Q2 2022 Fusion Fuel Green PLC Earnings Call

Speaker 1: companies under no obligation and expressly disclaims any obligation to update alter or otherwise revise any store of statements whether as a result of new information future events or otherwise except as required by law.

Speaker 1: Okay, thank you for joining us today. As always, I will run through our agenda for the next hour. We'll open with some remarks from Fusion Fields Chairman, followed by an overview of our value proposition as well, some observations about valuations in the Green Hydrogen Sector and the Management Team will share second quarter highlights, financial results, the latest on our technology, and an update on our commercial strategy.

Speaker 1: and pipeline. As we always do, we'll end with a recap of our 2022 milestones before opening up the floor for the Civilhood Q&A. As in previous calls, questions can be entered in the chat box in the webcast platform at any point during the next 58 minutes. Alternatively, you can also submit your question to the investor relations mailbox at ir at fusion-fuel.eu.

Hello, everyone and welcome to Green second quarter 2022 Investor update.

It's been Schwartz and I'm head of Investor Relations with diesel fuel.

First I'd like to remind everyone that this call may contain forward looking statements, including but not limited to the company's expectations or predictions of financial and business performance, which are based on numerous assumptions about sales margins competitive factors.

Speaker 1: So without any further ado, I'll pass it over to Jeffrey Schwarz, Fusion Fools Chairman.

Speaker 2: I'm Jeffrey Schwartz, Chairman of Fusion Fuel Green PLC, and I want to add my welcome to our Q2 and six month investor presentation.

Interest you performance.

And other factors, which cannot be predicted.

Speaker 2: The equity markets have not been kind to growth stories this year. The Federal Reserve's efforts to rein in inflation by raising interest rates has had a disproportionate effect on the share prices of fast growing companies due to the discounting of out-year cash flows. Or so Wall Street analysts would have you believe.

Forward looking statements are inherently subject to risks uncertainties and assumptions and they are not guarantees of performance I encourage you to read the disclaimer slide in the Investor presentation for a discussion of the risks that may affect our business today or may cause ever assumptions prove incorrect the company's under no obligation and expressly disclaims any obligation to update alter or otherwise revise.

Speaker 2: Then again, most of those strategists began the year predicting double digit, double digit equity market returns. So I take their advice with more than a few grains of

Any forward looking statements, whether as a result of new information future events or otherwise except as required by law.

Okay. Thank you for joining us today.

Speaker 2: I know I'd say this almost every quarter, and I apologize if I sound like the proverbial broken wreck.

As always I will run through our agenda for the next hour, we'll open with some remarks from fishing fuels chairman.

Speaker 2: But I've been in the investment business for more than 40 years, and the one investment strategy that has proven to work consistently over time is to uncover businesses that serve a growing market with a superior technology and a strong management.

Followed by an overview of our value proposition as well as some observations about valuations in the green hydrogen sector added the management team will share second quarter highlights financial results. The latest on our technology and an update on our commercial strategy.

Speaker 2: That is what we identified in fusion fuel green. In recent events, in particular, the energy crisis in Europe and the passage of the Inflation Reduction Act of 2022 in the United States have only served to magnify the opportunity.

And pipeline as we always do we'll end with a recap of our 2022 milestones before opening up the floor for facilitate Q&A.

As in previous calls questions can be entered in the chat box in the webcast platform at any point during the next 58 minutes. Alternatively, you can also submit your questions to the Investor Relations mailbox at I R at fusion dash fuel Dot EU.

Speaker 2: The chief concern for producers or off-takers of green hydrogen is a concept called the levelized cost of hydrogen, which is driven primarily by the

Speaker 2: The cost of electricity required for electrolysis and the cat-bex for the electrolyzer and balance with the planet. Fusion solution offers a

So without any further Ado I'll pass it over to Jeffrey Schwarz excuse me fuels chairman.

Thanks, Dan.

I'm Jeffrey Schwarz chairman of fusion fuel Green plc, and I want to add my welcome to our Q2 and six month investor presentation.

Speaker 2: grid independence and scalability are what make our solution unique and especially ideal for the high value added mobility market which is a key near term target for fusion.

The equity markets have not been kind to growth stories. This year, the federal reserve's efforts to rein in inflation by raising interest rates has had a disproportionate effect on the share prices of fast growing companies due to the discounting of out year cash flows work. So wall Street analysts would have you believe.

Speaker 2: In the production of green hydrogen, grit independence enables eliminating exposure to highly volatile prices for electricity and natural gas.

Speaker 2: The benefit is very much in focus during this time of historically high energy prices in Europe .

Then again most of those strategies began the year predicting double digit double digit equity market returns. So I take their advice with more than a few grains of salt.

Speaker 2: The benefit of eliminating this form of uncertainty is quite straightforward.

Speaker 2: The fact that our hevo solar generators can produce low-cost green hydrogen at even the very modest levels of production eliminates risk in a less obvious but potentially more important way.

I know I say this almost every quarter and I apologize if I sound like the proverbial broken record but.

But I've been in the investment business for more than 40 years and the one investment strategy that has proven to work consistently over time is to uncover businesses that serve a growing market with a superior technology and a strong management team.

Speaker 2: And I've been your indulgence for a moment as I use an analogy to explain.

Speaker 2: Imagine if you will, two suppliers of equipment, which are used to produce which.

Speaker 2: The Plyra A offers a machine that can produce 10,000 widgets per year.

That is what we identified infusion fuel green at recent events in particular, the energy crisis in Europe , and the passage of the inflation reduction Act of 2022 in the United States have only served to magnify the opportunity.

Speaker 2: at a lower cost, but with a significant upfront capital in

Speaker 1: The supplier B has a machine that can produce 10,000 widgets per year at that same lower cost, but with just a fraction of the required capital.

Okay.

Chief concern for producers or off takers of cream of Green hydrogen is a concept called the liberalized cost of hydrogen.

Speaker 1: Also, let's assume that the expectation is that the market for widgets will grow significantly over time. But next year when the equipment will be delivered, the market is projected to be 10,000 widgets. Well, which one would you recommend purchase? To me, the answer is obvious.

Which is driven primarily by the interplay of two factors the cost of electricity required for electrolysis and the Capex for the Elektra lives are in balance of plant.

Fusion solution offers advantages on both counts.

Grid independence, and scalability are what make our solution unique and especially ideal for the high value added mobility market, which is a key near term target for fusion.

Speaker 1: The ability to meet current demand while retaining the potential to grow productive capacity as the market grows is the slam dunk winner.

Speaker 1: and that's even more so if one believes the price of which it making equipment may well decline in the years ahead

And the production of Green hydrogen grid independence enables eliminating exposure to highly volatile prices for electricity and natural gas a.

Speaker 1: I suspect it won't come as a surprise to you, but in this analogy, manufacturers of centralized electrolyzers are supplier A and fusion of supplier B.

The benefit is very much in focus during this time of historically high energy prices in Europe .

The benefit of eliminating this form of uncertainty is quite straightforward.

Speaker 1: And this feature of being able to start with modest production of green hydrogen and grow as demand grows is especially important in a nascent market like mobility.

The fact that our heber solar generators can produce low cost green hydrogen at even the very modest levels of production eliminates risk in a less obvious but potentially more important way.

Speaker 1: With a very large existing stock of diesel fuel trucks, buses, and heavy-duty equipment, the demand for green hydrogen today is modest. However, is expected to grow over time as existing equipment reaches end of life as replaced by equipment powered by hydrogen fuel cells.

And I beg your indulgence for a moment as I used an analogy to explain.

Imagine if you will to suppliers of equipment, which are used to produce widgets supplier. A offers a machine that can produce 10000 wages per year.

Speaker 1: I'll conclude by saying this. Keep your eye on the prize. If you believe that the future of green hydrogen is bright and believe our hyposolar solution offers unique events.

Sure at a lower cost.

The significant upfront capital investment.

Supplier B has a machine that can produce 10000 wages per year at that same lower cost, but with just a fraction of the required capex.

Speaker 1: Then there is every reason to believe as I do. And mind you, I have never sold a share of fusion that we will be successful in building a company that is valued highly in the marketplace. With that, I'll turn the call back.

Also let's assume that the expectation is that the market for widgets will grow significantly over time, but next year when the equipment will be delivered the markers predict projected to be 10000 wishes, but which one would you recommend purchase.

Speaker 3: So with the finish of that context, let's begin with an overview of Fusion Feels Business case and value proposition.

To me the answer is obvious supplier b.

Speaker 3: So for those of you who are new to the aim or in need of our fresher, fusion fuel within the business of developing and delivering cost-effective clean hydrogen solutions to accelerate the global energy transition. As I've said before, at its core, fusion fuel is a technology company. We have developed and commercialized a proprietary integrated solar solar to hydrogen generator that unlocks grid independent green hydrogen production at a market leading the global.

The ability to meet current demand, while retaining the potential to grow productive capacity as the market grows is the slam dunk winter.

And that's even more so if one believes the price of Wizard, making equipment may will decline in the years ahead.

Well I suspect it won't come as a surprise to you, but then this analogy manufacturers that centralized electrolyze it our supplier a and fusion its supplier base.

Speaker 3: Our decentralized approach is a truly unique source of differentiation in the market. Where everyone else is going bigger to drive down costs, we have gone small scale and modular, and doing so have been able to eliminate some of the cost and complexity of hydrogen production and distribution.

