Forgent (LSE:FORG) — 2021 Interim Results

0:01 Good afternoon, ladies and gentlemen, and welcome to the EQ Tech PLC twenty twenty one Interim Results Investor Presentation. Throughout this presentation, investors will be in listen only mode. Questions are encouraged and can be submitted at any time by the Q and A tab situated on the right hand corner of your screen. Simply type in your question and press send. The company may not be in a position to answer every question received during the meeting itself. However, the company will review all questions submitted today and publish responses where it's appropriate to do so. These will be available via investment

0:31 company dashboard, and we'll notify you by email when these are ready for your review. I'd also like to remind you that this presentation is being recorded. Before we begin, I'd like to submit the following poll. And I'd now like to hand you over to David Palumbo. Good afternoon. Thank you very much, Alessandro. First of all, thank you very much for everyone attending this webcast. We would like to use the opportunity to give you a refresher of the business of Equitex and where we are in the growth. And we expect this to take twenty to twenty five minutes, and then we'll proceed to answer anyone's questions as much as we can in the given time.

1:24 Just to start with, our target business model, Equitec is a is a key technology innovation business. We are a IP rich, know how rich company that for main business is to sell technology solution and innovate innovate in the space. So our existing assets are, you know, the the capability and know how that we have going back to 1997, all our patents and the versatility of the applications that we can use our solutions and the operational availability that or plant the plant using the solution. This makes the commercial viability and the business case for each of these applications. Very interesting.

2:10 It's a business that is profitable in terms of the plans that it can be deployed right now and is interesting and profitable for the application today. The the the future endgame of of of where we want to be to generate more value in terms of being able to scale much quicker is in the in the licensing and and services. But to to get there, you know, we have to build not only the the integration and know how people did this in the market, but also define the market and that all the process that takes that are required to take project to not only a technical but also a commercial viability.

2:59 So what what what is the the the journey that we are, you know, going through now is to develop more market access, and we're doing that. I will discuss more about how we're achieving that to local go to market joint venture. More footprint and certification of of of plans built where we have external validation of the app to the whole technology, improving also the digital configuration. So we the the the end model that we want to have is where we certify, you know, third party companies or ETCs or or strategic partners to deliver and to deploy all technology in a way that we can distribute the company digitally. That's that's the end game. That's a little bit to use an example, it would be like like when you buy Microsoft Office or when you buy Salesforce, you don't have a Microsoft employee deploying the technology. You have a reseller, a certified reseller for other Microsoft or cell phone or an equipment. So we want to be, like, the the Intel inside of the justification war where we can provide this sector expertise in the in the form of or pay them our know how and be able to project that in the market through partners.

4:25 Another thing that is important to achieve that is access to data. We all our plants collect the the operational data from temperature to pressure to composition. And all that data from a plant, it just improved the the the know how in terms of predictive maintenance. And we are now looking to develop more in the context of industrial IoT to be able to improve or continue have the design of a plan, the new solution to be always on the leading edge of technology. And also now, we have been involved a lot is to be able to, you know, be involved with lobby groups and to to make them off of the spotlight that is in the sector of even COP twenty six, you know, around the corner in The UK, and and and being able to to be the expert voice that make reference of what is achievable in the in the market with the remodeling. It's important also to say what what we are not. We are not owner operator of plants. We are not a developer of plants, although we may need to be involved on that process now to be able to define the market and to make sure that the strategic partners as we're building are up to the quality that we require them to be, but also up to the know how to be able to scale rapidly.

5:50 As our value creation is much more important for us to deploy technology much quicker as a technology company will accrue a much higher multiple valuation than just as a, you know, owner operator of infrastructure, you know. So all business model is important that we keep it as it is, which is capital light in terms of investment in not in infrastructure and also quick return on investment in terms of how we deploy our capital just to capacitate and to certify delivery partners on each of the key markets.

6:28 So in the current business model, saying, the whole life cycle of a project, I think it's important to explain this. The all the work that has been happening in the last year is mainly on the pre financial flow board, which is the development phase. So this this includes the business development phase, which is the opportunity incubation, where you qualify the opportunities that contribute to a developer or to a a industrial client. We look at all that configuration, what is the optimal technology configuration for achieving the best economic result. And then this the other very important work, once you set up on that configuration is the whole project development, which is the delivery readiness.

7:15 That all of that work needs to happen before financial close. At times in the market, I saw still immature, like, in a different way, particularly with the early gasification technology has not been very successful on on delivery. You you have the the readiness of the project. It's much more dependent on how well developed and mature this delivery post financial close is than finding the capital itself of financial close. So for us, it's important having the the the interest and the demand on the pipeline that we have created, and we're very careful and should be choose which projects we will bring forward to financial close to be able to use this as a template both to develop the market and to develop for partners.

8:00 The business is setting in in such a way that we get paid development services fee as financial close at the latest, but as early as we can. So a perfect example that we we we described the the transaction when we sell the majority of the SPV to listed natural resource company like as Kibo Energy. And the intention is as soon as there is demand of that SPV to be someone else taking a development risk, this is the moment that we can transfer the ownership of the SPV, and we can build all development services, you know, or accrue internally development services. Development services are very high margin, you know, registry for us and and also derisk the project to still take it to financial close.

