FREYR Battery, Inc.

Good morning, good afternoon, and good evening. Welcome to Ferrer Battery's first quarter 2022 earnings conference call. With me today on the call are Tom Einer Jensen, our Chief Executive Officer, Jan Arve Haugen, our Chief Operating Officer, and Oscar Brown, our Chief Financial Officer. During today's call, management may make forward-looking statements about our business. These forward-looking statements involve significant risks and uncertainties that could cause actual results to differ materially from expectations. Most of these factors are outside Frere's control and are difficult to predict. Additional information about risk factors that could materially affect our business are available. Good morning, good afternoon, and good evening. Welcome to Frere Battery's first quarter 2022 earnings conference call. With me today on the call are Tom Einer Jensen, our Chief Executive Officer, Jan Arve Haugen, our Chief Operating Officer, and Oscar Brown, our Chief Financial Officer. During today's call, management may make forward-looking statements about our business. These forward-looking statements involve significant risks and uncertainties that could cause actual results to differ materially from expectations. Most of these factors are outside Frere's control and are difficult to predict. Additional information about risk factors that could materially affect our business are available in Frere's S-1, an annual report on Form 10-K filed with the Securities and Exchange Commission, which are available on the investor relations section of our website. With that, I'll turn the call over to Tom.

Thank you, Jeff. And again, good morning, good afternoon, good evening, everyone dialing in to this first quarterly result of 2022, Breyer's fourth quarterly result report since we went public on the New York Stock Exchange back on July 8th, 2021. Just repeating what Jeff has just been through and then moving to slide three, today's agenda. What I'm really... proud of and find very compelling is that we're here showing you a picture of the dry room in the customer qualification plant. Our chief operating officer will come back to the status of our operational progress later today. But today we'll go through some of the commercial developments which continue at accelerating pace, general market backdrop, our augmented value proposition to deliver into an unprecedented decade, the decade of the battery. We'll talk about our operations at supply chain, Our new chief financial officer will take you through the financial status of the company. We'll focus on the strategic priorities moving forward while we open up for a Q&A. We find ourselves in quite challenging environments in difficult times. We obviously reach out to all the people in Ukraine that have a very tough time these days, and that is obviously impacting markets all around us. But from a battery producer's point of view, What this is underlining is the need for an accelerated energy transition. The energy transition requirement is now clearer than ever, and batteries form, as I've been underlining many times, a critically important part of that, not only to decarbonize transportation, but also to decarbonize energy systems globally. And to basically eliminate the need for Russian gas into the European market will need an unprecedented development in renewable energy in Europe, which again will be catalyzed to a large extent by more storage and lithium-ion battery supply. Dreyer has very strong momentum across all market verticals. And we announced yesterday an additional offtake agreement with Poen. And today we're very pleased to announce an additional 25 gigawatt hours of offtake agreements that we have entered into over the recent weeks. This means that we have more than doubled our offtake agreements since our previous earnings call. uh, equating more than a hundred gigawatt hours worth of offtake from our initial gigafactories. This principally means that we're sold out on capacity from our gigafactory one and two in Norway up until and including 2013. Today it is committed to deliver on speed scale and sustainability, and this is ever more important than it ever has been. And our team is delivering on our commitments. We are finding ourselves, as mentioned, in highly volatile and challenging markets, but our financial position remains very strong, and the financing options that we are progressing is progressing according to plan. Capital is available for the right projects, and we are finding ourselves in a very interesting sweet spot to accelerate the even more urgently required energy transition. Talking about commercial traction, commercial traction continues on all fronts for Freyr. If I'm moving on this slide from the right to the left, let me now start by saying that we've now signed more than 100 gigawatt hours of initial offtake agreements. 50 of those with Honeywell and a leading global ESS player now is in closing stages of negotiation. So 50 gigawatt hours is now close to becoming definitive sales agreements. These are critically important aspects of unlocking project finance to our Gigafactory 1 and 2, which our CFO will come back to in a second. As announced yesterday and augmented today, we have an additional 50 gigawatt hours on top of that 50 on track to a definitive sales agreement, an additional conditional offtake agreement, bringing again, the total signed agreements now to more than a hundred gigawatt hours. We have an additional 100 gigawatt hours under negotiation, and we have those across commercial mobility and EV segments in addition to our very strong penetration in the ESS market. But on top of that, we're starting to see very strong traction in particular in the EV market. And we have now in discussion more than 200 gigawatt hours worth of annualized supply leading up to 2030. This could turn it from a triple digit gigawatt hour player to a 10 watt hour player over time. This is supporting our ambition to diversify the technology offering as well as diversifying our geographical footprint. To have an integrated supply chain approach with localized and decarbonized raw material supply is a critical component in this to ensure that we have a very cost competitive solution to offer to our customers. I alluded to yesterday, we announced our agreement with Poen, one of the leading ESS players and longest standing ESS players in the US. A 28.5 gigawatt hour offtake agreement is a milestone for Freyer, adding to our already announced agreement with Honeywell and the leading ESS player. But on top of this, we have also signed an additional 25 gigawatt hours from two of the leading ESS players in US and Europe. We will, as we progress towards definitive sales agreements for the not yet disclosed names, be announcing who these players are, but I can assure our investors that these are absolutely leading players in the ESS space, fundamentally supporting the fact that we have a leading technology solution to offer to our customers. The 24M technology with thick and larger electrodes is generating a lot of traction, in particular in the ESS space, but as you also are aware of, volkswagen coming into the 24m family towards the end of last year and starting to develop together with 24m ev solutions based on the semi-solid technology the 24m technology suite is applicable across the space but ess players in general and this is in particular for us exciting are to now to a large extent being marginalized by the ev demand and recent price increases from tier one producers in Asia are fundamentally supporting our accelerated development in the ESS space, supported to a large extent by our ambition to have localized and decarbonized value chains to develop security of supply of critical energy infrastructure. Larger and thicker electrodes when produced at gigawatt hour scale locally with decarbonized supply chain is gaining very strong market share driven by, as mentioned, the security of supply considerations, but ultimately it's a function of cost and decarbonization advantages. And we believe that when we produce these solutions at scale, that we will have a fundamental cost advantage relative to conventional production. While there are multiple initiatives for cell production globally, in particular in the European market, crowded with startups, we believe many of these will struggle to deliver technology, commercial wins, and ramp-up capabilities. When we move into the next decade, we believe a select few major players will remain and Freyr is on track to become a global champion in the clean battery solution space. As we presented in the PIPE presentation when we went public on the New York Stock Exchange, Freyr is a technology agnostic or technology flexible organization. And we are increasingly recognized by a broader and broader suite of partners across the value chain as an industrialization partner of choice. This goes, as mentioned, both for battery cell technology providers, as well as for up and downstream players seen from the vantage point of a battery cell producer. Localized and decarbonized supply chains, coupled with world leading project execution and operational excellence skills, which Freire has been very focused on developing over the last 18 months is attracting significant partnership potential for us upstream, downstream and horizontally. We are now taking significant steps to expand our total addressable market potential by also diversifying technology to conventional technology solutions as well as into solid state solutions. Product differentiation and diversification is going to be key to become a leading provider of clean battery solutions over time. All of this is happening while we are progressing and accelerating our plan to develop the 24M technology suite. We are seeing increasing and accelerating interest of the 24M technology as mentioned and articulated with our traction on the ESS side, but also in commercial mobility and EV solutions. So all market verticals are seeing dramatic cost potential in the 24 m technology and we are as previously mentioned going to be the first one to take this technology to gigawatt hour scale in the most favored locations globally what you should expect moving forward from player is a lot of momentum on numerous fronts including diversification up and downstream as well as technology diversification to essentially increase our total addressable markets With this, I will turn over to Jan Arve, who has in an excellent way been leading our efforts in delivering on our commitments and basically committing to deliver moving forward. So with that, Jan Arve, I'll turn it over to you.

