Q4 2024 Emeren Group Ltd Earnings Call
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Thank you. Bye-bye.
Hello, ladies and gentlemen. Thank you for standing by for Emrin Group Limited fourth quarter 2024 earnings conference call.
Speaker Change: On the call with me today are mystery human Liu Chief Executive Officer, Mr. Kurt Chen Chief Financial Officer, and Mr. Enrico Bocce Executive Vice President of Europe humanity will provide an overview of our business performance financial results followed by Q&A session during which Enrico will also be available to answer.
Before we continue please slide two let me remind you that remarks made during this call may include predictions estimates or other information that might be considered forward looking these.
Speaker Change: Forward looking statements represent amarin group's current judgment for the future. However, they are subject to risks and uncertainties that could cause actual results to differ materially. Those risks are described under risk factors and elsewhere in Emory group's filings with the SEC. Please.
Speaker Change: Please do not place undue reliance on these forward looking statements, which reflect ameren groups opinions only as the date of this call Amber group is not obliged to update you on any revisions to these forward looking statements. In addition, please note that all financial numbers discussed on this call are on.
Also please note that unless otherwise stated all figures mentioned during the conference call are in U S dollars with that let me now turn the call over to industry.
Speaker Change: You May go ahead.
Thank you Gary and thank you everyone for joining today.
Speaker Change: Let me start with a brief overview of our Q4 and full year results.
Before discussing our business outlook on key financial catalysts.
After that Phil will take you through a detailed breakdown Brian.
Overall financial performance and 2025 guidance.
Speaker Change: On the 20th floor was a year of revenues and disciplined execution.
Speaker Change: And strategic growth for Ameren.
Speaker Change: Despite currency headwinds and project sales delays waste.
Speaker Change: We successfully monetize renewable energy assets.
Expanded our energy storage footprint and.
Speaker Change: <unk> generated positive free cash flow in Q4.
Our IPP and DSA segments for white at high margins and stable cash flows.
Speaker Change: While strategic.
Speaker Change: Project monetization.
Our financial position.
Speaker Change: For the full year, we generated $92 1 million in revenue.
Speaker Change: $24 1 million gross profit.
Speaker Change: With a 26% gross margin.
Speaker Change: We reported an operating loss of $5 million.
While noncash and unrealized foreign exchange loss resulted in a $12 5 million net loss at <unk>.
<unk> two ml group.
Speaker Change: However, operating cash flow improved significantly towards breakeven.
Speaker Change: Reaching back to $4 2 million compared to negative $23 4 million a year ago.
Speaker Change: And adjusted EBITDA Rose to $6 9 billion, demonstrating disciplined financial execution.
Turning to Q4, specifically.
Speaker Change: We maintain strong financial discipline and cash flow generation.
Peter brings $34 6 million in revenue and $4 8 million gross profit.
Speaker Change: With a solid 14% gross margin.
Speaker Change: While foreign exchange losses due to U S dollar.
Speaker Change: Joins impacting net income.
Speaker Change: Our operating loss improved by 35% year over year in Q4, reflecting.
Speaker Change: Strong cost control.
We also generated over 5 million free cash flow in Q4 reentered.
Speaker Change: Reinforcing our strong liquidity position.
Speaker Change: Our capital light model in early stage monetization strategy continue to support financial strengths.
Speaker Change: We ended the year with 15 million cash.
After up 40% sequentially.
Sending us well for growth in 2025.
Speaker Change: With a strong pipeline.
Speaker Change: Spending energy storage initiatives.
Speaker Change: Disciplined execution we.
Speaker Change: We are positioned to scale profitably and drive long term shareholder value.
Speaker Change: Turning to our key milestones in Q4 with.
We successfully closed several strategic transactions.
Further solidifying our leadership in renewable energy monetization and energy storage across Europe, the U S and China.
Speaker Change: In Europe we.
Speaker Change: Successfully completed the <unk> sale of our 70 megawatt solar project portfolio in Poland.
Speaker Change: With 50 megawatt under a PPA.
Reinforcing our strong foothold in the region.
Speaker Change: We also expanded our energy storage footprint in Italy.
Speaker Change: Executing a 462 megawatt USA for battery energy storage system with a pinch up.
Further strengthening our leadership in the growing energy storage market.
Speaker Change: Additionally.
