Ilika (LSE:IKA) — Investor update

0:01 Good afternoon, ladies and gentlemen, and welcome to the ILIKA PLC Investor Update. Throughout this presentation, investors will be in listen only mode. Questions are encouraged and can be submitted at any time via 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 it receives during the meeting itself. However, the company will review all questions submitted today and publish responses where it where it is appropriate to do so. These will be available via your invest me company dashboard, We will notify you by email when these are

0:31 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 now I'd like to hand you over to Graham Purdy, CEO, and Steve Boydell, CFO. Good afternoon to you both. Good afternoon, Alessandro. Many thanks for the intro. Good afternoon.

0:53 So many thanks to attendees of this update. Actually, today, it's our AGM, and we thought it was useful to give a recap of our activities over the summer because we haven't been able to host any attendees at the AGM due to COVID restrictions. But we'd like to thank you for voting, those of you who did, to unanimously pass all of all of the motions. And, well, let's crack on with the presentation and give you an update.

1:43 So as Alexandra said, you've got myself and Steve Bordell who are presenting this afternoon. I won't linger on our bios. If you're interested, of course, you can look us up on our website. IKA is one of the the few independent experts in solid state batteries, and that's what we're gonna focus on, in this presentation over the next half an hour or so. There are two parts to our business. One is, our Stereax technology, which we're currently scaling up, and I'll give you an update on where we are with the implementation of our manufacturing strategy as we go through the presentation. There you see one of our engineers holding up a wafer of our stereo cells for inspection.

2:35 And actually, if you look at it closely, you can see that, in fact, the wafer is transparent because it's a glass based wafer with the batteries that are deposited onto it and and then etched and and singulated out of the wafer. And then on the bottom left, see pictures of Goliath cells, which are designed for EVs and also for consumer appliances.

3:09 So the markets that we're addressing are huge. On the one hand, our Stereoac cells for medtech and industrial IoT or industrial wireless sensors. In their own right, they are multibillion markets, but we think of them as being actually niche markets or certainly smaller than the markets for Goliath. Goliath is really designed for some of the biggest battery markets on the planet. Actually, consumer appliances is currently the biggest market, but is rapidly being overtaken, by electric vehicles. And, of course, by 2025, we expect the EV markets to be the dominant one largely because, of course, the batteries that you need in order to drive an EV are much larger in size than the batteries that you put into consumer appliances.

4:07 And therefore, actually, the overall value of the market is expected to become larger.

4:16 So why are people interested in solid state batteries? Why do they continue to get excited about this market? Well, first of all, solid state batteries are ultra compact, so my rule of thumb is that they're about half the volume of a traditional lithium ion cell, so they enable a smaller battery pack design. They are tolerant of higher temperatures. So, actually, our steriac cells will operate at up to a 150 degrees C, and this opens up industrial markets where traditional lithium ion can't really support because standard lithium ion is typically rated up to about 60 degrees C.

5:02 And this is also really important, actually, in the automotive sector because a lot of the volume and weight of a battery pack is taken up by the the parasitic weight of the cooling system, so the fluid and the pumps and the heat exchangers that you need in order to keep a traditional battery pack operating within its safe design window. The other advantage is that solid state cells are rapid charging. Again, our rule of thumb is that they're actually six times faster charging than lithium ion. So if a normal lithium ion pack needs an hour to charge, then you can expect that a solid state pack will charge in about ten minutes.

5:54 There are also environmental benefits. Now currently, only about 5% of lithium ion cells are recycled, and they are environmentally harmful due to that toxic liquid electrolytes, which needs to be drained out before the more valuable metals in the cells can be recovered and recycled. There's also a risk of fire and explosions, so they can't be landfilled or incinerated. With oxide solid state batteries, which is the type of solid state cells that ILIKA specializes in, there's no such risk of explosion because the electrolyte is not flammable. And actually fairly common process technologies, can be used.

6:41 Effectively, you strip off the packaging around the cells, and that gives you a type of oxide ceramic, which you can then shred, and you can put the the materials through a standard precipitation process to allow you to recover the metals and put them back into the supply chain. So how do we make money from our battery business? So over the last few years, we've been operating a pilot line for our Sterex cells. In order to do that, we've been, fabricating the, the cells on wafers that we buy in. We then thin and dice those wafers, stack them, form the cells, and and test them before sending them to customers. So effectively, it's a small manufacturing operation.

