Q1 2025 ClearSign Technologies Corp Earnings Call

Okay.

Yes.

[music].

Good afternoon, and walking through the clear sound technologies first quarter 'twenty 'twenty five conference call.

Operator: Good afternoon and welcome to the Clearsign Technologies first quarter 2025 conference call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the store key followed by zero.

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Operator: After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star than the number one on your touchtone phone. To withdraw your question, please press star than the number two.

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Operator: Please note, this event is being recorded.

Please note. This event is being recorded I would now.

Matthew Selinger: I would now like to turn the conference over to Matthew Selinger of Firm IR Group. Please go ahead.

Speaker Change: I'd like to turn the conference over to Matthew Selinger of of firm IR Group. Please go ahead.

Speaker Change: Good afternoon, and thank you operator, welcome everyone to the clear sight Technologies Corporation first quarter 2025 results conference calls.

Matthew Selinger: Good afternoon and thank you, operator.

Matthew Selinger: Welcome everyone to the Clearsign Technologies Corporation first quarter 2025 results conference call. During this conference call, the company will make forward looking statements. Any statement that is not a statement of historical fact is a forward looking statement. This includes remarks about the company's projections, expectations, plans, beliefs, and prospects. These statements are based on judgments and analysis as of the date of this conference call, and are subject to numerous important risks and uncertainties that can cause actual results to differ materially from those described in the forward-looking statement. The risks and uncertainties associated with forward-looking statements made in this conference call include, but are not limited to, whether field testing and sales of Clearsign products will be successfully completed, whether Clearsign will be successful in expanding the market for its products, and other risks that are described in Clearsign's filings with the SEC, including those discussed under the Risk Factors section of the Annual Report on Form 10-K.

Speaker Change: During this conference call. The company will make forward looking statements any statement that is not a statement of historical fact is a forward looking statement.

Speaker Change: This includes remarks about the company's projections expectations plans beliefs and prospects.

Speaker Change: These statements are based on judgments and analysis as of the date of this conference call inner subject to numerous important risks uncertainties that could cause actual results to differ materially from those described in the forward looking statements the.

Speaker Change: The risks and uncertainties associated with forward looking statements made in this conference call include but are not limited to whether field testing and sales of crudes and products will be successfully completed but it certainly won't be successful in expanding the market for its products and other risks that are described clear sights filings with the SEC, including those discussed under the risk factors section.

Speaker Change: The annual report on Form 10-K.

Speaker Change: Period ended December 31, 'twenty 'twenty four.

Matthew Selinger: The period ended December 31, 2024.

Matthew Selinger: For more information, visit www.fema.gov For more information, visit www.fema.gov Except as required by law, Clearsign assumes no responsibility to update these forward-looking statements to reflect future events or actual outcomes and does not intend to do so.

Speaker Change: Except as required by law Christian assumes no responsibility to update these forward looking statements to reflect future events or actual outcomes and does not intend to do so.

Matthew Selinger: So on the call with me today are Jim Deller, Clearsign's Chief Executive Officer, and Brent Hinds, Clearsign's Chief Financial Officer.

Speaker Change: So on the call with me today are Jim Deller Chief.

Fred Hite: Executive Officer, and Fred Hite, Chris Nines, Chief Financial Officer.

Matthew Selinger: To this point of the call, I would like to turn the call over to Brent Hinds.

Fred Hite: At this point of the call or would like to turn the call over to Brett highs. So what's that Brent. Please go ahead.

Brent Hinds: So with that, Brent, please go ahead. Thank you, Matthew. And thank you to everyone joining us here today.

Speaker Change: Thank you Matthew.

Speaker Change: Thank you to everyone joining us here today.

Brent Hinds: Before I begin, I'd like to note that our financial results on Form 10-Q was filed with the SEC on May 15. And with that, I'd like to give an overview of the financials for the first quarter of 2025. For the first quarter of 2025, the company recognized approximately $400,000 in revenues, compared to $1.1 million for the same comparable period in 2024. The year-over-year decrease in revenues was driven in large part by a decrease in process burnership. Now recall, last year we shipped multiple process burners to a California refinery, whereas this year's quarterly revenue consisted predominantly of spare parts orders.

Speaker Change: Before I begin I'd like to note that our financial results on Form 10-Q was filed with the SEC on may 15th.

Speaker Change: And with that I'd like to give an overview of the financials for the first quarter of 2025.

Speaker Change: For the first quarter of 2025, the company recognized approximately 400000 in revenues compared to $1 1 million for the same comparable period in 2024.

Speaker Change: The year over year decrease in revenues was driven in large part by a decrease in process burner shipments now recall last year, we shipped multiple process Spurs to a California refinery, whereas this year's quarterly revenue consisted predominantly of spare parts orders.

Speaker Change: Now I would like to look at our full income statement, our net loss increased by approximately 1 million compared to the same quarter in 2024.

Brent Hinds: Now I'd like to look at the full income statement. Our net loss increased by approximately $1 million compared to the same quarter in 2024. This year over year increase was predominantly due to a decrease in our sales volume as compared to the same period last year and $581,000 in legal fees for two separate unrelated activities. One activity incurred $131,000 in legal fees that pertain to work performed in connection with a regulatory inquiry by the SEC into the trading of our securities back in the year 2020. For the second activity, we incurred legal costs of $450,000 during the first quarter of 2025 related to work performed for the board special committee in response to submissions of several stockholders for director nomination.

Speaker Change: This year over year increase was predominantly due to a decrease in our sales volume as compared to the same period last year and 581000 in legal fees for two separate unrelated activities.

Speaker Change: One activity.

Speaker Change: 131000, and legal fees that pertained to work performed in connection with our regulatory inquiry by the SEC into the trading of our securities back in the year 2020.

Speaker Change: But the second activity, we incurred legal cost of $450000. During the first quarter of 2025 related to work performed for the Board Special Committee in response to submissions of several stockholders for director nominations.

Speaker Change: Now for some background during the first quarter of 2020 time the company Board of Directors formed a special committee of independent directors for the purpose.

Brent Hinds: Now for some background. During the first quarter of 2025, the company's board of directors formed a special committee of all its independent directors for the purpose of responding to, managing, and otherwise addressing attempts by several stockholders to submit director nomination notices in connection with the company's 2025 annual median stockholders. We believe, based on recent information provided by the special committee, that this activity is near completion.

Speaker Change: Responding to managing and otherwise addressing attempts by several stockholders to submit director nomination notices in connection with the company's 2025 annual meeting of stockholders.

Speaker Change: We believe based on recent information provided by the Special Committee.

Speaker Change: Activity is near completion.

Speaker Change: Now I'd like to shift the focus to cash.

Brent Hinds: Now I'd like to shift the focus to cash. Our net cash used in operations was relatively flat compared to the same period in 2024. For the first quarter of 2025, we used approximately $1.1 million in operating activities compared to approximately $1 million for the first quarter of 2024. We ended the first quarter of 2025 with approximately $12.8 million in cash and cash equivalent. Our outstanding share count as of March 31st, 2025 was approximately 52.4 million. From an overall financial perspective, we believe our current working capital positions as well to scale our business. And we believe it also gives our customers and suppliers confidence to do business with us.

Speaker Change: Net cash used in operations was relatively flat compared to the same period in 2024.

Speaker Change: For the first quarter of 2025, we used approximately $1 1 million in operating activities compared to approximately $1 million for the first quarter of 2024.

Speaker Change: We ended the first quarter of 2025 with approximately $12 8 million in cash and cash equivalents.

Speaker Change: Our outstanding share count as of March 31, 2025 was approximately $52 4 million.

Speaker Change: From an overall financial perspective.

Speaker Change: We believe our current working capital.

Speaker Change: Positions us well to scale, our business and we believe it also gives our customers and suppliers confidence to do business with us.

Jim Deller: And with that, I'd like to turn the call over to our CEO, Jim Deller. Thank you, Brent, for the financial overview. As always, I'd like to thank everyone for joining us on the call today and your interest in Clearsign.

Jim Deller: And with that I'd like to turn the call over to our CEO Jim <unk>.

Speaker Change: Jim.

Jim Deller: Thank you Brian for the financial overview.

Speaker Change: As always I'd like to thank everyone for joining us on the coldest days until interest in Cleveland.

Jim Deller: The call today.

Jim Deller: The call today, Matthew will lead a question and answer session where we'll go through different business units, much like our previous calls. We will end with an outlook for the rest of 2025 and then open up the call for Q&A from our investors.

Jim Deller: Matthew will need a question and answer session will go through different business units much like our previous calls we.

Jim Deller: And with an outlook for the rest of 2025, and then open up the call for Q&A for our investors.

Matthew Selinger: Many of you have seen this but you can send in questions ahead of time to investorrelations at mselinger at firmirgroup.com So Matthew, I will hand it over to you. All right, Jim, thanks. So we did just have a call about a month ago. And I'd like to carry some of the themes we talked about then, diversification of both product lines and channels. Now, I have heard from some investors of the perception that we've been a bit quiet. especially in this interim. You know, can you give some color of what's been going on?

Jim Deller: Many of you have seen this but you can send in questions ahead of time to Investor Relations at M. S. E. L. I N G E R. At Bam I, All group dog food.

Jim Deller: So now I will hand over to you alright. Thanks. So we didn't have a call about a month ago and I'd like to carry some of the themes we talked about that.

Jim Deller: Diversification of both product lines and channel.

Jim Deller: Now I have heard from some investors is a perception that we've got a quiet.

Jim Deller: Especially in this interim can you give some color on what's been going on.

