Amprius Technologies, Inc.

Good afternoon and welcome to the Amprius Technologies conference call and webcast. It's now my pleasure to turn the call over to Greg Bradbury.

Good afternoon. Welcome to Amprius Technologies' fourth quarter and full year 2022 conference call. Joining us for today's presentation are the company's CEO, Dr. Kang Sun, and CFO, Sandra Wallach. At this time, all participants are in listen-only mode. Following management's remarks, we will open the call for questions. Please note that this presentation contains forward-looking statements, including but not limited to statements regarding future product commercialization, new customer adoption, and timing and ability of AMPRIUS to build its large-scale manufacturing facility, expand its manufacturing capacity, and scale its business. These statements involve known and unknown risks, uncertainties, and other important factors that may cause AMPRIUS's results, performance, or achievements to be materially different from any future results, performance, or achievements expressed or implied in such forward-looking statements. For a more complete discussion of these risks and uncertainties, please refer to AMBRIUS's filings with the Securities and Exchange Commission, including but not limited to the discussion of AMBRIUS's risk factors in its quarterly report on Form 10-Q filed on November 14, 2022. Finally, I would like to remind everyone that this conference call is being webcast and a recording will be made available for replay on the company's investor relations website at ir.ampreus.com. In addition to the webcast, the company has posted a shareholder letter that accompanies these results, which can also be found on the investor relations website. I will now turn the call over to Ampreus Technologies CEO, Dr. Kang Sun, for his comments. Sir, please proceed.