7:38 We are actually transitioning from being a technology developer selling small quantities of wafers, for company evaluation through to being a manufacturer of, of about 70 times the volume of such cells, and that'll all happen from next year when our wafer fab, our first factory, has been fully commissioned. And, again, we will continue to receive purchase orders from customers and execute the contract manufacturing of those. Licensing is the model that we will move to for larger scale production because rather than build a string of factories around the world, we will be actually a a design authority in which we'll license IP to larger scale manufacturers.

8:33 And then the company that's taken the license to the technology will manage the customer interface and the supply chain. So where are we with with that factory? Well, it's been a a really exciting summer for us because, you know, we've seen the the clean room in which we install all of our equipment completed to specification, and the the major tools have now all arrived. That whole process has been coordinated by a tech transfer director, Paul Maron, who we've brought in specifically to build a team with industrial experience and complement the scientific team that originally developed the technology.

9:25 He's overseen the completion of that clean room and, of course, the installation of the tools. And, actually, we've got most of the the vendor support engineers on-site at the minute helping us commission that equipment and then move it into what we call the the process qualification part of the the fab development, which is where we have all of the equipment operating to allow us to start to make products that we then qualify ready for sales to industrial and and med tech customers. And we've invested now about 3,500,000 of the the 4,000,000 total expected spend on this fab implementation.

10:16 So a few pictures actually of what the inside of that clean room looks like. So, actually, the outside looks pretty, clean and and well presented and uncluttered. That's the picture you see at the bottom there, second from the left. Actual equipment itself, of course, is is very much, you know, integrated into the fab, so that there's not a large amount to see once it's actually installed. On the left hand side, you see what we refer to as tool two, which is our principal sputtering equipment. The the yellow window looks into the photolithography and etch suites that we've got, and then the photograph on the far right, which actually looks a bit like a Dalek from this perspective, is what we call tool one, which is a large evaporator.

11:09 You see the the black control panel on the far right of that image. The the bit that looks like the Dalek is actually the door that you open, and then you can put the wafers into the deposition chamber. So, you know, in terms of getting commercial pipeline in place for the sales of what this facility will be producing, we've already sold evaluation samples to a portfolio of about 16 customers from the pilot line, and we've put, confidential agreements in place, about 48 of them, with customers who are interested in evaluating, the the cells that come off this line. So about 27 of them are with industrial IoT and 21 with med tech.

12:00 So one of the other things that's happened is that we've identified substantial addressable markets to overutilize the the three and a half thousand wafers of peak capacity from this manufacturing facility. And actually, because there is more demand than we'll be able to supply from this facility, that really validates the opportunity for licensing and going into that third phase of the model that we were just talking about. In terms of the application areas, those of you who've heard me speak before will know that we are you know, we've been talking about these addressable market segments consistently for a couple of years now. We we've got this insight because, you know, we've sent samples from our pilot line through to customers in these segments, and they've told us, yeah, you know, the specification of what you can make is a match with our applications.

13:02 Some of them are relatively well defined small niches where we have a unique selling point. And in an industrial IoT, the high temperature tolerance of ourselves is really important to enable some of the applications that people have in mind. So, you know, you'll all have heard actually about the tremendous stress that the semiconductor supply chain is under. People are really looking to get as much production as possible from, the fabs that they have in place, and being able to calibrate those fabs to get a high yield and a high output is really key to making sure that that invested capital is made best use of. And that's what wafer sensing is all about. Effectively, you can put battery powered sensors onto wafers that are being used to calibrate the process conditions of the semiconductor manufacturing chambers, and therefore get a a better yield out of the processes that people are running.

14:08 There are also condition monitoring applications. We've got a really good case study on our website about the wind turbine deployment, and then, of course, process equipment, such as refineries and chemical plants and power stations, as well as infrastructure, because often, you know, infrastructure that's out in the in the open is exposed to very high temperatures in the direct sunlight. So having devices that are by rail tracks or on bridges, you know, you you need to be able to have a very robust power supply for those applications. With miniature medical implants, we believe that orthopedics is pretty much the biggest addressable market for us. There's a big, let's say, tsunami of innovation that's sweeping through, the healthcare industry where a lot of these miniature medical implants are metamorphosing from being a largely mechanical, you know, straightforward device that doesn't actually interact with the user in terms of data generation.

