Q3 2023 Fusion Fuel Green PLC Earnings Call
Speaker 1: My name is Ben Schwartz and I'm head of investor relations at Fusion Fuel.
And I'm head of Investor Relations as diesel fuel.
Speaker 1: I would first 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, industry performance and other factors which cannot be predicted. Forward-looking statements are inherently subject to risk.
I would first 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.
Sales margins competitive factors industry performance and other factors, which cannot be predicted forward.
Forward looking statements are inherently subject to risks.
Speaker 1: uncertainties and assumptions and they are not guaranteed performance and encourage you to read the disclaimer slide in the investor presentation for discussion of the risks that may affect our business or may cause our assumptions to prove incorrect. The company's under no obligation and expressly disclaim any obligation to update alter or otherwise revise any further statements whether as a result of new information feature events or otherwise except as required by law.
Uncertainties and.
Assumptions and they are not guarantees of performance and encourage you to read the disclaimer slide in the Investor presentation for a discussion of the risks that may affect our business or may cause our assumptions prove incorrect the company's under no obligation and expressly disclaims any obligation to update alter or otherwise revise any forward looking statements whether as a result of new information future.
For events or otherwise, except as required by law.
Okay. So.
Speaker 1: So greetings, thank you all for joining us today. In terms of our agenda for the next hour, I'll pick things off with an overview of Fusion Fuel, along with some perspectives on what we're seeing in the market currently. Gavin and Federico, Fusion CFO and CEO , respectively, who will then share their quarter highlights financial results and commercial updates.
Greetings. Thank you all for joining us today in terms of our agenda for the next hour I'll kick things off with an overview of fusion fuel along with some perspectives on what we're seeing in the market currently Gavin and Federico <unk> CFO and CEO, respectively will then share third quarter highlights financial results and commercial updates before wrapping up with a recap of our <unk>.
Speaker 1: before wrapping up with a recap of our 2023 priorities and our progress against them.
2023 priorities and our progress against them. We'll then open up the floor for a facility to Q&A.
Speaker 1: We'll then open up the floor for a facilitated Q&A. As the previous quarterly calls, questions can be entered in the chat box in the WebCAD platform at any point during the next hour.
Our previous quarterly calls questions can be entered in the chat box in the webcast platform at any point during the next hour. Alternatively, you can also submit your questions to the Investor Relations team.
Speaker 1: You can also submit your questions to the investor relations team at the IR mailbox, that's fusion-fuel.edu.
At the mailbox IR at fusion dash fuel dot in EU.
So as always lets begin with a brief refresher on future fuel our value prop positioning in the green hydrogen sector.
Speaker 1: So it's always let's begin with a brief refresher. Fusion fuel, our value prop positioning in the green hydrogen sector. So our mission is to make the energy transition more accessible to development and develop delivery of cost effective clean hydrogen solutions.
Our mission is to make.
The energy transition more accessible to the development and delivery of cost effective clean hydrogen solutions.
Speaker 1: Our patent did miniaturize thermal electrolyzer, the Hevo, that the hearts of everything we do, it simplifies, and modular architecture is a unique differentiator in a crowded electrolyzer market, one that unlocks multiple sources of advantage for us, including high-food, throughput, industrialized production, and a scalable building block approach that positions us to create, customize it for purpose hydrogen solution.
Our patented miniaturize, Tim Electrolyzed with Evo to the heart of everything we do is simplified and modular architecture is a unique differentiator in a crowded electric wiser market when that unlocks multiple source of advantage for us, including high throughput industrial less production and a scalable building block approach positions us to creep.
<unk> customized fit for purpose hydrogen solutions, we built a robust pipeline of actionable near term green.
Speaker 1: We built a robust pipeline of actionable near-term green hydrogen projects in our core market of Southern Europe , enabling us to create our own demand for our technology. Many of these foundational projects have significant grant funding tied to them, strengthening and de-risking the business case for third-party investors.
Green hydrogen projects in our core market of southern Europe, enabling us to create our own demand for our technology. Many of these foundational projects have significant grant funding tied to them strengthening and Derisking the business case for third party investors.
Speaker 1: We have a differentiated and synergistic business model that fits us across the value chain. In addition, filling up a proprietary technology to third party customers, we also originate and develop green action projects from start to finish.
We have a differentiated and synergistic business model positioned us across the value chain. In addition to selling our proprietary technology to third party customers. We also originate and develop green hydrogen projects from start to finish.
Speaker 1: with diverse avenues for monetizing, value creation, along the development cycle.
With diverse avenues for monetizing value creation, along the development cycle and.
Speaker 1: And finally, we have positioned for a significant growth ramp as the market continues to mature with an extensive long-term project pipeline and a world-class production facility with the limited Portugal, where we're targeting 500 megawatts by Charles's production per annum by the end of 2025.
And finally, we are positioned for significant growth as the market continues to mature.
With an extensive long term project pipeline and a world class production facilities located in Portugal.
We're targeting 500 megawatts electrolysis production per annum by the end of 2025.
Speaker 1: Despite the promise thing, the next five please, long-term tailwinds behind the Green Hyder opportunity, the industry is grappling with a number of fundamental challenges that threaten its trajectory. Brand-in project delays, an electrolyzer under performance, a scarcely affirmed projects and off-the-agreements are about a handful of roadblocks, the industry has had to navigate as early movers work to deliver on the lofty expectations they've set.
Despite the promising the next slide please long term tailwind behind the green hydrogen opportunity. The industry is grappling with a number of fundamental challenges that threaten is trajectory.
Ramp and project delays.
Electric wiser on performance, especially at firm projects and off take agreements or about a handful of roadblocks industry has had to navigate as early movers work to deliver on the lofty expectations set.
Speaker 1: Nevertheless, with the development with the velocity rather of our project pipeline and our unique technology, among other things, we believe we are uniquely positioned to overcome these obstacles. And in many cases, we had a meaningful head start in doing subcompared to our peers. So with that, I'll now introduce Gavin Jones, the above fusion field of shares and highlights from the third quarter of 2023. So
Nevertheless, with the development with the velocity rather of our project pipeline.
And our unique technology.
Other things we believe we are uniquely positioned to overcome these obstacles and many cases, we have a meaningful head start in doing so compared to our peers. So with that I'll now introduce Kevin Jones, CFO fusion fuel, but share some highlights from the third quarter of 2023.
Thank you Ben.
Good afternoon or morning to all of you who joined our turns quarter investor update call joining today from our offices in items.
Speaker 2: Good afternoon, or morning to all of you who have joined our third quarter investor update call. I'm joining today from our offices in our...
Speaker 2: During the third quarter, we were awarded a technology sale contract to supply a 300 kilowatt electrolyzer and balance of plant system from a leading global building solution supplier.
During the third quarter, we were awarded a technology sale contracts to supply 300 kilowatt election lines around bonds upon system from a leading global buildings <unk>.
<unk> supplier.
Speaker 2: We also entered into a partnership with Elemental Clean Fools, a company focused on originating and developing clean fuel projects in North America.
We also entered into a partnership with elemental team films, a company focused on originating and developing team fewer projects in North America.
Speaker 2: This partnership will provide fusion fuel with exposure to the emerging North American green hydrogen markets and adds to where existing partnership would do furrowing it lead while enabling the company to focus its near-term commercial efforts on the Iberium Peninsula and Northern Europe .
This partnership will provide <unk> with exposure to the emerging North American green hydrogen markets, and Thats, where existing partnership with <unk> in Italy, plus enabling the company to focus its near time near term commercial efforts on the Iberian Peninsula in Northern Europe.
