Q2 2023 Lightbridge Corporation Earnings Call
Okay.
Thank you for standing by and welcome to the lightweight Corporation business update and second quarter 2023 Conference call. Please note that today's call is being recorded its now my pleasure to introduce Matthew Abernathy.
Director of Investor Relations for Light Bridge Corporation. Please go ahead.
Thank you Lisa.
Thanks to all of you for joining us today, the company's earnings press release was distributed.
Yesterday and can be viewed on the Investor relations page of the White Birch website.
Ww got healthy breakdown.
Joining us on the call today is Jeff Graves, Chief Executive Officer, along with Larry Goldman Chief Financial Officer, Andre Michel Executive Vice President.
For nuclear operation.
I would like to remind our listeners that any statements on this call that are not historical facts are forward looking statements.
This presentation includes forward looking statements about the company's competitive position and product and service offering.
During today's call words, such as expect anticipate believe and intend will be used in our discussion of goals or events in the future. This presentation is based on current expectation and above.
Certain risks and uncertainties that may cause actual results to differ significantly from such estimates.
And other risks are set forth in more detail and languages filings with the Securities and Exchange Commission.
<unk> does not assume any obligation to update or revise any such forward looking statements, whether as a result of new developments or otherwise.
And with that I'd like to turn the call over to our first speaker Seth Great Chief Executive Officer of like Bridge, Hello, Seth well. Thank you on that.
And thank you all for joining us to discuss <unk> second quarter results I'm delighted to share our latest achievements and developments with you.
On July six we announced the Texas A&M University has been awarded approximately $1 million from the U S Department of Energy's Nuclear Energy University program R and D awards to evaluate thermal hydraulic performance.
Of libraries fuel and a new scale small modular reactor.
The choice of Texas A&M University for this study speaks to their world renowned standing in nuclear Engineering education.
Their expertise in research capabilities make him an invaluable partner for this project. We are proud to have them, leading this critical study and we are eagerly looking forward to this new collaborative project.
The study planned to be conducted over a span of three years is designed to develop a comprehensive understanding how light bridge fuel performed.
In a small modular reactor in S. M are designed by new scale power New scale is a recognized global leader in developing <unk>, which are playing an increasingly important role in the move towards safer more efficient and flexible nuclear power.
Partnering with US in this project is structural integrity associates, which will perform a thermal evaluation of light bridge fuel in the S. M. R. Using its Pegasus simulation software the software. It represents a next generation fuel evaluation and design optimization tool.
Which will provide us with detailed insights into the performance of our fuel under various conditions.
I want to take a moment to express our gratitude to the U S Department of energy their financial support through that nuclear Energy University program. R&D Awards has been instrumental in enabling this research and experimental work.
This is the second year in a row that light bridge fuel has been selected for evaluation in an EU study as we continue to work today with these.
These kinds of collaborative projects are an important component of advancing our nuclear technology understanding and capabilities.
Overall, we are confident that this project will yield critical insights into the performance of light bridge fuel and new scale SM ours. These insights will help inform our future research and development and ultimately we believe they will contribute toward paving the way for widespread commercial adaptation of next.
Generation nuclear fuel technology, strengthening our ability to provide safe efficient and sustainable nuclear energy.
In addition to our achievements in R&D.
Government approved <unk> request to join two pivotal public private nuclear power partnerships.
The first of these partnerships is with the department of Energy's high assay low enriched uranium consortium or Halo consortium.
Achieving a national Halo stockpile and production capacity is a key step in supporting advanced nuclear energy technologies like the ones we're developing.
The consortium is focused on streamlining the production and use of Halo in the U S aiming to promote energy security on sustainability.
Both of which are pivotal to our strategic vision by.
By joining this consortium, we are now part of an industry, leading group of companies and organizations focused on advancing availability of this critical feedstock material also just mention that just before we started this call a few minutes ago. The U S Senate voted on a bill to support it.
Creasing enrichment capacity in the U S for Halo and it passed in the Senate and the vote was 96 to three reflecting widespread bipartisan support for nuclear power.
I also want to mention a second partnership that we've entered into with the U S Department of Commerce International trade administrations FMR working group. This working group brings together industry leaders in the field of SMS ours, just facilitate international trade and cooperation.
As a member we gain opportunities to influence policies and initiatives that affect the SMB market and we can contribute to setting global standards for this emerging industry given the rising demand for <unk> in Europe and globally. We believe this position working within the working group will help us understand.