8:50 As I mentioned before, the the it's it's it's very rare that the same developer is the owner operator of the plant or next time is to be involved in the financing of the plant. Post financial close, these plans are usually all all and fired by large infrastructure investors to be private equity looking into into energy position infrastructure or orders operator of either waste or energy infrastructure. At that point of financial close, we we sell our technology or solution to the project. So the SPV already capitalized, start paying milestones for us to to sell doing construction and commissioning, you know, for our technology.

9:36 And post COD or commercial operational date when the plant operation starts, then another revenue stream hits thing, which is the maintenance of management of the assets in in some shape or form under the commercial operation of the plant. Again, so we are always subcontracting for services, other than the beginning as delivery project development services in the middle of solution provider and on operation as maintenance and management. Our intention is not to own capital in this infrastructure, and this is designed like that. This is part of the strategy so we can innovate and grow much quicker and deploy more plants globally. As we grow the ecosystem of both the capital investment, both from development and from the the infrastructure and better delivery partners, we can shrink all involvement more and more just on the technology innovation and engineering and maintenance and continue to innovate and to deliver new products and

10:40 new applications. You know, for us to say, we are very much focused on thermal and electrical. We are already looking at biofuels. We are already looking at hydrogen. But this is something that every iteration of this model is profitable. It it it provides good results to the company. It's capital intensive low and creates stacked value on on on each other of the iterations. And just to to add to what David's saying, I mean and to clarify, when we say shrink, we're shrinking the scope of our focus from what he outlined here across the entire life cycle so that we can focus on the technology innovation, the technology deployment, and the quality and of the the plants that are running with the tech in them. That because of that, as David said on the first slide, will allow us to grow tremendously in terms of of of revenue and so on. Just before we move on, I think this this kind of life cycle that David's walked us through gives us a very good baseline for understanding the evolution of ePipe as a business as well.

11:45 You know, we we announced in our interim last year in 2020 a lot about pipeline, and we followed that up in our q one trading update in March of this year.

11:55 And we were naturally commenting on what we were doing around opportunity incubation, therefore, the business development. What we then begin then began to talk about in as early as March, but also then in our q two in in July was how many projects we're beginning to develop. And, of course, as we reinforce again in our interim report just this morning, it's it's that we've been investing in that project development in parts so that we can move more quickly to financial financial flows, but critically, so that we can maintain our brand through the quality of what gets done up the financial flows. If we get into construction and commissioning with poor quality project readiness, there is very little we can do to recover that. And those of you familiar with this industry will know that a lot of projects fail because of a lack of preparation prior to contract, not after and following contract.

12:47 So because of that, we have spent time and effort and indeed investment in ensuring that the quality of what we're putting forward is excellent. So the EQTeq is a technology brand leads all the way to the life cycle and indeed to the lifetime of the plant itself. If we then move on and we look a bit about, therefore, the strategy, which is effectively a plan for how we get from what David just outlined, how do we get to our target model, that of a licensing technology business focused on innovation and constantly putting the front pushing the front edge of the technology capability? How do we get there from where we currently are? And what this track is even what how far we've come so far. So the little triangle you see on your screen is kind of an indication of roughly where we are in that journey. We've been through startup phase, which was a lot about developing financial viability and stability, which we believe happened back in in 2019 going into 2020.

13:48 We developed some anchor projects that you will know about because we announced them last year coming into this year. But, of course, we were operating with a very

13:56 strong technology team in Barcelona and a very scattered and very small corporate center team, and therefore, development team, you know, in in in Ireland and The UK. Moving on beyond that, as I said, we started to push on pipeline and incubation of opportunities and growing interest and awareness, and we had very good success with that, as you'll know. We announced back in in March that we had 75 deals in the pipeline, and and we continue to grow that pipeline. The interest and the demand is, without

14:28 a doubt, continuing to grow. But then the focus becomes a little bit different, and we focus less on growth in the pipeline and just opportunity, and we now need to convert those opportunities into real projects where we we put expert project developers. We put subject matter experts from waste to energy. We get delivery partners actively engaged. And in some of our larger projects, we're getting tier one EPCs involved. And we work together with them to get that quality of delivery ready in place. So by the time we get the financial close, by the time we're contracting, we can ensure that that quality goes right the way through the delivery of the plant, and then, of course, the the commissioning and the live operations of that plant. So we're now focused beyond that into deal growth.

