contingencies are earlier on.
I'm not directly involved in that art, but our licensees are pretty good planners for contingencies. Earlier on, August Berman had asked a similar question about natural gas shortages expected for Germany. I don't see that as being a problem.
August Berman at AST.
A similar question about natural gas shortages expected for Germany, and you know I don't see that as being a problem.
I hope so.
Comments.
Yes.
Yes.
Any comments on Nippon Glass? We were told a couple of years ago that around this time that they would be very active in developing some applications on some of their cars and we don't hear anything at all from Nippon.
We will.
A couple of them.
Around this time.
<unk>.
Would it be.
Reactive.
Thanks.
Applications on <unk>.
Some of the other causes.
And we don't hear anything at all from Nippon.
Nippon glass for cars, you may be referring to a and S. G for.
Mipon glass for cars. You may be referring to NSG for some of the things they're doing with the display market.
Some of the things, they're doing with the display market.
No.
Jack.
No, it was Japanese glass company Nippon.
Glass company Nippon.
As a G C, probably and Pilkington I also talked about AGP, becoming more active.
AGC probably and Pilkington. I also talked about AGP becoming more active. So a number of companies. NSG has been – other than their ownership of Pilkington which maybe what I was referring to, Pilkington is the British class company that they bought many years ago. Other than that, they're focusing on the display market.
So.
A number of companies and S. G has been other than their ownership of Pilkington, which maybe what I was referring to.
You know Pilkington is the British class company that they bought many years ago other than that they're focusing on the display market.
So they're in both.
Okay.
How is that developing is it commercialized.
Still there in both.
How is that developing? Is it commercializing yet or they're going to release some more? LD has had a very strong push in this area and all of the market research that I've seen from them and from parties indicate it could be a very large market.
Sure.
Dig into release.
LG has had a very strong push in this area and all of the market research that I've seen from them and from third parties indicate that it could be a very large market.
Okay.
The launch of that.
Right.
When did they get to launch that?
They're talking about later this year early next year is what the last reports I saw.
The fucking about later this early next year is what last reports I saw. 55v.
55 inch TV.
Okay. Thank you.
Okay, thank you.
Thanks, a lot.
Thanks a lot.
And our next question comes from Bill Berg and Beth, your line is open.
And our next question comes from Bill Berg and Investor Your line is open.
Thank you.
Thank you.
In the near term Joe, auto was the area to look to review. I thought that you said that architectural.
In the near term Joe Auto was the area to look to slower revenue.
I thought you said that architectural.
is to biggest market within three years.
It's to be the biggest market within three years.
yeah that's what i thought i believe yeah and i think one of the great question bill what a driver's on that is that for this time uh... we have a film that's wide enough for architectural applications you know for both commercial and
Yeah, that's what I said earlier I believe yeah, Yeah, and I think one of the drivers and that's a great question Bill.
One of the drivers on that is that for the first time.
We have a film that's wide enough for architectural applications for.
So some of the things that I can talk about are different ways of delivering product to the customer more efficiently and making it more usable for... and making it more usable for...
For both commercial and residential and also some of the things that I can't talk about our different ways of delivering that product to the customer much more efficiently and making it much more usable for.
all types of architectural applications, whether it's new construction or otherwise. So that could become the killer.
All types of architectural applications, whether it's new construction or otherwise so.
Very shortly. Okay. So if that the case is Gaussian ramping up to that, uh, to hat out. So that, uh, to hat out.
You know that.
That could become the killer app.
Of course, that and automotive are very busy. I don't know if people remember, but when we had the factory launch for Gaussi, it was in Stuttgart, Germany. I would have mentioned on a call either before or after that, built in the space to replicate their existing SPD film coder, which is their only business out there, right on that same scale. Although, I imagine that now they know what they need to build and where to get it and where to get it is more of a BE file. This is where this kind of stuff becomes possible. That's one within their knowledge, knowing how critical your business is, and actually understanding the way in which sometimes people be aware of your work and really rescue you
Very shortly.