After the end of the third quarter, we received two separate purchase orders for a combined $4 2 million euros in revenue.
Speaker 2: After the end of the third quarter, we received two separate purchase orders for a combined 4.2 million euros of revenue.
Speaker 2: These projects will service customers in Portugal and will include the supply of our Heavocaine products along with balance of plant equipment and EPC services and will each represent a 1.25 megawatt.
These projects will service customers in Portugal, and will include the supply of our hemo chain pumps, along with balance of plant and equipment on EPC services.
And with each represented a 125 megawatt system.
When I spoke with you back in early September I commented that we were in discussions with both existing and prospective capital providers about financing solutions.
Speaker 2: When I spoke with you back in early September , I commented that we were in discussions with both existing and prospective capital providers about financing solutions.
Speaker 2: We are pleased to share that we have entered into an agreement with McQuarrie on a financing facility of up to 20 million US dollars, which we announced last week.
We are pleased to share that we have entered into an agreement with Macquarie on a financing facility of up to $20 million U S dollars, which we announced last week.
This agreement represents the culmination of a due diligence process that span multiple months.
Speaker 2: This agreement represents the culmination of a due diligence process that's banned multiple months.
We are very pleased with the terms of this facility and perhaps equally as importantly, the stature and quality of the counterparty of Macquarie.
Speaker 2: We are very pleased with the terms of this facility and perhaps equally as importantly, the stature and quality of the counterparts in the quarry. This is a convertible debt.
This is a convertible debt facility with a two year term.
The drawdowns will be done on a phased basis with the size of each tranche to be mutually agreed by both parties, depending on our cash flow needs at the time.
Speaker 2: The drawdowns will be done on a face basis with the size of each tranche to be mutually agreed by both parties. Depending on our castle needs.
Speaker 2: Requiring would receive warms equal to 30% of the aggregate immense funds.
<unk> received warrants equal to 30% of the aggregate aggregate amount funded.
Speaker 2: The warrants will have an exercise price equal to 130% of the volume weighted average price for the five trading days immediately proceeding and each branch.
Warrants will have an exercise price equal to 130% of the volume weighted average price for the five trading days immediately preceding and each tranche issuance.
Speaker 2: There are certain conditions that must be met before we operationalize the facility. So she's completing the required SEC five.
There are certain conditions that we that must be met before we operate operationalize this vicinity such as completing the required SEC filings. We are working on these and expect to close during the first quarter of 2024.
Speaker 2: We are working on these and expect to close them during the first quarter of 2024.
This facility will provide us with the capital needed to execute our 2024 objectives.
Speaker 2: This affinity will provide us with a capital needed to execute our 2024
Speaker 2: We will now move on to the financial results for the third quarter. Please note that all values discussed are in euros on the stated order wise.
We will now move onto the financial results for the third quarter. Please note that all values discussed or in euros on a stated otherwise.
Speaker 2: We recognize 2.5 million and rad knee during the third quarter.
We recognized $2 5 million in revenue during the third quarter.
Speaker 2: This represents the revenue related with our green hydrogen projects in Madrid.
This represents a revenue related with our green hydrogen projects in midrange.
Traditional assessments of this project was achieved in September of this year.
Speaker 2: for visual acceptance of this project with achieves in September of this year.
Speaker 2: Of the 2.5 million recognized, 0.7 million is accrued and this past is expected to be received within the next 60 days.
Well the $2 5 million recognized zero point $7 million of crudes and this cash is expected to be received within the next 60 days.
Speaker 2: Back in the first quarter of 2023, we recognize revenue relating to a technology sale contract.
Back in the first quarter of 2023, we recognize revenue relating to a technology sell contracts our customers intention was to complete this project as part of Portugal is possibly your program.
Speaker 2: Our customers' intention was to complete this project as part of Portugal's Poso Europe program.
During the third quarter. It became apparent that this project would not proceeds as it wouldn't be completed within the timeframe set at in their cramped agreement with the Portuguese government.
Speaker 2: During the turf quarter, if we ten apart, this project would not proceed, as it wouldn't be completed within the time frames set out and their grant agreement with the Portuguese.
Speaker 2: We reversed the revenue and associated cost of goods sold for this contract during the third quarter, and this reversal is shown as part of the second quarter volume for comparative purposes.
We reversed and revenue and associated cost of goods sold for this contract during the third quarter and this reversal is shown as part of the second quarter Cardiome for comparative purposes.
The revenue reversal managed $2 5 million.
Speaker 2: 0.5 million. Please note that we sit expect to complete the sale with this client for furniture project they have planned.
Zero point $5 million. Please note that we said expect to complete the sale with this client for furniture project they have plants.
As you May remember from our second quarter Investor presentation, we booked a provision for impairment of $7 2 million against our legacy Heber solar inventory.
Speaker 2: As you may remember from our 2nd quarter investor presentation, we booked a provision for impairment of $7.2M against our legacy Hevo solar investment.
During the third quarter and into the fourth quarter, we've continued to sell our scrap this legacy equipment.
Speaker 2: During the third quarter and into the fourth quarter, we've continued to sell or scrap this legacy equipment. We expect this process to continue.
We expect this process to continue for the foreseeable future.
Speaker 2: The inflows receive this part of this process having all set by an increase to the provision of 0.5 million turns.
The inflows received as part of this process have been offset by an increase to the provision of.
Wound part.
<unk> 5 million during the third quarter.
Our operating cost base decreased for the third consecutive quarter we.
Speaker 2: Our operating cost-based decrease for the turquish consecutive course.
Speaker 2: We saw a reduction to our personnel related costs of 0.26 million when compared to this items related to this gas??? mieli
We saw a reduction to our personnel related cost since <unk>, two 6 million when compared to the second quarter.
This was due to the continued reduction in our head count coupled with the fact that the second and fourth quarter typically a higher cost due to vacations substances subsidies being paid to our Portuguese based employees.
Speaker 2: This was used to the continued reduction in our headcount, coupled with the fact that the second and fourth quarter typically have higher cost, due to vacation, socials, socials, being paid to our Portuguese-based employees.
Speaker 2: This is covered in further reductions to travel, administrative, legal and consulting fees, but with some law offset by an increase in warranty expense.
This was coupled with further reductions to travel administrative legal and consulting fees, but was somewhat offset by an increase in R&D expenses.
Speaker 2: Our quarterly charge relating to our equity incentive time increased by 0.28 million during the turn.
Our quarterly charge relating to our equity incentive time increased by 0.2 dollars 8 million during the third quarter.
The second quarter amount was lower due to a one off reduction for the forfeiture of a significant number of instruments.
Speaker 2: The second quarter amount was lowered due to a wound-off reduction for the forefisher of a significant number of events.
Speaker 2: There were no new awards during the throw quarter and none expected for the four.
There were no new awards during the third quarter and unexpected for the fourth quarter.
Speaker 2: We expect a non-tash quarter to expense was 0.6 million for legacy share-based compensation until the end of 2024. The pre-tech clause.
We expect a noncash quarterly expense was <unk> 6 million for legacy share based compensation until the end of 2024.
The pretax loss for the quarter amounted to $4 million.
In terms of the balance sheets.
Speaker 2: The increased property property equipment is driven by the booking of new equipment that was invoiced during the quarter for our then advantage reduction facility. This increased the value of this
The increase in property plant and equipment is driven by the booking of new equipment that was invoiced during the quarter for our <unk> production facility.
This increase the value of this asset by $2 8 million.
The inventory balance shown as net of the impairment charge, which was discussed earlier.