Jim Deller: Certainly, and I certainly realise we have just issued the one that's really slated to a purchase order since the last call, but the period's actually been very busy for us and we have got a lot done. I think some of the major activities are probably worth highlighting. The large 26 process burner audit that's going down to the Texas Gulf Coast chemical company has been in testing. There's been a lot of engineering, a lot of interaction with Bilolco as we progress that project. There's been a lot of activities related to sales growth and customer visits, both individual sales trips and commerce attendance that I think we should touch on later.

Speaker Change: Certainly Mike.

Speaker Change: Suddenly realize we have just issued the warm, especially slated to pay sort of since the last call, but the periods that you'd be at break busy Fortunately have topped got a lot done.

Speaker Change: I think some of the major activities are probably worth highlighting the large twenty-six process been all that it's going down to the Texas Gulf Coast Chemical company has been in testing there's been a lot of engineering a lot of attraction with the logo as we've progressed that project.

Speaker Change: Been a lot of activities are related to sales growth and customer visits both individual sales trips and homes tenants, but I think we should.

Speaker Change: Such a later yeah.

Jim Deller: And the, you know, the ministry has been very busy for us. We've had continuous work there that I'm actually very excited about. So, you know, I understand not many purchase orders came in in this quarter, but we actually have made a lot of progress and got a lot done. Okay, great.

Speaker Change: And the.

Speaker Change: Yeah. They are the midstream ministry it'd be very busy for us we've had a continuous what death it unless you're very excited about it.

Speaker Change: I understand not many places orders came in in this quarter, but we actually are having a lot of progress you've thought about okay. Great I think it will die they unpack some of the one times you mentioned Jim was the reset.

Matthew Selinger: I think we'll dive in and unpack some of those.

Matthew Selinger: One of the items you mentioned, Jim, was the recent press release about a flare order.

Speaker Change: Yes, released about a flare order could you give a little more and this is again diversifying for the product lines right could you give them more color on this order and we'll dive into this.

Jim Deller: Could you give a little more, and this is again diversifying some of the product lines, right? Could you give a little more color on this order? And we'll dive into this. Certainly.

Speaker Change: Suddenly.

Jim Deller: In Alaska, we started talking more about this has been a product line that historically we've not talked about that has not been a dominant focus of ours. But in the recent months, we have seen a lot more traction. It seems to be a new need driven by regulations. We did receive an order in the last few weeks. What's exciting is this is actually a repeat order from the same customer. And this customer has actually bought flares from Clearsign back in the past, even prior to my joining the company.

Speaker Change: In the last call. We started talking more about places has been a product line that historically, we've not talked about but just not being a dominant focus of that.

Speaker Change: In the recent months, we have seen a lot more traction.

Speaker Change: It seems to be a new need driven by regulations. We did receive a an order in the last few weeks was exciting as this is that shouldn't repeat order from the same customer and this customer has actually bought players from players like back in the past even prior to my joining.

Speaker Change: Joining the company.

Jim Deller: Then just a little bit of background on what we're doing, right? So these flares are a cylindrical vessel. It's a large cylindrical vessel, probably 30 feet high. And the burner element is inside that vessel. The burner element is designed to have very low NOx emissions and burn the fuel cleanly. That's our specialty. That's why we're putting burners in there. The existing burners were not meeting the permit requirements. And the customers come to Clearsign to replace that burner. So the vessels are in place. The first order we got, we did the engineering. We've since got the order to build that flare burner.

Speaker Change: Thank you, it's a little bit of background on what we're doing right.

Speaker Change: These players are a cylindrical vessel is the largest single vessel probably 30 feet high.

Speaker Change: And the third element is inside the vessel the better element is designed to have very low nox emissions and doesn't feel clearly that's a specialty that's why would sleep benefit and that the.

Speaker Change: The existing vendors, but not meeting the requirements of the customers come to cliffs on tour.

Speaker Change: To replace that but so the vessels are in place. The first of all the weak golf, we did the engineering, which sends the order to build that plant, but what do we have just recently released is a second engineering project to design it but we have to engineer. These because they have to retrofit into the existing products and so I get it. So we're seeing a resurgence kind of in this product line.

Jim Deller: The order we've just recently released is a second engineering project to design a burner. We have to engineer these because they have to retrofit into the existing products.

Jim Deller: And so again, so we're seeing a resurgence kind of in this product line.

Speaker Change: Yes, and let's let's talk some numbers here you mentioned, obviously that this was the third total project for this customer. This most recent order is the second in short order, we did concentrate talking about isn't.

Jim Deller: Yes, and let's talk some numbers here. You mentioned, obviously, that this was the third total project for this customer. This most recent order is the second in short order. We did concentrate talking about, excuse me, this is the third order for them most recently. We talked about the second order on the last call. And on that, you did talk a bit about the total order size. Can you give kind of some quantification on that? Certainly, these orders are coming in in phases, but for the Radicube, and we'll talk about the overall project, the supply of the engineering and the burner product to the site is going to be ballpark $250,000 to $300,000.

Speaker Change: This is the third order for that and most recently, we talked about a second order on the last call and I'll. Let you did you did talk a bit about the total order size could you gotta get kind of a quantification on that.

Speaker Change: So it makes these orders are coming in in phases, but for the right keeps them. We're talking about the overall project to supply all the engineering and the better product to the site is going to be ballpark 250 to $300000. An example, the last all of them they've added some other hardware to the all of this increase the size of that scope.

Jim Deller: In example, the last one, they've added some other hardware to the order that's increased the size of that scope, but compared to a typical burner order that we've given guidance is typically around $100,000, these just the burners for flares will be in the $250,000 to $300,000 range.

Speaker Change: But compared to a typical been orders that we had given guidance is typically 100000 bees, just but that is the players being the 250 to 300 range.

Jim Deller: Now, just to build on that and the theme of the previous call, we've talked about the systems projects or our ability to sell, not just in this case, to Flair Burnham, but the entire Flair product as a system. We do have some of those quoted. When we can expand that scope and talk to the size, those will be in the range of 750 to 1.25 million dollars. Typically, but the orders we have in-house now, just for clarity for everyone, that equipment supply will be in the 250 and 300. Those are great size orders then.

Speaker Change: Now just to build on that and a theme from previous calls we've talked about these systems projects or our ability.

Speaker Change: To sell not just in this case, the flatbed, but entire player product as a system we.

Speaker Change: We do have some of those quoted when we can expand that scope.

Speaker Change: Talk to the size of those will be in the range of 752 $1 million to $5 million.

Speaker Change: Typically but the orders we have in house not just for clarity rigor.

Speaker Change: Equipment supply will be in the 250 to 300.

Sachin: Outside of the order Sachin.

Matthew Selinger: And then I do want to make a clarification regarding some of the terminology, and I'm not sure if investors picked this up, but we did have a little bit of changing terminology in the last press release. I know you may want to address this just so we don't confuse investors going forward. Thank you, Matthew.

Speaker Change: And then do you want to make a clarification regarding the terminology and I'm not sure investors picked us up but we did have some.

Speaker Change: Limited changing terminology in the last press release I know you may want to address that just so we don't confuse and that's just going forward. Thank you Matthew yes.

Jim Deller: Yes, I actually did want to bring this up. So just to confuse, and Matthew, please help me out if this gets too complicated. I'll try and keep this really simple. The wording of the last order we got was that this unit is actually an incinerator. I mentioned what we're supplying is the burner into a vertical vessel and the purpose of that piece of equipment is to dispose of waste gas. Just the way that both the what's technically called an enclosed ground flare and an incinerator are defined, this particular product falls under both names. The reason I wanted to bring this up is looking at permits or potential future journal articles or reports on the site, you will see that sometimes these things are called incinerators, sometimes they're called flares.

Speaker Change: They want to bring this up so just to confuse them. Matthew. Please help me out with this gets to Colombia, I'll try and keep it really simple the wording of the last order. We got was up this unit is actually an incinerator.

Speaker Change: Imagine what we're supplying as the burden into a vertical vessel and the purpose of that piece of equipment is disposal place guess.

Speaker Change: Just the way that both the technique orders enclosed ground flare and then incinerator I'll define that this particular product falls under both names.

Speaker Change: The reason I wanted to bring this up is it.

Speaker Change: Looking at permits or potential future.

Speaker Change: John Law schools, or Portsmouth site, you will see that sometimes these things are all court incinerators, sometimes they called players I don't Wanna be confused you know keep flipping back and forth in the press releases, but just for clarity. If you were looking at they are actually the same thing okay fantastic, let's move into the unprocessed burners and Jim can you give an update on the progress of some of the orders we have.

Jim Deller: I don't want to be confusing and keep flipping back and forth in the press releases, but just for clarity for anyone looking, they are actually the same thing.

Matthew Selinger: Okay, fantastic.

Jim Deller: Let's move into the in-process burners then, Jim. Can you give an update on the progress of some of the orders we've announced? You did touch on this in your kind of earlier high level, but maybe get into the actual orders on the process burner side, traditional process burners. Yes, certainly.

Speaker Change: Now you did touch on this in your kind of earlier, a high level, but maybe getting to dive into the actual orders on the process burner side traditional process burners, yes, certainly in this.

Jim Deller: This is probably the most important area going on for Clearsign at this time. We have two very large process burner orders that are in different stages of production. The first we've been talking about for some time, there's 20 burners waiting on the job site for a Los Angeles refinery. Those are scheduled to be installed in the third quarter of this year. They will be the first major installation for Clearsign process burners. We'll be very excited to get those in. At the same time, we're also working on the 26 burner order for a Gold Coast Chemicals company.