<unk> better semi related technologies to see how light bridge fuel can best fit into international deployment plans for SMS.
And Additionally, I was reappointed by the U S Secretary of Commerce, Gina Raimondo to the U S. A civil nuclear trade Advisory Committee, our syntech as a member I'll continue to provide advice for developing and administering programs to expand U S exports of civil nuclear goods and services.
All of these partnerships place late bridge squarely at the Nexus of public policy and private innovation in the nuclear energy sector. They will not only help us to continue to develop light bridge fuel, but will also give us an influential role in shaping the future of nuclear power both in the United.
<unk> and internationally.
As we take meaningful strides in our development. We have also been strengthening our team with industry leading talent.
On April 25th we were thrilled to welcome Dr. Scott Holcomb to light bridge as Vice President of engineering with his distinguished career and profound experience in the field of nuclear engineering and irradiation testing experiments, Dr. Hulk and brings a wealth of expertise that will be instrumental in driving our fuel development.
Let me endeavors forward, Dr. Hogan will not only provide technical leadership, but will also influence our strategic direction as we strive to redefine the future of nuclear energy.
On April three we were equally delighted to have Sherry Goodman join our board of directors with Goodman is a renowned expert for her comprehensive knowledge and vast expertise in the intersecting domains of National security energy and environmental issues. Her inclusion in our board brings a unique.
That will enhance our ability to navigate the complexities of her global energy landscape in her role Ms. Goodman will chair the newly constituted energy security and National Security Committee of the Board. This committee will play a vital role in advising our organization on matters of energy security.
And related National security issues and sharing that we are not only providing innovative energy solutions, but are also contributing to positively.
Also contributing positively to the global energy security landscape.
Turning to our strong patent portfolio during the second quarter, we received a notice of allowance for a divisional patent relating to life <unk> innovative metallic nuclear fuel assemblies from the U S patent and trademark office. This expands our intellectual property portfolio with more than 100 <unk>.
60 patents and is an integral component of the company's plans to commercialize <unk> fuel technology in the future.
I will turn the call over to Andrey <unk> <unk> executive VP for nuclear operations to review, our ongoing fuel development activities Andrei.
Thank you Seth as previously announced we have been working since last December with Zydeco National Laboratory.
Under the umbrella of strategic partnership project agreement and an umbrella cooperative research and development agreement to support the development of language fuel.
Earlier this year, we worked with vital National Laboratory.
To complete an issue quality implementation plan for.
For the project. This was an essential first step to ensure that all future work performed at Idaho National Laboratory on the project.
U S nuclear regulatory commission quality assurance requirements.
We're working with right now.
The demonstrate cash Jim.
Belka phase uranium zirconium ingots.
<unk> uranium using existing equipment as part of that effort.
Have recently been able to cash through initial ingots using depleted uranium zirconium alloy materials.
Currently undergoing characterization. Our next step is to scale up the ingot size to make it suitable for extrusion and then come back to the initial exclusions from the scale that you can get.
In addition to our project with Idaho National Laboratory at Seth mention language is collaborate and was thanks for spam University <unk>.
Scale power and structural integrity first hit on the 1 million study funded by the U S Department of outages nuclear energy and University program R&D Awards.
The second collaboration for Lionbridge for the U S University.
As we previously announced.
So having ongoing collaborative project with MRI.
Sure I'll briefly describe the new collaborative project with Texas A&M the project in <unk> comprehensive characterization or.
The performance of the language helical cruciform advanced fuel design mutual January two unique sets of experimental data of friction factor low and heat transfer behavior and the newest chaos lightwater small modular reactor accumulate at normal end of normal conditions.
<unk> is expected to accelerate the deployment of advanced fuels for why to what they're asked to marsh applications by leveraging the use of existing infrastructure measuring basic thermal hydraulic brokerages et cetera.
The ongoing study led by Mike.
The second study.
Relates to relation of accident tolerant fuels and various types of small modular reactors.
The project that we are collaborating with <unk> aims to simulate the few of them safety performance of <unk> fuel for the new scale small modular reactor and provide scope and analysis to improve the safety and economics of light water reactor small modular reactors.
With that I'll turn the call over back to you Sir.
Hello Andre.
Thank you Andre.
Global efforts to attain net zero carbon targets championed by both government and private entities have led to a policy shift favoring nuclear power.
