Emeren Group Ltd

Hello, ladies and gentlemen. Thank you for standing by for Emron Group Limited's first quarter 2024 earnings conference call. Please note that we are recording today's conference call. I will now turn over the call to Suzanne Wilson, Director of Investor Relations at Emron Group. Please go ahead, Ms. Wilson.

Thank you, Operator, and hello, everyone. Thank you for joining us today to discuss our first quarter 2024 results. We released our shareholder letter after the market closed today, and it is available on our website at ir.mrin.com. We also provided a supplemental presentation that's posted on our IR website that we will reference during prepared remarks. On the call with me today are Mr. Yumin Liu, Chief Executive Officer, and Mr. Ka Chen, Chief Financial Officer. Before we continue, please turn to slide two. Let me remind you that remarks made during this call may include predictions, estimates, or other information that might be considered forward-looking. These forward-looking statements represent Emmering Group's current judgments for the future. However, they are subject to risk and uncertainties. That could cause action results to differ materially. Those risks are described under risk factors and elsewhere in Emmering Group filings of the SEC. Please do not place undue reliance on these forward-looking statements, which reflect Emarin Group's opinions only as of the date of this call. Emarin Group is not obliged to update you on any revisions to this forward-looking statement. In addition, please note that all financial numbers are discussed on this call are unaudited. Also, please note that unless otherwise stated, all figures mentioned during the conference call are in USD dollars. With that, let me turn the call over to Mr. Yumin Liu. Yumin.

Thank you, Suzanne. Thank you, everyone, for joining our call today. I'll begin by providing an overview of our operational performance in Q1 2021. And Ke will discuss our financial results for Q1 and our outlook. In Q1, we generated 14.8 million in revenue, marking a 15% increase year-over-year our gross profit soared to $4 million, more than doubling from the previous year, with the gross margin reaching 27.2%. The operating loss was approximately $0.7 million, significantly reduced from last year. This substantial growth in revenue was primarily driven by our Expanding Development Service Agreement, or DSA, business, which generated over $5 million in revenue. Our effort to improve operational efficiency across all regions is paying off. We decreased operating expenses by over 50% through strategic cost control measures. That progress was offset this quarter by 0.7 million write-offs of canceled US early stage projects due to our shifted focus on advanced stage projects and unrealized foreign exchange loss of over 3.2 million. which constituted the bulk of our net loss. We'll give you a quick overview of each of our business lines, starting with the quarterly primary catalyst, then we'll circle back with more details later. Our DSA initiatives contribute to a stable and predictable business model, enabling revenue recognition at the early stage of the project development. This approach is proving instrumental in managing risks and maximizing cash flow efficiency across the project lifecycle. In Q1, DSA revenue accounted for 34% of our total, largely driven by battery energy storage system, or BESS, projects in Italy. Looking ahead, we are working to broaden our DSA partnerships on a global scale. Concurrently, our BAS pipeline continues to grow steadily globally. We recently signed a BSA agreement for our BAS projects in southern Italy with Norway Infrastructure, formerly known as Glenmont Partners, one of the world's largest fund managers specializing in clean energy, aiming for a total power capacity of 199 megawatts or up to 1.59 gigawatts. In April, we secure an additional agreement with Noveen for 155 megawatts or up to 1.24 gigawatts of battery storage projects. We bring the partnership total power capacity of 354 megawatts or up to 2.8 gigawatt hours. In Q1, our IPP assets were the primary drivers of growth and profitability. contributing to 38% of our revenue with a gross margin of 44%. IPP continues to be a pivotal component of our business model, providing a dependable source of stable and predictable cash flow. Our IPP revenue is balanced between Europe and China with a modest presence in the U.S. as of today. In Europe, we have 67 megawatt of IPP assets that generate sustainable revenue. For legacy reasons, we have IPP assets in China located in the five coastal provinces with favorable power prices, strong economies, and robust regulatory environments. We are now fortifying those assets by adding battery storage to the portfolio. As of the end of Q1, our battery storage portfolio comprised 19 megawatt hours, all integrated into the virtual power plant platform. The VPP platform owned and operated by Huanan Power International, one of the largest IPV operators in China. The VPP market in China expanding rapidly. During the quarter, we continue to develop solar and storage projects. As of the end of Q1 2024, we had over 2.6 gigawatts of advanced-stage, high-quality solar projects. We maintain our expectation to monetize approximately 400 to 500 megawatts of projects in 2024 and beyond. At the end of Q1, our total energy storage project pipeline had increased to over 8 gigawatts, or over 32 gigawatt hours. In conclusion, we are optimistic about our revenue growth potential, which is fueled by our strategic initiatives and a robust project pipeline, and our ability to achieve gross margin of over 30%. We are also confident we can continue to lower operating expenses. Now let me turn the call over to our CFO, Ke Chen, to discuss our financial performance and guidance.