Speaker Change: We finalized the sale of 65 megawatt of solar projects in Germany to Trina.
Speaker Change: So a mixed dsa's last SBA structure.
Speaker Change: Underscoring the strength of our development partnerships.
Speaker Change: In the United States, We made further progress in shipyard at generation by closing the <unk> sale of our two eight megawatt community solar project to Altra is power demonstrating our ability to capture opportunities in the U S community solar market.
Speaker Change: Meanwhile, in China, we are the ones our energy storage strategy.
Speaker Change: With the successful commissioning of 18 megawatt hour World class projects.
Speaker Change: We start now fully integrated into an empower international's virtual power plant platform.
This integration your houses great stability and further strengthens our presents in China's evolving energy storage sector.
These achievements highlight our ability to execute across multiple regions.
Speaker Change: Efficiently monetize projects and expand our renewable energy portfolio, while reinforcing contracted cash flow generation.
Speaker Change: Now turning to our core business segments.
Our high margin DSA model remains a key driver.
Speaker Change: Stable revenue and early stage project monetization.
Speaker Change: In 2024, we recognized 19 million TSA revenue.
Speaker Change: Primarily from Italy, and Germany.
Speaker Change: As of year end, we had yesterday contracts with Knight partners covering 40 projects at holding over two eight gigawatts.
Speaker Change: As a proxy may late $84 million in contracted revenue expected to be realized over the next two to three years as well as more than $100 million in Unparallel track the revenue currently under negotiation.
Speaker Change: Meanwhile, our IPP segment played a crucial role is supporting staple cash flow.
Speaker Change: Contributing 31% of the type of revenue and 64% of the total gross profit.
In Q4.
Speaker Change: We optimized our portfolio across Europe, and China, while further WEC energy storage integration.
Speaker Change: House long term profitability.
Speaker Change: Complementing these efforts.
Speaker Change: Our sole argue about am and PM has continued to generate strong monetization opportunities.
In 2024, we successfully monetize about 200 megawatt solar PV projects across Germany, France, Spain, Poland, China, and the U S allows.
Allow site, one three gigawatt of past projects.
These achievements reinforce the strength of our capital light development model and our ability to efficiently recycle capital for future growth.
Speaker Change: Looking ahead, we remain very confident in our ability to execute our growth strategy and drive profitability at 895.
While project sales timing delays impacted Q4 revenue recognition. These projects remain on track to close in the first half of 2025.
Speaker Change: Enforcing near term revenue visibility.
Speaker Change: Key drivers for our 2025 financial outlook include.
Speaker Change: Our strong.
Speaker Change: We track revenue base provide a solid foundation for future growth.
Speaker Change: We have 84 million contracted DSA revenue with an additional 90 million under negotiation.
Speaker Change: Strengthening long term cash flow visibility our revenue stability.
Speaker Change: Overall with 75% of our DSA pipeline concentrated in Europe, we are positioned to capitalize on demand growth across key markets.
Building on this momentum our high margin DSA in IPP Penises continues to generate strong gross margin and predictable cash flows supporting sustainable unprofitable expenses.
Speaker Change: Additionally, our robust monetize eastern pipeline position positions us well to capitalize on growing market demand.
With approximately $4 three gigawatts, otherwise stays storage pipeline and two four gigawatt of solar PV projects, we have a clean pass.
Clear path for long term growth in key regions.
Speaker Change: Further strengthening our outlook the opening of China merchant power market in 2025 presents a significant opportunity.
Speaker Change: Our best assets are statistically positioned to capture new revenue streams through energy arbitrage reinforcing our leadership in energy storage and grid services.
Kurt Chen: With that let me turn the call over to our CFO Kurt.
To provide a more detailed breakdown of our financial performance and 2025 guidance.
Kurt Chen: Yeah.
Kurt Chen: Okay.
Kurt Chen: Thank you you mean.
Speaker Change: And thanks, everyone for joining us on the call today.
Speaker Change: In Q4, we delivered $34 6 million in revenue.
Down 23% year over year.
Speaker Change: Primarily due to project delays pending government approvals.
Speaker Change: Sure It has surged 169% quarter by quarter.
Speaker Change: By successful project monetization.
Speaker Change: While timing delays in the U S and Europe impact Q4 revenue recognition.
This project remain on track to close in the first half of 295.
Speaker Change: Providing strong near term visibility.