And this feature of being able to start with modest production of green hydrogen and grow with demand grows is especially important in a nascent market like mobility.

With a very large existing stock of diesel fuel trucks buses and heavy duty equipment. The demand for green hydrogen today is modest however is expected to grow over time as existing equipment reaches end of life as replaced by equipment powered by hydrogen fuel cells.

Speaker 3: While others are talking about developing green hydrogen projects, we're doing it.

Speaker 3: As we speak, our HIVA solar technology is producing green hydrogen at our demonstration facility in Portugal. And our unique approach in differentiated technology have enabled us to build a robust commercial pipeline of textile and development projects led by our pilot project with ex-Lumen Madrid, which will be up and running by the end of the year.

I'll conclude by saying this keep your eye on the prize if you believe that the future of green hydrogen as bright and believe our people solar solution offers unique advantages than there is every reason to believe as I do and mind you I have never sold a share of fusion that we will be successful in building a company that.

Speaker 3: Yet despite all that, it's not lost on us that we continue to be persistently and significantly undervalued relative to our peers in the Green Hyde Fencector. A group of names that undoubtedly has advantages from maturity, scale, and balance you perspective.

As valued highly in the marketplace.

With that I'll turn the call back over to Beth.

Great. Thanks very much.

So with the benefit of that context, let's begin with an overview of fusion fuels business case and value proposition.

Speaker 3: But as our chairman rightly pointed out, in a market where most everyone has fundamentally the same offering, what customers care about more than anything is levelized cost of hydrogen. That is and will continue to be the key differentiator. That also happens to be where we believe we have a clear competitive advantage. Not only can we offer known long-term certainty of costs or integrated solution, but we can do so at market leading levels, agnostic of scale and without grants.

So for those of you who are new to the anymore and you need a refresher using fuel within the business of developing and delivering cost effective clean hydrogen solutions to accelerate the global energy transition.

I've said before at its core fusion fuel is a technology company, we have developed and commercialized a proprietary integrated solar solar to hydrogen generator that unlocks grid independent green hydrogen production at a market leading liberalized cost.

Speaker 3: We have a differentiated business model of filling both technology and green hydrogen and have a clear path to revenue generation and delivery at scale. So another way of looking at this chart would be to say, Fusion Fuel is the cheapest green hydrogen pure play stock out there today by an order of magnitude. And hopefully the next 50 minutes or so together will lead you sharing a similar perspective.

Our decentralized approach is a truly unique source of differentiation in the market.

Where everyone else's going bigger to drive down costs, we had gone small scale modular and doing so had been able to eliminate some of the cost and complexity of hydro production and distribution.

Speaker 3: So now, Pastor Perfiteriko, who will provide an update on the quarter and subsequent event.

While others are talking about developing green hydrogen projects, we're doing it.

Speaker 4: Great thank you, Ben. And good afternoon and thank everyone for joining us. As always, we're excited to share with you the latest developments of Q2, in particular given the recent macro events and industry news that make it a very bright and exciting future for us.

As we speak our Heber solar technology is producing green hydrogen at our demonstrator demonstration facility in Portugal.

And our unique approach of differentiated technology have enabled us to build a robust commercial pipeline of textile and development.

Speaker 4: So we'll cover a few of these ice insuride presentations, so I'll just touch upon some of the highlights now. From a technology and production side, we've not only gone online with the production of our Hebrew electrolyzer, the new Benavende, the sociality, being the first to be producing electrolyvers in Max scale in our area. We've also completed an assessment of our technology and manufacturing process with Black and B.

Development projects led by our pilot project with <unk> in Madrid, which will be up and running by the end of the year.

Yet despite all that it's not lost on us that we continue to be persistently and significantly undervalued relative to our peers in the green hydrogen sector.

A group of names that undoubtedly has advantages from each maturity scale and balance sheet perspective.

Speaker 4: In addition, we have two suits performing ongoing performance tracking about people so we use it and it continues to perform 10 to 10 above our head.

But as our chairman rightly pointed out in a market, where most everyone has fundamentally the same offering what customers care about more than anything is localized cost of hydrogen that is and will continue to be the key differentiator.

Speaker 4: As part of our continued investment in commitments to our technology development, we've found two more patients, which we believe will continue to provide us with a technological edge in the market.

That also happens to be where we believe we have a clear competitive advantage not only can we offer known long term certainty of costs through our integrated solution, but we can do so at market leading levels agnostic of scale and without grants.

Speaker 4: On the project side, we continue to secure significant grants for our project portfolio. And to take them with a written announcement of our sea pool team and sea fiber water pool.

We have a differentiated business model of selling both technology and green hydrogen and have a clear path to revenue generation and delivery at scale.

So another way of looking at this chart would be to say teach and fuel is the cheapest screen hydrogen pure play stuck out there today by an order of magnitude and hopefully the next 15 minutes or so together will lead you sharing a similar perspective.

Speaker 4: In July , in August , we also raised around $2 million through our ATM offering. This is an opportunity we expect to continue to tap into opportunities.

Speaker 4: We see great opportunities for us to pursue, but they're not part of the other dimensions. And at times we may feel that we may tap into the tool of the field of purpose.

So I'll now pass through preferred Rico, who will provide an update on the quarter and subsequent events.

Great. Thank you David and good afternoon, and thank everyone for joining us as always we're excited 70 latest allowance until June .

Speaker 4: In the past weeks, the days where we were more most active and actually around the PlayStation Relection Act in the US, that drove higher market volumes and we also need to be efficient votes. That said, we continue to be on strategically.

Given the recent macro events and industry news.

It makes it a early price inside of each of those.

So we will cover a few of these items during the presentation Sulzer pumps.

Some of the highlights now.

Technology and production side, we have not only phone lines and production of <unk>.

But as I say.

The facility being above the producing less and less.

Speaker 4: In the second quarter we recorded no frozen loss of 4.8 million euros, for which 4 million euros related to operating expenses. Of these 1.9 million euros are related to personnel costs, and 1.3 million euros are related to non-reparational administration costs, as well as one off annual costs related to annual company and such for data components related to maintenance.

Yes.

We've also completed an assessment of our technology and manufacturing process with local needs.

In addition, we have two suite of holding ongoing performance practical boggy muscle weakness.

It continues to perform 10% above of the sheet.

As part of our continued investment and commitment to our technology development, we filed two more patients, which we believe will continue to provide us with a technological edge in the market.

Speaker 4: We maintain our guidance for around 3 million euros per quarter of operational costs until the year end.

On the product side.

We continue to secure significant growth product portfolio in particular with the recent announcement follows loss equal team and CFO pools in Portugal.

Speaker 4: We bought about 150,000 euros of shared-based expenses in the non-cash expenses and are related to restricted stock units, not from the wall, which is even too personal.

In July and August we also raised around $2 million through our ATM offering. This is a facility we expect to continue to substitute opportunistically.

Speaker 4: As previously highlighted, this is the charge that will be recurring as it is advertised over the best in theory. We do intend to keep using securities with best in causes as an answer tracks talent, rewards of, and ensure environments with channels.

We'll see grateful changes across to pursue with an important although as I mentioned and entitled we may feel that.

We may tap into this pool.

Speaker 4: Therefore, a non-tash expense line related to these should be expected over the coming years.

In the past weeks the days when we were more most active naturally around the inflation reduction.

Speaker 4: Each course we need to recognize the data movements on outstanding work.

In the U S.

Speaker 4: With the mountain movements, insistive releases and energy in the stops, we have a positive impact to note of 5.7 million euros.

Drove higher market volumes, and we Opportunistically assistant loads.

That said, we continue to be in strategic.

Speaker 4: This is simply an accounting recognition and it is a non-passage.

I hope this into more details that they saw.

Speaker 4: In the course of, we also booked a half million euro gain driven by positive effects movements in our cash and children.

Next slide.

Speaker 4: We also had an 170,000 euro charge related to artificial fuel, spanking and venture and our share of those results.

In the second quarter, we recorded an operating loss of $4 8 million euros of which 4 million euros. It relates to operating expenses, albeit 119 million euros related to personnel costs were three minutes.

Speaker 4: We enter the course of the 10.6 million euros in our cash and cash equivalent instruments. As people see mentioned in the cutting-hawk 2021 and the Felt-Off 2022, we make strategic and long-term purchase orders to secure our supply chain.

A related to nonrecurring professional administration costs as well as one off cost related to annual company as such for Reorders filings and related legal fees.

Speaker 4: With those deliveries now having taken place in this company, we've slightly been finished up to significantly able to base the second half of the year.

We maintain our guidance of around 3 million euros.

Quarter of operational costs until year end.

Speaker 4: We close the quarter with 63 million euros of assets, of which 32 million euros are related to PPE assets, such as our ever-one projects, our legal tool project containers, our benefit, still be in our intellectual pockets.

We booked 950000 learners share based expenses in the non cash expenses related to restricted stock units lawful little bits of field.

Personnel.

As previously highlighted.

That will be recurring as it is amortized.

Speaker 4: We also hold around 21 million euros in inventory. Materials we have prepaid and received.

Amortized over the vesting period.

We do intend to keep using securities with vesting holders as a means to attract talent rewards and ensure alignment with shareholders.

Speaker 4: Are areceivable and quarter driven by the a C, new recovers which we have split out here and our brands awarded.

Therefore noncash expense line related to these should be expected over the coming years.

Speaker 4: At the end of the second course, we continue to have the same number of notes on each edge.