Speaker 2: The inventory balance shown is net of the impairment charge which was the school serve.
The significant decrease since the second quarter is down to the revenue recognized.
Speaker 2: The significant decrease since the second quarter is down to the revenue recognized.
Speaker 2: Until we recognize this red new, the equipment used related to this red new was recognized as part of him.
Until we recognize this revenue equipment use related to this revenue was recognized as part of the inventory.
Yeah.
Our bank balance was just over 1 million on September 30th.
Speaker 2: Our bank balance was just over 1 million on September 30th.
Speaker 2: Since then, we've received 2.1 million in grant funding with a further amount of 0.4 million due, in addition to client inflows before the year's end.
Since then we've received $2 1 million in grant funding with a further amount of zero point for them and in June.
In addition to client inflows before the years ash.
Speaker 2: We have significant grant demands expected for 2024, which will mostly be to reimburse us for spend, relating to OR&D and our Venn event introduction to Sillis.
We have significant grant demand is expected for 2024, which will mostly be to reimburse us for spend relating to R&D and our benavente production facility.
Given that we are now receiving customer inflows monkey, we're satisfied that the operational inflows coupled with the drawdowns from them or party facility will enable us to have a strong 2024.
Speaker 2: Given that we are now receiving customer employees monthly, we are satisfied that the operational inflows coupled with the drawdowns from them are part of the facility will enable us to have a strong 2020.
Theater notable movements enthuse, a reduction of $2 million in the fair value of warms and.
Speaker 2: The outer notable movements include a reduction of too many in the inferior body of warm.
Speaker 2: An increase to trade tables as we book the equipment for Benaventa as mentioned above.
An increase of trade payables as we book the equipment for Benevento. He has mentioned to both.
Speaker 2: and ground income of 2.3 million receipts during the third quarter.
And grant income of $2 3 million received during the third quarter.
Over 16 trading days in the third quarter, we raised 0.6 million cumulatively by selling 376000 ordinary shares through our ATM facility.
Speaker 2: Over 16 trading days in the third quarter, we raise 0.6 million cumously by setting 376 thousands or maybe shares through our ATM facility. No sales have been...
Sales have been made since September 20th.
Next slide please.
Speaker 2: We revised our 2020 treat guidance in the second quarter and we expect this guidance to hold true.
We revised our 2023 guidance in the second quarter and we expect this guidance to hold true.
We have significant equipment to deliver during December for two active technology cell contracts.
Speaker 2: We have significant equipment delivered during December for two acts of technology sales.
For 2024, we expect to recognize revenues of $34 million.
Speaker 2: For 2024, we expect to recognize revenues of 34 million.
This slide shows.
Speaker 2: This total can be attributed to two different categories.
This total can be attributed to two different categories techs.
Speaker 2: Technology and balance of plant equipment sales and the sale of projects from our own portfolio.
Technology and balance of plant equipment sales and the sale of projects from our own portfolio.
The technology and balance of plant demands are already box by committed orders.
Speaker 2: The technology and balance of plant demands are already backed by committed order.
Speaker 2: We have not included any estimate of further equipment sales from our pipeline. As if we were awarded contracts, the timing of revenue recognition is two-one certain.
We have not included any estimate of further equipment sales from our pipeline as if we were awarded contracts the timing of revenue recognition is too uncertain right now.
Speaker 2: For those familiar with our development project pipeline, we have two projects in CNES Portugal that have been awarded a combined $32.5 million in grant funding from the Portuguese government.
For those familiar with our development project pipeline, we have two projects and seen as Portugal and Athene.
Awarded a combined $32 5 million in grant funding from the Portuguese government.
The revenue guidance for 2024, it seems that we will set our CNS one project, two and infrastructure funds and convert the project into a technology sale that will include balance of plant and EPC services.
Speaker 2: The revenue guidance for 2024 assumes that we will sell our CNS-1 project to an infrastructure fund and convert the project into a technology sale that will include balance of plans and EPC services.
Speaker 2: Frederica will touch upon the status of our technology at Under development project pipeline for Little Lake.
Federico will touch upon the status of our technology.
Development project pipeline to enter the later.
Speaker 2: From a call's perspective, we continue to work through our budget for 2024.
From a cost perspective, we continue to work through our budget for 2024, it's.
It's imperative that we keep our costs are slim as possible given the general uncertainties in the global hydrogen economy.
Speaker 2: It's imperative that we keep our costs as soon as possible given the general uncertainties in the global high-duty economy.
Now we have a lower cost base when compared to our competitors and we are working to reduce this further.
Speaker 2: Right now we have a lower cost baseline compared to our competitors and we are working to reduce this further.
Speaker 2: when I've diluting the quality of our products and unfit a reserve.
Diluting the quality of our products and ancillary services.
As noted earlier, our cost bases were keys for three consecutive quarters, and we will look to continue this trend into 2024.
Speaker 2: As notice earlier, our call space has reduced for treat consecutive quarters. And we will look to continue this friend into 2024.
Speaker 2: Our goal continues to be reaching cash flow self-sufficiency as quickly as possible and keeping costs low is critical to achieve.
Our goal continues to be reaching cash flow self sufficiency as quickly as possible and keeping costs low is critical to achieving this.
I will now pass you over to our CEO Federico who will guide you through the rest of the presentation.
Speaker 2: I would not pass you over to our CEO , Frederic Bilbo, who will guide you through the rest of the presentation.
Yeah.
Thank you Kevin.
And good afternoon, good morning tool.
Speaker 2: and good afternoon, good morning to you all. I'm pleased to share with you today the latest news from the numerous activities we have going on.
Please to share with you today the latest news from the numerous activities we have going on.
I want to note that many people speak about green hydrogen and announced launch future pumps.
In reality very few companies have transferred aligned and producing green hydrogen today and few have the expertise to install the green or green hydrogen pumps safely.
Through the process of having the Madrid 12 months, we have seen firsthand the benefits of our modular solution.
Speaker 3: Through the process of having the Madrid plant life, we have seen first hand the benefits of our modular solution. With the occasional feeding problems of the plant, only causing the loss of a few days of production, rather than full pound shutdowns as others have suffered.
With the occasional teething problems with the phones only causing the loss of a few days of production rather than full plant shutdowns as all of those have suffered.
We have the pleasure of having hydrogen plants in Portugal, and Spain as well as in the laboratory that is not only testing. The next generations of materials for future heap of releases, but it's also ensuring we run thousands of hours on our existing versions to ensure degradation rates and material behavior.
During 2024, we expect to put at least another six green hydrogen plants in operation.
Speaker 3: The experience from these first projects from our lab and our own production facility has been critical to close these contracts.
We experience from these first projects formula and our own production facility has been critical to close these contracts.
Speaker 3: I would like to highlight today our engineering capabilities.
I would like to highlight today, our engineering capabilities.
As they all know suddenly a differentiating suppressed facing factor, but have also been a crucial one and closing the various equipment sales would have signed.
Speaker 3: as they are not only a depression, depression is impactor, but have also been a crucial one in closing the various equipment sales with time.
Speaker 3: Few clients have the experience and knowledge required to design, implement and go live with a fully-fledged green hydrogen pump.
Few clients have the experience and knowledge required to design implement and go live with a fully fledged green hydrogen pumps.
Speaker 3: In addition to submitting, the electrolyzer proposals for over 4-3 projects, our engineering team has fully designed more than 10 green hydrogen parts and water on Spain today.
In addition to submitting electrical as the proposals for the 40 projects. Our engineering team is fully designed more than 10 green hydrogen plants in Portugal, and Spain to date.
