Emeren Group Ltd

Hello, ladies and gentlemen. Welcome and thank you for standing by for Ameren Group Limited third quarter 2024 earnings conference call. Please note that we are recording today's conference call. To ask a question during the session, you'll need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. I will now turn the call to Gary Dvorak Managing Director of the Blue Shirt Group. Please go ahead, Mr. Tvorczak.

Hey, thank you, operator, and hello, everyone. Thank you for joining us today to discuss third quarter 2024 results. We released our shareholder letter after the market closed today, and it's available on our website at ir.emron.com. We also provided a supplemental presentation that's posted on our IR website that we'll reference during our prepared remarks. On the call with me today are Mr. Yumin Liu, Chief Executive Officer, and Mr. Ke 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 Emory Group's current judgment for the future. However, they are subject to risks and uncertainties that could cause actual results to differ materially. Those risks are described under risk factors and elsewhere in Emory Group's filings with the SEC. Please do not place undue reliance on these forward-looking statements, which reflect Emory Group's opinions only as of the date of this call. Emory Group is not obliged to update you on any revisions to these forward-looking statements. In addition, please note that all financial numbers discussed in this call are unaudited. Also, please note that unless otherwise stated, all figures mentioned during the conference call are in U.S. dollars. With that, let me now turn the call over to Mr. Yumin Liu. Yumin, go ahead.

Thank you, Gary. Thank you, everyone, for joining our call today. To start, I'll provide an overview of our operational performance for Q3 2024. Then our CFO, Ke Chen, will walk through our Q3 financial results and our outlook. In Q3, our company executed on its bottom-line focus achieving solid profitability despite softer than anticipated revenue resulting from delays in closing scheduled project sales. With $12.9 million in revenue, we achieve a gross profit of approximately $5.6 million, yielding a solid gross margin of 43.8%. $2.1 million in operating profit and 4.8 million in net income attributable to Evergreen Group Limited's common shareholders. Strong EBITDA of 8.5 million further reflects our commitment to sustainable profitability and core business resilience. Our net income was supported by a foreign exchange gain exceeding 4.6 million as the euro strengthened during the quarter. offsetting a similar foreign exchange loss early in the year. With Europe generating a majority of our revenue in Q3, we benefited from a strong euro. Besides, our focus on high margin growth remains robust. The independent power producer or IPP segment generated 9.4 million, driven by seasonal strength in European assets. Our development service agreement, or DSA model, also expanded in key markets, adding $1.3 million from Italy, $1 million from France, and $0.9 million from our first battery energy storage system, our best project portfolio in the US. Revenue was lower than anticipated due to a timing issue. Politically, delays in government approvals for three projects in Europe. These remain in our pipeline and are expected to contribute to revenue once approvals are secured. Let's move to the progress of each of our business segments. First, the borrower DSA. In Q3, we executed a 394 megawatt batch DSA with PLT Energia and completed the sale of 57 megawatt solar projects to China through a mixed DSA slash SPA structure. Our DSA approach is a game-changing, reliable, and scalable business model that enables us to monetize projects at early to mid-stages while securing high-quality contracted revenue. This strategic model delivers unique benefits, including positive cash flow and effective risk mitigation throughout the project lifecycle. Building on this momentum, we also signed our first DSA contract in the US for our 72 megawatt-based project portfolio in California. As of September 30, we have secured DSA contracts with nine partners, including Glenmont Partners, Matrix Renewables, and PLT Energia, covering 28 projects totaling over 2.1 gigawatts. with 84% allocated to battery energy storage system, or BES, and 16% allocated to PV, resulting in an expected contracted revenue exceeding 69 million to be monetized within the next two to three years. Additionally, over two gigawatts of DSAs are under negotiation, estimated to bring another 100 million in revenue. This robust DSA pipeline, encompassing both contracted projects and potential agreements, and with nearly 90% based in Europe, underlines our strengths in markets that favor renewable energy, driving our financial stability and growth. In November, we announced a DSA with Appinga for a 300 megawatt battery storage portfolio in Southern Italy. This partnership, our force with an Italian ESG focus leader, strengthens our position in Italy's battery storage market, where we have approximately two gigawatts in the permitting process. The collaboration supports Italy's clean energy transition goals and aligns with our focus on high value growth opportunities in battery storage market. Second, Regarding our solar power project development, in Q3, we successfully closed the sale of our solar project portfolio of 42 megawatts in Spain to CVE Spain. Over the past few years, this portfolio is projected to generate approximately 92.8 gigawatt hours of solar power annually, offsetting nearly 20,000 tons of carbon dioxide emissions each year. Additionally, we sold a 57 megawatt solar project portfolio to Trina Solar, showcasing the strengths of our European development efforts. Due to project delays, the sales of our US community solar project portfolio and some projects in Spain and Italy did not get closed by the end of Q3. For example, certain closings expected with CVE in Spain were delayed due to lengthy local administrative approvals. Some of these delayed projects sales are expected to close in Q4. Last but not least, our IPP assets demonstrated robust growth and profitability throughout the third quarter, contributing approximately 73.2% of our total revenue for the period. We continue to optimize operations across our solar farms, including Branston, reinforcing the IPP segment as a cornerstone of our business model that offers dependable, stable, and predictable cash flow. In September, we energized a 4.5 megawatt solar power plant at LuxShare iTech, a major facility of LuxShare Precision Industry Corporation Limited. a public company listed in Shenzhen Stock Exchange in China, and a prominent Apple supplier active in Apple's supplier clean energy program. This collaboration reflects our shared commitment to environmental responsibility and Emirates expanding renewable energy presence. In Q3 2024, we connected 7.2 megawatt of solar projects across China, while our certified megawatt our battery storage portfolio was fully integrated into Huaneng Power International's virtual power plant platform. In consideration of our strategy to grow IPP assets, we decided to retain a 52.4 megawatt project portfolio in Hungary, previously planned for sale as an IPP asset today. 30 megawatt of the portfolio is already operational. with a remainder set to be energized by the year end. This decision leverages strong project returns, Hungary's positive economic outlook, and significant foreign investment into the country. Hungary's commitment to renewables, evident in AMBISA's solar goals and updated energy plan, further enhances the portfolio's value as an IPP. While this shift impacts four years' revenue, it aligns with our long-term growth and value creation goals amid favorable market conditions. Furthermore, with supportive local policies in Hungary's energy storage market, we see expanding opportunities in the country, and battery storage facilities are now planned for several projects within this portfolio. As we approach the close of 2024 and look to 2025 and beyond, we are strengthening our presence in some of the world's fastest growing solar and battery storage market, which are supported by increasing demand for clean energy, favorable government policies, and advancing technologies. Our primary objectives remain clear. Advancing early stage projects expanding our DSA partnerships across Europe and US, and refining our strategies to unlock the full potential of our development portfolio. While certain project sales in Europe may extend into 2025 due to the delays in government approvals, our core business lines remain robust, and we are confident in our ability to deliver substantial growth in the fourth quarter. driven by a strong pipeline and favorable market conditions. With that, let me turn the call over to our CFO, Ke Chen, to discuss our financial performance and guidance. Ke?