Welcome, everyone, and thank you for joining us this afternoon. To begin today's discussion, I will give some company's background, followed by a review of our recent accomplishments, before turning the call over to our CFO, Sandra Wallach, to discuss our financial results for the year in more depth. After that, I will share some closing remarks before opening the call for questions. Amperes develops and manufactures ultra-high energy density lithium-ion batteries based on our proprietary silicon annual technology. Our business has four distinct advantages. Unmatched technical and product performance, proven manufacturability, years of product commercialization with industrial leaders, and a team of seasoned business operators with a solid track record. Our near-term goal is to scale our manufacturing with the long-term goal of becoming a mainstream battery solution with applications across all segments of electrical mobility, including the aviation and the EV industry. Over the past years, Amperes has delivered commercial batteries with the highest known energy density and power density. Our current available batteries have as much as 450 Wh per kilo in specific energy density and 1150 Wh per liter in volumetric energy density with up to 10C high power capability. Our batteries are also built for the cost operating environments with the durability to pass the United States military benchmark nail penetration test as well as the versatility to operate in an extremely wide temperature range of as low as minus 30 degrees Celsius and up to 55 degrees Celsius. These features, along with extreme fast charging rates of 0% to 80% state of the charging in approximately six minutes, set amperes apart. It's our belief that there is no one else in the commercial market that can perform at this level. In addition, we have amassed over 80 patents and over a decade of know-how in silicon nanotechnology and manufacturing. Moving to our review, 2022 was arguably the most transformational year for Ampere since our funding in 2008. It was also the year of many firsts for our business as we execute our strategy to transform electrical mobility with a focus on aviation applications. I will now make a minute to highlight some of our key milestones from the past year. As noted a few minutes ago, Amperes has a leading position in the emerging energy transformation sector with disruptive technology. We entered 2022 with our first commercial segment of 450 watt per kilo and the 1150 watt per liter product for high-performance aviation. We manufacture the only batteries on market that can produce these specifications, and we are constantly working to improve the performance and capabilities with our technology. As an example, Earlier today, we announced that our upgrade 500-watt-per-kilogram capable batteries, all those not yet available to the market, have had their capabilities verified by independent third parties, which is a crucial step in the product development timeline. Demand for this next generation of the battery is growing. and we are making great progress. Based on current estimates, we expect to be able to shape prototypes to select customers before end of 2023. We also complete several important demonstrations of our technology's capability in 2022. In October, we successfully exhibit our battery's extreme fast charging ability through a video demonstration where we were able to achieve a rate of 0% to 80% stay of charge in approximately six minutes. Our performance is ahead of the United States Advanced Battery Consortium 2025 goal of 0% to 80% charge in just 15 minutes. In practice, This will allow the vehicles and other applications to operate much more efficiently with less downtime. Additionally, in November, we announced that an independent third party testing lab validated our 390 watt per kilo polymer electrolyte cells successful testing of the United States military performance specifications nail penetration test. This test is used to determine the feasibility of a specific product in complex scenarios and is an important benchmark to be considered for military applications. We have a unique opportunity to provide a significant energy density performance increase of nearly 100%, doubling the runtime for mobile powered devices without increasing the overall weight of the wearable batteries for our soldiers. Moving to our business development efforts, 2022 was a successful sales year for our aviation and the defense segments. Amperes has deep enrolled with the aviation and the EV talk market because we produce high energy density, lightweight batteries. Single most important issue in EV top performance is battery weight, which is why our batteries are in such high demand. Lighter and denser batteries means greater and sustained range, while faster charge turnaround time means increased flight time. To that end, We signed new multi-year agreements with several aviation industry leaders like Air Environment, Paladin, FLIR, and BAE Systems, and extend our existing commitments with Airbus, the U.S. Army, and the U.S. ABC, among others. I will highlight some of those agreements now. In July, we announced a three-year deal with Paladin, FLIR, to supply our batteries as they develop their unmanned aircraft system products. Also in October, we entered into a three-year cooperation agreement with BAE Systems to develop a lightweight high-energy battery specifically for electrically powered flight applications. In May, we will award funding for the second multi-year development program in the United States Advanced Battery Consortium for the development of a low-cost EV battery. This consortium is between Ford, GM, and Stenetis, and is enabled by a cooperative agreement with the United States Department of Energy. Their mission is to develop electrochemical energy storage technologies that advance the commercialization of next-generation electrified vehicle applications. I'm pleased to announce that we officially delivered the first set of the reference cells in the fourth quarter of 2022. Altogether, this new wings and opportunity expansion amount to a 65% year-over-year boost in battery shipments. We believe our successful early efforts are now driving a positive flywheel effect, leading to orders from the new customers and extension orders from existing customers. As we think about our goals for the next several years, our primary focus is on expanding capacity to meet demand. and ultimately achieve a sustainable cost structure at scale. We made several strategical moves in 2022 that put us on a clear path to achieve these goals. In September, we closed our business combination with Kensington Capital Acquisition Corp. 4 to provide us with greater access to capital via the public market. Through that process, we also raised $70 million in cash net of expenses and added a strategical customer to our investor base in every environment. We could not have asked for a better partner than the Kensington team and have continued to work closely alongside them as we executed our strategy. More recently, we put in place a community equity facility, which allows us to assess up to 200 million of additional funding. After a competitive process, we were selected to receive two cost-sharing grants from the United States Department of Energy in October of 2022. The first is a one million cost-sharing grant from the DOE's Advanced Manufacturing Office, specifically for the acceleration of the development of mass production process we use for our silicon annals. This process, based in our Fremont facility, includes a deposition system presently used in solar cell manufacturing. The second is a 50 million cost-sharing demonstration grant selected for negotiation of the award from the DOE's Office Manufacturing and Energy Supply Chain. We are among the first set of the company to be selected for negotiation of the award to receive funding from President Biden's bipartisan infrastructure law to expand the domestic manufacturing of batteries. To that end, in October, we received the first large-scale anode production machine from Central Therm, which is now being installed in our Fremont facility and is expected to increase our capacity for silicon anode production to approximately 2 megawatts exiting 2023. To meet this greater production output, we recently expanded our lease facility in Fremont, California, effectively doubling our footprint in that location our expansion in Fremont is planned to improve our high volume manufacturing processes and increase our capacity by 10x which will serve strategic aviation customers increasing needs and support sampling and qualification projects with new customers who are currently in backlog this takes me to our more exciting news. Early this month, we announced the selection of a site in Brighton, Colorado as a location for our 775,000 square foot nest production facility. The selection of the Colorado for our Gigawatt scale factory marks an important milestone for Amperes. We worked closely with the state of Colorado the Colorado Economic Development Commission, Ayrton County, and the City of Brighton to align on terms that are mutually beneficial, which include a comprehensive incentive proposal. The initial phase of our build out of the existing facility will provide a potential of up to five gigawatt hour and is also expanded to create over 330 new jobs. For the subsequent phases, the site has expansion capability for up to a total potential manufacturing capacity of 10 gigawatt hour. This site also holds a few advantages over our other potential locations. Notably, it's already equipped with the electrical power and the existing structural layout needed for gigawatt scale lithium-ion battery factory, which will reduce build-out cost and time to market with a goal of being operational in 2025. Also, it will brighten it closer to some of our material distributors in the Northwestern US, which we expect will lower operational costs over the long term. Our commitment to Colorado allows us to establish our large-scale operation here in the United States. Ampere's battery will be designed and made in the US. This new facility will transform our long-term production capabilities. In the near term, we will continue to develop and shape cutting-edge products from our Fremont facility while we refine our manufacturing processes to further de-risk the handle of our mass production products to Brighton in the coming years. To help with this transition, we made a strategic decision to form two new business units, Ambrose Lab and Ambrose Fab. Ambrose Lab, located in Fremont, will focus on advanced battery technology, products, and manufacturing process development. While Entry's Fab, located in Brighton, will focus on large-scale fabrication of silicon-handled batteries. To support this transition, John Bornstein, currently the company's COO, will take a new role to lead Entry's Lab as the division business unit president. In the interim, I will serve as acting president of MPFAB. I have one final update before I turn the call over to Sandra. One of the areas which I'm most proud is the team we have built. Over the last several months, we have added critical roles to lead our efforts to scale. In my acting president role for MPFAB, I'm working with our new Vice President of Infrastructure, Andrew Hui, who joined us last September. Andrew brings over 30 years of facility development and management experience, and most recently served as the Director of Facility and Panasonic Energy of North America. He will be spearheading our efforts to scale production capacity, focusing on factory planning, facility development, and regulatory compliance. With our leadership team in place, we believe that we are well positioned to execute on our growth strategy. With that overview complete, I will now turn the call over to our CFO, Sandra Warwick, to review our financial results for the full year. Sandra.