Speaker Change: This is probably the most important area going hopefully play assigned at this time, we have two very large process by the orders that are in different stages of production. The first we'd be talking about some time. There's 20 billion is waiting on the job site or a Los Angeles refinery. Those are all scheduled to be installed in the third quarter of this year.

Speaker Change: They will be the first major installation for ksi process, but it will be very excited to get those in at the same time. We're also working on the 26, but in order for a Gulf Coast Chemicals company those benefits are going to four different teachers.

Jim Deller: Those burners are going to four different heaters. They're in the final engineering and testing phase, but they are also due to be fabricated, shipped and hopefully installed later on this year. But these two installations will put our products into household global name companies and be very well recognized within the industry. So in terms of references and establishing Clearsign and showing what we can do, these will be very important for us.

Speaker Change: Stay in the final engineering and testing phase, but they also choose to be fabricated ships and hopefully installed later on this year.

Speaker Change: But these two installations will put our products into household global name companies and be very well recognized within the industry. So in terms of references and establishing clear on the shuttle we can do this.

Speaker Change: It will be very important for us, Okay, and then shifting to.

Matthew Selinger: OK, and then shifting to the expanding the sales channel for process burners.

Speaker Change: The expanding this sales channel for process burners I'm going to ask you kind of what's going on with Zika I know, we announced the sales and marketing agreement December and I know the co branding was finally launched in March here any sort of update you can tell us going on with the relationship with Zika.

Jim Deller: I'm going to ask you kind of what's going on with ZECO. I know we announced the sales and marketing agreement in December, and I know the co-branding was finally launched in March. You know, any sort of update you can tell us, you know, going on with the relationship with ZECO?

Jim Deller: I can. I mean, it's it's quite brief at this point, but I'm very pleased their marketing team and marketing team are working together really well to complete the package of information that the Zico sales team need. I believe they are just about done.

Speaker Change: I can't I mean, it's it's quite brief at this point I'm very pleased that marketing team our marketing team all working together really well to complete the package of information that Zika sales team need I believe they are just about done so certainly my market space.

Jim Deller: So certainly one of my markers for the upcoming months. is to registered the first inquiries that come in from a Zco sales lead, but the cooperation is going well. You know, we're also testing the burners at Zco for the 26 burner order and just the interaction and the assistance, and we've actually hosted our client as part of that testing. They've been into witness. The accommodation of our client on the Zco site has just been phenomenal. It's truly been a very supportive and productive relationship. Okay.

Speaker Change: Three months.

Speaker Change: Is too.

Speaker Change: Registered the first inquiries that come in from a Zika sales lead.

Speaker Change: The other cooperation is going well we were also testing the bonus Zika forest twenty-six been ordered.

Speaker Change: And the just that the interaction and the assistance and we've actually hosted outlined as part of that testing might be there to witness the accommodation of a bundle on the Zika side has just been phenomenal it's truly been a very supportive and productive relationship. Okay, and then how about giving a little bit of color on the pipeline and what are you.

Jim Deller: And then how about getting a little bit of color on the pipeline? What are you seeing in the sales pipeline in general? Maybe give us some visibility into that. Yeah, maybe I can start, you know, we track our sales and software salesforce.com, but we can pull data out of that to keep track of how things are going. And a big indicator for me looking for our future business is the opportunity pipeline and the inquiries we get in and the trends that are showing. So maybe just to share some very high level data, the The number of quotations that we've been able to provide so far this year compared to the same time period last year has doubled, which is very encouraging.

Speaker Change: <unk> seen in the sales pipeline.

Speaker Change: And in general can you give us some visibility into that.

Speaker Change: Yeah.

Speaker Change: Maybe I can start.

Speaker Change: We track our sales and software Salesforce com, but we can pull data out of that out of that to keep.

Speaker Change: Track with how things are going on a big indicators all be looking for our future business.

Speaker Change: Is the opportunity pipeline that requires beginning in the trends of that showing.

Speaker Change: So maybe just to share some very high level data.

Speaker Change: <unk>.

Speaker Change: The number of quotations that we have been able to provide so far this year compared to the same time period last year has.

Speaker Change: <unk> has doubled which is very encouraging.

Jim Deller: What's more encouraging is when I look at the total value of those proposals. The value of the proposals put out year-to-date this year are just under five times the value of the proposals put out this period last year. And I don't want to give a false impression. Those are not orders. There's no direct, mouthful promises. But for me, looking forward to our business, the first thing I'm looking for is is the interest there? Are we getting the inquiries? Are we getting, does our equipment meet those inquiries to the place that we're actually putting out? price proposals.

Speaker Change: More encouraging is when I look at the total value of those proposals.

Speaker Change: The value of the proposals put out year to date this year or just under five times the value of the proposals put out this period last year and I don't want to give a false impression of those ethanol orders there is no.

Speaker Change: Alright, and I promise. This puts me looking forward for our business, especially I'm looking for is.

Speaker Change: Is the interest they're already getting inquiries are we getting desire.

Speaker Change: To quickly meet those inquiries to the places that we're actually putting out.

Speaker Change: Price proposals.

Matthew Selinger: And this is a very strong indicator. I'm very optimistic with these numbers and the data I'm seeing. And for clarity, the numbers, the kind of quantification you're giving was total proposals. Is that correct for the company? Yes. Okay. So that may include then the M-series focus on the midstream, which we talked about quite a bit in the last call. Okay.

Speaker Change: This is a very strong again together I'm very optimistic with these numbers and the data that I'm seeing and for clarity that the numbers you use it kind of quantification you were giving was total proposals is that correct for the company. Yes. Okay. So that that May include then the M series focused on the midstream, which we've talked about quite a bit in the last column okay.

Jim Deller: So with that, why don't we, we did focus in on a lot of the last call on the M-series, which again is a new product line focused on the midstream. Can you give me some color? What's going on? What are you seeing there? That just continues to be a good storyline and a great story for us. The interest is just growing. In the last few weeks, in the midstream in general, this is actually a 3M wall burner. We worked with Exotherm, one of our customers, and started that burner up in their facility as part of a check before that heater goes out to their customers' job sites.

Speaker Change: So with that why don't we we did focus I know a lot of last call on the M series, which is focused on which is getting a new product line focused on the midstream.

Speaker Change: Give me some color what's going on what are you seeing there.

Speaker Change: That just continues to be a good part of it.

Speaker Change: I'm a great story for us the interest is just growing.

Speaker Change: In the last few weeks in the midstream in General this is actually you free up more but we've worked with access to one of our customers and started up better up in that facility as part of a check before that he did it goes after that customers' job sites that went well, we look forward to getting that better out.

Jim Deller: That went well. We look forward to getting that burner out. We have had repeat inquiries from established customers, Tulsi the Ministry and Devco in particular, we've been able to recently provide quotes to them for not only new burners, but also retrofit burners where there's equipment out in the field with new emissions requirements. Now looking at M1 burners forward placement of the existing burners out. Through them, we're also getting traction with some of the major companies in the midstream business and actually getting some really good interest from them, which is extremely exciting because they are just the balling bit of equipment out there.

Speaker Change: We have had repeat inquiries from established customers totally the midstream and <unk>.

Speaker Change: Particular, but we've been able to recently provide quotes to them for not only new benefits, but also retrofit business, where there's equipment out in the field.

Speaker Change: As new emissions requirements and.

Speaker Change: Now looking at it more buttons for replacement of the existing bums out.

Speaker Change: Through that and we're also getting traction with some of the major companies in the midstream business and actually getting some really good interest from that which is extremely exciting because the just the volume of equipment out there, okay and as a reminder, that the go to market strategy here is leveraging channel partners, which you mentioned right Dev co.

Jim Deller: Okay. And as a reminder, the go-to-market strategy here is leveraging channel partners, which you mentioned, right? Devco, Tulsa Midstream, ExoTherm. And are there others out there that we could be utilizing and leveraging?

Speaker Change: Tulsa midstream excellent there.

Speaker Change: Are there others out there that we could be utilizing and leveraging yes.

Jim Deller: Yes.

Jim Deller: Definitely a very tangible part of our sales activities right now and the planning and how you know, how do you plan for sales growth is to take M1 technology and go and meet the other companies that produce heaters because the more of those we introduce our technology to and get to use our burners, they essentially become an additional part of our sales channel and expand our reach and exposure. So very much, that's a key part of our sales growth plans. Okay.

Speaker Change: Definitely it might've been a very tangible part of our lives.

Speaker Change: Sales activities right now in the planning and how you know how do you plan for sales growth is to take our technology and go to meet the other companies that produce heaters because the more of those we.

Speaker Change: Introduce our technology to get to use up and as they essentially become an additional parcel sales channel and expand our reach and exposure. So very much let's say a key part of that.

Speaker Change: Sales growth plans, okay, and speaking of that kind of sales and growth plans and initiatives and activities.

Jim Deller: And speaking of kind of sales and growth plans and initiatives and activities, what about conferences? You know, are you leveraging conferences? And I do believe there have been some very recently. Is that correct? You know, in this, what we've been doing since the last call, a couple of the key activities, one were just having our engineers down, making a tour, visiting customers one-on-one and local meetings. But there's been some key conferences in that period also. One of them, we're seeing a significant interest up in Canada. There are some key conferences up there that we've been able to attend and use to start making a network and connections up in Canada.

Speaker Change: What about conferences.

Speaker Change: Are you leveraging conferences and I do believe theres been some very recently is that correct.