15:15 It's about how many more opportunities can we convert to real projects and how can we work with the right partners. Because as as David was mentioning on the previous slide, we need an ecosystem of partners, go to market partners,

15:31 many of which will become joint ventures. We also then need delivery partners, you know, PPCs and others. We need a pipeline of investors. So we have a growing pipeline of interested investors who want to fund the project with us. So as we build those in and we build the skills and we bring more talent on board, we've been investing. And particularly in the first half of this year, as we said in our interim results, we've been investing a lot in bringing that capability and talent on board and our and those partners on board to help us drive this next phase of our growth. As we do that in the various markets we're currently targeting, we then start to mature that ecosystem. And that ecosystem eventually becomes a series of distribution channels for our technology to a point where our JV partners cannot only have their own networks in their own markets of delivery partners and others to help them, you know, grow the capability, but they become channels through which we can, like with our technology, certify, as David was saying earlier, those who can do the on-site maintenance where required, where we can't do it remotely on-site.

16:38 The last thing I'll say before we move on is underpinning all of this is is our commitment to becoming a digital business. And that means both deploying industrial IoT and other digital technologies as part of what we do out of out of the box, out of the proverbial box with our technology. But also even to componentizing and prefabricating, commoditizing our plans so that they are what our our CTO, Joel Aleman, called cookie cutter so that we can replicate those rapidly into many of the markets where we go. The magic of what we do is not in the kit we manufacture per se. It's in the end to end process knowledge we have, the end to end operating knowledge we have of a plant needs to run, but then also beyond that end to end understanding of the commercials and economics behind the application.

17:27 That is very difficult to replicate, and it's something that we, therefore, need to put into everything we do. And if we can find a way of creating that out of the box, IKEA style, then we can replicate that much more rapid rapidly around the world. And that's what we intend to go. Just I just want to add, it's important to understand that it's not only the technology that we're looking to to be able to compartmentalize and and and and and make a product a product that it it is delivered by in terms of that that template. We created the business template as well for the joint venture. We created the business template for the market development center. So you will see we announced the market development in Italy. We announced another one in in Croatia.

18:12 Those are building blocks for being able to then upscale local partners, both use this as a sales strategy and distribution strategy, but also to use a place where you can see the technology at commercial scale working. You can see the technology operating. And the most interesting thing of all of that, we are not doing that on a balance sheet of our cost than just a slow moving target with that it's a cost to have a R and D center. We're doing that inside our commercially viable, highly profitable, where we sell investment within twelve months of of being deploying the capital. And that's that's the the model that we need. To be able to be agile and quicker, we we are if you look at the at the last twelve months, you know, and and and how we are confident to say that we are in target to meet the revenues even in the first, you know, two thirds or the first nine months of the year.

19:02 The first nine months of the year has been exactly that. We have been spending as executive director in Croatia building the capacity for the local partner. We spent the time in Greece building the capacity for the local partner, understanding the EPC contracting, who's gonna be there. So then in the last quarter of the year, we have half of revenues we expect to go around development services, which we are already contracting for that. And they have already been delivered, so we can recognize those revenues as well. And then the other is to about deploying and testing, you know, how quickly by having done the work of the creating the the platform with our partners, how quickly we can replicate and deliver and invoice those technology sales as well. And then this will drag on onto next year as well, and you have the the secondary the the ongoing revenues coming from the technology sales. And as we move forward, we'll see the technology sales will increase in the makeup of our revenues, but we still see the development services to become a recurring revenue that happens as we incubate the process. We're incubating other profits. And then as we operate, we'll see towards 2023, we will have a very clear distinct distinction of different revenue lines that are growing all of them and adding stacking their value while on top of billing.

20:21 So let's move and talk about page one. Okay. Thanks, David and Jeff. So we thought that alongside the strategy discussion that been having, and we wanted to take you through that journey and then move into where we currently stand from a H1 perspective. So as Jeff mentioned earlier, there's a there's a growing conversion of the pipeline, which is currently happening. Our pipeline seems to be swelling, but we want to make sure that we are prequalifying the parties that we are working with. We're

20:52 prequalifying the opportunities that we're working with. So all the opportunities that come through this pipeline are actually quality opportunity that we can deploy our technology in the way that we want EQTEDx to do the business going forward. We've been talking about the financial flows that have actually been achieved on the market development center, which is in Italy. These market development centers where we are actually taking

21:16 minority equity stake, but showcasing our technology in those markets as to what can actually be done. If you have a violent certain jurisdiction, people look at it and say, well, it's it's good to have that, but they would also like to see it operating in a commercial setting. And that's exactly what the market development centers are going to do for us. There have been an increased amount of investment into the joint ventures and having the expert teams to make sure that we actually incubate the capability where our markets are. We want to make sure that we first of all, before we enter into any discussions,

21:53 we qualify the parties for potential joint ventures. Once we go through that process, we wanna make sure that we have the capability to both develop the business as well as do the exact task which is necessary to break the projects to financial flows and fruition. So we have we have been kind of investing throughout the first half of the year in in those capabilities. And you all have been partly part parcel of the of the placement, which have which you would have seen. It was oversubscribed. We had a lot of confidence from the investors, which was which was clear that people believe in what EQTeq does, what EQTeq wants to become in the future, and the journey that we're currently going through. There have been a lot of engagement that we've been having with the with the policymakers to make sure that we are pushing boundaries on the technology front, but we also want to bring that conversation from an oral industry perspective as to how we can decarbonize help decarbonize the the the economies along along our key markets.