15:25 These devices are becoming, you know, smart so that we're making measurements of how well they're performing and then sending that information from the implants through to databases so that consultant surgeons can give advice on recuperation from surgery, on physiotherapy to allow the patient to get the most out of the intervention. Also, nerve stimulation. This is all about using electroceuticals to replace chemical drugs to to replace painkillers. Sensors such as blood pressure monitors, and even ophthalmic applications where you are coming up with devices that can assist with some of the degenerative diseases that can rob people of their site.

16:18 So some fantastic global opportunities there. So that's Stereax. Let's change gear a little bit and talk about Goliath and the the market that we're interested in selling Goliath batteries into. I think the EV revolution is well and truly underway. Annual sales are accelerating. I think most of us are looking forward to our first exposure to EVs, and most of the forecasts are very strong in terms of EV uptake.

17:00 So we're very much aligned with this general market growth, and what you see on the bottom left here is a chart actually from Bloomberg NEF where there's a forecast for EV batteries in Europe and The US, and how those batteries, are likely to, to change from being what we know now as a traditional lithium ion cell through to a solid state cell. And you can see that over the next fifteen years that actually solid state is expected to become the dominant technology, so it's gonna displace traditional lithium ion cells. So it's really exciting to be in at the front end of this market takeover.

17:50 We've seen similar analogs for this type of technology replacement in the past, in batteries, with NiCat batteries and nickel metal hydride batteries being overtaken by lithium ion, and we expect that the solid state form of lithium ion will become dominant in EVs. So what is it that's different from our program relative to other developers of solid state batteries? Well, first of all, we use a a silicon anode, which is different from the lithium metal anodes that some of the developers are using. We believe that there's some intrinsic advantages around the cyclability of silicon and therefore the, the long cycle life that you can get from using a silicon anode.

18:46 We know how to manage the interface resistances that you get, in forming a composite solid state structure because we've had to do that in STEREx in order to define that product. We're we're probably one of the organizations that's worked the longest in innovating solid oxide electrolytes. Some of our patents go back a good ten years now when we were screening different solid electrolytes to find the ones that have the optimum performance and functionality.

19:20 We understand how to make devices, so not only how to make an electrolyte, but how to get a complete cell architecture to work. And, of course, we've just been through a very interesting scale up of effectively a lab process through to a pilot line and now through to a manufacturing process. So we know all about the challenges of taking lab scale results and then turning them into qualified products. Our view on Goliath cells is that actually we will continue to use best in class cathode materials. There's an awful lot of R and D being done to develop superior cathode materials. And what we want to do going forward is to make use of the best in class materials that are available so that our cells, from a solid state perspective, offer the best performance to our customers.

20:20 So there's a few additional milestones in terms of technical development that we've achieved over the summer. You know, we you can actually track our progress really nicely relative to where we were just a year ago. So we started out making goliath cells that, would give us a 100 cycles without failure. But actually, within about six months, we'd increase that to over 500 cycles without failure, and that's continuing to increase. We expect that, you know, the industry is looking for, over a thousand cycles, and, our data is reassuring in that regard. We're also getting good conversion efficiency.

21:06 So we had over 90% in in our stable cells back in q four of twenty twenty. And and that allowed us then to move on to demonstrating baseline. So that's key as you go through the scale up of any technology is to be able to do the same thing day in and day out. And also, actually, to optimize the process that you've got so that you get the best out of the materials that you've chosen to make your cells out of. So on the bottom right, actually, you see a diagram of the improvement relative to where we were just back in

21:50 July for our red baseline cells, and they're the same materials, but we've improved the process that we use for making them. So you see that general upward trend. And then what we mean by non baseline cells is where we're starting to tweak the materials, so where we look at different, sintering aids, different formulations in order to get the best performance possible out of the cells, and that's, that's usually a bit more of a scattergun, result because you get some cells where actually that works really well, like you see the the top end of those blue points, and others actually where it doesn't quite give you the result that you want. But that's what technology development's all about, and as long as you're hitting some top end improvements, then you harvest those results and use them to build the technology program going forward.