The ongoing war in Ukraine has magnified global energy problems and amplified apprehensions regarding energy security there.
Therefore nuclear power is being increasingly perceived as a pivotal element and accomplishing national security energy and climate objectives, more so than renewable energy sources.
Nuclear power allows for a responsible amplification of clean reliable baseload electricity production with zero carbon emissions.
This energy source also minimises reliance on nations that can disrupt fossil fuel supplies.
Countries throughout North America, the European Union in Asia have begun initiatives to extend nuclear plant licenses.
Initialized reactors.
And construct new facilities.
We seem to be waking up to the realization that they can't meet their national security energy, our climate goals without a significant increase in nuclear power.
And now we're seeing that this is starting to happen just in the last month, we saw the UK launch great British nuclear initiative, a competition to help drive the expansion of new nuclear power plants in the U K, which has set a target of 25% of its electricity from nuclear energy by 2050.
We also saw Poland approve its first nuclear power plant based on our new scale FMR.
In the U S Marine Corps, Nic President and CEO of the nuclear Energy Institute testified before the house energy and Commerce Subcommittee on energy climate and grid security during a hearing titled American nuclear energy expansion updating policies for efficient predictable.
Licensing and deployment.
The hearing highlighted the resounding bipartisan endorsement for nuclear energy and mutually recognize significance. It holds for our national energy and security considerations.
During the hearing committee members from both political parties. They are mentally emphasize the urgent necessity to reassert U S dominance in nuclear technology.
This can be achieved by modernizing the nuclear regulatory commissions operations for increased efficiency and process simplification, securing a reliable and safe domestic fuel supply and strengthening U S competitiveness in the international nuclear market.
These are objectives that we fully and enthusiastically back.
This is an exciting time for the nuclear industry and particularly for Lionbridge, we look forward to updating investors on the progress we will make throughout the year now ill turn the call over to Larry Goldman Chief Financial Officer to summarize the company's financial results Laurie.
Thank you Seth and good afternoon, everyone.
For further information regarding our second quarter 2023 financial results and disclosures. Please refer to our earnings release that we filed yesterday.
The company's working capital position was $28 million at June 30 of 2023 versus $28 7 million at December 31 2022.
Total assets were $29 2 million and total liabilities were <unk> 6 million at June 32023.
Today, we have ample working capital and financial flexibility to support our near term fuel development expenditures.
This is very important to light bridge, and our stockholders as well as our external stakeholders such as the federal government to ensure that we have sufficient working capital as well as the ability to access capital in the future in order to conduct our future R&D activities.
Total cash and cash equivalents was $28 2 million as compared to $28 9 million at December 31, 2022, a decrease of <unk> 7 million for the six months ended June 32023, as compared to the prior period due to the following.
Total cash used in operating activities for the six months ended June 32023 was $3 million a decrease of <unk> 1 million compared to $3 1 million for the prior period in 2022.
Total cash provided by financing activities for the six months ended June 30 of 2023 was $2 3 million a decrease of $5 3 million compared to the $7 6 million raise for the prior period in 2022.
This decrease was due to the decrease in net proceeds from the issuance of our common stock by our aftermarket facility.
Regarding our P&L financial information net loss was $1 7 million for the second quarter ended June 32023, compared to $1 5 million for the second quarter 2022 due to the following.
Total R&D expenses amounted to <unk> 4 million for the second quarter June 32023, as compared to <unk> 2 million for the second quarter June 32022, an increase of <unk> $2 million.
This increase was primarily due to an increase in project labor costs incurred from the U S National laboratories.
One 1 million an increase in R&D payroll up point 1 million an increase in consulting fees of <unk> 1 million offset by a decrease in other R&D costs of <unk> 1 million.
Total G&A class, one $1 6 million for the second quarter June 30 of 2023 as compared to $1 4 million for the second quarter June 30 of 2022.
There was an increase in stock based compensation of <unk> 1 million and an increase in professional fees of <unk> 1 million.
Total other income was <unk> 3 million for the second quarter June 32023, as compared to zero for the second quarter to 32022. This increase was due to an increase in interest income earned from the purchase of our Treasury bills and our bank savings account.
In support of our long term business and future financing requirements with respect to our fuel development. We expect to continue to seek government funding in the future along with new strategic alliances that may contain cost sharing contributions and additional funding from others.
