Invinity Energy Systems plc

Good afternoon and welcome to the Infinity Energy Systems PLC investor presentation. Throughout this recorded presentation, investors will be in listen-only mode. Questions are encouraged and can be submitted at any time by the Q&A tab situated in the right corner of your screen. Simply type in your questions and press send. The company made it in a position to answer every question it received in the meeting itself. However, the company can review all the questions submitted today and publish responses where it is appropriate to do so. Before we begin, I'd like to submit the following poll. I'd now like to hand you up to Larry Zolch, CEO. Good afternoon to you, sir.

Good afternoon. Very good to see all of you today or not see you, but to be able to talk to you about our 2023 financial results. Many of you have seen variations of this slide before, you know, Infinity well. So I thought it might be most useful to mention two events that I attended in June. The first was the Long Duration Energy Storage Council's annual meeting in Washington state. And that's where the long duration energy storage providers generally come together to discuss the market opportunity in front of us. The second was the International Flow Battery Forum in Scotland that just concluded last week. And there, everyone in flow batteries from beginning to end are presenting and talking about the technology and the opportunity. These are two quite different sessions. The first one characterized by companies with offerings on the market in a variety of different technologies. The second, all about technologies based on flow, on flow batteries, such as Infinities. In both cases, what was very interesting to me, and I felt... almost a certain humility in the sense that Invinity was clearly in the lead in terms of our product offering in both cases. We were with peers who also have and you could call them competitors but the truth is our competitors are lithium batteries what we could see was we have been making great progress i'm proud of the team for that and we have a ways to go that we are in progress on as well so for all of those reasons um my confidence in the opportunity in front of us continues to grow the stability of our product and the product plans we have is uh very encouraging And my optimism about our company has been growing from, and already, as those of you who have heard me before know that I'm positive and have reason to be positive, this was further support of that. So, Infinity has been making great progress, and we're here to tell you about some of that. And for that, though, I'd like to start by talking about what we've announced recently, our 2023 results. and turn it over to Jonathan Marin, our CFO and chief officer of, and I'm always saying the wrong thing, but he is our chief development officer and has been instrumental in many aspects of the progress that we've been making over the last year and a half.

Jonathan. Larry, thank you very much indeed and good afternoon everybody and I'm delighted to be here today presenting the 2023 results. There are some noticeable changes from when I gave this presentation last year and I think I'll just highlight maybe on two of those. The first is a very sizeable increase in revenue from last year and we'll touch on that obviously in a bit of detail in a moment and also that we announced a clean going concern statement from the auditors. Both are incredibly important from going forward both give credibility to customers and suppliers and show that we're really making good progress and note we had new auditors this year so you know there was a very thorough process which those auditors went through no stone unturned and it's one of the reasons why our results are out towards the end of the period and also that obviously in the first half we were focusing on the fundraising but it is a name of ours to get those out sooner but we're very pleased with what we have presented last week. So looking at the top line there, a 511% increase in revenue, in total income. That was marginally ahead of the guidance that we provided slightly in the year by 400,000. And trading overall was in line with those forecasts. that was driven by an 800% year-on-year increase in product shipments. And so whilst it's clearly delightful to see the financial aspect of that coming through, that does very much point to the operational ability of Invinity. And when you look forward to our future projections, it is important to realise that we are shipping a significant number of products through our factory and through our operations at the moment, and therefore that we have sort of started to demonstrate that we can scale that business. From the commercial side, during 2023, we signed 136.7 megawatt hours of orders. Those are for signed or awarded funding in 2023. And those are for deliveries this year and next year. And again, that's a sizable increase on what we'd achieved in 2022. And that does include 100 megawatt hours of mistral orders. from a commercial pipeline perspective uh matt will talk about a little bit more about that in in the meantime but again a substantial increase when you look at a year-on-year increase from where we were sort of roughly this time last year now we're still recording a loss from operations and that has grown uh by about three million from last year when you look at that that is almost entirely due to an increase in the gross loss in 23 versus 22 but that does relate to two projects which we signed quite a number of years ago and that we'd flagged at length were in a loss-making position. We signed those, if you recall, to prove that we could get substantial product to market and demonstrate the supply chain or our operational abilities. And I think you've seen that come through the benefits of that in the other projects which we have signed. And all those others were flat or small positive gross margins at the project level. And I know there is a question coming on a little bit later as to what we mean by that. And I'll cover exactly what I mean by that when we get to the questions. We have managed to reduce cash outflows and that really was as a result of an improvement in the working capital position and admin costs were unchanged broadly year on year. We are debt free and we finished at the end of May with cash of 53.2 million, substantially increased from the position in the prior year and of course that reflects the recent fundraiser which was cornerstone by UKIB. So just giving a little bit more detail on that, That revenue growth came from shipping projects, 15 projects across Australia, the US, Canada, the UK and Europe. And I think when I take a step back and I consider the size of business we are and where we are sort of positioned in this clean tech space, that is quite an extraordinary achievement. And I think it's difficult to look at anyone of sort of our ilk who's managed to deliver projects across that number of continents and book 22 million of revenue. And when I take a step back and consider how that has changed over the last couple of years, it is substantial progress. The significant contributions came from Elemental, Spencer Energy and of course the Viejas Casinos project in the US, which is being commissioned and installed at the moment. We talked about the majority of that loss relating to 2022 projects. The staff costs number has increased as a result of investment in headcount. People are the core to this business across the entire organisation. We touch on a very sort of, almost heavy duty manufacturing to an extent with lots of sort of steel running through factories. Equally, we're doing a lot of high-tech development and people are key to that and we will continue to invest in them for the benefit of the business. On the R&D side, you'll note there's actually a sort of net income position from R&D. That's because of recoveries from Gamesa Electric under the joint developments and commercialisation, we have agreement with them under Mistral, and that's an improved performance on last year. I've lumped professional fees and other admin expenses together. You'll see there's a net decrease there of 1.3 million. The movement between those is really a reallocation between years, but the overall net increase, a net decrease of spend of 1.3 million really does sort of point to the focus on keeping non-essential expenditure down to a minimum. And I say to those, anyone who knows me, I do really dislike signing invoices off and I will continue that thought process. That doesn't mean that we don't invest in R&D, but when it comes to paying sort of unnecessary fees where we can do things better, I will do my best to make sure we do that. And then critically, no P&L charge for onerous contracts. That is a position where we talked again about margins moving towards positive. That means we've got no provision booked in this year. From a balance sheet perspective, the large inventory position you saw at the end of last year was a result of us delivering very shortly into 2023 the projects in Australia and Canada. When you look at a net basis across the year where you take account of not just inventory, but also amounts owed to suppliers, deferred revenue, And any owner's contract revision, there's actually an improvement on the balance sheet, small improvement from 3.2 million to about 3.6 million. uh from a net cash position uh last year we still had the river fork facility in place at the year end uh that was two and a half million dollars um that has obviously been repaid in the year and that gives us a net cash position of 53.2 million at the end of the year now that last bullet point is quite important because there's been at least one or two comments which have been reported back to me that um given the size of the fundraising that if our cash balance has moved down to that level that must be a reflection of our opex spend That is not the case. We did manage to work with our suppliers through the first half of the year to ensure that we could continue building inventory and building product, looking at this year's revenue. So the fact that that balance has come down is because we have settled those balances and then continue to work with those creditors to build that up. So you don't see that in these numbers other than that one isolated position. So with that, I will hand over to Mary.