22:46 What we've also done actually over the summer is reduced the temperature at which the cells operate. Solid state cells always operate better at elevated temperature. They generally have a higher capacity and also a higher power density, but we've been able to come up with a cell architecture that gives us cells that now cycle at room temperature and also ones that give us an increased cathode utilization. So that basically converts into the higher capacity trend that you see on the bottom right there. So in terms of our commercialization pathway for Goliath, it's very much as it was.

23:31 We're currently in the middle of a very intensive and accelerated process development as well as technology development. We've got some trials that are ongoing at the minute looking at different routes for making ourselves add volume, working with different equipment vendors and technology centers around the world. So that's allowing us actually to do a a scale up feasibility. At our own facility here in The UK, we'll be going from a a prepilot facility of a a kilowatt hour a week through to tenfold that by the end of twenty twenty two, implementing some of these new process routes that we've been assessing, and then providing enough cells so that our partners, typically automotive OEMs, can build modules and packs and use their BMS technology, and then drop that into what the industry calls mule tests, which are effectively prototype vehicles that are put onto test tracks.

24:41 We've got a framework agreement in place with the UK BIC, which is the battery industrialization center in The Midlands. So we will be transferring our technology into a facility like that to allow us to test and validate larger quantities of the cells and then actually transfer into a gigafactory scale. And there you see a series of product milestones that we expect to hit as we go through that timeline. So first of all, consumer cells, these are the consumer appliance applications, which are typically, you know, slightly smaller cells and batteries than you get in a vehicle, but also the generations of auto cells as we go through and and some of the the specifications and design performance that we expect out of those different products.

25:39 So in summary, you know, where we are today is that we're manufacturing on a prepilot line. We've developed the technology together with Honda, McLaren, and JLR, and and other automotive OEMs and consumer appliance OEMs. We've got a relationship in place now with Comma. We've got an ongoing program with them, Comma being part of the Fiat group, to to scale up to pilot line scale and to get us through mid twenty twenty four on the back of the the placing that we successfully secured in July to to be ready for manufacturing and transfer into a facility like the BIC with a view, again, ultimately to licensing that into Gigafactory scale.

26:37 So just a little bit of context about consumer appliance markets. You know, there's some very vibrant, and exciting markets that are a really good fit with solid state batteries.

26:53 Health and beauty. So these guys have a a high, energy and power density requirement, fairly compact devices, e cigarettes, and then power tools and cameras, similar sort of requirement to health and beauty, but, a very substantial market in, in its own right. And then, of course, medical. So this isn't to be confused with, the Sterex opportunity, which is for miniature medical devices,

27:24 but there are some applications which require a larger capacity, so typically things like pacemakers, where safety is ultimately the most important parameter, and we're able to sell, let's call them mini Goliaths into that opportunity.

27:47 So Steve's got a few figures actually just to give you an overview of where we got to post our year end results. Yes. So there's a couple of items of note since we last reported our financial results for the year ended April 30, which we did back in July. The first of these was the completion of the fundraise, which I've detailed on this slide. The placing raised 18,000,000, did an open offer, which closed very quickly, was fully subscribed of 3,700,000, and then a fully subscribed retail offer as well, a company called Primary Bid that raised a further 3,000,000. And we did this pretty efficiently. We thought, given the fees for the the whole raise, was was under £1,000,000. So net funds raised were £23,800,000 all of which were secured in our account last month.

28:42 And these funds have been earmarked with £10,000,000 to accelerate Goliath development through lithium ion equivalents and beyond by December 2022 and $5,000,000 of CapEx to enable a tenfold increase in our Goliath prepilot line capacity in ROMSI, which we aim to be complete by Q1 twenty twenty three. The other more recent development was our shares being released on the OTCQX. US retail shareholders currently make up about just over 15% of our register. And this listing effectively has upgraded us from the pink market, which is fairly unregulated over the counter market in The US, to the OTCQS best market.

