Lightbridge Corporation

Thank you for standing by and welcome to the Lightbridge Corporation Business Update and First Quarter 2024 Conference Call. Please note that today's call is being recorded. It is now my pleasure to introduce Matthew Abinanti, Director of Investor Relations for Lightbridge Corporation.

Thank you, Victor, 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 Andrei Mushikov, Executive Vice President for Nuclear Operations, Scott Holcomb, Vice President of Engineering, James Fornoff, Vice President of Program Management, Larry Goldman, Chief Financial Officer, 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 Lightbridge's filings with the Securities and Exchange Commission. Lightbridge does not assume any obligation to update or revise any such forward-looking statement, whether as a result of new developments or otherwise. And with that, I would like to turn the over the call to our first speaker, Seth Gray, Chief Executive Officer of LightBridge. Hello, Seth.

Well, hello, and thank you, Matt. And thank you all for joining us to discuss LightBridge's first quarter 2024 results. In March, we celebrated an important achievement at Idaho National Laboratory. We demonstrated an extrusion process for LightBridge fuel material using a uranium zirconium alloy a video of the extrusion processes on our website, along with photos of the team, the machinery, and the rod. I was recently honored to be appointed as the chair of the American Nuclear Society's International Council. This role grants me the privilege of working alongside global nuclear experts to enhance international cooperation and advocate for safe, secure, and economical use of nuclear science and technology worldwide. The International Council is vital for fostering global communications and cooperation among nuclear and non-nuclear organizations, and I am eager to leverage this platform to advance our collective goals. In addition, Jim Fornoff, our Vice President of Program Management at Lightbridge, who you'll hear from soon, has been appointed to the Board of Directors at the United States Nuclear Industry Council. The USNIC is a leading advocate for nuclear energy in promoting the American nuclear supply chain globally. It represents approximately 80 companies that are integral to various facets of nuclear innovation and supply chain development. Jim's role on the USNIC board reflects his expertise and dedication, and he is excited to contribute to the industry's growth, supporting initiatives that span from national security to environmental management. Both of these appointments reflect LightBridge's deep involvement and expanding influence in the nuclear power industry and policy, both domestically and internationally. We are committed to playing an important role in shaping the future of nuclear energy, ensuring it remains a key component of a sustainable and secure global energy framework. Now I'll turn the call over to Andrei Mushakov, Executive VP for Nuclear Operations, to review our fuel development activities. Andre?

Thank you, Seth. As Seth mentioned, LightBridge achieved a critical milestone in our fuel development efforts. Idaho National Laboratory, or INL, extruded a rod sample of LightBridge fuel material consisting of an alloy of depleted uranium and zirconium. This work was performed under Strategic Partnership Project and Cooperative Research and Development Agreements between Lightbridge and Battelle Energy Alliance LLC, the U.S. Department of Energy's operating contractor for I&L. The ongoing project aims to generate irradiation performance data for Lightbridge's delta phase uranium zirconium alloy related to various thermophysical properties. The data will support fuel performance modeling and regulatory licensing efforts for the commercial deployment of Lightbridge fuel. I will now ask Jim Fornoff, our Vice President of Program Management, to provide additional details about the extrusion demonstration milestone and our next steps in this project at INL.

Jim? A little over a month ago, we demonstrated the extrusion of a fuel rod sample consisting of an alloy of depleted uranium and zirconium. The extrusion process involves pressing a billet of light-bridge fuel alloy through a die under pressure to form an elongated fuel sample. Our intention is to align this demonstration process with our eventual manufacturing technique as closely as possible. This extrusion is a major goal that we set for the project for this year and is a prerequisite to ultimately fabricating coupon samples using enriched uranium and zirconium alloy for irradiation testing in the advanced test reactor at INEL. Casting and extruding this demonstration billet of LightBridge fuel alloy showcases the unique research talent and facilities within INL's materials and fuels complex. We very much appreciate the collaborative input that we've received from our INL colleagues during this work, as well as the ongoing support and recognition of DOE. INL and LightBridge will work together to analyze the extruded rod in order to confirm the extrusion process parameters and the resulting material characteristics, while performing additional castings and extrusions during the remainder of this year. Next year, we plan to produce irradiation coupon samples of Lightbridge fuel material using enriched uranium and zirconium for insertion into the ATR. Thanks, and back to you, André.