So if that's the case is gauthier ramping up so that to.
To happen now.
Of course of course, that's that in automotive are keeping them busy and if and I don't know if people remember, but when we had the factory launch for Galaxy. It was understood card, Germany, I Might've mentioned on a call either before or after that that they built and the the space to replicate that.
You go through when you're commissioning a new film. They may build second one in South Korea or somewhere else that's closer to customer, but they have capacity to do a lot. God bless them. They may be investment as do our other licensees when there's business supporting it so they can work with them.
Our existing SPD film culture, which is their only business out there right on that same site.
So I imagine that you know now that they know what they need to build and where to get it and you know.
The normal.
Things that you go through when Youre commissioning a new.
Line. They may build the second one in South Korea, or somewhere else, that's closer to the customer, but they have the capacity to do a lot and you know.
Okay, thank you.
Thanks a lot.
And our next question comes from Dennis Law with Landerm, your love open.
And God bless them they they make the investment as do our other licensees when when Theres business supporting it so it's great to work with them.
Dennis, how are you? Perfect. Living the dream. Living the dream.
Bye.
I was surprised the 154 or $150,000 charge off and got debt. Could you put any kind of that?
Okay. Thank you very much Joe.
for $150,000 charge off and got debt. Could you put any kind of that? do I have any reactions to want to know what would be more relevant to their initial
Thanks, a lot.
And our next question comes from Dennis Laval with Linda Your line is open.
I think that ultimately that is going to be helpful. I think that there are some pockets rolled where people need a little help to get started giving up on it and I believe it's probably an accounting issue than anything else, not an operational or a collection issue as far as I'm concerned. But once it hasn't paid file, Putin's dictate that he takes some kind of reserve. And if we didn't take that reserve.
Hey, Joe Hey.
Hey, Dennis how are you.
Uh huh.
I was surprised to see 154 million or $154000 charge off and bad debt could you put any color on to that.
I think that ultimately that is going to be collectible.
Think that there are some pockets of the world where.
You know people need a little help to get started in.
No I'm, not giving up on it and I, probably it's probably more of an accounting issue than anything else not a I'm not an operational or a collection issue as far as I'm concerned, but you know what somebody hasn't paid for awhile you know.
Prudence dictates that you take some kind of reserve and if we didn't take that reserve. If we didn't take that reserve our costs for this quarter would have been lower and for the first time that would've been lower I would call you view with that okay.
[laughter] Oh, you made if I spent that kind of money I don't spend that kind of money.
Acknowledging $270 million, what I can do with $270 million, which is what they burned last year.
We'd certainly.
<unk> be a lot better than what they did with it but.
Okay.
I listen to their conference call right before.
This one and they did say that.
And the next two months are going to beef up their balance sheet. So I wish them luck hopefully.
Yeah well.
Additional investor.
You probably know that it's probably not going to be available on such good terms for them. So.
Absolutely, but if I remember right they went through $80 million in the last quarter.
Yeah Yeah.
Yeah, I think last year, they what they went through they burn through $270 million in cash.
That would be about right from that I'll go back to that the bad debt is that a a royalty that you're all the earnings out of it.
A upfront license fee that you hope to collect at some point in time.
It's a royalty the royalty that mode that you know quite frankly, you know.
My accounts and I would probably disagree I believe it's fully collectible but.
You know we have policies in place that say that you know after a certain period of time, you take out an appropriate reserve and that's why I didn't hear it in theory, that's like a $101 $5 million of the revenue so somebody.
And you you want to know something we've taken reserves in the past and we've ultimately collected it and we've ultimately collected at so.
Maybe you know maybe it's good that the CEO is also an attorney.
Oh, Okay, I didn't want to spend a whole lot of time on that but anyway. Okay.
As the Guy said, we're on the cusp.
I I hope he's right there I.
I think we're a lot closer to the customer than people think.
Well you know it back in the old.
Late 18, Huggers that could've been eclipse.