Speaker Change: Gross profit was $4 8 million.
Speaker Change: Compared to $5 6 million in Q3 to <unk> 94, and $5 1 million in Q4 to introduce street.
Speaker Change: Gross margin was 13, 9%.
Speaker Change: Down from 43, 8% in Q3 and 24.
Speaker Change: But the up from 11, 3% in Q4 continued strength.
Speaker Change: The year over year improvement reflects the continued strength of our high margin IPP and the DSA business.
Operating expenses were $9 2 million Upfronts $3 5 million in Q3 total before but down from $11 8 million in Q4 2023.
Speaker Change: The annual decline was primarily due to reduced write offs and the absence of asset impairment losses.
Net loss attributed to Ameren group LTC common shareholders was $11 8 million.
Speaker Change: Compared to net income of $4 <unk> million in Q3, 2004, and a net loss of $2 million in Q4 to introduce street.
Speaker Change: The increase in net loss was primarily due to non operational foreign exchange losses.
Speaker Change: Diluted net loss attributed to <unk> OTT common shareholder.
Speaker Change: <unk>.
Speaker Change: <unk> two diluted net income from <unk> in Q3 total before.
Speaker Change: Diluted net loss of <unk> <unk> in Q4 and fiduciary.
Speaker Change: From a cash flow perspective with.
Speaker Change: We generated $10 4 million in operating cash flow and over 5 million free cash flow.
Speaker Change: Further enhancing our financial flexibility.
Speaker Change: Cash used in investing activities was $5 million and the cash provided by financing activity was $2 8 million.
Speaker Change: We ended Q4, 2000, <unk> 50 million in cash and cash equivalents.
Up 40% sequentially from $35 8 million in Q3 and the default.
Speaker Change: Reinforcing our strong liquidity position.
Speaker Change: Our debt to asset ratio at the end of Q4 2000 default was around 11, 2%.
Compared to 10, 2% at end of Q3 totaled 84.
Speaker Change: The majority of our debt was nonrecourse project financing.
Speaker Change: In 2020 for Europe contributed over 70% of our total revenue.
Speaker Change: On the China contributed 19%.
Both generated positive operating cash flow.
We are seeing a strong execution and steady growth in both regions.
Speaker Change: Turning to our 2025 outlook.
We expect full year revenue to be in the range of 80 to 100 meeting with.
Speaker Change: With a gross margin of 30% to 33%.
Speaker Change: IPP revenue is anticipated to between 28 and a surgery meeting.
Speaker Change: With around a 50% gross margin.
Speaker Change: DSA is expect to contributor 35 to 45 million in revenue.
Speaker Change: IPP at DSA contributed.
Speaker Change: We'll be expect to contribute over 70% of total revenue in 2025.
Speaker Change: Additionally, we anticipate achieving positive operating cash flow in 2035.
Speaker Change: For the first half of 2005.
Speaker Change: Anticipated revenue in the range of $38 million.
Speaker Change: The $35 million.
Speaker Change: With a gross margin of approximately 32 cities 3%.
Speaker Change: With that let's open up the call for any questions.
Operator, Please go ahead.
Speaker Change: Thank you.
Speaker Change: As a reminder to ask a question. Please press star one on your telephone only for your name to be announced.
Your question. Please press stop online again.
Speaker Change: Please standby.
Speaker Change: Now the Q&A roster.
Speaker Change: First question comes from Philip Shen of Roth Capital Partners. Your line is now open.
Speaker Change: Okay.
Speaker Change: Hey, everyone. Thanks for taking my questions.
Speaker Change: Wanted to talk about the 25 guide.
Specifically can you share what the mix is between DS.
Speaker Change: DSA revenue in IPP revenue and if there is any other revenue in the third bucket. Thanks.
Speaker Change: Okay.
Speaker Change: Phil We just talk about this IPP revenue between 28% to circumventing in 235, and we did mentioned gross margin will be around 50%.
Speaker Change: DSA revenue will roughly between 35% to $45 million.
Speaker Change: No.
Added up <unk> contributed almost welcome contributed almost 70% of our revenue.
Speaker Change: Great sorry, I missed that.
Speaker Change: And you talked about how there is another.
Speaker Change: Incremental $100 million of DSA revenue that you're negotiating now.
Speaker Change: Do you have a sense for.
Speaker Change: The geographic mix of that.