Speaker Change: And that's what we've been doing since the last call a couple of the key activities one is.

Speaker Change: Having our engineers down making a tour visiting customers one on one.

Speaker Change: Meetings, but there's been some key conferences and in that period it looks like.

Speaker Change: One of them, we're seeing a significant interest up in Canada. There are some key congresses.

Speaker Change: We'd be able to attend and used to start making our network and connections up in Canada.

Jim Deller: Probably the most important for us was the American Petroleum Institute meeting. This is a bi-annual meeting. The main function is to update and refresh the refining and equipment standards, which actually is the name of this conference. But because of that, nearly all of the lead engineers from the major refineries, the major heater manufacturers and the consulting companies, they are all there. So it's a very good conference for us to attend frequently. One of the key activities there is it's, you know, obviously the sessions are important. We're doing the technical work, but it's the dinners and the lunches and the times that we can interact with our customers.

Speaker Change: Most important for us what does the American Petroleum Institute.

Speaker Change: <unk>. This is a biannual meeting functioned as to.

Speaker Change: And refresh the refining and equipment standards, which actually is the name of this cultures, but because all of that nearly all of the lead engineers from the major refineries the major heater manufacturers in the consulting companies they all wet.

Speaker Change: So it's a very good conference for us to attend frequently.

Speaker Change: One of the key activities. There is it's obviously the sessions are important we're doing the technical work, but it's the it's the demos and the lunches and the times that we can interact with our customers previously we'd been able to interact with a lead agent is just because we've got personal relationships with them.

Jim Deller: Previously, we've been able to interact with the lead engineers just because we've got personal relationships with them. This last call, or this last visit, I'm sorry, we were able to get one-on-one dinners with the lead engineers from the major refineries on multiple occasions, major heat manufacturers. So we're seeing that they are talking to us now about us being solutions to their projects. They're spending a lot more time with us, showing genuine interest in Clearsign and what we're doing. And you go back talking about the sales numbers, I think that that is the same theme that's being reflected in the sales numbers, because a big part of that increase in value is a lot of process burner opportunities where we are being included at the early stages as our clients now look for solutions to their notch problems, as they retrofit their refinery heaters to comply with new standards that they either have or they foresee in the future.

Speaker Change: This last call or this last visit I'm sorry quite.

Speaker Change: We're able to get one or more dentist with elite engineers from the major refineries on both locations major he's manufacturers.

Speaker Change: So we see them, but they all are talking to us now about ESP solutions, they're projects that spend a lot more time with it now showing genuine interest in clear signs of what we're doing.

Speaker Change: When you go back talking about the sales numbers I think that that is the about the same theme that's being reflected in the sales numbers because a big part of that increase in value is a lot of process better.

Speaker Change: Maturities, where we are being included at the early stages as I clients that look for solutions to problems as they retrofit their refinery heaters to comply with new standards that they either happen or they will see in future. So Chris that is really a known entity that it's getting it's really getting a lot more established being taken seriously I mean this is what we've been trying to get to.

Jim Deller: So Clearsign's really a known entity now. It's really getting a lot more established and being taken seriously. I mean, this is what we've been trying to get to for years. It's really starting to show up in the numbers.

Speaker Change: Yes, it's really starting to show up in the numbers okay.

Jim Deller: Let's shift to an additional product line, you know, boiler burners, you know, maybe just give, you know, a high level, what is going on with the boiler burner product line now? Yeah. I mean, the market has generally been quiet in California.

Speaker Change: I'll shoot you an additional product line.

Speaker Change: Boiler burners.

Speaker Change: I'm, just giving you.

Speaker Change: A high level, what is going on with the boiler and our product line now.

Speaker Change: I mean, the market has generally been quiet in California, We've recently seen a significant increase in inquiries.

Jim Deller: We've recently seen a significant increase in inquiries for the water tube boilers, and I'll have more news. We actually have California Boiler coming into our office. We've got a meeting with them on Thursday to talk about sales planning and how to address this market as part of that. So I don't have a lot more news right now.

Speaker Change: The water tube boilers that we could've been up.

Speaker Change: One of them qualifying for that.

Speaker Change: I'll have more news, we actually have California boiler coming into our office, we've got a meeting with them on Thursday talked out sat with planning and how to address this market.

Speaker Change: Part of that so I don't have a lot.

Jim Deller: I think on the next call, we can give an update. Okay, fantastic.

Speaker Change: More news right now I think all over the next call. We can give it out there okay fantastic and then how about the clear Shanghai I know in the last call. We had some significant developments to report which.

Jim Deller: And then how about the Clearsign Eye? I know in the last call, we had some significant developments to report, which is exciting. We're seeing this product line kind of start to get its early growth, right? Yeah, it's hard to say early. Yeah, product line's been around for a A long time, but we have recently got got some very significant traction, but we have the four centres going down to a prominent Gulf Coast refinery for installation and demonstration there, but those are in production. They're not down on the site yet, but I think in the next couple of months they're due to be sent down there and started up.

Speaker Change: Which is exciting.

Speaker Change: We're seeing this product line.

Speaker Change: You start to get its fairly growth right, it's hard to heal even the protocol has been around freight.

Speaker Change: A long time, but we have recently got got some significant traction, but we have to be but the <unk> going down to a potent Gulf coast.

Speaker Change: I'm ready for installation demonstration that but those are in production. They don't download the slides yet, but I think in the next couple of months that you have to be sent down there and started up.

Jim Deller: That refiner has also requested a quotation for census for a second heater. We think they'll have to get these demonstration ones up and running first, but we expect that to follow on. Also, we have now got the opportunity and we're building sensors to fit onto our first Clearsign burners down on another Los Angeles refinery and have a second heater with Clearsign burners where we're actually providing a quotation. former census to be installed there. So it's it's starting to happen. I think for the timing, it takes about 12 weeks to manufacture these sensors, more time to install them.

Speaker Change: That refinery has also a request for quotation for sensus for a second pizza, we think that'll have to get these demonstration warmed up and running first but we expect that to follow on.

Speaker Change: Also we have now got the opportunity with building sensors to fit onto those cliffs line, but that's down on another Los Angeles refinery and have a second pizza with players like bonus wherever I should put in your quotation.

Speaker Change: For the census to be installed there. So it's it's starting to happen.

Speaker Change: I think for the timing, but it takes about 12 weeks to manufacture the sensors more and more time to install them. The compare it's way better projects. This policy is going to turn quicker it's a.

Jim Deller: But compared to a burner project, this product is going to turn quicker.

Unknown Executive: It's a Unknown Executive, Brent Hinds, Colin Deller, Robert Kecseg, Unknown Executive, Brent Hinds, So I think there's a really big need for it. It is a flame detection device. So clients are going to have to see it to get comfortable using it. But with that turnaround, to get these installed, to get a few months of runtime, we're seeing things picking up. I think realistically, we're probably in the six to nine months I'm really expecting to start to see some traction as we get these first installations out into the field and getting them running and then the news to spread around the industry.

Speaker Change: Standard product going to be off the shelf, it's really a disruptive technology that replaces a device with a flame north of his hatred in the industry for mechanical problems.

Speaker Change: So I think there's a really big need for it.

Speaker Change: It is a a flame detection device that clients are going to have to see it to get comfortable using it.

Speaker Change: But with that turnaround to get these stores to get a few months of run time, we're seeing things picking up I think realistically, we're probably in the six to nine months I'm really expecting to start see some traction as we get these specialist relations out into the field and get in and running and then the news to spread around the industry alright, So there'll be a few commercial engine.

Jim Deller: All right, so there'll be a few commercial installations coming up fairly soon. And these are sold into then the same customers with the same expertise and the same subject matter experts, is that correct, as other products? Yeah, that's really nice for us. It's the same people, right? The subject matter experts in the refinery are fire equipment experts. So that covers the burners, the sensing technology, and other aspects of the heaters. So these are the same people we're already talking to. I think what's significantly different is the sensor is not related to any NOx requirements or permitting.

Speaker Change: Patients coming up fairly soon and these are sold into then the same customers.

Speaker Change: At the same expertise and the same subject matter experts that correct as other products. Yeah, that's really nice for us. It's the same people, but the subject matter experts and are finally, all fired equipment experts does that covers the bed as the sensing technology.

Speaker Change: One of the aspects of the heat. So these are the same people are already talking to.

Speaker Change: I think it was significantly different is the sensor is not related to any.

Speaker Change: <unk> requirements for permitting so the applications the sensors all worldwide every heater.

Jim Deller: So the applications of these sensors are worldwide, every heater, rather than just the regions that are under new or expectedly new NOx constraints. So the market exceeds that of our process burner addressable market? Vastly, yes. It's every process burner that has a flame sensor on it, which is a huge number. That's exciting. So kind of a high volume off the shelf, lower sales price, as we said, right, but applicable to our existing and growing customer base. off the shelf, but no custom engineered. That's it. Yeah, that is this will be a volume style product.

Speaker Change: Rather than just the regions that are under you or expected lead you knock some strengths to the market exceeds that of our process burner addressable market.

Speaker Change: Vastly yes, it's every process better that that has a a flame sensor on it.

Speaker Change: A huge number that's exactly kind of a high volume off the shelf and lower sales prices, we said right.

Speaker Change: Clickable to our existing and growing customer base.

Speaker Change: Off the shelf and no customer engineered.

Speaker Change: Yeah that is this will be a volume style product great. That's great. So.

Jim Deller: Great. Exciting.

