Lightbridge Corporation

being recorded, and it is now my pleasure to introduce Matthew Abinante, Director of Investor Relations for Lightbridge Corporation. You may begin.

Thank you, Sean, and thanks to all of you for joining us today. The company's earnings press release was distributed yesterday and can be viewed on the Investor Relations page of the Lightbridge website at www.ltbridge.com. Joining us on the call today is Seth Gray, Chief Executive Officer. along with Larry Goldman, Chief Financial Officer, Andrei Mushikov, Executive Vice President for Nuclear Operations, Scott Holcomb, Vice President of Engineering, and Sherry Holloway, Controller. I would like to remind our listeners that any statements on this call that are not historical facts are forward-looking statements. Today's presentation includes forward-looking statements about the company's competitive position and product and service offerings. During today's call, words such as expect, anticipate, believe, and intend will be used in our discussion of goals or events in the future. This presentation is based on current expectations and involves certain risks and uncertainties that may cause actual results to differ significantly from such estimates. These and other risks are set forth in more detail in LIBRIDGE's filings with the Securities and Exchange Commission. Lightbridge does not assume any obligation to update or revise any such forward-looking statements, whether as a result of new developments or otherwise. And with that, I would like to turn the call over to our first speaker, Seth Gray, Chief Executive Officer of Lightbridge. Hello, Seth.

Well, thank you. Hello, Matt. Hello, everybody. And thank you all for joining us to discuss Lightbridge's first quarter results. We are continuing to make progress on our fuel development activities. successfully completing our work under our second DOE Gain Voucher at Pacific Northwest National Laboratory. Our work at PNNL advanced a critical stage in the manufacturing process of light bridge fuel by demonstrating a casting process using depleted uranium zirconium metal, uranium zirconium material. This accomplishment further demonstrates our ability to effectively collaborate with national laboratories and government agencies. Since entering into the strategic partnership project and cooperative research and development agreement umbrella agreements with INL in December of last year, we have made good progress on this project. In the first quarter, we completed development of the quality implementation plan. This was an essential first step to ensure all future work performed at INL on the project will be conducted in accordance with the nuclear quality assurance requirements of the U.S. Nuclear Regulatory Commission. We are now working closely with INL on the next task, which is a demonstration of the casting of delta phase uranium zirconium ingots with depleted uranium using existing INL equipment. In February, we announced publication of a peer-reviewed technical paper on the disposition of weapons-grade plutonium. A computer simulation revealed that a Lightbridge-designed fuel rod significantly outperforms traditional mixed oxide fuel in consuming plutonium, making the Lightbridge-designed rods well-suited for consuming excess weapons-grade plutonium. The paper was co-authored by Aaron Toggemeier, Ph.D., senior nuclear fuel consultant to Lightbridge, and by Braden Goddard, PhD, assistant professor, Department of Mechanical and Nuclear Engineering at Virginia Commonwealth University. The paper was published in Nuclear Technology, the leading international technical journal reporting new information on the practical application of nuclear science for peaceful uses. Additionally, the United States Patent and Trademark Office, and the Canadian Intellectual Property Office have granted LightBridge additional key patents. These latest additions to our growing intellectual property portfolio are a testament to the ingenuity and hard work of our team. We believe this technology will play a vital role in enhancing the safety and economics of nuclear power for both existing, for both currently operating reactors and small modular reactors that are being developed ultimately positioning LightBridge as a major player in the global nuclear power industry. Our leadership has been significantly bolstered by the appointment of Sherry Goodman as a new independent director and chair of the new Energy Security and National Security Committee of the Board of Directors, and by Dr. Scott Holcomb, who has joined LightBridge as Vice President of Engineering. Their wealth of experience and knowledge is valuable in advancing our fuel development efforts and guiding our company's strategy. Scott is participating on this call and he will speak soon. We recently announced that the company has been selected by the U.S. government to join two vital nuclear power groups, the U.S. Department of Energy's High Assay Low Enriched Uranium or HALU Consortium and the U.S. Department of Commerce International Trade Administration's Small Modular Reactor Working Group. Our active participation in these prestigious groups is helping us participate in the latest policy discussions and stay abreast of progress with respect to U.S. production of Halo, as well as the deployment of small modular reactors in Europe. These alliances with industry leaders, government agencies, and other key stakeholders contribute to a cleaner, more secure energy future, and we believe will also open up new avenues for collaboration and growth for LightBridge. I'll turn the call over to Andrei Mushakov, Executive VP for Nuclear Operations, to review our ongoing fuel development activities. Andrei?