This includes our Texan has of studies licensing processes and fully defining the specifications, but all equivalents in the pumps.
Speaker 3: This includes atex and has-optos, licensing processes, and fully defining the specifications for all equipment in the park.
Given the challenges with some hydrogen projects have experienced recently using an experienced and proven player is of increasing value to clients.
Speaker 3: Given the challenges that some hydrogen projects have experienced recently, using an experience improvement player is of increasing value to pile.
Speaker 3: This allows us to create a partnership with clients that goes beyond simply delivering equipment.
This allows us to create a partnership with clients that goes beyond simply delivering equivalents.
We have already received request for engineering orders in services, where a client wants us to review the pump design. In addition to request a fully developed engineering solutions for even alkaline electrolysis systems.
Speaker 2: We have already received requests for engineering auditing services where a client wants us to review their font design. In addition to requests that fully developed engineering solutions for even alkaline electrolytes.
Speaker 3: This confidence and trust in our engineering capabilities will not only be a major selling point for Fusion Fuel, but we expect to generate independent revenues from these services as earlier as next year.
This confidence and trust in our engineering capabilities will not only be a major selling point institution tool, but we expect to generate independent revenues from these services is obvious next year.
More and more the proposals request, we are receiving a full plan designs and these tailored to the specific product requirements.
Speaker 3: More and more, the proposal's requests we are receiving are for full-time designs. And these tailored to the specific climate requirements.
We have designed pumps with hydrogen usage at a pressure of two bonds as well as long, reaching even 1000 Bucks.
Speaker 3: We have designed plants with hydrogen usage at a pressure of two bars as well as one reaching even a thousand bars.
Speaker 3: and also various sizes from 300 kilowatt plants all the way up to 10 megawatt with bar.
And also of various sizes from 300 kilowatt phones, all the way up to 10 megawatts so far.
Speaker 3: The use cases include taunts for hydrogen mobility, gas funding, two trailer filling and for use in industrial furnaces.
The use cases include plans for hydrogen mobility gas funding to print.
<unk> filling in for use in industrial furnaces.
Speaker 3: What you see here are renders from three of the ten projects that the team has designed and provided full specifications for.
What you see here of renders from three of the 10 projects that the team has designed and provides.
Abided full specifications pool.
Speaker 3: In an initial step, we provide preliminary engineering for the equipment in offer. And then we charge for engineering services for detailing and designs beyond stage one.
And then initial Seth will provide preliminary engineering for the equipment.
In Alpha and then we charge for engineering services for detailing and designs beyond stage one.
Yeah.
They are all companies that can deliver this type of expertise.
Speaker 3: For markets, there are a few companies that can deliver the type of expertise. For markets where we do not have full engineering capabilities, we look to establish partnership with players that have a know-how for the specific market. The partnership we entered into in Italy, and also in the Middle East with TCC, is a good example of such.
For markets, where there are a few companies that can deliver the expertise for markets, but we do not have full engineering capabilities. We look to establish partnership with players that have the knowhow for their specific market. The partnership we entered into in Italy, and also in the Middle East with CCC is a good example of such cases.
Speaker 3: As we announce at the end of September , we will be delivering the 300 kilowatt green hydrogen plant for a global leader in the cement sector.
As we announced at the end of September we will be delivering a 300 kilowatt Green Hudson Collins for Oklahoma Global leader in the cement sector.
Speaker 3: This includes the Hebert chain electrolyzer along with full plant design and implementation along with local partners.
This includes the hemo train electric Nova along with full pump design and implementation along with a local partner.
Speaker 3: This plant uses our already announced Hivo chain technology in particular the CUBE solution, which is modular at 20 kilowatts per unit.
This parlance uses our already announced he will change technology, and particularly <unk> solution, which is modular 20 kilowatts per units.
Speaker 3: In the image you can see the first Hebrew chain demonstrated that has already been installed in our above pounds, which uses multiple Hebrew chain cubes in synchronized production.
In the image you can see the first hemo chain demonstrates that has already been installed in Aro broke pumps, which uses multiple hemo chain cubes and synchronize production.
In addition, it is the first call, but we will be using our new oxygen capture system.
Speaker 3: In addition, it is the first plant where we will be using our new oxygen capture system as the client has used for the green oxygen, the green oxygen spot. So we'll be using our new oxygen capture system, sorry, as the client has used for the green oxygen as well.
The client has used.
The green hydrogen oxygen spot, so abusing all new oxygen captured system sorry.
Besides as useful as the green oxygen as well.
Speaker 3: This project is currently in development and is expected to be fully in school and operational in the first half of 2024.
This project is currently in development and is expected to be fully installed and operational in the first half of 2024.
Okay.
Speaker 3: More recently, we announced the order of two 1.25 MW green hydrogen plant. So we'll also use the HEVA chain system for installation 2024 and Bortal.
More recently, we announced the order of 2125 megawatts screen Hudson pump, who will also use the Cuba change system for installation in 2024 and boardwalk.
As you can see we will not only provide electric lines of units, but also do the full plant design.
Speaker 3: As you can see, we will not only provide the electrolyzer units, but also do the full font design, PUP equipment selection and purchasing and overseas installation.
<unk> equipment selection and purchasing and oversee the installation.
We expect to book approximately 4 million euros and combined revenues from these two projects in 2024.
Speaker 3: We expect a book of approximately 4 million euros and combine revenues from these two projects in 2024.
Speaker 3: These projects consist of multiple Hebrew chain cabinets, as shown in the render, where each contains around 50 kilowatts of electrolyzer capacity.
These projects consist with multiple chemo train covenants as shown in the retina, where.
While each contains around 50 kilowatts.
Electric capacity.
Still providing significant modularity for the client and reducing costs by reducing the number of connections ballast and piping to used in the solution.
Speaker 3: still providing significant modularity for the clients and reducing costs by reducing the number of connections, bells and pifings used in the solution.
Okay.
Speaker 3: As we've said before, we made a significant push on our technology tails at the start of the third culture of this year.
As we've said before we made a significant push on our technology sales efforts at the start of the third quarter of this year.
In addition, we continued to receive requests for engineering services that we will evaluate on a case by case basis, but which we expect to generate revenues from this activity during 2024.
Speaker 3: In addition, we continue to receive request for engineering services that we will evaluate on a case-by-case basis for which we expect to generate revenues from the fact that it's each during 2024.
We have submitted around 50 proposals to third policies projects, all with the Hugo chain module of the system.
Speaker 3: We have submitted around 50 proposals to third-party projects, all with the Hiver Chain Modular System.
We do not see the industry executing more than a few very large projects in the next two years simply puts us has been demonstrated in several cases the industries not prepared for such projects and companies cannot provide the performance guarantees that allow our clients to take such such risks on a project.
Speaker 3: We do not see the industry executing more than a few very large projects in the next two years. Simply person and ask has been demonstrated in several cases, the industry is not prepared for such projects. And companies cannot provide a performance guarantees that would allow a client to take such risk on a project.
Speaker 3: We believe the next years will primarily be several, if not many. The projects below the 10-mg of size being implemented.
We believe the next few years will primarily see several if not many projects below the 10 megawatt size being implemented.
Speaker 3: This is where we have focused our commercial efforts and where we believe not only our technology shines, but it avoids us taking outside balance sheet risks when providing warranties for these.
This is where we can focus our commercial efforts.
Well, we believe not only our technology shines.
Once those taking outsized balance sheet risks, while providing warranties for these systems.
Speaker 3: As Gavin mentioned, I revenue target for 2024 is 34 million euros.