Jim Deller: So, Jim, what can investors kind of be, should they be looking for some key milestones kind of over the next few months and rest of the rest of the year? My key is just thinking through this, as I mentioned, the The startups of those two big process burning projects are going to be key for us. Those are very big deals. We have some other projects in progress actually with Kern Energy, Kerns are a repeat customer of ours. We're expecting to move forward with some other heated projects with them, which will be just for that repeat business will be exciting.

Speaker Change: To walk the investors kind of be should they be looking for.

Speaker Change: Some key milestones over the next kind of few months in rest of the rest of the year.

Speaker Change: Mike He's just thinking through this as I mentioned the.

Speaker Change: As a startup so those two big process been projects.

Speaker Change: Are going to be key for us those are right.

Speaker Change: Very big deals we have some other projects in progress actually with current energy codes or repeat.

Speaker Change: Customer of analysts were expecting to move forward with with some other heater projects with them, which will be just for that repeat business will be exciting but the.

Jim Deller: But back to the point, the two bigger, the LA refinery startup and the US Gulf Coast, I think are going to be very significant. I think for the rather growth of the industry, I am and I continue to be really excited about the midstream, especially with the M1 product that we have, getting the traction and the growth and expanding the sales channel and the potential for repeat orders and getting into some of the major players on the end user term in that part of the industry. I think, you know, just getting the sensors up and running will be a great development for us.

Speaker Change: That's the point the two bigger the L. A refinery startup in the U S. Gulf Coast I think I'll go the.

Speaker Change: Very significant.

Speaker Change: Things to the right the growth of the industry I am and I continue to be really excited about the midstream, especially with the mobile product that we have given the traction and the growth in expanding our sales channel and the.

Speaker Change: Potential for repeat orders and getting into some of the major players.

Speaker Change: The and use it to them in that part of the industry.

Speaker Change: I think just getting the center up and running get will be a great development for US and then really this engagement with Z code and getting their sales force engaged starting to get inquiries from Zika and they have we presented have technology to 50 of their sales team.

Jim Deller: And then really this engagement with Zco and getting their sales force engaged, starting to get inquiries in from Zco, I mean, they have, we presented our technology to 50 of their sales team. That's 50 of their US-based sales team. About half of those are embedded in the customer refineries. That's where they have an office. So the exposure they have and the opportunities that they will come across are going to vastly outnumber what we see. and to them to have the right materials, which is what we're creating, what's taking the time right now, to be able to have a conversation with their customers, if they hear they're considering putting in an SCR to use their NOx emissions, to be able to walk into that meeting and say, I have a solution for you, I believe is going to be extremely powerful.

Speaker Change: Thus 50 of the U S based sales team.

Speaker Change: Half of those are embedded in the customer refinery, so that's where they have an office so.

Speaker Change: So the exposure they have.

Speaker Change: The opportunities that they will come across all go into capacity.

Speaker Change: What we see.

Speaker Change: And to them to have the right materials, which is what we're creating what's taking the time right now to be able to have a conversation with their customers. If they hit their considering putting in an SCR to choose that nox emissions to be able to walk into a meeting and say I have a solution for you.

Speaker Change: I believe is going to be extremely powerful.

Jim Deller: So looking for those first priorities coming in from the Zco sales team, to me, is going to be a big market. Great. Well, it's exciting. I think exciting times and seeing the other product lines and our sales channels start to kick in. I think it's been a, I think a lot of investors have watched it for a while and it's a, like I said, again, exciting to be here.

Speaker Change: Looking for those specialty parties coming in from the CECO sales team to me is that it's going to be a big Mark great. What's exciting I think exciting times in deaths seen the other product lines or sales channels start to kick in.

Speaker Change: I think it's been a I think a.

Speaker Change: A lot of investors have watch it for a while I get to like I said again excited to be here I don't have any more questions. So with that I think we'll open it up.

Matthew Selinger: I don't have any more questions.

Operator: So with that, I think we'll open it up to the operator and then open it up for other people to ask questions. So with that, operator, please open it up for questions. We will now begin the question and answer session. To ask a question, you may press star then the number one on your touchtone phone. If you are using a speakerphone, please pick up your handset before pressing any keys. To resolve your question, please press star, then the number two.

Speaker Change: To the operator, and then open it up for other people to ask questions so with that operator.

Speaker Change: Please open it up for questions.

Speaker Change: We will now begin the question and answer session to ask a question you May Press Star then the number one on your Touchtone phone. If you are using a speakerphone. Please pick up your handset before pressing any keys for.

Speaker Change: The resign a question. Please press Star then the number two.

Operator: At this time, we will pause momentarily to assess her roster.

Speaker Change: At this time of all possible I'm entirely to assess her roster.

Speaker Change: Your first question comes from the line of Sameer Joshi from H C. Wainwright. Please go ahead.

Samir Joshi: Your first question comes from the line of Samir Joshi from H.C. Wainwright. Please go ahead. Yeah, good afternoon. Thanks for taking my questions, Jim Brent. Matthew did a good job covering a lot of the topics that we wanted addressed. But just digging a little bit deeper in some of those.

Sameer Joshi: Yeah. Good afternoon, Thanks for taking my questions Jim Brian.

Speaker Change: Matt you did a good job of covering a lot of the topics that we wanted addressed but just digging a little bit deeper in some of those.

Speaker Change: Oh, the Veeco co branding.

Jim Deller: The Zco co-branding effort How are the Zco salespeople incentivized to sell or market your products? Is there a commission-based approach or is there some kind of revenue sharing? Just wanted to understand what is there in Thanks for it.

Speaker Change: Effort.

Speaker Change: How are the vehicles sales people.

Speaker Change: Anyways.

Speaker Change: Subtle.

Speaker Change: Our market your product there are commission based approach or is there some kind of revenue sharing.

Speaker Change: Just wanted to understand what is that incentive.

Speaker Change: Just to the market.

Speaker Change: Got it.

Speaker Change: Thanks, Matt.

Jim Deller: That is a To be honest, that is a subject we have yet to work out. This engagement at this level with Zco is quite new. And obviously, we're working through getting the materials to them and getting them engaged with our sales team. I'll be frank, at this point, there is definitely an incentive system there. I've not had a discussion at this time with Zico about a specific or different. a incentive system for Clearsign projects specifically, obviously these are the it's the Zco employees and the Zco sales team. So that's a right.

Speaker Change: <unk>.

Speaker Change: To be honest that is a subject we have yet to accounts to this engagement at this level with CECO is.

Speaker Change: <unk> you.

Speaker Change: And obviously, we're working through getting the materials to them and getting them engaged with that sales team.

Speaker Change: Oh.

Speaker Change: Okay.

Speaker Change: At this point there is definitely an incentive system that I've not had a discussion at this time with zico about a specific or different.

Speaker Change: Our incentive system or clay assigned project specifically.

Speaker Change: These are the <unk>.

Speaker Change: The zico employees and the Zika sales team.

Speaker Change: So that's a problem.

Samir Joshi: a subject that I would address. with our respect all the Zika organizations. and, you know, the understanding we have with them. I understood. Yeah, I know. It's early days and you're still working out how it will work. That's fair.

Speaker Change: A subject that I thought I would address.

Speaker Change: With respect all the Zika organization.

Speaker Change: And the the understanding we have with them.

Speaker Change: Understood.

Speaker Change: Early days and you're.

Speaker Change: Youre still working out how it would work.

Speaker Change:

Samir Joshi: On the Clearsign I, four deployments that you are planning this quarter, Are there any subsequent, I know you talked about some additional orders emanating from this, but at the same location, can you deploy additional sensors? And then, because it is a supermajor, how many other refineries can you also deploy at the same supermajor?

Speaker Change: On the clear sign I.

Speaker Change: For deployment or that you're that you're planning this quarter.

Speaker Change: <unk>.

Speaker Change: Are there any subsequent I know you talked about some additional orders emanating from this but at the same location can you deploy.

Speaker Change: Additional sensors and then because it is a supermajor.

Speaker Change: How many other refineries.

Speaker Change: And you also deploy at.

Speaker Change: At the same supermajor.

Speaker Change: Okay.

Jim Deller: Great question. So, you know, at this point, what we're manufacturing are four demonstration units going down to a supermajor on the Gulf Coast. That refinery has many heaters with many burners. So even on that one site, there will be thousands of potential opportunities and being a super major, you'd reasonably expect that that company has multiple refineries within the US and then even more globally. And, you know, you can rattle off the household names of the major oil companies that have refineries throughout the US. The sensors are applicable to all of those refineries, and again, whether it's US-based or other countries around the world.

Speaker Change: Great question.

Speaker Change: At this point, what we're manufacturing all four demonstration units going down to a.

Speaker Change: You've made your on the Gulf Coast.

Speaker Change: That refinery has many heaters with many buttons so even on that one sites that will be.

Speaker Change: Thousands all potential opportunities and being a super major new you'd reason I expect that that company has.

Speaker Change: Multiple refineries right within the U S and then even more globally.

Speaker Change: And you can rattle off the household names all the major oil companies that have refineries throughout the U S. The brought the sensors are applicable to all of those refineries, whether it's at and again, whether it's U S based or.

Speaker Change: Other countries around the world.

Speaker Change: Understood.

Samir Joshi: Understood.

Jim Deller: And then this last question is sort of like a macro level question, stepping back from where you said, and given the tariff environment, supply chain environment, demand as a result of this environment, and also the forthcoming regulatory relaxing, potential relaxing of certain regulations, what is management's view of how these That is a A good question. So, you know, I've obviously got thoughts and opinions, which I will share. I do not have, I don't think anyone really has data at this point. We, you know, we've looked very closely at the materials pricing of our products. And there were some initial I'd say price fluctuations, I think due to the uncertainty when the tariffs were first announced, and nobody knew what was going on.