That's right [laughter] Buffalo Guadiana, well talk to you later bye take care Dennis.
And as a reminder, if you would like to ask a question. Please press star one on your phone and our next question comes from Francisco Chavez and Investor Your line is open.
Hey, Joe How's it going.
Hey, Francis How's it going.
Pretty good you had mentioned earlier about different colors of film.
Would that affect the overall price.
We don't think so.
I don't think so the most expensive component of this is not so much the materials that are inside the emotion you know, although their specialty materials. So they have to be produced.
Now precisely, but you know believe it or not the conduct of coated plastic that we code on is you know a pretty expensive component and that'll be the same no matter what kind of electrified film you're working with whether it's PD L. See your SPD. So you know volumes that can come down significantly which is why <unk> has been able to project out.
You know fairly substantial price reductions in the price of their film.
Just on volume.
So the price itself was actually due to volume or difficulties laminating to product.
Mostly its.
Volume and just one other materials as the conductive coated plastic and for every square meter of film you need two square meters of conductive coated plastic one on each side of the emulsion.
You know to activate the.
Nanoparticles inside the film.
Okay. Now you know you also mentioned <unk>.
<unk> Mike.
Building built another facility in South Korea, so it could be closer to.
The I was speculating I was speculating that you know it might be in Asia, but you know they already have a very good one in Stuttgart and the reason they put it there is it's 10 minutes away from Portage 20 minutes away from Mercedes an hour and 15 minutes away from B M. W. In an hour and 15 minutes away from Audi.
So yet, but you know.
You're covering the waterfront in terms of of high end automotive by being there, but they're not that's not the only place where high end cars are produced so in Asia might be a you know another good place to put it.
Yes, so in the past several months not six months, none of those car manufacturers wherever mentioned Audi.
Sadie's BMW.
If it was ever mentioned about any products being used there in those cars.
Is that still there well that's because they haven't gone into serial production with the product yet.
Yeah.
I can talk about Oh wonder.
Wonder woman by the savings that you're using it anymore.
Alright.
They're there theres a theres a story unrelated to the SPD glass that goes into that and Hum.
That's that's their business and I know it.
Okay.
Okay.
Thanks for answering the question.
My pleasure.
And our next question comes from Alan Ginsberg Investor Your line is open.
Yeah, just one more question is there any chance that any of these new automotive.
Companies might have the SPD as original equipment and not as an option.
Yes, there's certainly that and we often don't know the.
The exact way theyre going to deploy this.
You know if I took Mclaren for example.
Is it take rates are so high it could very well be a standard equipment, if they want it but the economics on how you sell cars and how you price it often benefits having it as an option. So you.
That's that's their decision as long as the volumes are there I'm happy.
Okay. Thank you.
Thanks.
Yeah.
And our next question is from <unk> Middle South Dallas and Investor Your line is open.
Hi, Joe how are you.
Thank you.
Sure.
Doing great.
I wanted to clarify.
If things materialize the way you expect them to for the second half of the year, how do we had there just a feasibility.
Well I think that it's going to depend on how many of those cars are delivered in the between now and the end of the year and how money go into the next year.
But we've shown that we can become profitable with a little bit of help so we had one profitable quarter last year.
And.
You know because we have been working very actively to keep our expenses in our burn rate as low as possible.
You know the idea is to become profitable and cash flow positive.
Great.
Thank you so much.
And our next question comes from John struggle in Investor Your line is open.
Hey, Joe.
Hey, John .
Follow up on the architectural comments you made you said that in three years architecture will be the main focus of SPD use does that mean SPD will be available for new projects in three years or are there actually projects on the books now and waiting for the <unk>.
Yes.
There's projects on the books, but what I said is in three years it could be a very big part of our business I Didnt say that you know we're gonna delivered in three years I think that like any market. It has to grow it starts people get used to it they expand its use you know and.
No. That's that's all I'm, saying I'm, not saying that we're waiting three years for architectural by any stretch you know I think by three years, it probably will be a much bigger market for us.