Speaker Change: DSA revenue is it also European.
Concentrated and then.
Speaker Change: Does it have similar do you expect high margins for that incremental $100 million and then when do you think you could start to close the.
Speaker Change: Paul Corps majority of that $100 million is that in the coming months or do you think it might take.
Speaker Change: Just a 25 to secure the 100 million. Thanks.
Speaker Change: The target to close all of them by the end of this year.
Speaker Change: <unk>.
Speaker Change: Couple of them are several of them are in the final stage to be closed within the next two to three months.
And more is coming.
Speaker Change: As you will see that we do have.
Speaker Change: <unk> welcomed.
Speaker Change: Pipeline on both solar and storage.
Speaker Change: We have built up the strong track record out the TSA position and that is why that we.
Speaker Change: We are super confident on our 2025 guidance.
Speaker Change: Two reasons, one is as Curtis mentioned.
The 70% of the revenue and margin will be coming from the contracted.
Speaker Change: IPP Npsa's.
Speaker Change: And another confidence is coming from the <unk> Psa positions.
Speaker Change: And at least 5% to six contracts.
Speaker Change: Being finalized and to be inked in the next two to three months and more are coming.
Speaker Change: Yeah, Phil in terms of breakdown I think Europe.
Speaker Change: Around 70%.
U S was 30%.
Speaker Change: Great, Okay and then.
Speaker Change: Can you talk about the types of.
Speaker Change: Counterparties for the 100 million that you're negotiating or they are there any repeat customers or partners or are they mostly new customers.
And kind of Counterparties. Thank you.
Speaker Change: I think it's about half our existing customers' repeat it.
And another half are the new customers.
Speaker Change: Okay. That's good and then for 2025, sorry, if I missed this but did you guys share what your cash generation or free cash flow outlook might be if you haven't.
Speaker Change: Give us some way we stipulate talking about we expect positive operating cash flow in terms of new buyer. So we ended in 2000 $450 million. So we've.
I truly believe we should have.
Speaker Change: Cash at the end of 295.
Speaker Change: Sure.
Speaker Change: Okay.
Speaker Change: Great. Thanks for taking all my questions I'll pass it on.
Bill: Thank you Bill.
Speaker Change: Thank you.
Speaker Change: A reminder, please press star one on your telephone keypad.
Rifle your name to be announced.
Speaker Change: This is the last call for questions.
Speaker Change: To press pressed.
Speaker Change: Press Star one on your.
Speaker Change: Telephone keypad.
Speaker Change: Just one moment. Please we have a follow up question.
From Philip Shen.
Speaker Change: Your line is now open.
Speaker Change: Philips did you have a follow up question.
Yes can you guys hear me.
Speaker Change: Yes.
Speaker Change: Great Okay.
Speaker Change: So let's.
Talk about the delays you've <unk>.
Speaker Change: System, we had.
Speaker Change: Pretty.
Speaker Change: A number of delays that.
Speaker Change: Unfortunately, resulting expectations or results are.
Speaker Change: Weaker than expectations. So do you think the delays in Europe and the U S.
Speaker Change: Government approvals and so forth.
Speaker Change: Do you think we've seen the worst of it or do you think it could get worse from here.
Speaker Change: And if and if it's if we've seen the worst of it worst of it.
Speaker Change: How much could it improve do you expect to see improvements in 25 or two do we have to wait for 'twenty six.
Speaker Change: This is a very good and interesting question.
What we see here is that the.
Speaker Change: For example, in Spain, we cannot close the deals as of the government approval those two major transactions, we cannot close none of them.
Speaker Change: And one of them, we already have waited for 18 months and we still have not got it.
Speaker Change: But.
Speaker Change: There was a deadline the garvin published guidelines for 12 months, an additional three months additional three months and deadline is coming.
Speaker Change: And we see that is ending in <unk>.
Speaker Change: Less than three months.
Speaker Change: So that is one thing I see that the.
Speaker Change: European governments are moving faster.
Speaker Change: As for example, Spain.
Speaker Change: They have to have the strong supporting policies to support renewable energy, including storage.
Speaker Change: That's one example.
Speaker Change: Only uncertainty we could not foresee is in the U S.
Speaker Change: But the good part.
Speaker Change: Yes art DSA structure.
Also let me comment on another one on European gas is structure.