Each quarter, we need to recognize that as other movements on outside of work.

Speaker 4: We had an increase of around 7,000, which is stock units, first of the first quarter, related to instruments, issues to certain new miles.

With the market movements and central related to LNG and good results.

We have a positive impact of $6 7 million.

This is simply an accounting recognition and it is a noncash item.

Speaker 4: In Q3, we will have some modest increase in the outstanding shares due to the ADFs, and some sales are all best for employees.

In the quarter, we also both Hoffman and neuro gain driven by positive FX movements in our cash position.

We also had another 17000 euro charge relates to small single tool standpoint venture and offset those results.

Speaker 4: We invited this client to provide transparency on the grounds we are pursuing, the ones that have already been approved. This is an area that we are incredibly successful in pursuing, and we have amassed a great portfolio of projects with potential support.

We ended the quarter with templates admitted euros not fast enough equivalents instruments as previously mentioned in the second half 2021.

Speaker 4: The numbers here exclude our interest submission and that problem is so large that it would significantly distort the numbers. The rest of the short, we're still pursuing it and as I remind that it is a problem that is in traditional western side more than 500 million euros.

2022.

We made strategic and long term purchase orders to secure our supply chain.

With those deliveries now have been taking place significantly we expect these expenditures to significantly abate in the second half of the year.

Speaker 4: As you can see, we have made submissions for just under 80 million Euros of ground financing. These are projects principally important but also a human state.

We closed the quarter with 63 million euros of assets of which 72 million euros or related to PPE assets, such as I'll ever projects <unk> all benefited facility at our intellectual property.

Speaker 4: 19 million euros of grants have already been approved and off these we have already submitted 3.5 million euros to be released. This example will grow as we continue to implement these projects.

We also hold around 21 million euros of inventory materials, we have prepaid in receivables.

Speaker 4: In the 16 million euros above the ground applications, we have the C5 senior projects in that.

Our receivables in wholesale driven by the ACC recovered with which we have split out here and all brands Award.

Speaker 4: This is a round with an awarded, but we have not yet received confirmation of the bounty. We will communicate this as soon as we can.

Hello.

Yes.

At the end of the second quarter. We continue to have the same number of votes on SaaS. We had an increase of around 7000 restricted stock units versus the first quarter.

Speaker 4: As we've noted before, we have a differentiated value proposition with both technology and own projects being developed, creating substantial value. We have seen several projects we've developed as the abundance, even after being a modern brand.

Related to instruments.

Two subsequent Elias.

In Q3, we will have some modest increase in the outstanding shares due to the ACF facility and some sensible thats for employees.

Speaker 4: We are on the very few that are in actual development and implementation.

Speaker 4: This highlights the success of our multiple-pronged approach and in this strategy we will continue to pursue in Nigeria and other markets.

Hello.

When you've added this slide to provide transparency on the growth we are pursuing the ones and the ones that have already been approved.

Speaker 4: We continue to rapidly evolve our technology to keep us ahead of the current. On this slide, you can see the continuous evolution of our Unitarized Electrolyze, the hero. In fact, I have four of them in front of me as well, for those who can see in the small screen.

This is an area that we are incredibly successful in pursuing.

We have amassed a grateful other projects.

Okay.

The numbers here food or didn't say submission is that permanent so loss, but it was significantly distort the numbers a rest assured with surplus doing it and as a reminder, it is.

Speaker 4: When it was first created, when the Hibo was first created, as an instant portion of our cost reduction, came from simplifying the payment design.

Perfect.

And clinical medicine side.

Speaker 4: We have maintained that representation principle and not only further applied it to the ego, but it's not.

And in Europe .

As you can see we have made submission. So just on the 80 million euros of ground financing is unfortunately, principally in Portugal, but also with human space.

Speaker 4: As you can see, we are reducing the number of e-votes and e-votes on the left, which helps us stress that we produce the number of components, the piting required, the maintenance costs of the balance, and it also reduces the inflation time in cost.

19 million euros of France have already been approved.

At <unk>, we have already submitted $3 5 million euros to be released.

This number will grow as we continue to implement these products.

And the 60 million euros of other applications, we have the <unk> projects.

Speaker 4: This more powerful hero and cost reduction related to our product evolution continues to position us at the forefront of green hydrogen in terms of cost of health.

This is undrawn. So we have been awarded but not yet received confirmation of the value.

Speaker 4: As much as the formal be completed in an interstachment of our technology and environmental process to a certain age.

We will communicate this as soon as Luca.

As we've noted before we have a differentiated value proposition with both on technology and on projects being creative.

Speaker 4: In addition, truth, truth, is performing an ongoing factor of analysis of our deeper solar. And it continues to be a solid situation in terms of piloting production for.

Creating substantial value.

We have seen several projects from developers be abandoned even after being awarded bronze.

Speaker 4: In addition to our legal revolution, we're also working on human-exciting technology advances which we hope to be able to share with you in one of the upcoming ups.

We're on the very few.

Excellent.

Based on.

This highlights the success of all multiple pronged approach and as a strategy we will continue to pursue.

Speaker 4: With this, I will pass now to that who will give an update on our commercial address.

And other markets.

Yeah.

Thanks Linda.

We continued to rapidly evolve our technology to keep us ahead of that.

And on this slide you can see the continuous evolution of the Bohemia dry electrodes on the depot I had before about in front of me as well as closely as we can.

Speaker 4: Hey, thanks, Rodrigo. Hello, everyone. From a commercial standpoint, our mandate is simple to secure commitments for the full production of our Benavent State Facility in 2023 and beyond. Our goal is to confirm over 2,500 orders in 2023 and approximately 4,724.

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When it was frustrated on the hemo substrates as a significant portion of our cost reduction came from simplifying the design.

We have maintained that simplification principal amount only thunder apply them to the Evo.

Speaker 4: We're concentrated on efforts in Portugal, and are strategically expanding into other markets, such as Spain, Italy, Greece, the United States, in Canada.

But also to the Heber solar overall.

As you can see yield reducing the number of <unk>, but he will fill up which helps us strengthen and reduce the number of components of ice's required the maintenance cost of our bonds.

Speaker 4: Each project or geography goes to a detailed review to make sure it is a good fit for our technology, our strategy, and most importantly, something we're confident we can actually...

And it also reduces the installation time.

Speaker 4: To do this, we've implemented a multi-faceted approach to deliver on our business plan, focusing on technology sales and developing our own projects. In the mobility sector, as well as strategic industrial health.

<unk> costs.

This more powerful hemo and the cost reductions related to our product evolution continues to position us at the forefront of green hydrogen.

Yes.

Speaker 4: Our vision is to build a mobility backbone throughout Portugal and use this as a blueprint to build into other strategic markets in southern Europe and North America. In parallel, we're also focused on being a major part of the solution in strategic and having industrial locations in Portugal and other markets we expand into.

As mentioned before we completed an independent assessment of our technology and manufacturing processes, but the niche and.

And in addition to soon is performing and ongoing track record analysis of Altimo solar and it continues to be clarification in terms of hydrogen production performance.

In addition to our EBITDA evolution, we're also working on new and exciting technology advances, which we hope to be able to share with you and one of the upcoming auctions.

Speaker 1: We have several third-party sales in our pipeline, seven of which are in more dance stages of development, and total of five hundred and seven Hebo solar units. That represents over 25 million of potential revenue in 2023.

With this I will pass out of that.

Who will give an update on our commercial efforts.

Speaker 1: Our expectation is for our current Fusion Fuel Development projects to count for the balance of our production in 2023 and 2024. Almost all of our projects have grants, which make them more competitive for our customers from a pricing standpoint, and financially attractive to investors. We've secured over 14 million in grants and planned to hear back shortly on additional programs that Fred Reid-Go-Menshin and C5 in Portugal, and also the Perth Day Program in Spain, which we've already been notified over.

As far as having a little bit of internet difficulties.

Yes.

Hey, Thanks Fredrik.

Hello, everyone.

From a commercial standpoint, our mandate is simple to secure commitments for the full production of our facility in 2023 and beyond our goal is to confirm over 2500 orders in 2023 and approximately 4700 2024.

Speaker 1: As mentioned, we've sought to mirror our commercial focus to two strategic platforms, mobility and industrial decarbonization.

We're concentrating on efforts in Portugal are strategically expanding into other markets, such as Spain, Italy, Greece, the United States and Canada.

Speaker 1: We continue to focus on developing a mobility backbone in Portugal by providing turnkey solutions to the market. We've been number of mobility projects in Portugal in various stages of the development cycle. And we're looking to build out, build on that template into other markets.

Each project for geography goes to a detailed review to make sure. It is a good fit for our technology our strategy and most importantly, something we're confident we can execute.

Speaker 1: Focusing on strategic industrial locations is the other key platform and we believe Portugal is poised to play a critical role in addressing the energy crisis which continues to plague all of Europe . And that starts with Sina's Portugal. We are committed to being a leader in decarbonizing Sina's industrial zone, but also ensuring we are positioned to capitalize on the hydrogen export opportunity.

To do this we've implemented a multifaceted approach to deliver on our business plan, focusing on technology sales and developing our own projects and mobility sector as well as strategic industrial hubs.

Our vision is to build a mobility backbone throughout Portugal and use this as a blueprint to build into other strategic markets in Southern Europe North America in parallel. We're also focused on being a major part of our solution and strategic heavy industrial locations in Portugal and.