60% of the world's glass as architectural.
Okay. Thank you doubled which is double the automotive right.
Okay.
And as a reminder, if you would like to ask a question. Please press star one on your phone now and our next question is from Lazard, let Sal and Investor Your line is open.
Yeah.
Hey, Joe listening to the comments the other thing that I thought about ways.
The.
Decrease in temperature and the Sun roofs.
Are there any of the manufacturers that are looking at.
Right now to use it.
Like the back window, and the side windows as well.
Certainly increased.
Or I should say decrease the cabin temperature even further.
Yeah, Yeah. The 18 degrees is just putting it in a half a square meter sunroof and you know now if you look at the size of the Cadillac, it's much bigger than that and the other cars coming out are much bigger than that and yes. There are.
You know other areas of the car, which I'll talk a little bit about or al mentioned at least in my closing remarks.
Okay. Thank you.
Thanks, a lot land.
Your next question is from Thomas Mccarthy of Invesco. Your line is open.
Hi, Joe.
You mentioned that you know, there's a bill in Congress that might likely get passed that would benefit.
Our sales because it would give incentives to people right tax credits right right.
You're aware of.
Somewhat similar legislation in other countries or.
Yeah, there's another country yeah. These are yes.
We're coming right.
Every every every major area of the World has you know what we call tax expenditures, where you use the tax code to actually promote certain social behavior that you want.
Like energy efficiency and we've had this in our tax code for a long time I mean, if you're on your personal taxes, Alaska. If you put in a solar water heater or some other things and they'll give you some credits for that usually it's limited the dynamic glass act potentially it can be a.
Major reduction in costs, you know based on the tax benefits, but I don't.
I don't count anything is being done until its done, especially in this environment of politics. So.
You know, where where we're delighted that people are focusing on dynamic glass.
When we started research frontiers and you know.
Even into you know.
The ear 2000, 2005, if you Google Smart glass you got five heads now.
Where the industry, so I'm, sorry, I'm glad that we're getting that visibility.
Are you aware of tax incentives.
For smart class in other countries.
Yes, but I don't know if those are going to pass this like I don't know if they're going to pass here alright.
Alright, so there.
But not a current okay right I mean, sometimes.
You come in you know through.
<unk> door not a back door in terms of you know energy efficient improvements and things like that are encouraged and sometimes it's from the utilities you know they have what they call demand management programs, where you know because of the car the marginal cost of a kilowatt of electricity is pretty high they want you to.
Especially during peak times dial it back and you know they give your incentives to do that too. So there's a lot of things out there we.
We just focus on having the best possible product and our licensees focus on selling it.
Right very good thank you Joe.
Thanks, a lot.
And our next question comes from Seth Nickerson with research Frontiers. Your line is open.
Okay.
Hi, Joe.
It says you from research frontiers, but just as a clarification Seth has been a longtime shareholder of research frontiers. He doesn't work here.
Otherwise I'd be I'd be accused of having a plant on the call I guess.
[laughter] alright anyway, that's okay.
I'm getting a kick out of seeing it.
Yeah.
Something about architectural for new and existing.
Yes.
At least that was.
Uh huh.
Mr Berg, who we're talking to.
So how is how would that work.
Yeah.
Is it that you're coming up with the pill and stick kind of thing.
I don't want to give the details, but we're talking about a retrofit of bull application that.
Makes it easier and just for people who.
Live in New York, or Boston, or Chicago, or places like that you'll know what I'm talking about whenever you replace glass on a let's say an apartment building or an office building that puts scaffolding up. So you don't drop the glass on people that are walking by him and that's you know and if you live in those cities in your living room and their co op.
Do you have to get co op board approval anytime you make a structural change to the outside of a building with a retrofit. It's a lot more like you know putting up.
New shades or blinds, where you don't need approval of the co op Board and you certainly don't need to go through the expense and the disruption of having.
Having scaffolding and things like that.
So it could be a very significant.
Benefit.