Speaker Change: And then this last question, it's sort of like a macro level question stepping back.

Speaker Change: From where you sit and given.

Speaker Change: Given the tariff environment supply chain.

Speaker Change: Environment demand as a result of.

Speaker Change: This environment and also.

Speaker Change: The forthcoming regulatory relaxing potential relaxing of certain.

Speaker Change: Regulations.

Speaker Change: How does that are there.

Speaker Change: Like what is management view.

Speaker Change: Of how these things.

Speaker Change: Will interplay with your business.

Speaker Change: That is a.

Speaker Change: A good question.

Speaker Change: I've, obviously got forced opinions, which I will share I do not have.

Speaker Change: I don't think anyone really has data at this point.

Speaker Change: Yeah.

Speaker Change: We.

Speaker Change: We've looked very closely at the materials pricing.

Speaker Change: All of our products and there was some initial.

Speaker Change: I'll say price fluctuations I think jude's the uncertainty when the terrorists with first announced and nobody knew what was going on.

Jim Deller: The pricing seems to have settled down back to the pre-tariff levels from what we're seeing right now. So as of today, we're truly seeing minimal impact right now, although there are obviously sensitivities. but just to the uncertainty and I think that's consistent with Right, general conversations in the market when we're looking at projects and our clients planning projects. I think just the uncertainty that it creates is as much of an issue as as any pricing changes just to finance projects, right? It's good to have stable pricing, stable financing costs. But with that said, I've not heard of any projects that we are discussing, or, or bidding on or, you know, chasing orders for that have actually been affected by any of the news.

Speaker Change: The pricing seems to have settled down back to the pre tariff levels from what we're seeing right now so as of today with truly see minimal impact.

Speaker Change: Impact right now, although they're obviously sensitivities.

Speaker Change: But just to the uncertainty and I think that's consistent with.

Speaker Change: Alright general conversations in the market when we're looking at projects and clients planning projects.

Speaker Change: I think just the uncertainty that it creates is as much as an orphan issue as as any pricing changes just to finance projects. It's good to have stable pricing stable financing costs.

Speaker Change: But with that said are not heard of any projects that we are discussing.

Speaker Change: Oh bidding on or chasing orders for that have actually been affected by any help that you said the.

Jim Deller: So the Right, the speculation is purely my opinion. In terms of what we've seen, we've actually seen, to my knowledge, we've seen nothing that has been right tied directly to tires for their customers.

Speaker Change: Right.

Speaker Change: Speculation is purely model my opinion in terms of what we see we've actually seen to my knowledge, we've seen nothing that.

Speaker Change: Has been quite tied directly to.

Speaker Change: Tariffs with our customers.

Speaker Change: In terms of the.

Jim Deller: In terms of the regulations and right effects on the EPA and the Most of those changes appear to be focused on the promotion of hydrogen technology. which obviously is something that we do watch very closely as we work out the promotion of our products. Do we promote the hydrogen burner? Do we focus on other technologies? The main driver of our business is low NOx requirements and the need to meet new permit requirements. That is an age old known pollutant and it's it's clearly written into the function of all the EPA and we've not seen any slowing down or changing of the needs to reduce ground level ozone to precursor, well, NOx is a precursor of that.

Speaker Change: Regulations and effects on the E P a and b.

Speaker Change: Most of those changes appear to be focused on emotion all of hydrogen technology.

Speaker Change: Which obviously is something that we do watch very closely as we do.

Speaker Change: The promotion of our products do we promote the hygiene and we focus on all the other technologies.

Speaker Change: The main driver a bit all of that business is low nox requirements and the need to meet new payment requirements.

Speaker Change: An age old node a pollutant.

Speaker Change: Pollutant.

Speaker Change: And.

Speaker Change: It is clearly written into the function of all the EPA and we've not seen any slowing down or changing.

Speaker Change: All the needs to reduce brown.

Speaker Change: Ground level ozone pretty good right now.

Speaker Change: <unk> is a precursor of that so.

Jim Deller: So Again, we're watching it very closely. I'm seeing more of an effect on the hydrogen side of and Markit, which is really just affecting selection, what type of equipment people are selecting. But in terms of the other projects we're chasing and the need for the technology that we provide, we're really not seeing an effect. And just in the past as well, the other NOx emissions I think are known and accepted pollutant and have not been quite fickle with the Change in the Political Climate.

Speaker Change: So.

Speaker Change: Again, we're watching it very closely I'm seeing more of an effect on the hydrogen side of.

Speaker Change: A market, which is really just affecting.

Speaker Change: A slide what type of equipment people selecting but in terms of the other projects, we're chasing and the need for the technology that we provide.

Speaker Change: We're really not seeing an effect and then Andrew said in the past as well.

Speaker Change: Now the Nox emission I think of a known and accepted balloon.

Speaker Change: And have not been fickle with the.

Speaker Change: Change in the political climate.

Speaker Change: Understood. Thank you for taking my questions.

Samir Joshi: Thank you for taking my questions.

Speaker Change: Thank you Josh.

Speaker Change: Your next question is from the line of Jim Kennedy from Marathon microphone two please ask your question.

Jim Kennedy: Your next question is from the line of Jim Kennedy from Marathon Microfunda. Please ask your question. Hi, Jim. Congratulations on the good progress. Thank you, Jim.

Jim Kennedy: Hi, Jim.

Speaker Change: Congratulations on the good progress.

Jim Kennedy: Thank you Jim.

Jim Kennedy: Really, two questions related to some comments you made about the proposal. and it being up approximately 5x in dollar volume compared to a year ago. Number one, and I realize this may cut across product lines, But can you comment on, are these competitive situations where there was a request for proposal, it went out to many companies, or were they ones where you are the only provider of what they may be kicking the tires on? That's the first part. And then the second part is really the source of these proposals. Did they come from your internal folks?

Speaker Change: Really two questions related to some comments you made about the proposal pipeline.

Speaker Change: And it being up.

Speaker Change: Approximately five acts in dollar volume.

Speaker Change: Compared to a year ago.

Speaker Change: Number one and I realize this may cut across product lines, but can you comment on are these competitive situations, where there was.

Speaker Change: Question for proposal that went out to many companies.

Speaker Change: Or were they ones, where you are the only provider of what they may be kicking the tires on.

Speaker Change:

Speaker Change: That's the first part and then the second part is really the source of these proposals they come from your internal folks did they come from the channel what you know what's getting these proposals elevated the way they are at.

Jim Deller: Did they come from the channel? What's, you know, what's getting these proposals elevated the way they are, at least at this point? Thanks. Thank you, Jim.

Speaker Change: At least at this point thank you.

Jim: Thank you Jim yes, so.

Jim Deller: Yes, so Yeah, I'll take this one at a time. The growth in the sales value of the proposals out is a combination of multiple different product lines, a significant portion is from the process burners and inquiries from major refineries who are planning how to control emissions or to make expansions in units and stay underneath a NOx cap. Other parts of that are from the newer systems projects that we're bidding for complete. Systems. which are obviously of a lot higher value than just providing the Burner Elements. Now, as the right competitive situation of those It's the But we we've got a number but I think generally the refining process burner opportunities are in the early stages where the clients are assessing their options to that control their, their emissions, they obviously have options like installing a large expensive SCR on their heaters.

Jim: Yes.

Jim: I would say, there's a lot of time D.

Jim: The growth in the sales finally, you all of the proposals out is.

Jim: A combination of multiple different product lines a significant portion.

Jim: Is from the process been us and inquiries from May.

Jim: A major refineries who are planning.

Jim: How to control emissions all to make expansions in units and stay underneath a nox cap.

Jim: On the other parts of that ore from the newest systems projects that were bidding where.

Jim: We are bidding for complete.

Jim: Systems.

Jim: Which you obviously you all have a lot higher value than just providing the.

Jim: So in the elements.

Jim: Estimate the right competitive situation.

Jim: All of those.

Jim: It's the.

Jim: Yes.

Jim: And we've got a number but I think generally the dove refining process burner opportunities all.

Jim: In the early stages, where the clients are assessing their options too.

Jim: Our control bad debt there.

Jim: Their emissions they obviously have.

Jim: Options like installing a large expensive SCR on the heaters.

Jim: Which we need to recognize them as a competitive offering there is also some situations where the client may.

Jim Deller: which we need to recognize as a competitive offering. There's also some situations where the client may have a large number of heaters and they have the opportunity to change out every single burner with a more standard burner or actually address just much fewer heaters and make much larger NOx reductions. and install the Clearsign equipment. So so in those regards, there are Competitors However, the price advantage we have against an SEO and I think the big changes that we're seeing is what we've always had that value compared to options like the SCR but the difference now is that we're actually considered a credible alternative and these large refiners are coming to us because they see us as obviously a preferred solution.

Jim: Have a large number of heaters and they have the opportunity to change out every single banner with a a.

Jim: A more standard burn or she addressed just much fewer heat doesn't make much large nox reductions.

Jim: And install the place on equipment. So so in those regards that all.

Jim: Competitors.

Jim: However, the.

Jim: The price advantage, we have against that and I think the big changes that we're seeing is what we've always.

Jim: Had that value compared to options like the SCR, but the difference now is that we're actually considered a credible alternative and these lager finds all coming to us because they see us as obviously a preferred solution. We are a lot less expensive for a lot less disruptive to that.