Speaker Change: We normally split the TSA payments into three to four milestones or sometime you but by milestones.
Speaker Change: As we go through all the milestones in 2025 this year.
We do see the impact from the government approvals all the TSA milestones is very minimal.
Speaker Change: That's why we have the.
Speaker Change: Certainty our high confidence.
Speaker Change: <unk> delivery in 2025.
Speaker Change: Interconnection approval delays in the U S is expected.
Speaker Change: But.
Speaker Change: The most TSA DSA.
<unk>, we are signing in the U S.
Speaker Change: We are expecting only milestone one payments in 2025.
Speaker Change: Some expect.
Mount milestone, two which related to interconnection connection.
Speaker Change: Nope.
Speaker Change: And we are guiding them and Thats, where they wanted to be signed within this months.
Speaker Change: Next two weeks.
Speaker Change: So the <unk>.
We see in the future.
Speaker Change: Maybe.
Speaker Change: The government in the U S.
Speaker Change: Slow style.
Speaker Change: Process approvals.
Speaker Change: That may impact our 27 28.
Speaker Change: A milestone payments.
Speaker Change: But they don't see near term impacts in EMEA and the U S.
Speaker Change: Okay. Thanks.
Speaker Change: The U S. We also.
This community solar.
Which we believe we are moving along despite of the federal uncertainty so completed community solar still.
Get accrued.
Speaker Change: As normal so we think those project.
Sure.
Our pipeline.
Speaker Change: We will see that.
Speaker Change: Execution in 295.
Speaker Change: Okay.
Speaker Change: So remind us for your U S projects.
Speaker Change: What percentages community solar and then what percentage might be.
Speaker Change: Larger scale.
One the 200 plus megawatt level.
Speaker Change: Okay.
Speaker Change: From megawatt size as due to the scale size is lot bigger and the communist Lamar sized lost smaller so it's hard to really make the monetary adjustment or the.
Speaker Change: Predict the financial results from the megawatt numbers.
As a specialty the margin non people I'm gonna see for big deals will be normally in single digit.
Speaker Change: And coming to sold or is <unk>.
Speaker Change: Several times, our many times of that margin.
Speaker Change: No.
Speaker Change: On the megawatt side I will say the total due.
Speaker Change: This scale and compared to come into solar I will say 80 20.
Speaker Change: Mhm.
Speaker Change: So 280%.
Speaker Change: 80% of liquidity and plenty of percent.
Speaker Change: Community solar sorry, Okay got it so the inverse 20% community solar.
No.
Speaker Change: What about.
Speaker Change: The utility scale solar.
Community solar.
Speaker Change: Do you have any.
AI or data center type.
Customers Hyperscale type customers.
Speaker Change: That you are currently working with or that you plan to work with.
<unk>.
Speaker Change: And future DSA as for example.
Speaker Change: We do have some assets in those.
Speaker Change: Data center spots.
Speaker Change: And we are building our internal expertise.
Speaker Change: Data Center power supplies last data center power management.
Speaker Change: And that part we try to combine art, where our developer head.
Speaker Change: Which is we talk about we are literally a developer and star from a land developer.
Speaker Change: And then we are also up developer supplying power to our customers.
Speaker Change: This two together literally we are a natural fit.
To support the data center demand.
Speaker Change: So in the house, we are building that expertise is firstly.
Speaker Change: We are.
Speaker Change: <unk> analysis in detail to understand the data center demand and demand.
Speaker Change: Demand from the power supply point of view.
Speaker Change: Great. So thank you that is also another point we have several projects in those hotspots that is also why some customers. They are looking at them and try to sign that the assay with us.
Speaker Change: What percentage of the U S market.
Speaker Change: <unk> is working with TSA frameworks.
Speaker Change: Do you think it's still very small.
Speaker Change: It will not be small anymore.
Speaker Change: I will say that a quickly can go as big as one 3rd% to 50% of our entire portfolio.
Right I mean.
It's big for you, but I mean for the overall market.
As you know is it becoming more common for the rest of the markets or Morris.
Speaker Change: Yes.
Speaker Change: I personally don't think so.
The reason yes.
Speaker Change: As the listing company, we have to provide numbers to the investors.
Speaker Change: On a quarterly basis.
Speaker Change: So naturally it's not really advantages for us to wait for several years to really find out and monetize.
That is why in the last 18 months.