As Kevin mentioned, our revenue target for 2020 full is 34 million euros.
Speaker 3: Although I infuse major for it, given how some proceeds can only be recognised towards the end of the delivery to the player.
Although inflows may differ given household proceeds can only be recognized towards the end of the delivery to the client.
Speaker 3: These 30 4 million euros are based on the projects and activities listed on the right.
These 34 million euros based on the projects and activities listed on the right.
We already have five projects signed some.
Speaker 3: We already have five projects signed and confirmed for 2024, and we are in the negotiation phase of selling our CNES-1 project.
As confirmed for 2024, and we are in the negotiation phase of selling all seen as one product.
Speaker 3: These six projects alone would allow us to meet our targets, leaving still some room for further revenues from proposals that we are waiting to head back from and also from new engineering sites.
These six projects alone would allow us to meet autologous seizing still some room for further revenues from proposals.
Awaiting to hear back.
And also from New Engineering services.
As we have seen as previous years, the exact co volumes Batesville projects is hard to predict.
Speaker 3: As we have seen these previous years, the exact profile face of the project is harder to predict. And therefore, in our revenue guidance, we've only included those that have already confirmed, have been confirmed for 2024, have already started and are seen as one project. So there is still potential for upside for new sales as we, as the pipeline mature.
Therefore in our revenue guidance. We've only included those that have already confirmed opened up 2024 have already started and are seen as one product. So there is still potential for upside from new sales as we as the pipeline matures.
Yeah.
Speaker 3: We're in a position where we believe we have significantly de-risked the revenue guidance for 2024, as well as allowing us to expect cash transfers and revenue bookings from clients quarterly going forward. As opposed to the one-off bookings we have seen previously.
We're in a position where we believe we have significantly derisked the revenue guidance for 2024, as well as allowing us to expect cash concludes in revenue bookings from clients quarterly going forward as opposed to the one off bookings we have seen previously.
The hydrogen market has been slow to take off but we are seeing significant movements now and particularly in the project size. When we itself. So we are very excited to capture part of this growth as the industry really comes in Switzerland.
Speaker 3: The hydrogen market has been slow to take off, but we are seeing significant movements now, and particularly in the project size where we as well, so we are very excited to capture part of this growth as the industry really comes in with that.
To finish all I will briefly cover the strategic priorities, we heavily talent for the year and where we stand against those.
Speaker 3: So finish up, I will briefly cover the strategic priorities we had laid out for the year and where we stand against those.
Speaker 3: As I've just highlighted, we have made substantial progress in the technology sales activities with several of the proposals in the table in the client before, being for projects beyond Southern Europe .
As I've just highlighted we've made substantial progress on the technology sales activities with several of the proposals in the table in the slides before being for projects beyond Southern Europe.
With the announced tranche findings financing facility that was signed with Macquarie. We believe we'd have significantly addressed one of the largest concerns those hospital company in the last year or so.
Speaker 3: With the announced charge finding for financing facility that was signed with McCory, we believe we have significantly addressed one of the largest consensus hampered our company in the last year or so.
Speaker 3: This facility, a result of several months of due diligence and discussions, is not only with the first rate partner, but also a desire that allows us to focus on different sexibutions for the future.
This facility as a result of several months of due diligence and discussions with not only with the phosphate partner, but also besides that allow us allows us to focus on business execution for the future.
Speaker 3: In addition, the conditions for the facility, in particular with its pricing, related only to each transe executed, are fair and attractive for shareholders. They avoid the brutal dilution the way the teen and office throughout the year.
In addition, the conditions for this facility in particular with its pricing related only to each tranche executed a fair and attractive for shareholders. They.
They avoid the brutal solution that we had seen in office throughout the year.
Speaker 3: and a design is designed with enabling the company to reach its goal. Rather than simply benefiting only the part of providing the capsule, as many of the deals in this capsule-constrating environment can end up being.
And the design is designed with enabling the company to reach its goal rather than simply benefiting only the partner providing the capsule as many of the deals in this capital constrained.
<unk> can end up being.
Speaker 3: As mentioned, we've been designing projects for 5 and 10 megawatts. In theory, we can deliver larger projects using such building walls.
As mentioned, we have been designing projects for five and 10 megawatts and in theory, we can deliver larger projects using such building blocks.
Speaker 3: However, for the midterm, our focus will be on the 10 megawatt and under project. To avoid overextending ourselves.
However for the midterm I'll focus will be on the 10 megawatts and under projects to avoid over extending ourselves.
And hoping to avoid the need for large warranty provisions as we have seen from others in the market.
Speaker 3: and hoping to avoid the need for large water provisions as we have seen from others in the market.
As Kevin mentioned, we are actively reducing costs.
Speaker 3: As Gavin mentioned, we are actively reducing costs, but also throughout this process, in terms of the resource allocation in the business, matches where we see the upcoming needs and developments of the market. This is a process that is well-
But also throughout this process, ensuring that the resource allocation in the business matches, where we see the upcoming need and developments in the markets.
This is a process that is well underway, but still in progress.
Speaker 3: Therefore, we won't comment much more on this except the pay that our focus is to have an organization that is signed and driven to help us be one of the first companies to reach cash flow breakeven in the industry.
Therefore, we won't comment much more on this except to say that our focus drive an organization that is sized and driven to help.
US be one of the first companies to reach cash flow breakeven in the industry.
Gross beyond Europe and in some European markets is only possible with strong partnerships, both from a commercial and production assets.
Speaker 3: Crows beyond Europe and in some European markets is only possible with strong partnerships both from a commercial and production aspect.
Speaker 3: We've already established partnerships in North American market and for Italy and also for the Middle East as Punch-Hands and we will continue to expand these where we believe that makes strategic sense for the company.
We've already established partnerships in north in the North American market in Peru, Italy, and also for the Middle East assumptions.
And we will continue to expand these but we believe it make strategic sense for the company.
We're making substantial progress in all these key elements and we're excited to be approaching 2020 pool as we can truly highlights how much of the pivotal role fusion tool can play in this industry.
Speaker 3: We're making substantial progress on all these key elements, and we're excited to be approaching 2024. As we can truly highlight how much of a pistol role fusion fuel can play in this industry.
We will already be reaching some peers that have much higher valuations in terms of Brooklyn books booked and we'd have much lower cost run rates. We have a modular technologies that provides lower risk in terms of future warranty provisions and expenses.
Speaker 3: We will already be reaching some peers that have much higher valuations in terms of revenue books, books, and we have much lower cost run rates. We have modular technologies that provide lower risk in terms of future warranty provisions and expenses.
So we look forward to executing with driving excellent on our plans for 2024.
Speaker 3: So we look forward to executing with drive and excellence on our phones for 2024.
With that ill close today and open up for Q&A.
Speaker 3: With that, I'll close today and open up for Q&A.
Thanks Frederico.
Speaker 1: Thanks for the radio. To check quick reminder, for those of you who have questions for medicine to submit them in the checkbox, webcast platform, or you can also submit them via email to irfusion-field.eu. So for now, let's begin with some questions from Jeffrey Graham, from Alliance School of Partners.
A quick reminder, for those of you have questions for medicine to submit them in the checkbox webcast platform or you can also submit them via email.
<unk> do you think that fuel.
<unk>.
So for now let's begin with some questions from Geoffrey Graham.
Global partners.
Speaker 1: First question is, are you seeing any particular use cases having stronger business models in this tightened hydra-mar?
First question is are you seeing any particular use cases, having stronger business levels in this market.
So I'll take that one.
Speaker 3: So I'll take that one. Ah, so that's it.