In order to help fund our future R&D milestones, leading to the commercialization of light bridge fuel back to use that well. Thank you Larry.
And with that we will go to the question and answer session. Thank you to everyone who has submitted questions. Matt. Please go ahead with questions.
Okay. Our first question.
Our both the metallic bonded cladding and full casting method being examined for lionbridge fuel testing or has one been determined or both the three and four low versions of <unk> fuel being evaluated.
Well I'll, let first part our ongoing work at Idaho National Laboratory under the existing statement of work includes both casting and extrusion of Unclad coupon samples. The initial irradiation testing in the advanced test reactor will include fuel material coupon samples can.
Apprised of Delta phase enriched uranium zirconium alloy materials, which is similar to the fuel material composition to be ultimately used in the commercial fuel product.
The purpose of this initial experiment is to generate or aviation performance data for light bridges Delta phase uranium zirconium alloy relating to various thermal physical properties.
The data will support fuel performance modeling and regulatory licensing efforts for commercial deployment of <unk> fuel.
Subsys subsequent phases of this work.
Our plan that will be.
Be under two umbrella agreements with Idaho National lab to be released in the future and these will include post irradiation examination of the irradiated fuel material coupons.
Fabricated of co extruded fully clad multi low clay bridge fuel of our outlets and loop irradiation testing of these robots in the advanced test reactor as well as transient experiments in the transient reactor test facility also known as the treat reactor at Idaho National Laboratory, and then cars.
Bonding post irradiation examination on that part of the question on the three or four low version of the fuel.
We are developing both they will be for different types of reactors that optimize fitting inside the fuel assembly geometry for those reactors. So for example for western pressurized water reactors its up for Loeb design and for Russian VR type reactors at the <unk>.
Three low design, but for each reactor.
There is a version of life retrieval, that's optimized for that reactor.
The second question.
How does <unk> compare and contrast <unk> fuel.
Well you know.
They are very different.
<unk>.
The.
First of all three so try so I hear pronounced both ways I, usually say trace out.
And they're meant for different reactor applications for different types of reactors.
<unk> stands for Tri structural ISO tropic.
And as a coded particle fuel and its generally firm.
High temperature reactor designs that include high temperature gas cooled reactors.
Fluoride salt called high temperature reactors.
There are several so called generation four and micro reactor designs in development by companies that include ex energy Westinghouse BWXT Cairo's power.
Now none of these reactors have yet been deployed in contrast light bridge fuel can be used in both the existing fleet of water cooled reactors, such as Pwc at BW ours, and can do as well as Russian Vv ours, as well as future water core small modular reactor.
<unk> of these types of technologies like <unk> that are currently under development by companies like new scale developing their <unk> GE Hitachi developing the <unk> 300 reactor and other companies like Rolls Royce and whole tech that are developing PW.
<unk>.
And for our final question.
Is there a rough estimate for the cost of <unk>.
Fitting existing fleet reactors to accept the acreage fuel.
$85 million.
<unk> seen.
Siemens has a subsidiary called pace global that performed an economic study of light bridge fuel looking at the cost of retrofitting a typical existing 1100 megawatt pressurized water reactor typical large reactor that's running in the world today for use of light bridge fuel and you can ask.
See this study on the.
<unk> website under the technical articles.
And the Siemens subsidiary pace Global estimated a one time upfront cost of $85 million per reactor to accommodate light bridge fuel capable of a 10% power uprate. So the reactor plus a 24 month fuel cycle extended from the reactors existing 18 month fuel cycle.
So.
That's.
Sure.
That's how we think.
Excellent.
Excellent advantages for the cost for the utility that has the reactor and other advantages.
The capital cost is zero for the nuclear power plant to get the longer fuel cycles, which will extend the fuel cycle from 18 to 24 months plus the significantly improved safety margin associated with Lionbridge fuel that all accomplished with the fuel.
The nuclear power plant on car some upfront costs relating to regulatory licensing procedure updates training as part of the conversion to Hawaii Bridge, Phil, but basically we expect our fuel will be a drop in substitute.
In the case of the fuel cycle extension only.
And with that that was the last question that I want to thank everybody for participating on today's call. We look forward to providing additional updates in the near future in the meantime, we can be reached at IR at <unk> Dot com stay safe and well.
Goodbye.
This concludes today's conference. Thank you all for joining you may disconnect everyone have a great day.
Okay.
[music].
Okay.