Eco Wave Power Global AB (publ) Q1 2024 Earnings Call Transcript

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May 17, 2024

There are 3 speakers on the call.

Operator

Greetings. Welcome to Ecowave Power's First Quarter 2024 Earnings Conference Call. At this time, all participants are in a listen only mode. Please note this conference is being recorded. I will now turn the conference over to your host, Aaron Yehuda, CFO of EcoWave Power.

Operator

You may begin.

Speaker 1

Thank you all for joining for taking the time and joining us this morning for this conference call. In the Q1 of 2024, EcoWave Power continued in its cost reduction strategy, while accelerating its progress with existing and planned projects. In Q1 2024, we achieved a 3.5% cost reduction compared to the same period in 2023. This cost reduction joins the cost reduction presented for the whole year of 2023, which amounted to a total of 26%. Now turning to our detailed cost structure.

Speaker 1

Our operating cost decreased from $683,000 in Q1 2023 to $659,000 in Q1 2024. We can see specific decrease in R and D costs, which decreased from $210,000 in Q1 2023 to $177,000 in Q1 2024. The R and D expenses are expected to increase in the next quarter due to adding a VP R and D to lead our engineering team, which is meant to drive the company's ability to handle new orders from clients and existing projects. Sales and marketing costs reduced from $76,000 in Q1 2023 to $65,000 in Q1 2024. Also during Q1 of 2024, we recorded net financial income of $132,000 dollars versus $160,000 in Q1 2023.

Speaker 1

The company ended the period with $7,960,000 in cash and cash equivalents and in short term bank deposits. We look forward to execute its plans for projects in the U. S. And in Portugal, which Ina Braverman, our CEO, will provide you with further info about. I will now turn the conference over to Ina Braverman, CEO of Echo Wave Power.

Speaker 1

Ina, you may start.

Speaker 2

Thank you, Raul. So over the past month, an array of ETFs dedicated to key aspects of energy transition from renewable energy generation to smart grid management have all posted positive returns. We can see that Echo Wave Power stock followed a similar pattern with the rising of Wave stock. During this period, Wave stock outperformed the Global Alternative Energy Index by showing growth of 136.4 percent in the last 3 months. We believe that what enabled the growth and rising interest in the Wave Stock is the fact that the company delivered on its promises and reached significant progress during each quarter, while cutting down its net loss and operational expenses and boosting revenues.

Speaker 2

As Alain mentioned, in Q1, we were able to keep the low level of expenses and thus demonstrate our resilience by decreasing our operating expenses by 3.5% compared to Q1 2023 and in the period with $7,960,000 in cash and short term bank deposits. In the same time, we were able to achieve progress in all the company's projects with key improvements in the operational results of the EWP DF1 project in the Port of Jaffa, Israel, submission of final licensing documents for the installation of our first project in the U. S. In the Port of Los Angeles and moving forward with our megawatt scale project in the City of Puerto in Portugal. And a little more detail, in Israel, the EWP DF1 project has been delivering clean electricity from the waves to the Israeli national electrical grid sends its connection to the grid in the end of 2023, and opening ceremony for the project will be held as soon as the company deems the geopolitical situation in Israel has improved.

Speaker 2

EcoWise Power and EDF Renewables IL have started an analysis of the first set of results from January 2024 to April 2024. The results from the projects are encouraging as we can see a month to month improvement both in terms of energy generation and in terms of significant decrease in downtime for the power station. Downtime has decreased from 35% in January 2024 to 26% in February to 13.4% in March and only 3.6% in April 2024. In addition, the company was able to get closer to its energy generation targets by 8%. As to the Port of Los Angeles, in January 2024, we announced that we signed a strategic investment agreement with Shell MRE for the implementation of our first U.

Speaker 2

S.-based wave energy project, while in the same time also moving forward with licensing process. We submitted our comprehensive project engineering plans to the port authorities and have requested the final licenses from the Port of Los Angeles and the Army Corps of Engineers. The last opinion that we submitted is an opinion saying that the sites where we're installing is not a historic site, which was requested by the Army Corps and now we're waiting for their updates. Due to the rising interest and opportunity that we see in the U. S.

Speaker 2

Market, we also conducted a comprehensive feasibility study with LMRE aimed at identifying the best locations for commercial onshore wave energy station along the U. S. Coastline and worldwide. The 3 months in this feasibility study, which now has been completed, showed favorable conditions for clean energy generation in 77 sites in the U. S.

Speaker 2

Compatible for the installation of eco wave power technology. In Portugal, we received the final approval necessary for the commencement of the construction work of our 1st megawatt scale project in Porto from APDL Port Authority. As a result, we have issued a performance bond, a bank guarantee basically, meant to solidify our commitment for of the 1st commercial wave energy power station within a 2 years period. We believe this will be the 1st wave energy project in the world to show significant energy production from the power of the wave. During Q1 2024, we finalized the construction plans of the energy conversion unit and held an official kickoff meeting with the port and the architect of the site.

Speaker 2

The next steps include finalizing detailed construction plans for the whole 1 megawatt power plant, including the floaters, to be followed by official visit of Echowaway Power's engineering team and commencing of actual construction, which is expected to take up to 24 months. The Portuguese project is expected to be EcoWave Power's 1st megawatt scale project, which we believe will position EcoWave Power as a leading wave energy developer and serve as a significant milestone towards the commercialization of wave energy globally. We have also reinforced our engineering team and are planning on establishing a U. S.-based sales and business development team to enable the company to enter deals for turnkey wave energy projects, which we believe will in turn significantly boost the company's revenues to be added to revenues that the company is already generating from feasibility studies and other related engineering services. The expansion of the engineering team in Israel and the new BDN sales team in the U.

Speaker 2

S. Will require some time. However, we believe that such an enhanced company structure will lead to positive financial results and accelerate the project delivery timeline. I would like to finish by thanking all our existing shareholders and the new ones that joined us in the recent months and reiterate our excitement about the new deal with Shell MRE and the progress with all our projects and update you that Eco West Power is still working towards receiving an approval from SFSA for a buyback of up to 10% of our shares. Thank you very much.

Operator

Thank you very much. This does conclude today's conference

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Earnings Conference Call
Eco Wave Power Global AB (publ) Q1 2024
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