FuelCell Energy, Inc.

All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press the star key followed by the number one on your telephone keypad. If you would like to withdraw your question, press star one again. At this time, I would like to turn the conference over to Tom Gelson, Senior Vice President of Finance and Investor Relations. Please go ahead.

Thank you and good morning everyone and thank you for joining us on the call today. As a reminder, this call is being recorded. This morning, Fuel Cell Energy released our financial results for the second quarter of 2024 and our earnings press release and our quarterly report on Form 10Q are available in the investor section of our website at www.fuelcellenergy.com. Consistent with our practice, in addition to this call and our earnings press release, we have posted a slide presentation on our website. This webcast is being recorded and will be available for replay on our website approximately two hours after we conclude the call. Before we begin, please note that some of the information that you will hear or be provided with today will consist of forward looking statements with the meaning of the Securities Exchange Act of 1934. Such statements express our expectations, beliefs, and intentions regarding the future and include, without limitation, statements with respect to our anticipated financial results, our plans and expectations regarding the continuing development, commercialization, and financing of our fuel cell technology, and our business plans and strategies. Our actual future results could differ materially from those described in or implied by such forward-looking statements because of a number of risk factors and uncertainties. More information regarding such risks and uncertainties is available in the Safe Harbor Statement in the slide presentation. and in our filings with the Securities and Exchange Commission, particularly the risk factor section of our most recently filed annual report on Form 10-K and any subsequently filed quarterly reports on Form 10-Q. During the course of this call, we will be discussing certain non-GAAP financial measures, and we refer you to our website and to our earnings press release and the appendix of the slide presentation for the reconciliation of those measures to GAAP financial measures. Our earnings press release and a copy of today's webcast presentation are available on our website under Investors. For our call today, I am joined by Jason Pugh, Fuel Cell Energy's President and Chief Executive Officer, and Mike Bishop, Fuel Cell Energy's Executive Vice President, Chief Financial Officer, and Treasurer. Following our prepared remarks, we will be available to take your questions and be joined by other members of the leadership team. I'll now like to hand the call over to Jason for opening remarks. Jason?