Speaker 1: We recognize that a development focus approach is capital intensive. And as a result, we are working on multiple solutions to secure equity capital from infrastructure bonds and exploring projectile financial alternatives.

In other markets, we expand into.

We have several third party sales and our pipeline seven of which are in more advanced stages of development and total over 570 <unk> solar units that represents over 25 million in potential revenue in 2023.

Speaker 1: Fusion fuels competitive advantage is our decentralized and scalable approach to green hydrogen production.

Speaker 1: Large centralized projects require some substantial investment, not just in the electrolyzer itself, but also surrounding infrastructure such as pipelines, trucks, and other balance of plant equipment. This also takes significant time and creates additional complexities for large scale centralized projects to secure permitting and financing to develop an additional infrastructure.

Our expect our expectations for our current fusion fuel development projects to account for the balance of our production in 2023 and 2024.

Almost all of our projects have grants, which makes them more competitive for our customers from a pricing standpoint, and financially attractive to investors. We've secured over 14 million in grants complaint here back shortly on additional programs with Frederico mentioned and see buy in Portugal, and also the part D program in Spain, which we've already been notified of award.

Speaker 1: We are seeing the cost of last mile logistics and distribution of hydrogen to be as much as $2 per kilogram. It costs most of the time goes unnoticed when you talk about levelized fossil hydrogen.

As mentioned, we have sought to near our commercial focus to two strategic platforms mobility and industrial de carbonization.

Speaker 1: Our approach is to co-locate our system on site. Next to the end user and use our Hebo Solar solution, even at small sizes as competitive. This allows customers to not have to make very capital and time intensive bets on a centralized system, instead start small and grow with the market demand over time.

We continue to focus on developing and mobility backbone and Portugal by providing turnkey solutions to the market with the number of mobility projects in Portugal in various stages of the development cycle are looking to build out the bill on that template into other markets.

Speaker 1: This option doesn't exist in the market today and is needed in a nascent market like green hydrogen. As pioneers in green hydrogen, Fusion Fuel noticed the problem in the market with our customers and are providing a solution to let our customers grow with us and ease into the hydrogen ecosystem while offering the lowest possible levelized cost of hydrogen in the market, especially when you include a weighted distribution cost.

<unk>.

We recognize that a development focus approach is capital intensive and as a result, we are working on multiple solutions to secure equity capital from infrastructure bonds and exploring project.

Speaker 1: As previously noted, we focus on two core markets, mobility and decarbonizing specific industrial hubs.

Financing alternatives.

Our next pad.

Speaker 1: First on mobility, we've learned many important lessons from our first project with X Alun. The largest refined products distribution company in Europe .

Fusion fuels competitive advantage is our decentralized and scalable approach to green hydrogen production.

Speaker 1: He take away from our experience thus far on X-Lum that we must not just offer our technology, but we must offer a solution to our customers which can include supporting in development, permitting grant applications, construction, and operations of the overall facility.

Large centralized projects require substantial investment not just in the electrolyzed itself, but also surrounding infrastructure such as pipelines trucks and other balance of plant equipment. This also take significant time and creates additional complexities for large scale centralized projects to secure permitting and financing to develop that additional infrastructure we have.

Speaker 1: This experience has led us to offer customer several solutions in mobility, such as just selling technology as a solution.

Seeing the cost of last mile logistics and distribution of hydrogen to be as much as $2 per kilogram and cautious.

Most of the time goes I noticed when you talked about level is cost of hydrogen.

Speaker 1: This provides our customers multiple options to transition to the hydrogen ecosystem by even offering to not only include hydrogen production, but also includes the retooling station and the vehicle.

Our approach is to co locate our site on co locate our system on site next to the end user and use our heber solar solution.

Speaker 1: We are establishing network of companies to offer suite of services, including trucks, pork lists and buses to our customers.

You have a small size and it's competitive this allows customers to not have to make very capital and time intensive bets on a centralized system instead start small and grow with the market demand over time.

This option doesn't exist in the market today and is needed in a nascent market like green hydrogen as pioneers in green hydrogen fusion youll notice the problem in the market with our customers and are providing a solution to let our customers grow with us and he's into the hydrogen ecosystem, while offering the lowest possible level is cost of hydrogen.

In the market, especially when include avoided distribution costs.

Okay.

Okay.

As previously noted we focused we're focused on two core markets mobility and Decarbonising specific industrial hubs.

Speaker 1: These are key areas of focus. And we plan to build off these locations to put green hydrogen production and refueling stations, every 150 kilometers to connect, portal to the outgards and Lisbon to Spain. We also have selectively been looking at working with municipalities throughout Portugal to offer.

First of all mobility, we've learned many important lessons from our first project with excellent largest refined products distribution company in Europe , a key takeaway from our experienced thus far on <unk> that we must not just offer our technology, but we must offer a solution to our customers, which can include supporting in development permitting grant applications construction.

And operations of the overall facility.

This experience has led us to offer customers several solutions and mobility, such as just selling technology as a solution building the facility and selling them hydrogen or building entire heightened and value chain offering hydrogen as a service provider.

Provider customers multiple options to transition to the heightened and ecosystem by offerings, not only who hydrogen production, but also includes the refueling station and the vehicles.

We are establishing a network of companies offering a suite of services, including trucks for.

Cliffs and buses to our customers.

We are seeing substantial interest not just in Portugal, but throughout the Iberian Peninsula, Italy, and Greece and are beginning to see interest in North America, particularly in light of the passing of the inflation reduction Act.

Speaker 1: In summary, this represents over 3,700 kilo solar units, which will be produced in 2023 and 2024. That's over 50% of our 2023 and 2024 production, and these projects will come online in 2024 and 2025. Our company continues to evaluate, negotiate, and develop opportunities in Spain, Italy, Greece, and North America to get there in many orders of the balance of our 2023 and 2024 production.

Portugal as I noted at the strategic market perfusion fuel and in order to make hydrogen a reality in 2023 with focus and develop our own pipeline of projects to build out the hydrogen refueling infrastructure in Portugal.

We're focused on building out a mobility backbone centered around major distribution hubs, along the coast and Azzam Boucher AMC has as well as in L. A as an apple.

These are key areas of focus and we plan to build off these locations to put green hydrogen production and refueling stations every 150 kilometers to connect portal to the algorithms and Lisbon disbanded. We also have selectively been looking at working with municipalities throughout Portugal to offer.

Speaker 1: To continue to fill out our plan capacity for 2023 and beyond, we're not just focused on development projects, but also looking to provide solutions to our third party cost.

Speaker 1: We have combined 500 over 500 kilo solar units of text fails in advanced stages that are either signed, awaiting the war to be grand or in negotiations.

Speaker 1: The ones we are awaiting to sign or receive grants from our business companies.

The <unk> region also is core to fusion fuel as I noted and it's not just fusion fuel it's also Portugal.

It's also important for Portugal, and fusion fuels ambition for the domestic hydrogen market.

Speaker 1: We're not just selling technology to our customers, but in many cases, we're also providing a turnkey solution as I noted before.

<unk> currently has one LNG terminal as well as having a gallup refinery that consumes 60000 tons per year hydrogen plant green ammonia export facilities and other industrial customers.

Speaker 1: One point I'd like to highlight is that the grant requests that are being made are exclusively using our technology, which gives us the ability to secure these projects as they are awarded. Our approach allows us to not only make margin on our technology sale, but also the opportunity for additional revenue streams with the overall construction of the facility and revenue during operations while offering the best possible solution for that specific cost.

<unk> is currently planning to build a hydrogen pipeline L supply hydrogen to customers in <unk> and potentially exports other markets.

To date, we have secured 40 million grants for projects and <unk> and are awaiting award of additional brands to help us achieve our target of 10000 tons per year of green hydrogen production in the region and.

In summary, this represents over 3700, Evo solar units, which will be produced in 2023 and 2024.

Speaker 1: Lastly, whatever core markets we're expanding to is North America. In the USA, the Inflation Reduction Act is a massive win for fighting climate change and accelerating the clean energy economy, specifically in Green Hydrogen.

Over 50% of our 2023 and 2020 for production and these projects will come online in 2024 and 2025, our company continues to evaluate negotiate and develop opportunities in Spain, Italy, Greece, and North America to get the remaining orders of the balance of our 2023 and 2020 for production.

Speaker 1: This is a true game changer for us and the rest of the hydrogen value chain. To focus specifically on Fusion Fuel, we qualify for the $3 for kilogram production tax credit or the 30% investment tax.

Okay.

Speaker 1: The production tax credit can also be taken as cash payments via direct payments from the IRS.

We continue to fill out our plant capacity for 2023 and beyond we're not just focused on development projects, but also looking to provide solutions to our third party customers.

Speaker 1: Dugins technology is rapidly reducing its levelized cost of hydrogen under $3 per kilogram before subsidies in 2023. And likely, we'll be low that our regions with superior solar radiance, such as California, Southern California, or Southwest USA. Discombined with our decentralized approach allows us to be able to offer lower prices than gray hydrogen or diesel costs today after monetizing the production tax.

At a combined 500 over 500 kilo solar units of Tech sales in advanced stages that are either signed awaiting the award of a grant or negotiations will resolve the ones. We are waiting to sign or we see brands are marked as confidential as of now our pipeline textile projects is focused in Portugal, Spain, and Italy were actively evaluating.