So that's hard.
Speaker 3: Right now we see a bit of everything. So what the use cases that have the highest IRR at the point in time is mobility, where there is enough of a fleet to justify the cat-backs related. The hydrogen peculo basis is one of the more expensive in terms of uses in the hydrogen industry. So this is one of the use cases that's most attractive today.
Right now, we see a bit of everything so we will see use cases that have the highest.
IRR at this point in time is mobility, where there is enough of a fleet to justify the capex related.
The hydrogen per kilo basis is one of the more expensive in terms of.
Uses in the hydrogen industry. So this is one of the use cases, that's most attractive today.
Speaker 3: That said, we do see a lot of projects starting with people really want to learn more about hydrogen, how it impacts a business, and then preparing for the future.
That said, we do see lots of projects also that people really want to learn more about huntsman, how it impacts our business and then preparing for the future.
Speaker 3: The project we mentioned before with one of the well-leading support cement companies is exactly that, a project where they expect that hydrogen will be a core element of that business going forward, and they want to learn how that funders and so on reacts when mixed with.
Project, we mentioned before but these one of those wells needing some cement companies as exactly that a project.
They expect that hydrogen will be a cool elements of that business going forward and they want to learn how thats on us and so on Rex.
But when mixed with with hydrogen.
Speaker 3: So from an IRR perspective, simply at this stage, I would answer that it's mobility, but we're seeing more and more industrials taking the funds and betting on hydrogen for their decarbonization purposes and their longer-term views of any.
So from an IRR perspective simply at this stage I would answer that its mobility, but we're seeing more and more industrials.
The pumps and betting on hydrogen for the decarbonization purposes in the longer term views.
Findings.
Thanks Vivek.
Speaker 1: Thanks very much. On the priority slide, you are moved to progress made on submitting offers to projects over opportunities in Northern Europe . Can you provide an update on that?
Good evening.
Priority slide you allude to.
Progress made.
So bidding offer.
Two projects or opportunities in northern Europe can you provide an update on this.
Speaker 3: So we continue to provide offers to Northern Europe . And these at this time have been all around the mobility sector. So we have just now submitted offers to other countries with UK, France and beyond as well. We expect this to continue. So what we are seeing is that it takes
So we continue to provide a pop.
No.
To northern Europe.
At this time have been all around the mobility sector. So we have just.
Submitted offers to other countries.
UK, France and beyond as well we expect this to continue.
We are seeing is that it takes quite consistent volume between guessing office submitted and declines taking.
Speaker 3: quite a bit in time between getting offers submitted and the clients taking their FID from the projects, mainly as they go through the process of negotiating off-take. So we do expect to continue to see more offers both in Northern Europe , although it might take us some time to hear back on positive or negative decisions on FID.
From Apotex, mainly as they go through the process of negotiating uptake.
So we do expect to continue to see more office based in northern Europe.
Although it might take.
I'll take us some time to hit back on positive or negative.
That's right.
Speaker 1: Thanks for more for you. Can you provide any examples of the type of projects where you might monetize your engineering services and what that revenue opportunity might be on a per-megawatt basis?
Thanks, one more for you can you provide any examples of the type of projects, where you might monetize your engineering services and what that revenue opportunity might be on a per megawatt basis.
Speaker 3: So this is hard to map out on a mega watt basis. Very often the product is mainly due to the project from patty and the end case of a client. So a project that requires hydrogen and or oxygen without purification at two bars is very different than one that needs some pure at 500 bars.
Sure.
This is hard to two megawatts.
Megawatts basis.
Some of the projects, it's mainly due to the project complexity in the case of our clients. So it protects physical clause.
Nitrogen.
And overall surgeon without purification of two bonds is very different the one that needs some pure typhon the boss.
Speaker 3: So it's really on a project by project basis. We have seen several cases as all of the projects that we have today, where people do want us to not only do the full design of the projects, but also the specifications of what the balance of plants is, so what compressor to use, what power system to use, or purifier to use and so on. And then we put them in touch with the right fires, we design, we do the full engineering mapping of the full projects.
So it's really on a project by project basis, we have seen.
Several cases all of the projects that we have today, but people do want us to not only to the full design of the project, but also the specifications of what the balance of plant is so what compressor to use what power system to use a pure quantity used and so on.
And we put them in touch with the right buyers with design we do.
To the full engineering mapping oxy.
Perfect.
Speaker 3: We're currently with talented hoping to reach 500,000 of revenues next year in terms of engineering services and hoping to, in 2025, get that to reach a million euros. This is still as in numbers as we are going through some engineering offers, even as recently as today, having some offers being sent on that. So we're still building the business case on our engineering services.
Yes.
Currently we have talented hoping to reach 500000 of revenues next year in terms of engineering services.
And hoping to in 2025.
Reach a million euros. This is still early numbers as we are coming through some engineering office, even as recently as today, having some office being sent on that so it's we're still building the business case on our engineering services, but given the strong demand will surge.
Speaker 3: but given the strong demand for such services, we do expect a couple of revenues for us already next year.
So this is we do expect to be booking revenues for its already next year.
Thanks critical pivoting to Kevin's question here.
Speaker 1: Thanks for the pivoting to Kevin now, a question here. What's the magnitude of cost reduction potential you are reviewing in their internal target? Or are you being communicated?
What's the magnitude of cost reduction potential you are reviewing is there an internal target.
At this time.
Thanks Pat.
Speaker 2: Thanks Ben. So again, to reiterate, our position from our Q2 investor presentation back in September , that calls for view that we embark.
So again to reiterate our position from from our Q2 investor presentation back in September.
That cost review that we embarked.
It's still ongoing.
Speaker 2: and it is been
It is it's been very very detailed and as I mentioned previously we're still working on finalizing our budgets, but in terms of.
Speaker 2: very, very detailed, and other mentioned previously where we're still working on finalizing our budget.
Speaker 2: but in terms of, you know, looking at that number of percentage, internally where we're trying to get as close to a 20% reduction on our full year 2023 S-GNA. And I suppose that's probably why the review is taking so long and we'll continue for some time as well because...
Looking at that number or percentage.
In turning we're trying to get as close to a 20% reduction on our full year 2020 tree SG&A.
And I suppose that's probably why.
The review has taken so long and we will continue for some time as cloud because.
Speaker 2: As I mentioned in my remarks, it's very important for us to have a slim cost base. And we see that as being a key driver to us being successful. And so it's so important that we take the time and leave no stone on turn when it comes to cost. So, so you have to hopefully that out.
As I mentioned in my remarks, it's very important for us to have a a slim cost base and we see that as being a key driver to us being successful.
So it's so important that we take the time and leave no stone unturned when it comes to cost so.
So, yes, hopefully that answers the question.
Thanks, Kevin.
Speaker 1: I just got a question from, or would you call it in from World Bank of Canada on the third quarter pipeline slide that would show 45 proposals for 152 million in prospective revenues.
Question from Kurt <unk> from Royal Bank of Canada.
The third quarter pipeline slide.
So 45 proposals for $172 million in perspective revenues.
Speaker 1: versus 41 proposals for 222 million in the previous iteration of the slide from the second quarter that applies a decline in the average value per project to a square of older 5.5 million euros to a little under 4 million euros per order. Can you provide any commentary on that distinction or difference?
These offers.
Versus 41 proposals for two equivalent to a $2 million in the previous iteration of the slides from the second quarter.
A decline in the average value per project, what's critical here.
Hopefully I can hit 1 billion euros to a little under $4 million per order.
Can you provide any.