29:34 So this does put a little obligation on us to make sure that we release regulated news and financial reports at the same time in The U. S. As we release them to the AIM market in The UK. But it does mean that US retail shareholders can buy the shares as they're denominated in US dollars. They can trade in US working hours, and they can the biggest innovation is actually they can invest

30:05 excited own we're opportunity portfolio. Thanks, Steve. So just to wrap up, I believe that we're strongly positioned to progress the commercial scale up of Sterex through this fab implementation. And, actually, I hope to be able to invite investors to visit that facility towards the end of the year. I think it'll be a really impressive visit and a fantastic opportunity to see the technology in action. We'll also be maturing our Goliath technology with our partners through a series of technical milestones, which we'll keep you informed about over the next eighteen months or so, and they will form a great platform for revenue growth going forward.

31:02 So that wraps up the slide presentation. Hopefully, we will now get the opportunity to have a a q and a session. Great. Thank you very, very much for your Ladies presentation and gentlemen, please do continue to submit your questions using the Q and A tab situated on the top right hand corner of your screen. But just while the company take a few moments to review those investor questions submitted, I would like to remind you that the 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 Me 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.

31:52 We received a number of pre submitted questions from investors, which I believe Graham and Steve have kindly written response to, and these will be published after the meeting. But for now, investors have also submitted questions during the live event, I and want to turn back to you to respond to those where it is appropriate to do so. Could I ask you to read out the question and say who it is from? Thank you very much, Alessandro. So thanks for submitting your questions, guys. We're just gonna have a bit of a trot through these and, see if we can provide some quick answers. So, first one from, Paul r asks, who are your key or important competitors?

32:37 Do they own similar IP, and how do you actively protect your IP?

32:43 So, I think what I'd like to do actually is split the competitive landscape into two parts. First of all, for Sterex cells, and then secondly, for our Goliath cells because actually the companies that are focusing on those different addressable markets, those different sectors, are sometimes different organizations. So Stereax is a a miniature solid state battery, and, actually, the the competitors for that type of technology are relatively few and far between. There are a couple of companies in The US that we we interact with. One of them is FrontEdge, and one of them is Symbed. They're both privately held, but they have developed similar thin film cells to ours.

33:36 We actually have differentiated IP. Interestingly, they've chosen to use a cell architecture and chemistry that is more similar to the original Oak Ridge National Lab IP that uses a a lithium anode, whereas we use a a silicon structured anode. So we are differentiated. We also use rather different processes. So part of what we do that's novel is that we use an evaporation technique for making our cathodes, and that allows us to avoid any post deposition annealing, which means that actually we get high quality cathode materials without having to buy expensive sputtering targets.

34:33 So that that we think gives us an advantage in the scalability of our process and the cost point, actually, that process can reach. In terms of actively protecting our IP, we have an in house lawyer who's on secondment to us, and she, works together with our team to harvest ideas, that, that come from, the team, both from Sterex and Goliath. And then we we prosecute our patents globally. So, typically, we make a national filing, and then we, allow that to go through to the PCT stage, from which point we then make other national filings around the globe.

35:24 We also do what we call a freedom to operate search, which means we look to see what our competitors are filing, and then, decide whether, we need to oppose, those applications or or indeed take other measures. So from the the Goliath perspective, I'd say the competitive landscape was somewhat different. The you know, clearly, these are the biggest markets on the planet in terms of batteries, that, the biggest incumbent battery manufacturers are also interested in addressing. And, you know, we we saw that, forecast actually for solid state becoming dominant in the next fifteen years for the EV market. So so, you know, if you were an incumbent battery manufacturer, you'd wanna make sure that you had access to that technology too. So a lot of the, the big players like Panasonic, LG Chem, Samsung, CATL in China, and BYD have got development programs in place, to look at, solid state, often using, you know, fairly varied approaches.

36:38 You know, there's a a quite an interesting landscape of of different chemistries that people are are looking at. But also outside of those incumbents, there are other technology developers like ourselves, some of them in in The US and and some in Asia. I'd say in The US, you'd probably look at companies like QuantumScape and Solid Power, and then in Asia, Prologium. And also there's another company called Solid Energy or SES. You know, these are all developers of EV scale solid state batteries. The the IP is is often different. One of our key differentiators is the fact that our Goliath cells use an oxide electrolyte as opposed to a sulfide electrolyte.

37:35 And, you know, there's I I wouldn't say that any one of these technologies is likely to take a monopoly position, but there are pros and cons for using the the different approach. So I think that's that question. Let's have a look at another one here. One from David m. He said he was looking at solid state batteries and came across the batteries and saw that they're smaller than Sterex and seem to have a higher energy density. So actually, it's the case is that our stereoc cells are designed to have a higher capacity. So that means they're they're capable of delivering a greater amount of energy in total.