Opportunities in other markets as well, we're not just selling technology to our customers, but in many cases, we're also providing a turnkey solution as I noted before one point I'd like to highlight is that the grant request that are being made are exclusively using our technology, which gives us the ability to secure these projects as they are awarded our approach allows us to not only make mark.

Speaker 1: Our team is working hard to build a large presence in North America. We're beginning to build out our team to give us the bench strength to aggressively enter this very important market. We are an active negotiation to secure projects and partnerships throughout North America.

Speaker 1: Can not stress how big of an opportunity this is for the hydrogen market and for fusion fuel, especially due to our unique value proposition, we can offer with our decentralized approach. We look forward to sharing more significant updates on this front over the coming months.

On our technology sale, but also the opportunity for additional revenue streams with the overall construction on the facility and revenue during operations, while offering the best possible solution for that specific customer.

Speaker 1: Great, thanks guys and it promised to be a...

Lastly.

Speaker 1: very exciting future updates given the whole US development and also the technology development side of you also joining us in our next one.

One of our core markets, we're expanding into is North America and the USA inflation reduction Act is a massive win for fighting climate change and accelerating the clean energy economy, specifically in green hydrogen.

Speaker 1: Before moving to our Q&A, I'll briefly recap on our four milestones for this year.

This is a true game changer for us and the rest of the value of the hydrogen value chain to focus specifically on fusion fuel we qualify for the $3 per kilogram production tax credit or the 30% investment tax credit.

Speaker 1: To help understand where the progress we've made, we've highlighted which items are consistent, which ones are in progress, and which ones are not yet started, as the time goes to two.

Speaker 1: On production, we went live with a heap of production of an agency to remind everyone that is about 120 megawatts for like the production capacity for next year. We will how much we produce and how well the project's live.

The production tax credit can also be taken as cash payments via direct payments from the IRS.

<unk> technology is rapidly reducing its level is cost of hydrogen to under $3 per kilogram before sotheby's in 2023, and likely wont below that our regions with superior solar radiant, such as California, Southern California or southwest USA.

Speaker 1: standing like this. We will try to give them the rapid evolution of the units in front of me, and we will try to always be producing for the project as we need to put them into the ground.

This combined with our decentralized approach allows us to be able to offer lower prices than gray hydrogen or diesel cost today. After monetize the production tax credits. Our team is working hard to build a large presence in North America, we're beginning to build out our team to give us the bench strength to aggressively enter this very important market. We are in active.

Speaker 1: The rest of the production lines in the inventory are expected to go live in Q1 and Q2 events.

Speaker 1: On a commercial scale, we've also secured, sorry, we've also secured the grant for the benefit. That's its ability to on the production flyer, that is very well on the progress side as it will already pass up.

<unk> received your projects and partnerships throughout North America.

<unk> stressed how big of an opportunity. This is for the hydrogen market and perfusion fuel, especially due to our unique value proposition. We can offer with our decentralized approach. We look forward to sharing more significant updates on this front over the coming months.

Speaker 1: On the commos the time, the players will be exactly already covered with the great progress open to clearing the orders, projects while securing a related grant, and the various things with development happening in the US.

I'll pass it back to you very good.

Alright. Thanks.

Speaker 1: On technology, we continue to evolve and maintain our leadership positions. In the second half of the year, we've started designing the oxygen capture set-up and we intend to project like this in 2023. So therefore, we'll be able to capture not only cell or positional, but also on a green hydro production role, so green oxygen production.

It promises to be.

Very exciting future updates given the whole U S development and also the technology development side.

He will also join US next month.

Before moving to Q&A I'll briefly recap on our pool milestones for this year.

Speaker 1: As piece before, we hope to share some of the new innovations we've been cooking and one of our upcoming updates.

To help understand well.

The progress we've made we've highlighted which license pieces, which was our progress and which ones are not yet started as of end of Q2.

Speaker 1: Project development and implementation is well on the way to several projects. As we've noted, several times, we're actually making green nitrogen a reality.

Okay.

On production, we went volume where the EBITDA production better lenses.

To.

Speaker 1: Safety is the central piece of our culture and the point that we've been instilling across all of the areas of the organisation. And this will continue throughout our time and the past.

Remind everyone that is about 120 megawatts electrolyte production capacity for next year.

We will how much we produce dependable either correlates line.

Speaker 1: Overall, the momentum we see within the firm and in the whole high-trade market has been incredible. I'm excited for the opportunity we have in front of us.

Standing licensee, we will try to give them the rapid evolution of.

The units in Pennsylvania, and we will try to always be producing for the project as we need to supplement to the ground.

Speaker 1: Now I'll possibly defend moderates on Q&A.

The rest of the production lines and <unk> expects to go live in Q1 and Q2 of next year.

Speaker 3: Looks like we've got quite a few questions coming through.

On the commercial side, we've also stuart's already all surgical the grants or the benefit than the facilities. So on the production side.

Speaker 3: getting some feedback on my end. I'll work through it. And also, questions the email as well. So let's let us kick this off with some questions from Chris soon at Webber Research. On the C5 grants, if you could talk a little bit about the approval process and what determines the final approval amount, I guess I'll, that's probably.

Very well.

On the broker side.

On the commercial side sizes with this accelerated some of the great progress both in securing the owners protect closer derivative related growth and the very exciting developments happening in the U S.

On technology. The same we continue to evolve and maintain our leadership position in the second half of the year. We have started designing the oxygen capture setup and we intend to purchase like this in 2023. So therefore, we'll be able to capture a lot of the cell.

Speaker 1: So on C5, C5.8.

Speaker 1: component of France that is mobilizing agendas. So these are many companies involved in these programs as around nine fields of companies that are involved in the discussions with the government. So the government is only when all of those are finalized, but we have a confirmation of our final balance.

On the green hydrogen production growth that bring oxygen production at.

His teeth before we'd hope to SaaS some of the new innovations, we've been cooking and all of our public updates.

Speaker 1: So we hope that that is within September , we hope to be communicating, but at the time line is not within our control. We have already been in firms that we will receive an award. The question now is the value.

Product development and implementation as well as delayed several projects as we've noted several hundred we're actually making green hydrogen a reality.

Safety is a central piece of our culture and the point that we've been filling the all of the areas of the organization and this will continue throughout.

Speaker 3: A couple of questions on grants funding here. So for Benaventay, what other milestones need to be met before you can invoice the remaining $3.5 million euros? How do tax credits work? Is it dollar for dollar or euro for euro rather? That reduces taxable income or is it taxed against a profit?

Hum.

Overall, the momentum we see within the.

And then the whole hydrogen market has been incredible and we're excited with the opportunity you have in hospitals now.

All positive its been moderate some Q&A.

Speaker 1: So, I'll also be in reverse order. So it's packing in profits, company, and we have until 2032 to make use of those. And on the...

It looks like we've got quite a few questions coming through.

I'm getting some feedback on my end.

Speaker 1: was required to take the other, it's a proportion of spend. So in line with our spending for the benefit, we are able to ask the reinvestments in past spending. So as part of the production line for the benefit of the poor, so if you want to start to be delivered, we expect also to be submitting the reinvestments for past spending.

I'll work through it.

And also for the questions via email as well so, let's let us kick this off with some questions from from Christina.

Our research on the <unk> Grant if you could talk a little bit about the approval process and what determines the final approval of Mt.

I guess, all that's probably a question for Federico.

So on the C. Five C fives.

Speaker 3: I'll skip to a different question and circle back to a couple more from Webber Research.

Component of bonds that is mobilizing agenda. So these many companies involved in these programs is around nine fuel cell companies that are involved in the discussions with government. So Dublin. So only when all of those are finalized, but we have the automation of all final value. So we hope for that.

Speaker 3: related to bed event day if demand increases significantly at what speed would be possible to ramp up production.

Speaker 1: I'll tell you as well. So this is at the moment with the first production line we're ready to design and ready to like to take it around and here to be able to develop the second and third production line of copypation of the existing one.

Is it.

Within September with hopefully communicating but I'd say the timeline adult within our control we have already been confirmed at all.

Speaker 1: However, and as I said before, we are working on some new solutions where we believe the ramp-up our ability to scale could be faster and also cheaper. So hopefully it's not next quarter potentially the one after. We will be sharing that with you all.

We will receive an award the question now is the adoption.

Okay.

A couple of questions on <unk>.

Grant spending here, so far been invented at what other milestones need to be met before.

Speaker 3: Thanks for everything guys. Let's get Zach involved a little bit here.

You can invoice the remaining $3 5 million euros had with tax credits work is a dollar for dollar or euro or euro rather that reduces taxable income or is it taxes against that.

Speaker 3: slide 19 of the presentation refers to an EPC turnkey project. Can you talk about what that means? Are those potential own projects or are those technology fail projects?

Yes.

So.

This robust orders so its types again profits of the company and we have until 2032 to.

Speaker 1: Thanks Ben. So they are technology sales. When we meet ETC term, as I noted in one of the slides, we're offering to supporting grants, grant applications, development, permitting, and it also includes building the entire project. So all balance of plant equipment, not just hebo-solar's technology.

To make use of those.

And on the <unk>.

<unk> the others, it's a proportion of spend so in line with us with and as I said, we are able to ask for reimbursement in the hospital setting.

As part of these production lines that I mentioned also in Q1 and Q2.

Subsea delivered we expect will soon be submitting the reimbursements request.

Speaker 3: Thanks. On that same slide for the tech sales, it looks like the cost per heaveau solar varies from the implied cost rather, varies from 31K for the two Portugal projects to 44K for the one Italy. Can you help understand how the pricing works and how the projects may differ from one another?