Commentary that distinction difference school, absolutely so while it's possible we have simply done as we've stripped out the volatile times revenues.
Speaker 3: Well, absolutely. So, and what's possible, we have simply done as we have stripped out the Balanter plant revenues from that sales pipeline, so that it's focused around the electrolyzer sales rather than Balanter plant equipment.
<unk> sales pipeline today is focused around the electrolyzed sales rather than equipment.
Equipment.
Speaker 3: In the end, the balance of funds and equipment sales for a project will be determined by the client to what extent we will be involved in providing those.
In the end the balance of plant and equipment sales for project will be determined by the clients to what extent, we will be involved in providing those.
Speaker 3: and the gross margin that we will be able to provide on the amount of art can that it starts protecting your district whether in f?? state mulch
And the gross margin that we will be able to provide on that.
Okay.
Substantially project to project.
Speaker 3: so for in order to ensure the more lake to lake purposes for the outer proposals and we've really kept it to the electrolyzer, the portion of the proposals.
In order to switch more than more like to like purposes all of the proposals.
We really kept it to the electrical Liza.
One of the of the proposals.
Great. Thanks.
Turning to capital.
Speaker 1: Tidding to capital strategy now perhaps for you, Gavin. How are you making about the A-Champ facility in light of the recent financing with McQuarry Leave will to utilize the H-H-H-M going cover?
<unk> now perhaps for you Kevin.
Where are you thinking about the ACF facility in light of the recent financing with Macquarie.
We'll continue to license <unk> going forward.
Sure So as I mentioned we.
Speaker 2: Sure, so as I mentioned, we haven't used the ATM since September 20th. I think that the last trading day, we have no immediate plans to reengage activity on the ATM. I'm just to be very clear, it is one of the conditions for operationalizing the McParty deal. If that the ATM facility is cancelled.
Haven't used the ATM since September 20th I think that the last trading day.
We have no immediate plans to reengage activity on the ATM.
And just to be very clear. It is one of the conditions for operationalized the Macquarie deal.
The ATM facility as cancels.
Speaker 2: So no venancy at the answer both in terms of current or expected future use of the...
So no that is the answer both in terms of current or expected future use of the ATM.
Great. Thanks.
Speaker 1: great things. And with both there, with the solutions currently in place between the Ferrari convertible project, inflows and grant funding, did that get you to the cash division needed or will you consider additional fundraising?
With both there with the solutions currently in place between the Macquarie convertible.
Perfect inflows and grant funding.
Get you to the cash position needed or would you consider additional fundraising efforts.
I'll start with the annoying phrase of it really depends.
Speaker 2: I'll start with the annoying phrase of it, it really depends. So it depends on whether we witness further delays and both projects find out seeing an execution of those projects. So if there's delays, the amount of capital requires, could and can, I'm probably will change substantially. And we move a caution here, given the recent delays, witnessed throughout the industry.
So it depends on weather.
We witnessed further delays.
In both project financing and execution.
Those projects so.
If there are delays the amount of capital required coach quote Encana, probably will change substantially.
We move a caution here given the recent delays witnessed throughout the industry.
And most importantly, as we noted in our investor that or the structure of the Macquarie facility allows us to pursue complementary forms of financing and other strategic sources of capital that would further strengthen our balance sheet as needed.
Speaker 2: and I'm probably most importantly, as we noted in our investor letter, the structure of the McQuarty facility allows us to pursue complementary forms of financing and other strategic sources of capital that will further stretch our balance sheeted.
Speaker 1: Question here about the timeline to profitability or cash flow break even.
Thanks, Kevin.
Chris you hear about the timeline to profitability or cash flow breakeven.
Sure so.
Sure.
Speaker 4: We expect this at some time during 2025. This is a good follow-up point to the previous question then.
We expect that at some time during 2025.
This is a good follow up point to the previous question vantage.
Speaker 4: you know, again it comes back to the point of it depends. So if everything plays out as we forecast and as we expect.
Again, it comes back to the point of the it depends.
So.
If everything plays out.
And as we expect.
Speaker 4: And we finalize the cost reviewer and get our costs as them as possible. We hope it will be, we plan it to be during 2025. But don't expect it to be during next...
And when we finalize the cost review and get our costs as seamless as possible and we hope it will be planted.
Honored to be during 2025.
But don't expect it to be during next year.
Speaker 3: The level simply had that we will still be one of the first of all the firsts.
Kevin I will simply add that we will still be one of the first with mobile pumps electrical.
Speaker 3: electrolyzer producer to reach that milestone, given our low cost base. Okay, so no pressure.
Electric lines of producers, who reached that milestone given all the low cost base.
Okay, So no pressure Federico.
Okay.
Speaker 1: Fredericka for you do you see the recent political issues in Portugal having the effect on the business for example in the form of delays in permitting more over
Good for you.
Do you see the.
We can political.
Issues in Portugal, having an effect on the business for example, and look for both of them.
<unk>.
Yes.
Corporate and Moreover received rent bumps.
Naturally this was one of all is one of our big concern, especially on the day that the news came out recently.
Speaker 3: So naturally this was one of our big concerns, especially on the day that the news came out and the recent political turmoil a few weeks ago, the kicked off in Portugal. Since then we have actually seen the monetizing of various grants.
Recent political turmoil a few weeks ago that kicked off in Portugal.
Since then we have actually seen.
Monetizing Hall.
Various grants.
Speaker 3: We've seen a number of items that we had with the government moving forward. So we have actually seen relatively normal operations within the government. So at this point in time, our projects have not been affected. The formal and important, I will just note that
We've seen a number of.
Items that we had with the segment moving forward.
So we have actually seen relatively normal operations.
Operations.
Within the government. So at this point in time, our projects have not been affected.
The terminal in Portugal, I will just note that.
Speaker 3: but we have seen what we expect to lay.
Well we have.
<unk> seen the way we expect to lease.
Speaker 3: is around programs the government was about to launch. So for example, there was the green hydrogen oxygen important that was expected to launch towards the end of the year. That naturally will be put on hold until the new elections happen in early 2024.
Is around programs the government pause about to launch. So for example, there was the.
Green hydrogen.
Auction in Portugal that was expected to launch towards the end of this year.
Naturally we will be put on hold until the new elections.
2024.
Speaker 3: but so the projects themselves have not been delayed, although some of the government programs had. None of the projects we had were...
So the projects themselves have not been delayed although.
Some of the government.
Programs have none of the projects we had.
Speaker 3: We're awaiting for that auction to a thousand impacts.
Expect we're awaiting pool.
That option so it doesn't impact.
Speaker 3: the revenue guidance that we've given for 2024. In addition, the launch of the European Hydrogen Bank, which has recently been put out all of the rules and regulations around it and have opened up calls for this.
The revenue sort of guidance that we've given for 2024 in addition.
The launch of the European hydrogen bank, which has recently been put out all of the rules and regulations around it and to open up call for this.
Speaker 3: has also meant that clients who are considered going for one option can now go to the European Hungarian Bank auction instead. So the impact from the Portuguese government has been minimal.
It has also meant that as clients.
<unk> considered going for one option.
Well the European hydrogen bank auction instead.
The impact from the Portuguese government has been minimal.
Speaker 1: Thanks for the very helpful. It was a question as well on the hydrogen auction in November . So that was helpful clarity there.
Thanks for that very helpful and just a question as well.
The hybrid auction.
Into their first so tablets.
That's helpful clarity there.
Speaker 1: Question here on mobility, so clearly a priority market for the company. Does not ever have a perspective on the future of hydrogen in mobility versus EVs. And then anything else of notes to touch on regarding strategic partnerships in this space.