22:58 We are also talking about, you know, potential sort of aspect or levers that different governments can actually deploy, which show that the technology is well supported, and it helps us achieve the objective that we want to achieve in this technology. And then last but not the least is we are we are definitely forecasting and targeting towards a significant growth compared to last year revenues. As David has been suggesting, a lot of work has been going on in the first half of the year to make sure we have the NPCs in place. We hire and

23:35 retain the right talent. We incubate the JVs and the capabilities relate putting all the right infrastructure, we are able to then monetize on the potential revenues that come along and hopefully deliver the growth this year. Yeah. And, Domain, when we talk about the place in the 60,000,000, we're also from from from you that,

23:56 you know, recent joint. I feel that you've been in the company already for about three years. How how effective and efficient we deploy the capital of the target that we said that we would do on the place, you know, how we went to the market development center, how effective we'd be doing That's that's a very good question there. First of all, obviously, and for everybody back here, we've always want to make sure that we we remain asset light business and more technologically focused. So whenever we are we are actually investing into projects or investing into JVs and project execution

24:29 and so on and so forth, we always look at what is absolutely needed from an equity stake perspective that we need to invest. Secondly, we always look at very closely around what sort of technological solution that we can actually deploy and how we can optimize returns. So we are trying to make sure that we get more more return from from the investment that we can. And last but not the least, we focus on whenever we are recruiting and hiring talent, we are very cognizant of what level of people we are bringing in at and and because we are at

25:01 a certain part of our journey, you need a certain skill set and certain seniority of individuals to actually help push that target forward. So these are the kind of some of the factors which we obviously we we we make sure that we look at. Correct. Thank you.

25:20 K. So just I think it's all good to to remind ourselves. Sometimes we don't do it in ten minutes or in aggregate. It's where where where are we coming from? You know, we as everyone knows that the year 2019 when I joined as CEO was a year just to bring stability and and and credibility with investment community, clean the the the capital table and the and the restructure of the debt of the company. We are a company now that, you know, have have a significant growth from 290, and and it has it has no debt. There's no venture debt. There's no type of debt. We have minimal facilities of debt just as a trade

25:56 with banks. So but but already from '20 to '21, you know, you can see a significant growth. We we have one project on the construction. We have now three projects on the construction, and, obviously, we expect to have a few more by the end of the year. Project on the development, went from eight to 17 revenue. We had in 2020 $200,000 We're targeting $15,000,000 this year. We were in three active markets. We are now in seven. We have no joint venture. We have a couple of collaboration agreements in 2020. Now we have two joint ventures that we expect to have probably more than two in the by q one next year. We're targeting, you know, Ireland. We're targeting Italy, Spain.

26:42 So, you know, that's that's crucial because the joint ventures are already

26:47 proven to be a a a an incredible source of of not only project, but also, you know, partnerships, you know, profile, you know, etcetera, etcetera. Market development centers, we have none, and we now have two. We probably targeted another two more, you know, by q one next year. And in terms of things, etcetera, we we we went from 12 to 15. This is the core engineer, the the the the crown jewels of the know how, the IP. I mean, we need to scale this. So we are looking also ways to scale the non core engineer. We have a couple of very exciting, interesting initiative of how we could scale the engineering capability quickly. But also in corporate center employees, we're five people a year ago. So if you think about the amount of corporate activity and funding and transaction, you know, and and designing the business, you know, is is you know, the reach that we have is very, very efficient. And we moved up from five to 15

27:50 full time corporate center employees. So that really shows the idea of the of the momentum. I mean, we we are a a growth company. You know, there's there's no you know, we we we all come I mean, the executive of this this team come from, you know, much larger business, much more established business. Are we bringing all that discipline early on or what is required for for a fast growing business? But let's not forget, we we we are a growth company. The momentum that we have is incredible. So we already want to judge ourselves as, you know, PE ratios or, you know, earning per share and discipline. But, you know, we have a market we have a stock market that is huge. We have not even targeted opening some of the geographies that we could be, the the biofuel market, the synthetic natural gas market, the hybrid market. We are very disciplined to make sure that we deliver the base to which we can scale and keep in the next few years having the growth in revenues and pipeline that we are targeting now. For us, it's everything is to invest now. You think there were companies like

28:55 Amazon Amazon took fourteen years to become profitable. Tesla, eighteen years. And, you know, and that's that's how you should be a technology company. You should continue to innovate, reinvest, and be able to scale so then you have a head start and a position in the market that is very hard to compete with. Yeah. It's it's it's exactly what we've been communicating. It's disciplined growth, but we're not spending a lot of time doing big, you know, cost reduction initiatives. That's not where we are. Given where we are, the the overriding interest that we have on revenue. Just to comment on the the the last few lines on this, you know, if you look at our pipeline, what we're forecasting over the next three years, and we're in the process right now of updating our three year plan from last year. And it's a surprise because we've grown much more quickly than even we expected, which I think is quite common in in in businesses of our size and and maturity.