Thank you, Seth. As Seth mentioned, we entered into agreements with IDES National Laboratory in collaboration with the U.S. Department of Energy to support the development of light-bridge fuel. The framework agreements consist of an umbrella strategic partnership project agreement and an umbrella cooperative research and development agreement, or CRADA, each with Battelle Energy Alliance, DOE's operating contractor for Idaho National Laboratory, with an initial duration of seven years. The initial phase of work under the two agreements will culminate in irradiation testing in the advanced test reactor of fuel material coupon samples using enriched uranium supplied by DOE. The initial phase of work aims to generate radiation performance data for light-digit delta phase uranium zirconium alloy relating to various thermophysical properties. The data will support fuel performance modeling and regulatory licensing efforts for the commercial deployment of light-bridge fuel. Subsequent phases of work under the two umbrella agreements are expected to include post-radiation examination of the irradiated fuel material coupon samples, loop radiation testing in the advanced test reactor, and post-radiation examination of one or more uranium zirconium fuel samples as well as transient experiments in the transient reactor test facility at Idaho National Laboratory. In February, we announced the completion of our work at Pacific Northwest National Laboratory to demonstrate leverage's nuclear fuel casting process using depleted uranium, a key step in manufacturing leveraged fuel. Several castings were performed throughout the project, and the cast ingots were analyzed. An iterative process of the casting methodology was modified based on the characterization results. As part of the process was a demonstration to achieve acceptable results with PNNL's existing equipment. The results of this work will help researchers determine a final process suitable to produce fuel material coupon samples for upcoming radiation tests in the advanced test reactor. Finally, as Seth mentioned, we've recently added Dr. Scott Holcomb, Vice President of Engineering, to our fuel development team. Scott brings a lot of invaluable nuclear industry experience, having led numerous fuel qualification and experimental demonstration programs for the new fuel designs. I'd like to invite Scott Holcomb to say a few words. Scott?

Thank you, Andrei. Happy to join today's call, as well as to join LightBridge at this exciting time in the company's history. Having spent many years working in the field of nuclear fuel and materials performance, nuclear engineering, and project management, I feel privileged to bring my experience and knowledge to this new position. My background, ranging from a PhD in physics with a specialization in applied nuclear physics to holding various management roles, has provided me with invaluable skills that I'm excited to apply in my new role in LightBridge. During my time at Idaho National Laboratory and the Institute for Energy Technology in Norway, I had the opportunity to work with incredibly talented teams, managing complex projects and ensuring compliance with safety regulations. I've learned the importance of collaboration and partnership in delivering cutting-edge research and results. As the Vice President of Engineering at LightBridge, I'm responsible for the technical direction and oversight of our research, development, and demonstration activities. I'm eager to work closely with our partner entities and technical consultants, ensuring the successful development and regulatory licensing of our advanced nuclear fuel technologies. I believe that LightBridge's innovative approach to nuclear fuel technology has the potential to make a significant impact on the global energy landscape. Our work is not only about advancing the field of nuclear power, it's about creating a safer, cleaner, and more sustainable energy future for all. And with that, I'll turn the call back over to Seth.