Jim Deller: We are a lot less expensive, we're a lot less disruptive to their refining, the amount of work to install our burners is vastly less than it would be be an SCR. So I think really this speaks to the acceptance or the growing acceptance of Clearsign burners and recognizing us as a viable provider to these major global companies.

Jim: Refining the amount of work to install our banners is vastly less and it would be BNS, yes, I think really this speaks to the.

Jim: The acceptance or the the growing acceptance of <unk> and recognizing us as a viable provider to these major.

Jim: Major global companies.

Jim: On the systems project side. There is there is a mix some we've bid on I believe they.

Jim Deller: On the systems project side, there's a mix. Some we've bid, I believe they may be going into a somewhat competitive situation, depending on the NOx levels the client actually needs. But there are certainly others where we have or we believe that we are in the position of being the only vendor able to meet the specific needs of the customer. which is very exciting. Gotcha. And in these situations where... customers looking for, let's call it the lowest possible PPM. You're the only game in town, right? And then to follow up with that, do you think those customers are looking for your level of NOx reduction because of what's coming down the pike regulatorily, or they just want to do the right thing?

Jim: May be going into is somewhat competitive situations, depending on the nox levels the client actually needs.

Jim: But there are certainly others, where we have what we believe that we are in the position of being a leap and able to meet the specific needs of off the customer.

Jim: Which is very exciting.

Jim: Got you and in these situations where.

Jim: The customers looking for let's call it the lowest possible ppm.

Jim: You are the only game in town right in and then.

Jim: To follow up with that.

Jim: Do you think those customers are looking for your level.

Jim: Nox reduction because of.

Jim: What's coming down the pike regulatory or they just want to do the right thing.

Jim Deller: It varies across projects. We have one very large project that would fall into the system side, the client has a cap on their NOx emissions in tonnes per year or pounds per year. So there is a certain number of NOx molecules they're allowed to make a year. and by by enabling them to operate with lower NOx emissions, we're actually enabling them to expand the capacity of their plant. So there is definitely a value to the absolute lowest NOx numbers they can get. And that's what we believe is the financial driver. for that project. There are other projects where we can enable a client to modify less of their equipment to meet their overall NOx cap.

Jim: It varies across projects, we have one very large project that would fall into the I see in the system side decline has a.

Jim: Cap on the Nox emissions in tons or pounds PSA was a certain number of months molecule was not allowed to make a year.

Jim: And by by enabling them to operate with lower Nox emissions, but actually enabling them to <unk>.

Jim: Expand the capacity of that plant. So there is definitely a value to the absolute lowest nox numbers I can get and that's what we believe is a financial driver.

Jim: For that project.

Jim: There are.

Jim: Other projects, where we can enable applying to modify less of their equipment to meet their overall Nox cap.

Jim Deller: And to be fair, we have to recognize they're making an economic decision looking at the total project cost. Do they modify, for example, two heaters with Clearsign burners? Or do they modify eight heaters with somebody else's burners and look at the overall cost of those projects? But again, I think we have a competitive offering. For more information, visit www.fema.gov And the additional advantage is by going with the clear sign burners, if the needs change in the future, they've got the option of putting more and more clear sign burners in. as the regulations continue to reduce.

Jim: And to be fair, we have to recognize them, making any economic decision looking at the by the total project cost really modify it for example to aegis with close on bonus quarterly mollify eight heaters with somebody else's bonus and look at the cost.

Jim: Cost of those projects, but again I think we have a <unk>.

Jim: A competitive offering.

Jim: And the additional bands or you're just by going with the cliffs I'm Ben is if the needs change in the future they've got the option of putting more and more clear sign bonds in.

Jim: As the regulations continue to reduce.

Jim: Got you.

Jim Deller: And then just circling back to my proposal questions, with this increased dollar volume that's in-house now, how much of that is Zco related versus not? We're basically in the first inning with Zco now, and can you say that most of what's in-house at 5X is not related to Zco, bringing it in the door? That's right. The At this point, we do not have inquiries coming in from the Zco team as of yet. So this is developed through the Clearsign team. through a lot through personal connections, knowing the subject matter experts on the refineries. through conference meetings, etc.

Jim: And then just circling back to my proposal question Hum.

Jim: With this increased dollar volume.

Jim: That's in house now how much of that is zico related versus not I mean, where are we just we're basically in the first inning with zico now and can you say that most of what's in house at five axes not related to Zika, bringing in in the door.

Jim: That's why the.

Jim: At this point.

Jim Deller: We did not have inquiries coming in from the Zika team as of yet. So this is developed through the cliffs team.

Jim: <unk>.

Jim: <unk> III personal connections knowing the subject matter experts on the refineries through conference meetings et cetera. So I'm, obviously very excited as we bring.

Jim Kennedy: So I'm actually very excited as we bring and Zico on board and ramp up with their sales team, that will be additional to the business that we have today. Yeah, I mean, what an exciting opportunity. Okay. Thank you, Jim. I appreciate your questions.

Jim: But zika onboard and ramp up with our sales team that will be additional to other business that we have today.

Jim Kennedy: Yeah, I mean, what are the exciting opportunity okay. Thank you Jim.

Jim: Thank you Jim I appreciate your questions.

Speaker Change: There are no further questions at this time and so I'll be turning the call over to Mr. Matthew Selinger for you are you mainly questions. Mr. Selinger. Please go ahead.

Matthew Selinger: There are no further questions at this time and so I'll be turning the call over to Mr. Matthew Selinger for our emailing questions. Mr. Selinger, please go ahead. Thank you, operator. I'm going to go ahead and read some questions. Thank you to the investors that sent them in. We've got a healthy number of questions that came in the email ahead of time and even up to this current moment.

Speaker Change: Yeah. Thank you operator, I'm going to go ahead and read some questions. Thank you to the investors they sent them and we've got a healthy number of questions that came in the email ahead of time and even up to the current moment, so starting with the first one Tim.

Jim Deller: So starting with the first one, Jim, you did mention the last call that you could tweak the ultra low emission burners to make them good, but juice up their energy efficiency and be a mass market adoptable burner for those not needing the ultra low Ferrari model, but would do just fine with a very efficient sedan. Have you made progress on moving to this market and getting any traction with this potentially appealing new option? We have this is one of the growth areas of working on it and you appreciate this is It's a sales initiative and also a technology and a sourcing project because as you bring the sales price or move your technology into a lower sales price part of the business, the cost is a very big factor of that.

Speaker Change: You did mention in our last call that you could tweak the ultra low emissions burners to make them, good but juice up their energy efficiency and be a mass market adopt a burner for those not needing the ultra low Ferrari model, but we do just fine with very efficient sedan.

Speaker Change: Have you made progress on moving to this market and getting any traction with this potentially appealing new option.

Speaker Change: We have this is one of the.

Speaker Change: Growth areas and working on it and I. Appreciate this is.

Jim: It's a sales initiative and also a technology and a sourcing project because as you.

Jim: Bringing the sales price will move your technology into a lower sales price part.

Jim: Alpha business you brought the cost is a very big factor all of that we.

Jim Deller: We have actually got some quotes out with customers. for this lower Unknown Executive, Brent Hinds, Clearsign Tech We do have good feedback. And what's been interesting is as we pursue this initiative, we're actually uncovering like new areas of collaboration and new partners and new opportunities. So it's yes, we are acting on it. We do have quotes out. I'm definitely not saying it's done because what we're learning is there's actually a lot more opportunity here that we believe is potentially very good business for Clearsign. And we will continue to write. work on that and develop the products to meet that market that we believe we have the ability to do well with the engineers and the technology at Clearsign.

Jim: We have.

Jim: <unk> got some quotes out with customers for.

Jim: This lower <unk>.

Jim: Spec or less corollary product.

Jim: We do have good feedback and what's been interesting is as we can.

Jim: Hugh This initiative were actually uncovering.

Jim: But new areas of collaboration and new partners and new opportunities. So it's yes, we are acting on it we do have close outs.

Jim: I'm definitely not saying it's done because what we're learning is there's actually a lot more opportunity here that we believe is potentially very good business for <unk> and we will continue to rise.

Jim: Work on that and develop the products to meet that market that we believe we have the ability to do.

Jim: Well with the engineers and the technology actually assigned.

Jim Deller: Great.

Jim: Great.

Jim Deller: Here's another question. How will further ramp up and commercialization of the Clearsign Eye Sensor look like? I know you touched on this earlier.

Speaker Change: Here's another question.

Speaker Change: How will further ramp up in commercialization of the <unk> sensor look like I know you touched on this earlier.

Speaker Change: Good question.

Jim Deller: Good question. So I think, you know, if just take a step back, looking at the Clearsign products, we have products like the process burners and the flares where there's engineering quite long lead times. and then we have products like the boiler burners and what we're planning to be the midstream burners that will be a more standardized platform off-the-shelf model. The sensors take that one step further and these will be are produced in volume of a fixed design kind of a sold off the shelf product. For the I think the question was probably related to the market and sales and my expectations of the growth of that market.

Jim: I think you know.

Speaker Change: If you just take a step back looking at the place I'm products, we have our products like the process burners and the players whether it's engineering quite long lead times.

Speaker Change: And then we have products like the boiler burners and what we're planning to be the midstream business that we will be a more standardized platform off the shelf model.

Speaker Change: Our sense is take that one step further and these will be.

Speaker Change: Ah produced in volume of a fixed design kind of sold off the shelf.

Jim: Product.