Two people to be able to get smart windows in their homes or offices much easier, especially in large cities.
And so you'd have you'd have to replace your glass is not something you could stick on top of what's down right.
I don't want to go into the details.
Okay, there's ways, where there's ways, where you don't have to replace the glass.
Okay laundry every detail thank you Joe.
Okay.
And at this time there are no further questions I would like to turn the call back over to Jeff.
Okay. Thanks, I'm going to make a few closing remarks and I. Thank everyone for their questions. If we haven't fully addressed your questions as always just feel free to email us where here off of 24, seven so we will try to answer them.
Research Frontiers enters the second half of this year are very well positioned for success.
Our customers and our markets tend to be more recession proof than others.
And when you consider the fact that research frontiers as an asset light intellectual property licensing company with very little expenses.
Inflation is not expected to have much an effect on the cost side for us.
On the revenue side, because we get paid as a percentage of our licensees sales with 10% in automotive and 15% in other markets inflation well undesirable in general could actually have a positive effect on our revenues.
We have no debt so a higher interest rate environment is not going to adversely affect us directly either.
And the leading indicators of economic activity are all positive for us.
Our licensees have expanded their production capacity major customers such as Hyundai have invested in them.
And our projected product pipeline for the next six to 18 months is quite strong.
In fact, the number of new car models and new cars that are expected to come out with our SPD smart glass technology over the six to 18 month period has never been higher.
Yeah.
And we expect it.
Just in the initial periods of these cars introduction to at least double our best year in terms of SPD film usage.
Our licensees that are closer to the frontline have almost completed their steps to actually quintuple production capacity.
And going back to the macroeconomic trends electric vehicle adoption is accelerating at a much higher rate than any of US originally anticipated just five years ago.
And it was reported earlier this week that electric vehicle sales spiked in June and almost every major car company in the World has now announced that Theyre going all electric.
So now I ask yourself.
What would these car companies do to get a five 5% increase in driving range without having to increase the size and weight of their batteries.
We're need bedroom major breakthroughs in battery technology.
And even if they did put larger batteries or had better battery technology with.
We still would help them increase the driving major their vehicles further because of the 18 degrees Fahrenheit reduction in cabin temperature through use of our SPD smart glass and just the sunroof.
In some areas. We're also slated for other areas of the car as well.
That'll be the first.
We have other firsts coming as well in the automotive area and the architectural areas.
And not all cars will be electric and certainly in the next 15 years. So during that time, we will also be helping internal combustion engine vehicles reduce C. O two emissions by as much as four grams per kilometer.
Glass.
It is a highly desirable building material, making homes and offices more functional and livable.
With our technology, we also bring beneficial daylighting and when people want it keep unwanted UV heat light and glare out.
And save energy and the process.
And vehicles, such as aircraft trains and of course cars, we give passengers a better connection with the outside world and block harmful UV heat and light and glare, while enhancing security and privacy and road stability.
And with no moving parts other than our highly efficient nano particles, we offer greater reliability than traditional shades and blinds or curtains.
And are much easier to clean and sanitize, thereby reducing germs and allergens.
By eliminating weighted the roofs of cards and Bentley estimates this to be about 13 pounds of weight savings and also that our SPD smart glass allows them to remove 56 components from the car.
And increasing the headroom without raising the center of gravity, we make vehicles more stable whether their cars trucks boats or trains.
So smart glass, certainly has an important and meaningful place in the future as well as the present.
Well my wife and children until the hard work hard work it took us to get the smart glass industry established.
Our 13, and I'm happy to say growing number of our grandchildren.
It's pesos, new Sun and many of your own children and grandchildren never lived in a world without our SPD smart glass.
All of us should be proud of the work that we've done together to accomplish this and bring this strategically important and high performing technology to the world.
I, thank our loyal shareholders for being in a central part of that and look forward to sharing updates with you throughout the year.
Thank you.
Yeah.
This concludes today's conference call. Thank you for attending.
Yeah.
Okay.
The House has ended this call goodbye.