29:45 But as we update those three year plans, we also look at three year forecasts, and we tag the capacity we require from an engineering, but also from a business development corporate centric type perspective as well in terms of delivering that growth. And if you look at the number of engineers we need, it is not a small number. As David said, it's not just about the relatively small core of real chemical engineers and gasification experts and process engineers, control systems engineers that we have in Barcelona in our technical center. But beyond that, we need civil engineers, we need mechanical engineers, we need electrical engineers also to do these work, and we need them in quite large numbers. So as we map that through, as David said, we really do have to pay attention for how we're going to grow that engineering capability.

30:33 We've got some very good plans in place for how to do that that we hope to announce. In the corporate center, which will grow, you know, slightly more slowly, of course, than the engineering capability will, we nonetheless have to grow that business development capability. But the real focus needs to go to the markets. And that's why building the joint venture that we have becomes so important because

30:54 in effect, they become the business development engines, you know, outside of our core markets. So just to give a bit of a hint going forward, and some of you who are online and and look at our social media posts and so on may have seen this. But as we think about scale, we've already told you several of the things we're doing in terms of planning that capacity, you know, and setting up the joint ventures and building the market development centers and so on. But what we also have recognized is that we're not simply playing a one size fits all, you know, business model for what we're doing. And when I mentioned earlier, for example, you know, what the the CTO talked about in terms of the cookie cutter approach to the engineering, We have to start to look at, well, you know, you can't take a small biomass facility and suddenly turn it into a large scale, you know, r f RDF or or MSW type facility.

31:53 And so what we started to recognize is there are there are roughly six areas that

31:57 we're currently targeting play in, five of which we're already very active in. So we talk about the community cooperative model, which is very much about building small modular plants where the feedstock is located. And so in the case of of Greece and Croatia and Italy, that is predominantly going to be in farming communities where there are local cooperatives who can pull together the feedstock from local farms and bring it to us. In the case of Italy, for example, we're arranging to have maybe deliveries of the feedstock,

32:28 which shows you how closely linked we are with that local community and the local farms there. And, of course, in return, we provide power and and possibly in certain instances, heat or or other off take to to that local community. If we look into some of the other areas, we look at California, for example, the proposition there is very, very different in a way because it's less about the energy off take or the energy the off take in the energy, you know, generation, and much more about the feedstock collection. One of the biggest causes of the forest fires is forestry waste, you know, the dry brush that gets left behind. As that gets accumulated, again, we can build in the forest areas where that feedstock is located, collect it from the local areas, and bring it together.

33:15 The pipeline that we have now in California is quite significant. And as we, you know, complete the North Fork project and we move ahead there with other plants, we will build a distributed set of plants whose predominant role is the prevention of forest

33:30 fires. The energy that we can generate or indeed the biofuels that we can generate from that will be an added benefit of a much larger focus on forest fire prevention. Prevention. It's probably worth mentioning as well that in in that's a very similar situation that you have in Australia, which is a market that we haven't even looking at in geography yet because we don't have the delivery part of this market that is happening. We we had a lot of forest fire now in the Mediterranean as well this year. We have FORGENT PLAY in in Southeast Asia. And also, I think that we see that is transferable from experiencing in in California is the the California have a very established market for biochar, you know, and not only for the use of biochar into the the the the soil, but also, still that we see that happening now in in the in the Europe as well. And also, the carbon credit for biochar is a very interesting market. So all these things are transferable to geographies as well as applications. So those are two examples. But the high volume, large scale we're doing with RDS in UK, the Syngas refinery type model that we're beginning to explore with our partners in Ireland for production of synthetic natural gas.

34:38 The energy transition that we announced in the interim results for France, which is getting very, very active in this area. And then the last one, where we where we get we have had a number of conversations, but we have no active projects yet, which is building on premise on industrial facility. All of these are areas, and they're more than simply concepts.

34:58 In the future, they become those cookie cutter designs that from an engineering perspective we produce. They become, in certain instances, prefabricated plants or the significant parts of plants that we can make. They become, as David was saying, business models, business cases, financial models that all of which are targeting very similar outcomes that we can then take to market. So this is the kind of thing that we're starting to explore to help support our growth and scale in 2022 and beyond. I think we should hand over the question. Yeah. We can move to the thanks, Mike.

35:37 So yeah. So thank you everyone for coming to this webcast. I mean, we we will we like to to commit to do this more often as well. I mean, not only when when or or have you resolved or or full year resolved out. And and, you know, as you guys can probably see, we all all three of us can talk about the business for days. David, Norman, Jeffrey, thank you very much for your presentation. Ladies and gentlemen, please do continue to submit your questions using the q and a tab situated in the right hand corner of your screen.

36:12 But just while the company take a few moments to review those investor questions submitted already, I'd like to remind you that a recording of this presentation along with a copy of the slides and the published Q and A can be accessed via your investor dashboard on the Investor Meet company platform. I'd also like to remind you that your feedback is important to the company. And immediately after the presentation has ended, you'll be redirected for the opportunity to provide your feedback in order that the company can better understand your views and expectations. We received two pre submitted questions from investors, and I want to start the Q and A with these. The first one reads as follows. Are the company's predicted 2021 earnings on track, I. E, circa €15,000,000 in revenue? Okay. Well, I think what what I would say to that is we we very much are on track with so many initiatives in the background to deliver what we said we set out to deliver it in the beginning of the year.