Saturday is the whole operation of the company and put up that the IC strategy across the board.
Speaker Change: And we are signing many of the assays as they might see in this script in the Europe, and we will be signing more.
But.
Speaker Change: Now they see that the people are actively signing but the one the new market is coming we see in within next 12 months the market will be in favor of the renewable energy and battery storage.
Speaker Change: They don't need to sign Psa's anymore.
Speaker Change: Okay got it that's applied to many other developers too.
Speaker Change: Interesting.
Speaker Change: Thank you, maybe one more and I'll pass it on.
As it relates to power prices.
Speaker Change: Is the base case.
Speaker Change: Alright, and maybe talk about the top three countries in Europe.
Speaker Change: What's the base case, you have for those.
And markets, where we hosted a webinar with woodmac recently and the outlook for retail power prices in Europe in general was maybe a little bit of an increase in 'twenty five, but then maybe it's flat or down even for 2006 and seven.
Speaker Change: So do you expect power prices to remain.
Speaker Change: Kind of at current levels or do you see upside or what's your base case as you develop these projects and sell against.
Speaker Change: Against them.
Speaker Change: We have IPP operation.
Or the seal deed.
Speaker Change: All of our assets in two countries now in Hungary and Poland.
Speaker Change: And we also definitely have been China, China is stable the power price stable in Europe, we see the price remains to be very nice compared to before COVID-19 are before the wall.
Speaker Change: But we do have noticed that in some countries like Spain. The price is going down in the last 12 to 18 months.
Speaker Change: And goes down from as high as 8% to <unk> are the Ethernet.
Speaker Change: <unk> per kilowatt hour to all the way to below three <unk>.
Speaker Change: And even Capri Ppas only gives you about 3.5% to four.
Speaker Change: But.
Speaker Change: In general European market.
Is a lot nicer than the U S market.
So the beauty of the U S is we still enjoy the tax equity.
The 30% or 40%.
And that helps.
Speaker Change: While U S.
Speaker Change: Tariff as Youll know Youll know better maybe the naidu that the we are looking at the four five even higher.
Speaker Change: Four five cents or even higher.
I just want to add our brownstone project in UK is under strong PPA still has much higher down the current merchant pricing U K. So that's the advantage we have.
With this strong PPA.
Speaker Change: We saw brownstone projects.
Speaker Change: Okay. Thank you for taking all my questions.
Thank you Phil.
Thank you just one moment for our next question. Please.
Sam: Our next question comes from Sam <unk> from H C. Wainwright. Your line is now open.
Speaker Change: Great. Thanks.
Sam: <unk>.
Sam: Thanks for taking my questions.
Sam: So the range for <unk>.
Sam: The range of top line expectation for this year.
Sam: The DSV it seems to be like a wide range of $10 million from 35% to $45 million.
Sam: What are the like what will it make.
Sam: I will be at the lower end versus the higher end of their projects big projects that you expect to materialize.
Sam: Timing issue or are there some other.
Sam: Things that play.
Sam: I think the.
Wrenches, because accounting will have to really solve the project like we said is DSA SaaS SBA. So we have to trade with us differently. It's S. P. A and TSA, so thats why theres big rents.
That's the major reason so is mainly accounting category.
Speaker Change: Okay understood and then the push out of the project from this year into fourth quarter and into next.
Sam: Fourth quarter into the first half.
Sam: Do we know what the size of those projects was like if those hadn't materialized.
Our revenue have been.
For the fourth quarter.
Sam: I think it's around.
Sam: Around $10 million.
Yes.
Sam: Pretty big chunk.
Okay.
Sam: And then also like.
Sam: Our outlook for.
For gross margins I think you mentioned the gross overall gross margin, what's the IPP gross margins.
Sam: But I don't think the guidance for DSA gross margins was provided.
Is there a reason for that and does it depend on project to project or how should we look at that.
Sam: Segment gross margin.
Sam: In general as I also mentioned you may understand our DSA milestone payment structure.
Sam: In nominal case not the.
Sam: The milestone royalty and milestone have lower margin.
Sam: And later milestone will hope it will be having a higher margin. For example, we normally try to book or a cost in the first two milestones.
Sam: So the margin in the earlier payment our early years of the TSA will be lower.
Sam: And that put our 2020 with plenty of buy margin for the TSA for the new ones new are ones.
Lower.
Sam: You see my point.
