Pioneer Power Solutions, Inc.

Please stand by. We're about to begin. Good afternoon, everyone. Welcome to today's Pioneer Power 2023 fourth quarter and year-end financial results conference call. At this time, all participants are in a listen-only mode. Later, you will have the opportunity to ask questions during the question-and-answer session. You may register to ask a question at any time by pressing star 1 on your telephone keypad, and you may withdraw yourself from the queue by pressing star 2. Also, today's call is being recorded, and I will be standing by if anyone should need any assistance. Now at this time, I'll turn things over to Mr. Brett Moss, Managing Partner of Hayden Investor Relations. Mr. Moss, please go ahead.

Thank you and welcome. The call today will be hosted by Nathan Masaryk, Chairman and Chief Executive Officer, Walter Michalik, Chief Financial Officer, and Gio Murican, President and CEO of Pioneer Power Mobility. Following this discussion, there will be a Q&A session open to participants on the call. We appreciate the opportunity to review the fourth quarter and full year financial results, as well as discuss recent business highlights. Before we get started, let me remind you this call is being recorded in webcast. During this call, management may make forward-looking statements. These statements are based on the current expectations and assumptions and are subject to risks and uncertainties that could cause actual results that are different materially. Please refer to the cautionary text regarding forward-looking statements contained in the earnings release issued earlier today, which applies to the content of the call. I'd like to now turn the call over to Nathan Masaryk, Chairman and CEO. Nathan, please go ahead.

Thank you, Brett. Good afternoon, and thank you all for joining us today. Before I begin, please be aware that the financial results that we reported earlier today and will be discussing during this call are unaudited preliminary results. Pioneers on the Forefront of the Energy Transition in North America is evidenced by our banner 2023. We delivered revenue growth of more than 50% and full-year positive net income. More importantly, we are well positioned for another year of impressive organic growth and increasing net income. Our backlog surged to 46 million as of the end of 2023, a sequential increase of 36% over the prior quarter. Our innovative new products and solutions continue to gain traction in the marketplace, and highly favorable secular tailwinds are creating an environment of supercharged demand. Indeed, 2023 was an inflection point in our business. With revenues continuing to increase and fixed overhead remaining close to constant, positive operating leverage has taken hold. And going forward, we believe we will be able to sustain and increase our positive net income through calendar 2024. For 2024, we are providing guidance of full-year revenue of between $52 and $54 million. and fully diluted EPS of between 31 and 34 cents. Importantly, we believe this guidance is conservative and anticipates measured investments in our e-block and e-boost product platforms to stay ahead of the innovation curve, as well as investments in sales and marketing to increase brand and product awareness. This full year guidance also anticipates a certain number of customer-directed deliveries originally or currently scheduled for 2024 that will probably be moving into 2025. In addition, as of the end of 2023, we had approximately $14.6 million in net operating loss carry-forwards available to shelter taxable net income. While we may still experience quarter-to-quarter volatility This volatility is most often driven by delivery accommodation requests from our customers and not Pioneer's ability to manufacture or deliver our solution. Over the course of 2023, we had a notable list of new use cases and purchase orders for both e-block and e-boost from a diverse set of vertical markets. Demand for electric power is growing rapidly, and market trends indicate this will continue for the foreseeable future. The accelerating adoption of electric vehicles, increased computing power consumption from AI proliferation, and advanced technology solutions require more power than ever before. And existing utility power is becoming more expensive, less available, and increasingly unreliable. Greater efficiencies are needed to get maximum power output from existing infrastructure and new distributed Energy resources need to be brought online. Our products specifically support, harden, and accelerate these efforts. Turning first to eBlock. eBlock is an integrated compact outdoor transfer switch scheme. Circuit protection and power control system integrated, specifically designed for users of more than one source of electrical power. Customers can add additional energy sources like solar, battery storage, fuel cells, natural gas engines, without doing any internal upgrades to existing electrical systems, all in a compact outdoor skid-mounted package. Since the initial launch of eBlock and its success several years ago, we have designed several additional variations that extend the eBlock product line and open new and larger market opportunities for Pioneer. Our solar microgrid version of eBlock is a smaller and more economical version of the original. We developed it specifically in response to requests from several national solar microgrid developers, and this product expansion was met with immediate purchase orders. A small portion of that initial demand was shipped at the end of 2023, and we expect the solar microgrid market to be a big growth driver for us in 2024 and indeed in 2025. Another extension of the original e-block design is our new e-block charge port series. This product was born out of a customer-specific need to protect the electrical integrity of EV chargers and related equipment and to help support the rollout of EV charging stations. It resulted in the immediate purchase orders of more than $2 million several weeks ago and has opened up a new market opportunity that we believe will include additional units beginning in the second half of this year and through 2025 and indeed 2026. Finally, we introduced our package substation platform, which integrates a high-voltage protection system liquid or dry type transformer, and a low voltage protection system to provide users with a compact, unitized indoor or outdoor substation. Installation is more economical and more expeditious compared to installing individual components from a number of disparate vendors. Again, opening a new, large, and growing market opportunity for Pioneer. Turning to our eBoost mobile charging platform, as we've reiterated many times, eBoost provides anytime, anywhere EV charging, and it's comprised of several platforms, including eBoost Mini, a skid-mounted version that provides high-capacity EV charging in the smallest footprint we have available, bringing on-demand charging of electric vehicles to any location. eBoost GOAT, G-O-A-T, generator on a truck, a truck-mounted option that brings ultimate mobility with high-capacity EV charging. eBoost Mobile, a trailer-mounted solution that balances the need for mobility and higher-capacity EV charging. And finally, eBoost Pod, a mostly stationary EV charging solution with customizable higher capacity and can be moved if necessary. The first eBoost product was conceived just a short time ago in June of 2021. We unveiled our first prototype, a truck-mounted unit, a few months later in November of 2021 and shipped our first unit, a trailer-mounted unit, in March of 2022. In the full year of 2022, eBoost delivered 7.5 megawatt hours of power over approximately 350 charging stations, sessions. In 2023, we delivered 220 megawatt hours of mobile charging power over approximately 7,500 charging sessions. In addition, in 2023, we booked more than $4 million in new eBoost orders across diverse end markets ranging from the major transportation agency, a major automaker, municipalities, several enterprises operating bus and truck fleets, a North American utility, a truck dealership, as well as many others. We plan to deliver a record number of mobile off-grid EV charging solutions in 2024, which we expect will make a significant contribution to our revenue and operating margin. We continue to aggressively market eBoost, and as education and awareness of of e-boost increases, orders have similarly surged. Similar to the market backdrop related to e-block, the pursuit of more green alternatives and sustainability and the increasing adoption of electric vehicles by school districts and municipalities and other organizations provide a strong tailwind for continued growth in this portion of our business. Enterprises are trying to move quickly to add charging solutions for their customers, employees, and fleets. As the electrification of things continues, mobile and on-demand charging will become increasingly important, and e-boost squarely meets that demand. Before I turn the call over to Walter, our Chief Financial Officer, for a more detailed discussion over financial results, I'd like to leave you with this. 2023 was a highly successful and pivotal year for Pioneer in terms of our financial results, the solutions we brought to market, and customer wins. Everyone at Pioneer is excited about the prospects and opportunities that are ahead of us and looks forward to doing their best to deliver another record year for the company in 2024. With that, I'll turn the call over to Walter.