Thanks, Tom. And hello to everyone listening to us today on our call. I'll start with an update on our operations. And the key message that I have to share with you today is that our teams are making remarkable progress on both the CQP construction and the pre-construction activity on the combined Gigafactory 1 and 2 in Moerana, Norway. As a lot of other industries, we too experience challenges related to the COVID-19 situation and of course, supply chain disruptions. However, I'm pleased to report that the construction of the Customer Qualification Plant, or the CQP as we abbreviate it, is progressing very close to the schedule. As previously reported, we are expecting to complete the site acceptance test now for the first sample tests in the facility in Moerana near year end 2022. Hopefully many of you have seen the materials we have posted on social media detailing the work that's been done by our skilled project execution team. Thanks to their effort and the outstanding support they are receiving from our technical staff in Oslo, we are advancing steadily towards factory acceptance testing during the summer and into the fall. Our Gigafactory 1 and 2 team is also making excellent progress in advance of the start of the construction. Groundwork preparations on the site and detailed engineering is largely complete. Indicative quotes from the different suppliers of production line equipment are now being analyzed, and the structure of frame agreement contracts are being formalized. We intend to present the project plan for final investment decision to the Frayer board during next month. In the interim, the board has approved additional capital spending to facilitate the long lead time orders on building and infrastructure materials. This is mainly to support an optimized installation of the production line equipment in the factories. Recruitment for the workforce is progressing well and we are currently updating the standard operating procedure for all key operations. I'm also very pleased with the efforts and achievements we have made in recent months to secure key raw materials for the combined Gigafactory 1 and 2. Amidst an increasingly challenging environment for upstream raw materials, our team has completed qualification program on technical compatibility, capacity and quality control for most of the raw materials that we need for the factories. We are now working to finalize the volumes, delivery and pricing terms with our suppliers. At Freyr, we believe that developing the localized and decarbonized supply chain at gigascale is an essential competitive differentiator. And we are already implementing our strategy by moving closer to final investment decision on our collaboration with Alice to construct an LFP cattle plant in the Nordic region. By localizing upstream elements of the value chain, we can reduce our emission profile over the life cycle of our battery production. And we can simply simplify the process of delivering decarbonized cells to our customers in Europe and the US. Our teams are focusing on arriving rapidly at final investment decision on the proposed LFP cathode lab in conjunction with the combined Gigafactory 1 and 2. This is not a small undertaking and there have been and will be continued to be challenges along the way. We are in progress of doing something that never has been done before in the Nordic region. A startup of a company is developing now that will be a complex multi-billion dollar manufacturing facilities in a somewhat remote yet industrialized region of Norway, but with unrelenting commitments to decarbonization, operational excellence and strong financial returns on the capital that we are deploying. My reassurance to you today on this call is that this task is in reliable and experienced hands. Our projects, supply chain and technical people are the best that they can do. And they are collectively focused on our goal to deliver clean next generation batteries to our customers. On behalf of the entire operations team in Frey, thank you for your confidence in us. Our mantra is to commit to deliver and deliver on our commitments. And with that, I turn the call over to Oskar.