Thank you, Jim. In addition to our ongoing project at INL, we are working with Rattan ICN on an engineering study to assess the compatibility and suitability of light-bridge fuel for use in CANDU reactors. Expect this initial engineering study to be completed later this year. In collaboration with Centris Energy, we are also conducting a front-end engineering and design study, a feed study, to assess feasibility for deployment of a Lightbridge pilot fuel fabrication facility at the Piketon, Ohio site. We're currently working on cost and schedule estimates to assess commercial feasibility of moving forward with this project. We expect the study to be completed in the coming months. Finally, my Lightbridge colleagues and I recently returned from a trip to Texas A&M University where we visited the Fuel Cycle and Materials Laboratory and thermohydraulic facilities that have state-of-the-art experimental and modeling capabilities to discuss our ongoing projects and future collaboration opportunities. The Fuel Cycle and Materials Laboratory is currently performing, under contract with Lightbridge, cladding characterization work on the trial of surrogate rod samples that were extruded in May 2021. The work will inform our future plans with respect to cladding development and co-extrusion process demonstration efforts. Separately, we toured the thermohydraulic facility and discussed Texas A&M University's computer modeling capabilities in that area. They're currently working on their DOE-funded Nuclear Energy University Program Award on a flow test experiment setup under new-scale SMR school and flow operating conditions. It will use six-foot-long acrylic rods mimicking land-based fuels, multi-lobe geometry, and helical twist. Now I'll ask Scott Holcomb, our Vice President of Engineering, to give us an update on several other ongoing projects and initiatives. Scott?

Thank you, Andrej. First, with the ongoing progress of our fuel development work, we've expanded and strengthened our fuel development team with the hiring of additional R&D personnel with expertise in computer modeling and simulation, experiment design and execution, and fuel qualification and regulatory licensing activities. Their additions aim to bolster Lightbridge's capabilities in neutronics, thermal hydraulics, fuel performance, and transient analysis. all critical components to support fuel qualification, regulatory licensing, and commercial deployment of LightBridge fuel. The newly appointed R&D staff will support LightBridge's ongoing collaborative projects, including our SPP and CRADA collaboration with Idaho National Laboratory in the U.S., our engineering study with VAT and ICN in Romania, and two important projects under the Nuclear Energy University programs with Massachusetts Institute of Technology and Texas A&M University. These experts will lead the development of lightbridge-specific codes and methods, utilizing industry-standard modeling tools to simulate lightbridge fuel across various types of water-cooled reactors. We believe these new hires will support advancement through TRL levels 4 to 9, as it underpins our ability to model and simulate our fuel's behavior under various operating conditions, an essential aspect of our development process. As we project further into the future, our roadmap towards full commercial deployment encompasses a series of intricate and scientifically rigorous steps. This includes the extensive irradiation of nuclear material samples and prototype fuel rods within test reactors, followed by thorough post-irradiation examinations to validate material characteristics and performance metrics. Our comprehensive testing regimen will also involve advanced thermal hydraulic experiments and additional out-of-reactor tests. designed to rigorously evaluate our fuel safety and functionality. Advanced computational modeling and simulations will support the qualification process, ensuring that our fuel meets stringent industry standards. The culmination of these efforts will involve the design of lead test rods and ultimately lead test assemblies, and subsequent collaborations with commercial reactors and potential fuel vendor partners for the deployment of lead test rods and assemblies. One successful operation of lead test assemblies with light-bridge fuel has been demonstrated in commercial reactors we would seek regulatory approval for batch reloads of light-bridge fuel in those host reactors. With that, I'll turn the call back over to Seth.