What's that.

I'll skip to a different question then circle back to a couple of more from Webber research.

Related to bad event, if demand increases significantly at what speed would be would it be possible to ramp up production.

I would say is as well so this is at.

Speaker 1: Thanks. So on some projects, we have additional equipment such as compression, storage, and other balanced and plant equipment. That drives up the cost of the overall system. That's embedded in that cost that is noted, which is why it's higher on a per-univase.

At the moment with the first production line is already designed and ready.

I can take a year to be able to develop the second.

The production is a copy paste of the existing one.

However, and as I said before we are working on some new solutions, where we believe the ramp up.

Speaker 3: Great question here for our chairman. So we received a question alluding to Nikola as a potential partner or customer in the US market. So while we can't touch on any individual companies or counterparts, perhaps you can share your perspective on the strategic partnership process and how you and the executive team are thinking about it.

Our ability to scale could be faster and also cheaper so hopefully.

<unk> also potentially the one off that we will be starting up with fuel.

Thanks, Patrick let's get exact involved a little bit here.

Slide 19 of the presentation refers to an EPC turnkey.

Speaker 2: Yes, so as we've said on numerous occasions, we're a small company today with approaching a very large opportunity. And we understand that our...

Can you talk about what that means are those potential own projects or those are.

Are those technology sale projects.

Thanks Ben.

Speaker 2: growth trajectory can steep in materially with

Our technology sales, we mean EPS EPC turnkey as I noted in my.

Speaker 2: with partners who have either financial or operational scale. So we've been in conversations with potential strategic partners, whether they're technology providers. We've mentioned conversations with Toshiba, which are ongoing with companies that might be interested in our HIVO solar solution and deploying it in their businesses or

And one of the slides, what we're offering to supporting grants grant applications development permitting and also includes building the entire project. So all balance of plant equipment, not just heber solar technology.

Thanks on that same slide for the tech sales it looks like the cost per kilo is solar.

Berries from.

The implied cost rather varies from 31 K for that to Portugal projects 244, Kate for the one in Italy can you help us help.

Speaker 2: partners who are interested in our project pipeline and might be interested in co-investing with us or purchasing projects for infrastructure funds.

Understand how the pricing works and how the projects may differ from one another.

Thanks.

So on some projects, we have additional equipment, such as compression storage and other balance of plant equipment that drives up the cost of the overall system. That's embedded in that cost that is noted which is why it's higher on a per unit basis.

Speaker 2: So all of those are conversations that are ongoing in a process that is a formal process.

Speaker 2: If you will step into their shoes for a moment, you could imagine that they would probably want independent third party validation of our technology,

Great question here for our chairman So we've received a question alluding to.

Nicola as a potential partner or customer in the U S market and so while we can't touch on any individual companies. Our counterparts, perhaps you can share your perspective on the strategic partnership process and how you and the executive team are thinking about it yes.

Speaker 2: And that's something that we understood. We went out and have obtained that confirmation through the black and beach and the two process. And we have been able to now deliver that to potential strategic partners who we've been in conversation with.

Yes, so as we've said on numerous occasions, where small company today with.

Approaching a very large opportunity and we understand that.

Speaker 2: once again putting yourselves in their shoes, the shoes of an interest-based financial party, you could imagine that the size of the grants that we might receive for projects have a major impact on what the economics of those projects are like.

Our.

Traject growth trajectory can steepen materially with.

With partners who have.

Who have either financial or operational scale. So we've been in conversations with potential strategic partners whether they're.

Technology providers.

Speaker 2: and C5 in that regard, C5 is an important one. It's the single largest of the grants that we have received so far, but we are in, as Frederico described in these final stages of negotiation.

We've mentioned conversations with Toshiba, which are ongoing with companies that might be interested in our hemo solar solution and deploying it in their businesses or <unk>.

Partners, who are interested in our project pipeline and might be interested in co investing with us or.

Speaker 2: I would think that without offering any information that would compromise our ongoing conversations, it would seem reasonable that

Or purchasing projects.

Projects for infrastructure funds. So all of those are conversations that are ongoing and the process that is a formal process. If you will step into their shoes for a moment.

Speaker 2: these various strands of a strategic partnership evaluation process are coming together. We have not wanted to have any one party too far out in front of others in order to be able to present our board with multiple options to choose from. And all I would kind of conclude with is this at the mic is specifically in the

You could imagine that they would probably want independent third party validation of our technology.

And that's something that we understood we.

Went out and have obtained that confirmation through that the black and veatch.

In the.

Speaker 2: This is a process that we would hope to be able to provide significantly different, difficult disclosure on before year end. And just to maybe touch on what might be an adjacent question, which would be.

The two process and we have been able to now deliver that to potential strategic partners, who we've been in conversation with.

Once again, putting yourself in their shoes.

The shoes.

Interested financial.

Party, you could imagine that the size of the grants that we might receive four projects has a major impact on what the economics of those projects are alike.

Speaker 2: How do we finance both the...

Speaker 2: our ongoing operation and these potential projects and what I would call out to folks is we have a balance sheet that has no debt.

<unk>.

And C. Five in that regard <unk> is an important one.

Speaker 1: significant assets, a factory in Benavente, that is debt-free. We have...

The single largest of the Av.

The grants that we have received so far but we are in as Federico described in these final stages of negotiation.

Speaker 1: claims against or receivables from government entities, whether those be VAT receivables, whether those are grants receivable. So we have significant assets that would be attractive for debt financing.

I would think that.

Without offering any any information that.

That would compromise our ongoing conversations.

Speaker 1: We also have the potential for raising capital at the project level from financial partners. We have the potential to raise equity at the holding company level.

It would seem reasonable that.

<unk>.

These various strands of a of a strategic partnership evaluation process.

Speaker 1: those I view all of those as live options for us. And the board will determine which and most likely what a mix of all of those would look like to finance both our ongoing operations as Federico referred to roughly a 3 million euro per quarter.

<unk> coming together, we have not wanted.

To have.

Any one party too far out in front of others in order to to be able to to present, our board with multiple options to choose from.

And all I would kind of conclude with is that this is a process that we would hope to be able to to provide significantly edition.

Speaker 1: operating expenses and then significant investment for project development.

Additional disclosure on before year end.

Speaker 1: So as a company, we're very comfortable with our financial position in the options available to us.

And just.

To maybe touch on what might be an adjacent question, which which would be.

Speaker 1: Thanks. So let's stick with, we've got a couple questions here on the AT&T facility. So we'll stick on that capital strategy theme.

How do we finance both.

The.

Our ongoing operation and these potential projects and what I would call out to folks is we have a balance sheet that has no debt.

Speaker 1: Talk about the company being undervalued relative to its peers. Isn't it counterintuitive to use the ATM and further dilute shareholders at this point? Would it be better to either get a big partner on board or concentrate on the textile portfolio with a faster return on limited equity instead of potentially using that the ATM to finance the company's production thoughts on that.

<unk> assets are factoring in that event they that is debt free we have.

Claims against or or receivables from <unk>.

From government entities, whether those be VIP receivables, whether those are grants receivable.

So we have significant assets that.

Speaker 5: I've been talking on that one, so naturally into what Drifree Blue did and also that has mentioned a given off product for Blue. We have a massive runway ahead of us.

<unk>.

Would be attractive for debt financing.

We also have the potential for raising capital at the project level through from financial partners, we have the potential to raise equity at the holding company level.

Speaker 5: And we need to think strategically of how we will cover that. We have several options available to us. The ACM has done it before. It's something that we will look to tap into. Optionistically, I will receive volume.

Those I view all of those as as.

Speaker 4: of interest and also the facility that allows us to find the right partnership opportunity and not be forced into something in a rush.

As live options for us and the board will determine which most likely.

What a mix of all of those would look like to finance both our ongoing operations is frederico referred to roughly 3 million euro per quarter.

Speaker 4: So we do not want to slow down the activities, the ramp up in the industry of methods. We see an opportunity to take an outside market share, given our notoriety.

Operating expenses.

Speaker 4: I would want to push for that. And so this is just another tool when I'll box. And as I mentioned before, the I-Rain announcement in the US provided market movements that we could actually optionistically happen.

And then significant investment for project development.

So we are as a company, we're very comfortable with with our financial position and the options available to us.

Thanks, So let's stick with it we've got a couple of questions here on the ATM facility until we'll stick on the capital strategy team.

Speaker 2: Then I just want to add one or two other thoughts.

Speaker 2: The first is that, as Federico mentioned, we have

<unk> talked.

Talk about the company being undervalued relative to its peers isn't it counter intuitive to use the ATM and further dilute shareholders at this point would it be better too.

Speaker 2: built up an inventory of both key components and finished goods.

Speaker 2: will enable us to move quickly on projects that where grants have been received and where they need to begin construction by a deadline or else those grants are lost. So there are indeed projects that we are looking at that have been brought to us because the clock is ticking and

You could get a big partner on board are concentrated on the textile portfolio with a faster return unlimited equity instead of potentially using the ATM to finance the company's production.

Thoughts on that.

Hello.

At a level so none within towards triple needed and also such as mentioned as developed project.

We have a massive runway ahead of us.

Element.

Strategically at how we will cover that there are several options available to us the ACF as I mentioned before is something that we will look to tap into opportunistically in low season volumes.