Well, thank you very much, Scott. The pursuit of net zero carbon goals by governments and the private sector worldwide has fueled a shift towards policies that support nuclear power. Russia's war in Ukraine, now in its second year, has intensified global energy crises and heightened concerns about energy security. As a result, governments are increasingly recognizing that nuclear power, much more than renewables, is essential for achieving their national security, energy, and climate objectives. Nuclear power offers a responsible way to increase the supply of clean, reliable baseload electricity without carbon emissions. Nuclear energy reduces dependence on countries that could cut off fossil fuel supplies. Nations across North America, the European Union, and Asia have taken measures to renew nuclear power plant licenses, restart reactors, and construct new facilities. The supply-demand fundamentals for nuclear energy are strong. Ninety power reactors are in order or planned worldwide, and over 300 reactors are in the proposal stage. Public acceptance and overall sentiment toward nuclear power are improving. with positive developments emerging from governments, academia, municipalities, electric utilities, and capital markets. Lightbridge offers a distinct opportunity for investors who understand the shifting dynamics toward nuclear power. Our technology represents the first genuinely new fuel design for existing reactors since the inception of light water reactors in the nuclear industry. We believe these substantial changes will bring significant safety, economic, and nonproliferation benefits to currently operating reactors and to new plants. This is an exciting time for LightBridge, and we look forward to updating investors on the progress we will make throughout the year. Now I will turn the call over to Larry Goldman, Chief Financial Officer, to summarize the company's financial results. Larry?

Thank you, Seth, and good afternoon, everyone. For further information regarding our first quarter 2023 financial results and disclosures, please refer to our earnings relief that we filed yesterday and our Form 10-Q that we will file with the SEC later today. The company's working capital position was $27.9 million at March 31, 2023. versus 28.7 million at December 31st, 2022. Total assets were 28.9 million and total liabilities were 0.6 million at March 31st, 2023. Total cash and cash equivalents were 28.1 million as compared to 28.9 million at December 31st, 2022, a decrease of 0.8 million for the three months ended March 31st, 2023. Total cash used in operating activities for the three months ended March 31st, 2023 was 1.5 million, a decrease of 0.4 million as compared to 1.9 million for the three months ended March 31st, 2022. Total cash provided by financing activities for the three months ended March 31st, 2023 was 0.7 million, a decrease of 4.7 million as compared to 5.4 million raised in the first quarter of 2022. This decrease was due to the decrease in net proceeds from the issuance of our common stock by our at-the-market facility in the first quarter of 2023. In support of our long-term business and future financing requirements with respect to our fuel development, we expect to continue to seek government funding in the future, along with new strategic alliances that may contain cost-sharing contributions and additional funding from others in order to help fund our future R&D milestones leading to the commercialization of Lightbridge fuel. I will now turn the call over to Sherry Holloway, our controller, who will go over our P&L financial information for the first quarter of 2023. Sherry?

Thank you, Larry. Net loss was $2 million for both the first quarter ending March 31st, 2023, and the first quarter of 2022. Total R&D expenses amounted to $0.4 million for the three months ended March 31st, 2023, compared to 0.3 million for the three months ended March 31st, 2022, an increase of 0.1 million dollars. This increase was primarily due to an increase in project labor costs incurred from the U.S. national laboratories of 0.2 million dollars offset by a net decrease in other R&D costs of $0.1 million. Total G&A expenses remain consistent for the three months ended March 31, 2023 as compared to the three months ended March 31, 2022. There was an increase in stock-based compensation of $0.1 million offset by decrease in employee compensation and employee benefits of $0.1 million. Net other operating income was zero for the three months ended March 31, 2023, compared to 0.1 million for the three months ended March 31, 2022. This 0.1 million dollar decrease was due to a decrease in contributed services research and development with a corresponding amount recorded to R&D expenses. Total other income was $0.3 million for the three months ended March 31st, 2023, compared to other income of $0.1 million for the three months ended March 31st, 2022. An increase of $0.2 million. The increase in other income was due to an increase in interest income earned from the purchase of treasury bills and from our bank savings account. Now over to you, Seth.

Well, thank you, Sherry. And with that, I want to thank everybody for participating in today's call. We look forward to providing additional updates in the near future. In the meantime, we can be reached at ir.ltbridge.com. Stay safe and well. Goodbye.

This concludes our program. You may now disconnect.