Jim: So the I think the question was probably related to the right in our market and sales and.

Jim: My expectations of the growth of that market.

Jim Deller: We'll have the first sensors installed in the next two to three months, being realistically the client and the industry will want to see them operate and get confidence in their performance and the durability. We have a few more few commercial proposals out that I expect to turn into orders once those are done. The The community and the market is communicates very well, right? So we don't name clients in press releases often because when what we can't, but the subject matter experts meet very frequently. I mentioned the API conference we've been to. earlier on in this call.

Jim: We will have the sensors installed in the next two to three months being realistically the client in the industry want to see them operate and get confidence in that performance on the durability.

Jim: We have a few more a few commercial proposals out that I expect to turn into orders once those are done.

Jim: The.

Jim: The community and the market is that communicates very well right. So we named clients and press release, as often because wins, but we cant, but the subject matter experts meet very frequently I mentioned, the API Congress who'd been too.

Jim: Early on in this call is that everyone is talking about I do believe that there is a lot of interest in the eye because of what it does and the problems that it solves I think the news of the.

Jim Deller: So everyone is talking. So I do believe that there is a lot of interest in the eye because of what it does and, and the problems that it solves. I think the news of the performance when they get installed will spread rapidly.

Jim: Performance when they get in store will spread rapidly.

Jim Deller: So I think to bring up Right, a long answer to a conclusion. I think we'll start to see commercial orders picking up in the... Three is probably short, but three to six month timeframe. And as we get more of these out, I think more people will get confidence in them. And I expect it to ramp up from there.

Speaker Change: So I think to bring up.

Jim: A long answer to a conclusion I think we'll start to see commercial orders picking up.

Jim: On the.

Jim: Alright.

Jim: Freeze probably short for three to six month timeframe and as we get more of these out I think more people will get confidence in them and I expect it to ramp up from there. So a follow on in the sensor round is.

Jim Deller: So we'll follow on in the sensor realm, Jim, is the collaboration with Narayan still in place? And to what extent is Narayan further developing software or other applications?

Jim: This is a collaboration with <unk> still in place and to what extent is an area on further developing software or other applications.

Jim: Thank you.

Jim Deller: Thank you.

Jim Deller: So, for anyone not familiar, Narion is a partner we have. They're based in ASEA, our old Seattle office space. The owner and manager of Narion is a ex-Boeing employee, which is how we met with him with some of the earlier Applications for the Clearsign Eye technology. The relationship with them is very much in place. We do talk with them frequently. Dave, The projects they work on are their business, we talk to interest, they share some information, but they have a wide range of projects because of The owner's Mr. Kwon's background. He obviously has aerospace interests, but there are a lot of other very exciting opportunities that he's working on.

Jim: So.

Speaker Change: A friend who are not familiar neuron is a pond that we have they're based in NCR or Seattle office space.

Speaker Change: Owner and manager of now is a ex Boeing employee, which is how we met with him.

Jim: With some of the earlier.

Jim: Applications for the class I and II technology at the relationship with them is very much in place, we do talk with them frequently.

Jim: <unk>.

Jim: The projects they work on all their business, we talked to interests. They should have some information, but they have a wide range of projects because of.

Speaker Change: The other Miss Mr. Quantz backgrounds. He obviously has aerospace interest, but there are a lot of other very exciting opportunities that he's working on they do tend to be longer timeframe. Because he is developing new technologies for some very.

Jim Deller: They do tend to be longer time frame because he is developing new technologies for some very high-tech industries and applications, but it's definitely ongoing and very exciting for us.

Speaker Change: Hi Tech industry is not applications, but it's it's definitely ongoing and very exciting for us.

Speaker Change: He has another question.

Jim Deller: Here's another question. Jim, a few calls back there was a lot of talk about SoCal Gas and kind of the DOE grant. What's going on there with kind of that report about efficiency? Yeah, so there's a lot we continue to be involved with SoCal Gas. As you said, we first got involved with them following the SBIR grant for the development of our hydrogen burner. That project is still going on. and the SoCalGas's interest was to and initially to provide financial assistance to support the introduction of that high hydrogen burner technology into their client base in California.

Speaker Change: Jim a few calls back there was a lot of talk about socal gas and kind of the.

Speaker Change: Grant.

Speaker Change: What's going on there with kind of their report about efficiency.

Speaker Change: Yeah. So there's a lot we continue to be involved with socal gas as you said, we first got involved with them. Following the Spi one grant for the development of our Hudson burden that that project is still going on.

Speaker Change: And the by Soco gases interest was too right.

Speaker Change: And initially to provide financial assistance to.

Speaker Change: Alright support the introduction of that high Hodgkin better technology into their client base in California.

Jim Deller: They, as part of the utility company in California, they've been able to put us in touch with some of the large consulting firms there. One was a, I think what you're referring to here was the ICF report where they actually sponsored a third party monitored testing of the Clearsign burner versus the best alternative burner in the boiler space that showed about a 4% efficiency increase. By the way, there was a presentation given about an hour ago on that Berner product, right going through it. I've got very brief notes, we had a very good attentive lot of interaction there.

Speaker Change: As part of the utilities he comes in in California, they've been able to put us in touch with some of the large consulting.

Speaker Change: Firms there one was a I think we're referring to it was the ICF report, where they actually sponsored.

Speaker Change: Right.

Speaker Change: Third party.

Speaker Change: Monitored.

Speaker Change: Testing all the place on that.

Speaker Change: This is the best alternative burner in the boiler space that showed about a 4% efficiency increase.

Speaker Change: By the way there was a presentation given about an hour ago on that burn a product right going through all of it.

Speaker Change: Very brief notice we had a very good attention a lot of interaction there.

Jim Deller: but back to the and topic.

Speaker Change: But back to the.

Speaker Change: On topic.

Jim Deller: The results of that efficiency increase have provided some great value statements for our sales team, it gets good traction because the without kind of saving The installation of new burners will actually pay for itself over a period of time through the less fuel that has to be consumed in the boilers. just following on from that, we talked a little about the M Series burner, but that has similar benefits. And again, through those savings, The client can select the best NOx burner available and realize a significant savings in fuel cost over the years. which can actually pay for the burner over time.

Speaker Change: The results of that efficiency increase have provided some great valley.

Speaker Change: Sally's statements for our sales team it gets good traction because the with that kind of saving.

Speaker Change: The installation of new bonus pool actually pay for itself over a period of time through the less fuel that has to be consumed in.

Speaker Change: In the boilers.

Speaker Change: Just following on from that we talked to them about the M series benefit that has similar benefits and again through those savings.

Speaker Change: The client can select the best Nox burner available and.

Speaker Change: Realize a significant savings in fuel costs over the years.

Speaker Change: Which can actually pay for the banner overtime.

Jim Deller: So there's a follow on question which you might already answered then.

Speaker Change: So there is a follow on question, which you might already answered that.

Jim Deller: Are you seeing efficiency becoming more of a factor in terms of the sales process as just emissions or is it equal or, you know, in this environment is efficiency leading some of the times now? It is certainly supporting the sales and guest interest. And I think if you can, right, from a client's perspective, what we're hearing is, right, realize that a lot of our clients are not the end users, especially in terms of heater company, they're selling to their end users. If the heater company is offering a heater with a premium, a Clearsign product with extra low emissions, with a with a slight increase in price to the customer being able to go to that customer and say, you can put in this better burner.

Speaker Change: Are you seeing efficiency, becoming more of a factor in terms of the sales process. It as just admissions or is it equal or.

Speaker Change: In this environment is efficiency, leading some some of the times now.

Speaker Change: It is certainly supporting the sales and guest interest and I think if you can buy from a client's perspective, what we're hearing is but realize that a lot of our clients multi end users, especially in terms of heat the company, they're selling to their end users.

Speaker Change: Each company is offering a he's a with a premium class on products with extra low emissions.

Speaker Change: With a with a.

Speaker Change: Slight increase in price to the customer being able to go to that customer and say you can put in this better Buena and by the way you will recover your money and more over time because of these efficiency increases it makes it a very appealing.

Jim Deller: And by the way, you will recover your money and get and more over time because of these efficiency increases, it makes it a very appealing. right sales proposal for our customers who are de facto sales channels for us.

Speaker Change: Sales proposal for AD customers school.

Speaker Change: Right.

Speaker Change: The fact that our sales channels for us.

Speaker Change: Greg I have no more written questions. Thank you so with that I'm going to turn it again back to you Jim for any closing remarks, well, Thank you Matthew and.

Matthew Selinger: Great, I have no more written questions. Thank you.

Jim Deller: So with that, I'm going to turn it again back to you, Jim for any closing remarks. Well, thank you, Matthew. And thank you, operator.

Speaker Change: Thank you operator, so thank you everyone for your interest and taking the time to participate today.

Operator: So thank you everyone for your interest and taking the time to participate today. We do look forward to updating you regarding our developments and speaking with you on our next call. In the meantime, please keep checking in for developments on our website and especially for more behind the news. season's news and hand updates, check in with us on LinkedIn. So thank you very much.

Speaker Change: We do look forward to updating you regarding our developments and speaking with you on our next call.

Speaker Change: In the meantime, please keep checking in for developments on our websites and especially for more behind the news.

Speaker Change: She's news and updates I'll check in with us on Linkedin.

Speaker Change: So thank you very much.

Speaker Change: The conference has now concluded and thank you for attending today's presentation you may now disconnect.

Operator: The conference is now concluded, and thank you for attending today's presentation. You may now disconnect.

Speaker Change: [noise].