Speaker 2: complete to get the equipment necessary to complete the projects in time. We wanted to be in a position and we are now in a position to move quickly on projects like that. But as Frederico said, having now built up that our inventory, our spend on inputs will decline materially in the back half. Having theweed of our back half... So I...

Of interest and also some facility that allows us to find the right partnerships of Chintzy.

<unk> adult before into something in a rush. So we did not want to slow down the activity.

Roundup and the industry is massive we see an opportunity to take an outsize market, China given our choices.

Speaker 2: And the answer to that question about isn't it better to focus on text fails?

We want to push for that and so this is just another tool in our books and as I mentioned before.

Speaker 2: I think that going forward, we are now positioned to...

Italy announcements.

Speaker 2: to not need to be investing in working capital, something that we did proactively choose to do in the first part of the year. And secondarily, I will acknowledge that the timing of the receipt of some of the grant funding. The grant funding.

In the U S provided market movements that we could FC opportunistically tap into.

Then I just wanted to add one or two other thoughts.

The first is that as Federico mentioned.

We have.

Built up an inventory of both key components and finished goods.

Speaker 2: has been a little bit slower than we had anticipated.

That.

Speaker 2: This is all very new for the governments that are involved in trying to encourage development of the green hydrogen industry. And it has taken them a little longer than I think they would have expected and then we expected both on the grant approval process but also once grants have been approved on funding. And we think that that

That will enable us to move quickly on projects that where we're grants have been received and where.

Where they need to begin construction by a deadline or else. Those grants are loss. So there are indeed projects that that we are looking at that have been brought to us because the clock is ticking and.

Speaker 2: That lag is something that should be...

Complete to get the equipment necessary to complete the projects and time, we wanted to be in a position and we are now in a position to move quickly on projects like that but its frederico said having <unk>.

Speaker 2: The government should be catching up on that, but we are also, as I mentioned, exploring options for getting debt financing against some of those grants and receivables. So that too should reduce our needs for short-term funding, which an ATM can be another opportunistic source.

<unk> now built up that.

Our inventory our spend on.

On inputs will decline materially in the back half.

Aye.

And the answer to that question about isn't it better to focus on tech sales I think that going forward. We are now positioned to.

Speaker 1: Great, let's, one last question on financing, maybe for Zach here. In last quarter's call, we described there being a choice between partnering to obtain capital versus using our own on fusion field projects, which much of our pipeline being company on development projects and no announcement yet of partners, are you now leaning towards using your own capital for these projects?

To not need to be building to be investing in working capital.

Thing that we did.

Proactively choose to do in the first part of the year.

And secondarily I will acknowledge that.

Speaker 2: Thanks Ben, that's a great question we should provide some clarity to do. So I noted on the first slide that I was speaking to that we recognize this is Jeffrey and Frederick could just stated, we recognize it's a capital intensive set of projects and we are actively in discussions.

The timing of the receipt of some of the grant funding.

It has been a little bit slower than we had anticipated.

This is all very new for for the governments that are involved in trying to encourage development of the green hydrogen industry.

Speaker 2: and looking at alternatives with infrastructure funds, and other equity sources to fund our development pipeline. So those.

And it has taken them a little longer than I think they would have expected and then we expected both on the grant approval process, but also once grants has been approved on funding.

Speaker 2: Those structures will allow us to use third-party capital to fund the majority of the capital costs, which will reduce the stress on our balance sheet going forward. Thanks, I look too.

And we think that that that lag is something that that should be.

The government should be catching up on that but we are also as I mentioned exploring options for getting debt financing against.

Speaker 1: to our cost advantage. There's a question around scale. One would expect that even the modular technologies, such as our own, would have a lower level-less cost for a larger-scale project than a very small one. That's certainly the case for solar farms, despite the modularity of solar panels. When we describe our ability to produce a small sub-1 megawatt project at low cost, would you estimate that there is no increased level-less cost of hydrogen even at this small size?

Some of those grants in receivables so that too should should reduce our need for for short term funding, which which an ATM can.

It can be another opportunistic sourcing.

Great.

One last question on financing, maybe maybe for Zach here in last quarter's call. We described there being a choice between partnering to obtain capital versus using our own fusion fuel projects, which much of which much about with much of our pipeline being company owned development projects and no announcement, yet partners are you now leaning towards using your own <unk>.

Speaker 2: The question, is there any additional or the flip side is, or the, I guess, can you talk about the economies of scale that we do or do not benefit from as we develop larger projects from our portfolio?

Speaker 2: I'll take that one for you to go.

For these projects.

Thanks, Dan that's a great question, we should provide some clarity to do so I noted.

Speaker 2: We, like other, our peers would benefit from bounce of plant equipment on compression or storage or purification that as you kind of scale into an opportunity. But we're, as far as the technology on our electrolyzer, we've been able to prove even with, you know, as small as an ebbera at 15 units.

On the first slide that I was speaking to that we record.

Jeffrey and perfect. Good just stated we recognize it's a capital intensive.

Other projects and we are actively in discussions and looking at alternatives with infrastructure funds and other equity sources too.

Speaker 2: that we can, that we can, we can teed at the price of that we stated in our presentation.

Fund our development pipeline, so that those those structures will allow us to use third party capital to fund our fund the majority of the capital cost which will.

Speaker 1: Related to that, I guess what, and I recognize that this will depend on the specific application or use case. At what price per kilogram is a fusion fuel's technology and fusion fuel's green hydrogen profitable?

We will reduce the stress on our balance sheet going forward.

Thanks, Mike, let's pivot over to.

Our cost advantage.

A question around scale.

And would expect that even the modular technologies such as our own we have a lower level last cost for a larger scale project and a very small one and that's certainly the case for solar farms. Despite the modularity of solar panels. When we described our ability to produce small sub one megawatt projects at low cost would you estimate that there is no increase liberalized cost of hydro.

Speaker 2: Yeah, that's a great question. So that's also a very loading question, right? It depends on the market. So, so let's unpack that a little bit. So, let's be Europe , right? Well, as you know, to really focus on Portugal.

Speaker 2: If you look at the gas blending, one, at four bar, we can inject directly into the gas grid. So that reduces the amount of balance and plant equipment that we would need. That market today, if you look at natural gas, 10 years.

And even at the small size.

The question business.

Are there any additional.

Yes.

Flip side is.

Speaker 2: plus carbon tax avoidance is north of 475 a kilogram. So we noted that our levelized cost is becoming around $3. So there's definitely margin there to make selling into just spot pricing on the gas grid, as I can see.

I guess can you talk about the the economies of scale that we do or do not benefit from that as we as we develop larger the larger projects in our portfolio.

Sure I'll take that one perrigo.

We like other.

Speaker 2: Mobility, which is a key market for us, is as high as close to $8 to $10 a kilogram.

Our peers would benefit from balance of plant equipment on compression or storage or purification.

As you kind of scale into an opportunity.

Speaker 2: bar requires storage, but we're still able to be profitable and Be below what what what the current market pricing is being offered today

We're.

As far as the technology on our Electrolyze or.

We've been able to prove even with smaller than ever at 15 units now.

Now we think that we can.

We can compete at the prices that we stated in our presentation.

Speaker 2: And then looking to U.S. and other markets were seen in select markets, not including the IRA incentives.

And related to that.

I guess what.

I recognize that this will this will depend on the specific application or.

Speaker 2: We're seeing young California and other markets that we can compete heads up on mobility by just providing our technology and being under the current market price.

Use case.

<unk> per kilogram is is infusing fuels technology and future fuels green hydrogen profitable.

Speaker 1: to great segue to the next question. Given the cost advantage both in the EU, even without grants, given that the energy market and the US with grants, why does it seem to take so long for the market to materialize, particularly in the EU, one would think that would be current, obvious cost advantage that would translate to firm orders in fairly short order.

Yes, it's a great question. So that's also very loaded question right. It depends on the market. So so so so let's unpack that a little bit so let's look at Europe , whereas we know that we're really focused in Portugal.

If you look at the gas blending one.

At four bar weakening Jack directly into the gas spread right. So so that reduces the amount of balance of plant equipment that we would need.

Speaker 2: I think, you know, industry wide as I noted, everybody's meaning really heavy into doing large, large scales, centralized projects that requires additional land, additional permitting, and additional complexities, right? You know, binary risks.

That market today, if you look at natural gas.

10 year strip plus carbon tax avoidance is north of 475 kilograms.

We noted that our level is cost is becoming around $3. So there's definitely margin.

Speaker 2: our approach and what we're doing.

Speaker 2: we're able to, we're able to kind of reduce the balance of plant risk. And I think really for us, we're seeing a lot of...

Margin there to make selling into just spot pricing on the gas grid. As example, mobility, which is a key market for us is as high as close to eight to $10 a kilogram.

Speaker 2: A lot of men to recently, as we've just got our story out there more and are really pushing to just really show people they can come to ever, giving them a black and beach study, showing them the two study. I really want to explain that our technology has reached a certain level of commercialization that can be competitive even without ramps. And we are starting to see, as I noted, other opportunities in Italy, Spain, Portugal and North America.

Yes.

Bar required storage, but we're still able to be profitable.

And be below what the current market pricing is being offered today.

And then looking at the U S and other markets, where we're seeing in select markets not including even the <unk>.

Speaker 2: Like I'd like to just say that this is a nation-to-industry in a way and there's been significance of the progress made more recently in changing the legislation around licensing at all. And I'll just recall how long it took us to get all the licenses that we saw on pour ever up.