37:11 We have been literally looking at all the risks that we have been mitigating the risks as we go along, reducing, you know, the uncertainty around the revenue piece. So so we are we are fairly confident. But, obviously, all of these things do rest on certain things happening by the year end, and we have we are all hands on deck to make sure that we actually deliver those things. Yeah. Just, yeah, just just to add to that, this this is important work that happened at the beginning of the year. We we believe that we'll achieve that because, let's say, most of the revenues are split between development services, which have already been delivered. And and as soon as we change the ownership of the SPVs, we can recognize. And the other ones are to technology sales or projects that we are doing under the under the the joint venture. So if you think about that, how is that seems like a large number of of of in terms of revenues, it's coming from six projects. And it's coming from six projects, which we have our executive director on each two projects, just making sure the execution. The the risk that you have of this is execution risk. It delays on on, you know, we don't have we don't have a a sales risk. We don't have, let's say, even a funding risk. We just it's all about execution on time. We see a lot of that, you know, coming between October and November this year, and and and that's we are working, and we have everyone from the executive down in the company motivated, committed, and incentivized to be able to deliver what we said and we believe. Yeah. And and if I may, I mean, is this

38:43 is not a surprise. This is the same number we had at the outset of the year. We have consistently announced in our trading updates that we knew this year is backloaded. If you go back to the life cycle that we shared with you on this call, it's very clear why that is. It's very much about getting that work done upfront, assembling the right players, driving this thing through to financial flows. And so, therefore, quite naturally, that work, as David has alluded to, had to happen in in the first half of the year. We're very pleased with how it's happened and how it's been set up. We're very pleased with the quality of the teams we have working on it. Now now we need to see that come back through, of course, the back end of this year, and we have confidence in both of them. Yeah. The last last thing to add is to is to mention. We're we're we're at the stage where as a company is all about the momentum.

39:32 You know, we we will fight tooth and nail to deliver, you know, seven times revenue. But if we will disappoint the investor, we will be by delivering five, six times revenue, which is a good problem to have. So the point is all those projects that we have by the last quarter of the year are our projects, and they are funded, and they're going going ahead. So if we miss one or two for q one next year, it will it will just continue to build the momentum on on on execution. So we are, you know, we are on chipset and for the big win, and, you know, we'll we'll prove that we can achieve that. That's great. Thank you. The next question the next question reads as follows. With COP twenty six starting on October 31 being next month, what marketing campaign is in place to showcase Equitex technology to the world?

40:24 Well, let me start by saying that the single biggest marketing campaign, if I can put that in quotes, for us is execution. So what David was just saying about, you know, all chips in and delivering the results this year and going into q one and beyond that q two and driving the growth that we just said is is the best way to prove the value of what we do. Let's remind ourselves that we are advanced gasification in a sector that has traditionally not proven to be commercially viable. We are commercially viable. We know we're commercially viable, and we are in the process of proving that again and again and again. The more we do that, the better the marketing for this is. But I think it's also important to talk about how we engage with policymakers because that needs to be on their radars as well. Yeah. And we and we plan to be at COP26.

41:17 We'll have got a couple of invitation from our strategic partners that we'll we'll really look forward to. We can find hotel room there. We'll we'll we'll be there. Thank you very much. That deals with the pre submitted questions. Investors have submitted a number of questions during the presentation today and I wondered if I could hand back to you to respond to those where it's appropriate for you to do so. Could I please ask you to read out the question and then say who it is from? Thank you. We we are not seeing the questions on the on the q and a. So if someone can read them, we'll happy answer the one that we got. Okay. So I can read them out for you if you want. There's a question from Michael V. It says, in the next six, twelve, and eighteen months, how many plants do you expect to get to the plant operation start stage?

42:14 In the next six, twelve, and eighteen months. Let's let's talk about GIN twenty twenty two. It's probably easier. We we expect the we expect by GIN twenty twenty two to have even employees that build, also probably aggregates and Northport. And there may be a couple of wildcards as well that they talk to. Okay. We'll see the question then. Yeah. So so yeah. So by the end of twenty twenty two, we are committed to have deletion and Italy built, probably also North Fork and Iberia should be about mid year as well. We expect to have a little bit of 2.4 plants built and operated. There's a question. Adam, in terms of active as a developer to the five markets, we have a series of megawatts on all project development.

43:10 I can I can I can answer that one? The the the ceiling of megawatts, we can make gasifiers at the any scale to from, you know, one megawatt or half a megawatt all the way to 10 megawatts, even 12 megawatts, they're gasified. If you look at billing and we've decided on three nine megawatt gasifier. So I think that the limited of the size of of the gasification unit for electrical application is not the technology. I think that the opportunity is about, you know, market demand. I think that the the trend is moving more to smaller localized plants, which is what we can do that incineration cannot do is doing five, ten megawatt plant more localized. And I think that's what will drive the scale of the plant that we develop. It's more of a you know, we are very much you know, so far so surprisingly, technology companies, we're very much market driven. You know, you need to listen to the market, see what is the money, and that's what we want to address.