Yes.
Sam: We mentioned, we have $84 million remaining TSA contracted revenue, we already recognized 19 and 1919, we recognized in 2024 has lost lower margin compared to the 35% to 45, we are building.
Sam: In 2025.
Sam: I will say that the at least half of the 35% to 45 margin expected in 2025.
Sam: We'll generate higher margin and other for other half as they are newer or they are milestone one payment that.
Sam: That will be a lower margin.
Sam: Yes, yes.
That's a good explanation for that.
And one last one.
Sam: Yes.
Sam: I know.
Sam: Also asked about the 100 million. Additionally.
Sam: Additionally.
Sam: Negotiating is there possibility of.
Upside from those projects like if you if you sign those in the next few.
Sam: Months.
Sam: Is there any possibility that your revenues for 2025 will be able to recognize some of those revenues or is it too early.
Speaker Change: Lee we learned the lessons in the last couple of years, we try to understand the market and also precisely make the predictions are guidance for our numbers.
Speaker Change: The TSA all the revenue and the pricing of the TSA, we are going to close let's say, but in Q2 of this year next three months.
The price there the revenue expectations there for the milestone of one payment.
Speaker Change: And those are covers about 5% to 60 assets to be side.
But the potential upside may come in that the assays, we are negotiating to be closed in Q3.
Speaker Change: Our late Q2, our June June July August timeframe.
Alright.
We do see a possibility that that provide us upside as more assays will be coming as the $100 million expectation.
Successfully signed over $100 million.
Speaker Change: The milestone one payment will absolutely help.
Speaker Change: The 2025 revenue.
Speaker Change: Understood.
Good.
Speaker Change: In the guidance, we only consider par.
Speaker Change: Part of it.
Speaker Change: Detroit is speaking the ones to be closed within the next two months.
Got it understood.
Jim: And then Jim.
Speaker Change: Just.
Speaker Change: Actually at.
Speaker Change: This probably will be the last one.
Speaker Change: Is there a mix of.
Speaker Change: Best versus only PB.
Speaker Change: That.
Speaker Change: Is that you are looking at maybe different in different geographies are.
Speaker Change: How do you see that.
Speaker Change: Our project mix.
Speaker Change: In your pipeline.
Speaker Change: It's a whole mixture as you you'll see that they presented already that we started our storage business our initiative over two and half years ago.
Speaker Change: And the point is almost every single country, we have storage assets.
Speaker Change: And PV, either big or small normally big ones in the U S and in Europe, we try to assign psa's.
Speaker Change: And smaller ones.
Speaker Change: <unk> tried to do it all the way to NTP and sell that at least partly risk free.
Format and make higher margin.
Got it.
Speaker Change: I think you will definitely see more storage from U S. Because we launched the first storage austere and you will see more in the U S.
Speaker Change: <unk>.
Speaker Change: Again, we have a strong pipeline both for solar and storage and then you will see more from different country from Europe, We talk about Italy lock you see we launched Germany.
Speaker Change: And so you will definitely see more.
Speaker Change: From different countries and also okay.
Speaker Change: Good mix of solar and storage.
Speaker Change: Got it thanks, a lot for taking my questions.
Speaker Change: Thank you.
Speaker Change: Yes.
Thank you for all the questions.
Speaker Change: This concludes the Q&A session I would now.
Speaker Change: Now hand back to <unk>.
<unk>.
Speaker Change: Thank you operator.
Speaker Change: The global transition to renewable energy continues to accelerate creating strong tail reasons for solar energy storage.
Speaker Change: With disciplined execution.
Our solid contracted revenue base and a growing presents in high margin segments.
Speaker Change: Our well positioned for sustained growth.
Speaker Change: As we enter 2025.
Speaker Change: We remain focused on executing our strategy across DSA, IPP and energy storage.
Reinforcing our leadership in the sector.
Speaker Change: Backed by our strong financial foundation, and our commitment to innovation.
Speaker Change: We're confident in our ability to seize new opportunities drive long term value creation.
Speaker Change: To deliver meaningful returns for our shareholders.
Speaker Change: Thank you operator.
Thank you. This concludes today's conference call. Thank you for participating you may now disconnect.
Speaker Change: Yes.
Speaker Change: Okay.
Speaker Change: [music].
Okay.
Speaker Change: Okay.
Speaker Change: [music].