Thank you, Tom, and good morning, everyone. Thank you for joining us on our call today. I'm very pleased with our results for the second quarter as we continue to execute on our powerhouse business strategy. Our revenue climbed sequentially compared to our first quarter, but as expected, decreased compared to the prior year period due to the fact that there were no module exchanges this quarter, while there were eight module exchanges in the prior year period. Our on-balance sheet 62.8 megawatt generation portfolio achieved 67% revenue growth year-over-year, which included a full quarter of revenue from three projects that began operation in the first quarter. During and subsequent to the quarter end, we had some significant commercial wins. And we've also announced an update and extension of our joint development agreement with ExxonMobil's low-carbon solution business. Additionally, we've made progress on cost management and continued our disciplined approach to capital allocation, enabling us to continue our focus on pursuing growth while managing our expenses related to scale, R&D, and CapEx. A number of important data points are included on slide three, but we think our overall success is most evident through our technological solutions for and collaboration with some of the world's largest global companies, including our work with ExxonMobil, Toyota, Pfizer, Canadian Nuclear Laboratories, or CNL and IBM, to name a few. All of us at Fuel Cell Energy are very proud to be global leaders in electrochemical technology all in support of our purpose to enable a world empowered by clean energy. We are working to achieve this purpose by deploying our proprietary fuel cell technology platforms for energy delivery and emissions management around the world to accomplish two fundamental technological applications, decarbonizing power and industry and producing hydrogen. Turning to key messages for the quarter. As you know, we have a long-standing relationship with ExxonMobil Technology and Engineering Company, or EmTech, which provide technical support to ExxonMobil's low-carbon solutions business. In April, we extended our joint development agreement through the end of 2026, allowing development work on carbon capture technology to continue. We also continue to progress our pilot project at Esso Nederland BV's manufacturing complex in Rotterdam, Netherlands. I will share more details in a few moments and how we are working with Exxon's low-carbon solution business. Second, we've had a number of commercial wins substantially increase in our backlog during fiscal 2024. The most significant commercial win is in South Korea, a market where we have made expanding our reach with applications like electrolysis, time to power, and CO2 recovery and carbon capture a top priority. After the end of the second quarter, we announced an agreement to supply Gogonjin Green Energy, or GGE, in South Korea with 42 upgraded replacement fuel cell modules. In connection with the sale of these modules, we also entered into a new seven-year service agreement under which fuel cell energy will support GGE's Hwasong Ballin Industry Complex, which is the world's largest fuel cell power platform installed at a single site. In total, this transaction adds approximately $160 million to our backlog and represents an incredibly important milestone for our company in a market that has embraced fuel cell technology as essential to its energy infrastructure. We look forward to continuing our relationship with GGE providing them with excellent service and continuing to expand our business in South Korea. During the quarter, we also announced a deal for our carbonate fuel cell technology, which will be used in a biogeneration project developed by Amoresco for the Sacramento Area Sewer District to convert onsite biofuels into clean electricity. The project will be powered by one of our 2.8 megawatt carbonate fuel cell platforms, which produces carbon neutral electricity and usable heat from biogas and has the potential for future production of renewable green hydrogen similar to our Port of Long Beach Toyota installation. We also entered into an agreement to provide comprehensive maintenance services for the fuel cell system, which will ensure that Sacramento Sewer can focus on its mission of protecting public health and the environment while delivering renewable power from the cleanest technology available. Fourth, we are taking proactive steps to maintain the strength of our balance sheet. And as we grow, we will do so in a cost-effective way following a disciplined approach to managing capital investment by establishing investment triggers linked to key milestones. We have taken concrete steps this quarter to manage costs from managing the pace of our solid oxide expansion to changes in the structure of our engineering team, to managing R&D and CapEx with the goal of positioning ourselves for long-term financial success. We are making critical investments to position fuel cell energy for future growth while taking a highly disciplined approach to maintaining cash and liquidity. Finally, we continue to evaluate potential options to benefit from global energy transition policies. In the U.S., These include the legacy investment tax credit program, as well as incentives under 45Q for carbon capture, 48C for the development and construction of clean energy manufacturing, and the potential benefits from the new hydrogen production tax credit as we await final guidance from the IRS and U.S. Treasury related to 45E. Add to this the numerous supportive policies around the world, and we believe that fuel cell energy is positioned well to take advantage of available opportunities. Next, turning to the extension of the JDA and our work with Exxon's low-carbon business on slide 6. The extension of the JDA through the end of 2026 represents a significant milestone for our company. In order to reach this stage, the technology met several key technical performance criteria, which is a major accomplishment for the talented scientists and engineers from both of our companies. This success also reinforces our view that there are significant commercial possibilities to extend the value and opportunity for our carbonate technology by delivering what we believe will be superior carbon capture technology at a lower cost. The extension of the JDA is designed to allow fuel cell energy and Exxon's low carbon business to pursue multiple commercial opportunities. The carbon capture enhancements to our core technology jointly developed with Exxon to be demonstrated in Rotterdam features an optimized design for large-scale installations. Through this updated agreement, Deoso Energy has the opportunity to pursue carbon capture opportunities using our current generation of carbonate modules by incorporating carbon capture improvements derived from our joint development work. We can move more quickly to provide access to this superior technology and our existing platform targeting 250 KTA or kilotons per annum as an opportunity to demonstrate the technology capabilities earlier while we complete the work to demonstrate large industrial scale carbon capture at Esso's refinery in Rotterdam. We believe The ability to incorporate improvements developed under the JDA into Fuel Cell Energy's current generation modules will enhance the capabilities of our power, hydrogen, and carbon recovery solutions and provide the ability to offer more attractive near-term carbon capture solutions to our customers. Additionally, Fuel Cell Energy and ExxonMobil are continuing to progress discussions for a commercial framework aimed at enabling deployments of the carbonate fuel cell technology for carbon capture through Exxon's low carbon solutions business and fuel cell energy. Turning to slide seven, we are excited about the promising potential of this technology to capture CO2 emissions from industrial and commercial exhaust streams with the goal of helping to solve one of the world's biggest environmental challenges. The ESSO Rotterdam pilot project is co-funded by the European Union under the Admissions Trading Systems Innovation Fund and by the Netherlands Enterprise Agency by means of a demonstration energy and climate innovation DEI Plus grant. This manufacturing site will be the first place in the world to pilot this differentiated multi-featured technology that captures CO2 emissions from industrial sources while simultaneously generating electricity and hydrogen. The ability to deliver these valuable co-products is targeted to improve the economics of carbon capture, lower the barrier to broader adoption of carbon capture in this marketplace, and deliver decarbonized electricity and hydrogen. Next, as you'll see on slide eight, We have entered into an exciting new relationship with Amoresco to use our carbonate fuel cell technology in a bio generation project for the Sacramento Area Sewer District. Wastewater treatment is a particularly attractive application for our platforms and California remains an important geography for our company. Some of the inherent benefits in this application are Our carbonate fuel cell platform runs directly on biogas created on-site from the wastewater treatment process. Our proprietary fuel cell cleanup system removes contaminants to maximize usable on-site biogas. Waste heat generated by the fuel cell will be used to support the anaerobic process that creates biogas and the fuel cell's chemical reaction is virtually free of NOx, SOCS, and particulate matter emissions, improving air quality for the community. In California, FuelShow Energy's platforms have received key certification under the California Air and Resource Board Distributive Generation Standards, which allows the local air quality management district to utilize a streamlined air permitting process, accelerating the installation of clean energy projects the company pursues in the state. The Sacramento Sewer Project represents our fourth biogas project in California, with our other plants already installed in Riverside, Tulare, and San Bernardino. Turning to slide nine. As we mentioned earlier in the call, subsequent to the end of the quarter, we signed a significant long-term service agreement to support GGE's Wausau Fallen Industrial Complex. In addition, To the $160 million this project adds to our backlog, our engagement with GGE also demonstrates our ability to roll out and service large-scale power projects, a capability we think is unique to fuel cell energy. Importantly, our carbonate technology is a proprietary and proven design. Today, fuel cell energy operates eight large-scale platforms ranging from 11.2 megawatts to 58.8 megawatts, and of these eight platforms, seven have been in operations for five years or more. One rapidly growing need, particularly in the U.S., is for new data center construction to support investment in AI. Strong demand for additional computing power has been set back by the limitations of the current power grid, which is unable to meet the energy demands of large AI data centers. Current projections for power usage show that this bottleneck is only expected to grow, creating a substantial addressable market for the large-scale baseload power projects that are one of our unique strengths. No other fuel cell provider has implemented, run, and supported large megawatt projects at our same scale, making fuel cell energy uniquely positioned to meet the immediate and future needs tied to the data center growth. We have demonstrated our large-scale platform capabilities at sites in the US and Asia, providing customers and prospective customers with the operating data to support a fuel cell energy purchase decision. In addition, we have delivered platforms integrated with absorption chilling, thus fully taking advantage of our ability to deliver steam, our thermal energy ideal for cooling data centers. Data centers require continuous power, and our continuous baseload platforms provide the reliability and resiliency data centers need. Finally, we have a proven track record in microgrid applications, which are crucial for data centers. We are actively pursuing opportunities in this sector and believe our business is uniquely suited to capitalize on this secular trend. And now, I would like to turn the call over to our CFO, Mike Bishop.