Minesto AB (publ)

Hi and welcome to Minesto's second quarter report 2025. With us to present we have CEO Martin Edlund. If you have any questions for the company you can use the form to your right. And with that I give the word to you Martin.

Thank you very much. Hi everyone. I'm going to spend some time here to give you a brief run through of where we are as a company minister with today's half year report public since a few minutes ago. And first, I'd like to say a few words on testing and our Megawatt machine, the product that is targeted to drive sales and build out. And for the second quarter this year, we had it back in the water for its second production run, and it is still running in a very positive way for us as a company. We have made configuration changes foremost to extend the length of the tether that attaches it to the seabed and as predicted we get a 25% increase in production by utilizing this. The test site we have is originally targeting smaller units But with historic path dependencies with Brexit and the evolution of things in Wales, we moved to this test site, decided to do that several years ago when we planned the launch of this Dragon 12. So it means it's installed in this site with a little bit shallower water than what it's optimized for. But we've been able to, despite that, to get closer to the right length of the tether and it is very very comfortable to see that this longer tether gives us the performance that we expect. For the first commercial site in Hästfjord around the corner literally from where we are there will be yet a further extension of the tether for that installation. So this is very important and very good news for us. It's easy to say that it's by far the best and most robust system that we've ever built. And we're in the fourth month of production here with it. And the plan is to keep going. But if there are any reasons for us to bring it back, we will do that and investigate for further development. We believe we have enough real production data now to motivate the verification of the technology relative to the dialogues we have on project investors in Hestfjord. But of course, it's good to keep testing as much as possible as we move forward. We've also been able to secure grant-based funding and get a consortia together to move on microgrid products. So a 25 million grant injection to a consortia that targets building a microgrid based on Minesto's dragons is something that has started now. We were awarded this earlier in the beginning of the summer. And this is really great news for us at Minesto to have this in place. We will work with Capture Energy, the local partners SEV and consultants to really bring this alive. Good expert partners, solid consortia that we've built around it. You can ask, and we've been asked, is this a distraction now when it comes to the bigger race and the big farms? But I'd say it's not at all the case. On the contrary, this enforces and strengthens Let's say the rollout and the business agenda we have. It's a complete product setup where we get other commercial partners to invest in complementary systems so that we really can offer turnkey microgrids from Minesto. We have a close involvement from SEV, the local utility. where their ambition and the plan of this whole project is to build this and verify its functionality in Westmanna at the current test site and then move it to a commercial site on one of the non-grid connected locations in the Faroes. Of course, we target other sites with other partners around the world as well. And we will be able to shorten lead times for delivery and be on our toes to get those projects going. And often it is asked by those partners out there to do a small project first. Not that they're interested in small projects per se long term. But it will speed up environmental consenting and local acceptance and turn around things quicker. So I think that's a relevant connection to the bigger business as well. And of course, it's important to acknowledge that for Minesto, we're going to deliver basically the same product into a microgrid setting as we do into a grid connected array setting. So The upgrades we are doing and that's funded in this project is also beneficiary for the array side of it. And we will build our core products as a part of this project as well. A final note on this is that we might sort of over interpret the prefix micro in this context. When it comes to microgrids, it's more a matter of an isolated system working in island mode in a certain context. And we can see applications maybe up to 40, 50 megawatts, which from our tech company perspective will be something very far from the prefix micro, so to speak. So I think that's important aspects of this project. And of course, also, since we're integrating energy storage and we're going to use tidal energy as sort of the complete production source of energy in those systems, it will also give us hands-on evidence on the baseload characteristics of tidal and how little storage that's needed compared to other more stochastic renewables. So really good news for us. We're already moving on this project. Then next topic here would be then the market establishment work, the core activity of Minesto in many ways now. And I know also obviously of a vital interest to our shareholders. How far are we in our customer dialogues? When will we see Minesto launching press releases with announcements of big sales? And we are working broadly and in depth, more intensively and with more activity than ever in this area. I think that just to show you some insights into this. We're not just doing the same thing and trying to knock on doors. It's a very, let's say, rich and in-depth process to reach into those, especially the large renewable project developers and their decision-making processes. So we're doing everything on securing the resource to create confidence that the tidal resource is as strong as we say and that other local conditions are in place. We're working on customizing our kites also with simulation tools. And we have now, during the second quarter here, also added a very powerful tool to to analyze the grid impact of what we do, basically to be able to put economic value on the base load characteristic of the tidal technologies that we're offering. So we're strengthening our way of creating this breakthrough and working hard in this area. We've also set up for the Faroe Islands, we've set up a market development company that we've labeled Dretchen. And the Dretchen company is sort of the business model concept that we're using. Since the first project will be small, there are project risks and there are perceptions of technical risks from the customers. We're putting the right to move on the whole Faroe Island context into this Dretchen company. Dretchen means the dragon in Faroese, so I think it's quite an appropriate label for it. And the hands-on work for us is to invite different types of investors into Dretchen and then use Dretchen as the main owner and builder of the Hestfjord. In addition, we've had a really interesting quarter behind us when it comes to exposure. product exposure, brand exposure, and to be able to talk about our title solutions as a necessary or extremely valuable addition to the global energy mix. This work means a lot to us in many ways, investor relations, customer relations, and to sort of broaden and fill CRM systems with relevant partners. And also, of course, to create more awareness of this sector as something that is really moving forward and is far from what it used to be historically with horizontal axis, niche oriented solutions. So I think this exposure that we get from this is of significant value. You see, we use our test site in the upper right corner here. Cecilia, our communications director, showing the site to stakeholders. We're invited to be a part of Team Sweden in a very positive way, together with the big Swedish industry players, and get a lot of promotional opportunities in those contexts. to build trust and to build relationships. And I think that it's appropriate to be really proud and satisfied with the fact that we have over half a billion views and exposures on Minesto's products and our brand over this quarter, where the marketing project together with SKF on a global scale, of course, has been the leading driver for this. The one where we take sort of the Faroe Islands space program and make some interesting sort of claims there on running a space program without leaving Earth. If you haven't seen it, you can easily find it via our homepage. I think it's pretty cool work from from the team at SKF to put this together in this way. Also, for the second quarter, we choose to secure funding short term with a loan that was quite comfortable to set up in April. to give us more room to look into different finance and solutions and to build the company further. So we keep doors open for autumn and onwards on what would be the best way to push forward with securing funding and moving Minesto forward. We also acknowledge that the stock market and the perception of renewable innovation is improving again. So the position there, we believe, is quite good at the moment. We've also completed a process that we have been working with systematically for more than a year on focusing Minesta's organization to Gothenburg to integrate operations, technology, and of course, sales and marketing, the business development side in a clear way. So basically, the whole team is now under the same roof. in Frölunda, in Gothenburg, including the workshop and the build and testing onshore of technical systems. This has also led to a more efficient organization. We cut around 30% of our fixed costs, giving us more room to build things and to invest in the early phases of site development to lower hurdles for the first movers to work with us. So all in all, it's been a good second quarter. We are really looking forward to autumn 2025 with commercial focus and with build and design of upgraded Dragon Claw systems in the Swedish Energy Agency funded project together with partners. So I think with that, I'll hold my horses and see if there are any Any comments or questions from our shareholders?

Thank you so much for that presentation. If we'll move over to the Q&A. First question here. How much energy does the big dragon deliver per day after your optimization?