Thanks, Scott. Globally, we are witnessing an expansion of the nuclear sector. New nuclear plants are under construction, and many existing plants are having their operating licenses extended well beyond their original lifetimes. Remarkably, some facilities that had shut down are now being revitalized and brought back online. In a groundbreaking development last December at COP28, the UN Climate Conference in Dubai, the United States, along with other nations, committed to tripling the world's nuclear power capacity by the year 2050. This ambitious goal was reinforced at the recent Nuclear Energy Summit in Brussels. which convened leaders at the head of state level to transform this vision into tangible action. The focus was clear, move from ambition to real action with specific emphasis on establishing robust financing mechanisms to achieve this tripling of global nuclear power. During this pivotal time, I had the honor of meeting with America's new climate envoy, John Podesta, along with other leaders of the American nuclear industry. It was evident from our discussions that there is a strong alignment between the U.S. government and the nuclear industry. We are advocating for the adoption of American nuclear technology, which adheres to the highest safety standards globally. The World Economic Forum's special meeting last month in Riyadh on global collaboration, growth, and energy development included a session on advanced energy solutions. The urgency to shift from decades to years in deploying advanced energy solutions, including nuclear power, was a central theme. The special meeting brought together top political leaders, major corporations and investors, highlighting the critical role of nuclear power in global energy strategies. For instance, Saudi Arabia is exploring significant shifts in its energy strategy to establish a robust nuclear power program. This move aims to reduce domestic consumption of hydrocarbons, thereby allowing the country to increase its exports to bring in revenue to support economic development. Heads of state and government are increasingly recognizing nuclear power not as a peripheral issue, but as a central component of energy strategies. I'll now turn the call over to Larry Goldman, Chief Financial Officer, to summarize the company's financial results.

Thank you, Seth, and good morning, everyone. For further information regarding our first quarter 2024 financial results and disclosures, please refer to our earnings release that we filed post-market close yesterday, as well as our quarterly report on Form 10Q, that will be filed with the Securities and Exchange Commission. The company's working capital position was $27.4 million at March 31, 2024, versus $28.3 million at December 31, 2023. Total assets were $28.9 million, and total liabilities were $0.9 million at March 31, 2024. Today, we have ample working capital and financial flexibility to support our near-term fuel development expenditures. This is very important to LightBridge and our stockholders, as well as our external stakeholders, such as the federal government, to ensure that we have sufficient working capital, as well as the ability to access capital in the future to conduct our R&D activities. Total cash and cash equivalents were 27.9 million as compared to 28.6 million at December 31st, 2023, a decrease of 0.7 million for the first quarter ended March 31st, 2024. Cash used in operating activities for the first quarter ended March 31st, 2024 was 1.9 million, an increase of 0.4 million compared to the 1.5 million for the first quarter ended March 31st, 2023. This increase was primarily due to increased spending on R&D and G&A expenses. Total cash provided by financing activities for the first quarter ended March 31st, 2024 was 1.2 million, an increase of 0.5 million compared to the 0.7 million for the first quarter ended March 31st, 2023. This increase was due to an increase in the net proceeds received from the issuance of common stock under our at-the-market or ATM facility. 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 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 2024. Sherry? Thank you, Larry.

Net loss was $2.8 million for the first quarter ended March 31st, 2024, compared to $2 million for the first quarter ended March 31st, 2023. Total R&D expenses amounted to $1 million for the first quarter ended March 31, 2024, compared to $0.4 million for the first quarter ended March 31, 2023, an increase of $0.6 million. This increase was primarily due to the increase in R&D activities related to the development of our fuel, including an increase and INL project costs and outside R&D expenses of $0.5 million. Total G&A expenses were $2.2 million for the first quarter ended March 31, 2024, compared to $1.9 million for the first quarter ended March 31, 2023. The increase of $0.3 million was primarily due to an increase in employee compensation and employee benefits, as well as director's fees, an increase in postage and recruitment expenses, and an increase in stock-based compensation. Total other income was $0.4 million for the first quarter ended March 31, 2024, compared to other income of $0.3 million for the first quarter ended March 31st, 2023, an increase of $.1 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. Back to you, Seth.

Thank you, Sherry. I would like to recognize Ambassador Thomas Graham Jr. for his extraordinary leadership and service to Lightbridge. Tom was the chairman of Lightbridge's board and retired last month. His legacy is etched in the history of the company. Tom has had a remarkable career, including leading the successful efforts by the United States to permanently extend in force the Nuclear Non-Proliferation Treaty. We're staying in touch with Tom and continue to benefit from his advice. I would like to thank everybody for participating on today's call. We've not received questions submitted by email. We're looking forward to providing additional updates. In the meantime, we can be reached at ir.ltbridge.com. Stay safe and well. Goodbye.

Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.

Everyone have a great day.