Name, including that the IRA incentives, we're seeing California and other markets.

We can compete heads up on mobility by just providing our technology and being under the current market pricing.

It's a great segue to the next question given the cost advantage both in the EU even without grants.

Speaker 2: And then, at the cause of our overall process, there was a change in legislation around licensing. So this is going to happen with several markets, and this is one of the reasons why things have taken just not only into Europe , the Regency Regulationary Environment is catching up now with a market development.

Given that the energy market in the U S with grants why does it seem to take so long for the market to materialize, particularly in the EU. One would think that with the current obvious cost advantage that would translate to firm orders in fairly short order.

I think industry wide as I noted.

Speaker 6: I'd just like to offer one more practical element, which is there's huge amount of funding available.

Everybody's, meaning really heavy into doing large large scale central centralized projects that requires.

There is additional land additional permitting additional complexities right binary binary risks.

Speaker 6: installing a green hydrogen plant and your choice is pulling the trigger today.

Our.

Our approach and what we're doing.

Speaker 6: and knowing that there is an, you get the project is economically viable.

We're able to kind of reduce the balance of plant risks.

And I think really for us we're seeing a lot of.

Speaker 6: but also knowing that if you pull the trigger today and go ahead with that project, it is highly unlikely that the government is going to provide the grant. The grant is an incentive for companies to move ahead. And so people are understandably hanging back in the hopes of

A lot of momentum recently as we've just got our story out there more and are are really pushing this really show people. They can come Deborah giving them a lack of each study showing them. The two two study and really be able to explain that we're our technology as reaching a certain level of commercialization that can be competitive even without <unk>.

And we are starting to see as I noted.

Speaker 6: being able to win grants and then move ahead with projects. And I think that as these grants start to break loose, you will see projects.

Other opportunities in Italy, Spain, Portugal, and North America.

I'd like to just add that.

This is a nascent industry in a way and there's been significant progress made more recently in changing the legislation alone licensing. So ill just recall how long it took us to get all the licenses and so on for ever up.

Speaker 6: move more quickly. But quite frankly, I understand why the clients that we are talking to are wanting to wait on the, you know, on the finalization of grants before committing to projects.

And then as a cause of Ara process. There was a change in legislation around licensee. So this is going to happen with several lawsuits.

Speaker 1: Thanks. Frederick, you mentioned the permitting process forever. If you could just touch on a quick update on where things stand with ever.

And this is one of the reasons why things have taken just long levels in Europe .

The regulatory environment is catching up now with the market developments.

Speaker 2: So, with our role, we have all of the pilots that license professional, I've been wanting to connect to the grid. We are the fellow fuel pilots ready to be connected. We are waiting for just the Portuguese metro company to...

I'd just like to offer one more practical element, which is.

There is huge amount of funding available.

If you are considering.

Installing a green hydrogen plant.

Speaker 2: do the actual physical connection to the grid. We actually expect to start, as we expect that to be shortly, we will start producing into the storage tank.

And your choices pulling the trigger today.

And knowing that there that that there is in the.

The project is economically viable, but also knowing that if you pulled the trigger today and go ahead with that project. It is highly unlikely that the government is going to provide the grant the grant as an incentive for companies to move ahead.

Speaker 2: our potential is the next week, the part that we've also. And with that, as soon as we're connecting to the grid, we will start producing electricity to cover the grid. So we are in the, in the clear, we literally now need to speak physical, targeting to the electrical grid here in the board.

And so people are understandably hanger.

Speaker 2: And a little bit before that, we will help reducing the fill-up these words.

Hanging back in the hopes of being able to win grants and then move ahead with projects and I think that as these grants start to break loose you will see projects.

Speaker 1: Thanks for the recon. A couple of questions here about the German market, and I guess perhaps more broadly, Northern European or Northern latitudes or longitudes.

Move more quickly.

But quite frankly I understand why the clients that we are talking to are.

Speaker 1: isn't the benefit of the...

Our wanting to wait on the on the Finalization of grants before committing to projects.

Speaker 1: avoidance of transportation costs limited to sunny countries or regions so for countries like like Germany or or northern Europe you would only have the benefits of cheaper re-relection i think this is more about clarifying uh... that the market uh... the choices we are making about the markets in which we're going to play

Thanks.

Fredrik you mentioned.

The process of the permanent process for ever if you could just touch on.

Speaker 2: That's correct. And we are focused on markets with strong solar radiance to build all for the best advantage to our own projects as well as our customers. So that's why as I noted, we're focused on port schools, staying Italy, Greece, and then specific areas within the United States.

To provide a quick update on where things stand with Deborah.

So whenever I would have hoped.

The others that license professional hygiene lessons.

Connect to the grid.

Sure.

The fuel cell is ready to be connected waiting pool justice the Portuguese company to do the actual physical connection.

We actually expect to solve.

Speaker 1: that thanks that I would I would just if I if I may I would add that

As we expect that these shortly.

Speaker 1: What we would say is that our technology not only produces more green hydrogen in areas with greater solar irradiance, but it produces that green hydrogen more cheaply. So in these early days, the supply constrained days, we say there are discrete choices to be made about where and when I suppose to allocate that

We'll start producing into the storage tanks.

As soon as next week, although we also.

And with that as soon as the next thing.

Makes it to the grid, we will stop producing electricity.

So.

We are in the in the clear.

It should be known need just the physical plugged into the electrical grid here in Portugal.

Little bit before that we will start producing to fill up the sports events.

Speaker 1: the scarce Hevosolar units. So we wanna be allocating those to the regions where we can extract the most value from those deployments.

Thanks Federico.

A question a couple of questions here about but.

The German market and I guess, perhaps more broadly northern European or.

Speaker 1: A couple quick questions here before we run out of time. How many employees do we have at this time?

Northern.

Latitudes and longitudes.

Is the isn't the benefit of the.

Avoid into transportation costs limited to Sony countries or regions. So for countries like Germany, or Northern Europe , you would only have the benefit to keep our production I think this is more about clarifying the markets. The choices, we are making about the markets in which we're going to play.

Speaker 4: have a 140 adjusted significantly driven by our production facility in Silicon City also, a little bit around it is our running speed agencies and the method is the routes look much more than the administrative..

That's correct.

We are focused on markets with strong solar irradiance.

To be able to offer the best advantage to our own projects as opposed to our customers. So that's why as I noted we're focused on Portugal, Spain.

Speaker 1: And then sticking with that event, you mentioned on the mouse mouse slide, we mentioned that that event, a full-go live is still in progress. Can you touch on the process of building out that facility and what that cadence will look like over the next, in the near term?

Italy, Greece, and then us.

Specific areas within the United States.

Thanks, I would just if I may I would add to that.

Speaker 4: So we have the electrolysis production in one of the next two lines to arrive are the production of the solar concentrator module and the solar concentrator small units that followed us before with the works of Prismopop. These are two units that the current part of manufacturing still is the 10 to do so ready.

What we would we would say is that our technology not only produces.

More green hydrogen in areas with greater solar irradiance, many producers that green hydrogen more cheaply. So in these in these early days the supply constrained.

Days, let's.

I'd say there are discrete choices to be made about where we are and when I supposed to allocate.

Speaker 2: so we can travel to the products and e-bos in the ground, like a solution already from the current production facilities and that's why they are less.

Net debt.

B.

Scarce Heber solar units, so we want to be allocating those to the regions, where we get the most we can.

Speaker 2: urgent in terms of the global life, the critical global life of the Hebo, he expects the line for the full sort of a concentrator uniquely, the very short piece of the prism in Q1 and in Q2, the module line. And then we have the full lines, lines and with the production output of 120 megawatts for production capacity.

Extract the most value.

From from those deployments.

A couple.

Quick questions here before we run out of time.

How many employees do we have at this time.

140.

Obviously significantly driven by oil production associates.

The lenses.

Those are the laws.

This is <unk>.

This level of the <unk>.

Speaker 1: Okay, thanks, Jericho. So it's the top of the hour, that will do it for our second quarter webcast. Thanks to everyone who's joined. If you have additional questions, or if we didn't get around to answering your questions, feel free to reach out to me and the IR team at IR at FusionFuel.eu. And we look forward to seeing you all again at our next update.

A little bit around the fed is.

R&D and <unk>.

As the rest of the commercial and administrative fees.

And then.

Sticking with that event.

You mentioned on the milestone slide we mentioned that.

A full go live is still in progress can you touch on on the process of building out that facility and what that cadence will look like over the next in the near term.

Also we have the our electrical as a production as alerts from volume. The next two lines to drive all of the production of the solar close with Lisa.

Module.

And these sort of concentrate are small units with the for those who followed us before with little preventable.

These are two units.

<unk>.

Our other manufacturing facilities and produced already.

So we can service the producer need those in the ground like absolute OLED from the current production facility and that's why EBITDA less urgency in terms of the total is critical.

Crystal devices.

We expect the <unk>.

Your line for these small silver concentrate.

The principal piece of the prism.

In Q1 and in Q2 the module lines.

Of the four lines.

And with the <unk>.

120 megawatts of full sort of capacity production capacity.

And better density.

Okay. Thanks, Puerto Rico, so it's the top of the hour that'll do it for a second quarter webcast. Thanks to everyone who has joined if you have additional questions or if we didn't get around to answering your questions feel free to reach out to.

To me and the IR team at IR at fusion fueled that EU and we look forward to seeing you all again at our next update.