A question here on mobility, so clearly a priority market for what the company.
This benefit had a perspective.
The future of hydrogen and mobility versus it needs.
Anything else.
Of note two to touch on regarding strategic partnerships.
And in this space.
So I would note to talk be it from us to get try to get to the debates of witches vessels between the 100 and EV.
Speaker 3: So I would know that it can't be from us to get tried into the debate of which is better between the Hyderon and Evie.
Sort of discussion.
Speaker 3: sort of discussion to know, I personally, and I think most of these action committee are still in fuel believes that there is a market for both.
To note.
I personally and I think most of the effects of community issues and fuel believes that there is a market for both.
Speaker 3: in particular places where which need fast charging, it avoids the need for
In particular.
Which need fast charging.
It points the need for.
Speaker 3: having multiple batteries or whether you need to carry large loads. There's a big case to be made for hydrogen or even hydrogen derivatives, due to ammonia as fuel as well. So we think, in our view, that there will be a market for both UVs and hydrogen mobility in all their elements.
Having multiple batteries or whether you need to to carrying sort of launch loads.
There's a big case.
We manage for hydrogen or even hydrogen derivatives ammonia as fuel as well.
So we think and all of you is that there will be a market for both.
<unk> and hydrogen.
Ability.
All the elements.
Speaker 3: So we've seen this across all the discussions with our clients also seem to point to that fact that it is not an either or but actually a combination of both in their aim to decarbonise
<unk>.
We've seen this across the board all the discussions with our clients also seem to point to that fact.
Susan.
Either rule, but actually a combination of both.
Aim to Decarbonize the Lucy.
Thanks Kurt.
Speaker 1: Thanks for the go. A question here on performance guarantees.
A question here on the performance guarantees.
Speaker 1: touch on the ability of or need for players in this space to provide those guarantees particularly on larger projects.
Can you touch on the.
Ability.
Or need for players in this space to provide those guarantees, particularly in larger projects.
Speaker 3: Thank you, Lennon. I think this is a really important topic that in the industry is not discussed enough.
I think this is a really important topic in the industry is not discussed enough.
Speaker 3: effectively, that's to keep in mind that when someone wants to do a 100-megawatt project that's spending like the 150 million euros or more on the full-hatron plant.
Effectively.
Got to keep in mind that when someone wants to do a 100 megawatt project spending like the 150 million euros or more on the full Hudson pumps.
Speaker 3: and which is a substantial cat-x risk for any infrastructure player or client.
And which is a substantial capex risk for any infrastructure payroll clients.
Speaker 3: Now with that, traditionally you would expect to get performance guarantees and warranties for several years to back up a capped face investments of that size.
With that traditionally you would expect to get performance guarantees and warranties.
As to back to back up.
Capex investments of that size.
Speaker 3: Today the industry does not provide, or as far as we have seen, does not really provide performance guarantees, especially for the very large projects. Therefore, whoever's doing a large investment needs to determine how much capital they can truly put at full risk. So we have seen.
To date the industry does not provide what that as far as we have seen does not really provide.
Performance guarantees, especially for the very large projects. Therefore, whoever is doing a launch investments.
To determine.
How much capital they can truly put at full risk. So we have seen one let's call it launch U S competitor.
Speaker 3: That's called it the large US competitor has gone through the approach of putting substantial cash deposits and cash collateral with banks in order to finance.
<unk> has gone through the approach of putting substantial.
Cash deposits.
Cash collateral with banks in order to finance.
Speaker 3: of some of the larger equipment sales. This is a substantial risk to anyone's balance sheet, especially with technology that has not yet had years and years of proven track record.
One of the largest equipment sales. This is a substantial risk to any one's balance sheet, especially with technology that has not yet had he has and he has a proven track record. So this is why we believe in.
Speaker 3: So this is why we believe that there will be a few projects, large projects being done in the next two to three years. The majority of projects will be in the small permit scale, where the risk for both parties, both the projects, fire and dust, as well as the companies providing the equipment is manageable.
It will be a few projects large projects being done in the next two to three years. The majority of projects will be in the small to mid scale, where the risk for both parties. Both the project Kleiner investor as well as the company is providing the equipment.
Is manageable.
<unk>.
Speaker 3: I think this is really important because it will limit the amount of large projects in the next two to three years until the industry is more mature. For us, it's an advantage because our technology really plays in that small to mid cap area.
I think this is this is really important because it will limit the amount of large projects in the next two to three years until the until the industry is more mature.
For us, it's an advantage because our technology really plays in that.
Small to mid cap.
Sort of area.
Speaker 1: Perfect, thanks for the week. Last question here pending, any more that comes through? Um, can you perhaps add a comment on, uh, on current headcounts, uh, in the context of, uh, the cost structure and their need, based on current and expected sales?
Perfect. Thanks, Puerto Rico.
Last question here.
Would it come through.
Can you, perhaps Kevin can comment on that.
Our current head counts.
In the context of.
The cost structure and they are need based on current and expected sales.
Yeah sure so I.
Speaker 4: I think we've gone on a journey in terms of headcats over the past 12 months.
I think we have done on the journey in terms of head count over the past 12 months.
We're probably roughly around the <unk>, Turkey, 135 market diminish or the subsequent one party.
Speaker 4: We're probably roughly around the 1.30, 1.35 mark at the finish. Probably felt for the 1.30. I think the important thing to point out is that the...
I think the important thing to point out is that the.
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Moderate costs within Portugal are a lot lower and a lot of other countries within the EU and also compared to the likes of North America, and even Australia.
Speaker 4: not only costs within Portugal are a lot lower than a lot of other countries within the EU and also, you know, compared to the likes of North America and even Australia. And so that is included within our cost review process, but we think, and I think I pushed upon this in the quarter two presentation with that.
So if that is included within our cost review process, but we.
We think and I think I touched upon this in the quarter two presentation with us.
Speaker 4: It might not be a case of reducing the headcam, but more rationalizing the headcam and moving people from one department to a different department. I think as Frederico pointed out at his slides,
It might not be a case of reducing that can put more rationalizing the head count and moving people from from one department to a different department.
As Federico pointed out in his slides and.
Speaker 4: You know, engineers really let it come to the fore in recent months.
Engineering extreme that it has come to the fore in recent months.
Speaker 4: Do we have the team fit for purpose for that? And you know.
Do we have the the team take for purpose for that.
Do we have resources in other areas of the organization that cuts.
Speaker 4: Do we have resources in other areas of the organization that could, you know, assist and even promote that, that's really a converter. So that is something, it's a very good question. It's something that we actively look at. And right now, what we think we've got a positive mix.
And you can promote bass and upstream even further.
So that is something that it's a very good question.
We actively lock us on right now, where we think we've got a positive mix.
Speaker 4: but you know as I said that's something that we look at on a long-old basis.
But as I said, that's something that we look at on an ongoing basis.
Perfect. Thank you Kevin.
So in the absence of any questions I think that will do it for our third quarter.
Speaker 1: So on the essence of any additional questions, I think that will do it for our third quarter webcast. So thank you for everyone who's joined. If you have additional questions or if you'd like to speak with myself or with Madison, please feel free to reach out to me and IR team at IAR at FusionBashfield.e. And we look forward to seeing you all again. Our next update.
Webcast. Thank you for everyone who has joined.
If you have additional questions or if you'd like to speak with myself with Madison. Please feel free to reach out to me the IR team, but I R F.
Fusion that fueled that means that we will talk to you all again.
Great.
Thank you.
Yeah.