44:06 I can answer the next one. It's about, can you touch on the expected pipeline conversion rate and the average sales cycle for deals, which I think to mean the distance between incubation and financial close or the, you know, the time between the two. This is something that we're we're working very hard on. I think it's fair to say one of the problems that we grapple started grappling with twelve, eighteen months ago was that we were seeing very long cycles, by which I mean, there was no bounding around that. Now in this industry, which is, you know, the construction industry in any kind of infrastructure project, I think what you'll find is people people are hard pressed to answer that question. But one of the things that we're trying to bring to this is the discipline that we've we've we've seen in other industries.

44:52 You know, I come from large scale IT implementations, global IT implementations, for example, and we do want to start to bound them. So as we start to put in financial close dates that we negotiate and we discuss this with our own people and with partners, we are starting to pin that down. You know, we would like to see, even for the more complex, harder to negotiate deals, it's falling well within a year. But right now, I would say the larger, more complex one is probably twelve to eighteen months. For some of the smaller ones, you know, we were talking with our partners in Greece recently. Even on the smaller ones, the time it takes simply to get an environmental permit, which is critical, could be at at this moment a year. So with that kind of of, you know, lead time, what we have to try and find is how can we put in more influence, but also much better management to close those things down. So I'm afraid there's no mark mathematical hard and fast benchmark, but I think bringing it within twelve months is definitely our our goal.

45:53 Yeah. And just to add to that, obviously, we have a a a very diverse pipeline of projects that have been already incubated and maturing. So the the order thing is to distribute on that period, in our projects so you reach a point where they have the capability to close a project every two months or less because you have you can close multiple projects at the same time. So you And that's what the discipline is to approach. So question for Richard is is you restated today that your 50,000,000 revenue target remains that way. Do you think this JV investor is already being sufficient to form business as usual? Essentially, you're thinking to understand when the business will be self sustaining the the quality of the course of this activity. Again, this is this is I I think there's two sides of this question. One of them, what we are accelerating and improving now with our momentum is there will be more and more investors at the development level, at SPD level, which which makes all deployment of capital even more efficient. So we'll have our capital in project incubation and looking for less time. That will always have an impact how we we circle that capital and how we we deploy it again. And in terms of when the business is sustainable, the the again, this is a choice based on, you know, how quickly do you grow.

47:05 For us now, it's all about, you know, how much investment we make to scale quicker. And I think the answer to that is you need to have an ear of the market to see when when when that is. We would always use the most efficient way that our balance sheet and our capital to be able to, you know, take the best required to dominate the market that we want to operate. So we you know, the good thing is we can dial that open down at the way that we need it, and we decide that it's advantages to it all. I can take the next from Arun. That's do you provide the current and future clients a business model with expected profit once the plant is fully operational to encourage them to adopt your technology? Yeah. I mean, this is I I love this question because it really points to one of the things that makes us so different to to some of the other players that we see out there.

47:56 We look at, as I mentioned earlier, not just the end to end process of get the thermochemical process of gasification and how it operates in the plants. We don't just look at the end to end operation within the plant, which includes all the ancillary technologies. We look at the business that the owner operator is ultimately going to own and and and operate. And we look at the commercial modeling behind that. We've identified the five really key value drivers, but we also have very complex commercial models that we put in place. And we will run a range of scenarios. On one of our bigger projects, such as billing them, you know, we've run as many as 20 different scenarios, changing the the variables to try to get the best possible IRR from that commercial operation. And that's over the lifetime of the plant as well as through the project of the structure and commissioning itself.

48:48 And so when we factor that together, you can imagine when we go to market and we put and we look for investors, we have a much more sophisticated pitch to them than many others have because we're not pushing our technology or pushing equipment. We're having a discussion about the full commercial model. So one of the things we're very proud of is that understanding of how we look at the end to end commercials of anything that we sell. Next question. Sean, the equity is a much cleaner way to go away than also looking this generation. Why do we not see you pushing the health benefit more so that you kind of sit in COVID? And the answer is we at at the moment, incinerators are, you know, are are the lesser of evils in terms of comparing license. So we, you know, we we would we like to just be able to make statements that, you know, when you see the emissions of our plan and when our clients are coming to us, the the the case is made already. There's no point for us. You know, we we don't go out there commenting of the of the negative impact of incineration or the competitors not being able to achieve operational availability. But we just go there. It's probably on building plan. We have more demand than we can address.

50:03 And, eventually, it's more important for us to make that point to policymaker, which we start doing and to, you know, environmental groups and and and focus groups. So so that start changing the policy, and we start more rewarding incentive for carbon efficiency and not toxic emissions instead of just going out to the market and, you know, do some hard waving and say, you know, we are better than than the rest. I think this is something a discussion where we need you know, COP twenty six will be very interesting to to put that information in front of the right eyes that that can influence policy. I think one of the questions that we have is, are you currently looking to either merge or opt out any of the business that will complement each execution development? So what I would say to that is because a lot of a lot of the part part of the question remains, you know, the details remain confidential, but we always keep on looking at opportunity and and, you know, potential value drivers that we can actually bring into the business to scale up our capability because we are building a platform for growth.

51:15 Whether it is related to a certain kind of engineering capability, whether it's digital, whether it is other things, we always keep on looking at, you know, those those things. So so, yes, to answer your question, we would always look at those opportunities, and we do, you know, look at them very carefully And going forward as well as and when, you know, the the necessary details are available, we will certainly go out to the market in that regard. Yeah. And the final question we have here is, is there a plan in place to reduce the number of EPC contractors involved in project delivery, or is this driven by the location of the project? I mean, quite contrary. Right now, our plan is to grow the number of EPC contractors with whom we engage. We already have very good EPC partners in in Greece, of course, in in Italy, and they deliver for us across multiple, you know, markets.

52:03 We're building relationships in The US and, of course, in in all of our target markets, including The UK with EPC contractors. I think it's something David alluded to earlier. What we now need to do is select the EPC partner that we want to be permanent members of that ecosystem that we're building, qualify them as being high quality, make certify them as being able to work with with EQTeq technologies, and then work with them to become partners who can also take up the market in other places. Some of the tier one EQT we're talking to right now are interesting not just because of the quality of the work they do, not just because of the breadth of their vision, but also because of the breadth of their global network. And so they will be able to take us in the markets where we would not be able to go on our own. And so the plan right now is to grow the number of EPC contractors we're involved with, but we will always be ensuring that the ones we work with are reliable and can help maintain the quality of the EP type brand. Yeah. Just one thing to add to that as well because the team has been coming in the in the in the community sometimes as well. When we talk about tier one EPCs, just because you are tier one EPCs, that's the mean that we want to work with you. And the reason of that is because we need to understand, and this is what we're talking to a lot of people that are progressive coming moving away from fossil fuel for the process engineering of oil and gas because we want this transition to be existential for them. We want people that are really committed or if you think they want that are really committed to this path, so then they involve and invest the resources required to integrate the next step technology. And that's

53:35 more important, I agree. There there's also a notion in the market that, you know, we're gonna get, like, a big engineering company as a partner, and they're find us a pipeline. This big engineering company and big EPC, their business is very clear. It's that engineering capability and and set in procurement and and and construction services. So so we are a client to them, and then eventually, they'll be called wholesale channel. You know? So that's that's that's where we said that we qualify EPC. We also qualify the intention and strategic alignment with tier one EPCs as well. And we have you know, there's there's many tier one EPCs that we have happily agree to not work together. Indeed. Thank you for being very generous with your time there. I think you managed to address pretty much all the questions from investors today.

54:23 And, of course, the company will review any further questions submitted and publish responses where it is appropriate to do so. David, just before redirecting investors for feedback, I wondered if I could ask you for a few closing comments. And then and the commitment for investors that have been with us for a very long time, both institutional and the recent investors. You know, we have a very active investor community on on the on the retail side as well. You know, the the there's there's incredibly well informed comments that we've seen some time, and and we will make a commitment as well to to explain and to where we can spell out much more what we are doing as a business and how we what the strategy Because I think it's important to rehash and continue to build to investors what is you know, this is a three to five year strategy. It's very, very clear to scale. You know? This is not this is not of the things that we're doing now. The more you find a trajectory, we can show that there's a trend line here, that there's a strategy even if I throw it and change every three months.

55:36 You know, we we we'll find a way to be through this platform and all of them more engaged and give you give you a running commentary where we are deep in the woods doing the work. But if if Jeff or Noah wants to say anything else? No. I I I think you rightly mentioned that we are happy to, you know, keep on engaging in these kind of discussions I'm happy to take any questions and and, you know, keep on responding them as we go along. We always keep one air to to to the market as and, you know, whilst we are actually able to pick up the forest in doing these deals and everything else as well. So, yeah, we we commit to actually do a lot more of this hopefully going forward. And we take the feedback, and we reply when we can. So, you know, please keep please keep it coming and, you know, bear with us in terms of time. Sometimes it's not easy to respond right away, but we we we do incorporate the feedback that we hear in investment community.

56:26 The last the only thing I'd throw in would be we we're excited about the future. It's it's palpable in the business with every meeting we do, with every visit that we now are starting to do coming out of COVID with our partners and so on. So as David said, it's great to feel the enthusiasm beyond the the walls of of our business. And, yeah, we look forward to to engaging with you much more often. Great. Thank you. David, Nauman, Jeffrey, thank you very much for updating investors today. Could I please ask investors not to close the session as you'll now be automatically redirected for the opportunity to provide your feedback in order that the management team can better understand your views and expectations? This will only take a few moments to complete, however, is of great value to the company.

57:13 On behalf of the management team of Equitec PLC, we'd like to thank you for attending today's presentation. That now concludes today's session, and good afternoon to you all.