38:26 And our our calculations actually show that the stereo cells that we use have got a a higher energy density. So we believe that they compare favorably with that product line. Adrian c says, when might you expect your first order to be placed, and then how long does it take to deliver the product? So, you know, we we're actually currently already selling our Sterex cells to customers. So we've sold to 16 different customers now, and we have conditional orders for what we call m 300 product, which is MVP or minimum viable product. So it's effectively the first product on our road map as we sell to to more customers at larger scale.

39:23 And so that order book is building. And as soon as our products are qualified and the the sales are ready for, you know, for commercial sales, then we will be commencing larger volume shipments in q two of next year. With respect to Goliath, Goliath is still a a prototype product that we are developing together with our customers. So often, they engage with us on an NRE basis. By that, I mean, we have a sort of collaboration with them under which they receive, you know, small quantities of prototype cells.

40:11 Over the next year or so, as the performance of these cells improves, we will be making larger volumes of prototype cells available. And, ultimately, you know, our scale up plan is aligned to be able to match their product development road maps. Let's have a look. Next one from Adrian. How will the product be priced? Is it cost plus, and how much scope do you have to increase prices if raw materials increase in price? Yeah. So, you know, our our sales are largely priced in terms of the value that we think that we can accrue through their sale into different applications.

41:01 You know, the different markets have got a different tolerance for margins. I mean, typically, industrial markets are large volume, smaller margin markets, whereas some of the niches where we have some unique differentiators, like, for instance, in med tech, are smaller volume for individual products but are tolerant of higher margins. So, you know, we we model the value of our technology within these applications and set a price point which is appropriate to that opportunity. Yeah. I think it's worth pointing out here that the the pricing for Goliath and and Sterex are somewhat different. For Goliath, a a lot more of the the cost of the battery does reside in the raw material cost and less associated with the with the processing cost than than the Sterex. So actually, the raw material costs for the for the miniature batteries are relatively low, but there's obviously a lot more processing involved with those.

42:12 Yeah. And so we need to keep an eye on what commodity prices do, particularly for the the Goliath cells, because probably about 85% of the cost of manufacture of those cells comes from raw materials. So, you know, lithium pricing, in particular is important. So next, another question from Adrian. Thanks for your, interest here, Adrian. So who are the main competitors of Sterex? I think we've covered that, actually. And, how will we compete on on price or performance? So, actually, it is largely on performance. We tend not to try and compete with anybody on price. We believe that, actually, the the performance of the cells with this type of new technology is what gains us new customers. And we we tend to try and address market segments that existing technology can't support.

43:15 So that's why, you know, the the high temperature tolerance of our cells and also our ability to miniaturize them means that actually we can certainly differentiate ourselves relative to incumbent technology, You know, standard lithium ion cells, coin cells, they top out at about 60 degrees C, and you can't really make them much smaller than a couple of millimeters across. So the fact that we can go down to very small sizes makes them ideal, in particular for some of these new med tech applications where, you know, the the inserted device that goes into the patient needs to be absolutely as small as possible. Let's have a look. So we got a question from Kamal here. There seems to be a demand for hydrogen based technology for the automotive industry. How does Goliath compare against the likes of series hydrogen tech that licenses to other manufacturers.

44:19 Yeah. So, you know, I actually am a great believer in hydrogen being used for transport applications. You know, the the main challenge actually with hydrogen is its distribution and storage. I guess, you know, if we'd been having this conversation ten years ago, we probably would have still been debating whether fuel cell vehicles or battery powered vehicles were going to dominate. Well, I think that particular argument has been settled. You know, battery powered vehicles have, you know, certainly stolen a march on hydrogen technology, but the the whole drive for electrification will probably still involve hydrogen. And I think hydrogen has a role to play in range extenders.

45:15 So I think that certainly in an urban environment, then electric vehicles powered by batteries are at a decent price point. But if you're looking for long range vehicles, you know, some of the the hybrid, and by hybrid, I mean hydrogen and and battery pack hybrids, are going to have a place, you know, in in particular, in countries where larger traveling distances are are part of society and and part of the culture. You know, Seres Power, of course, is a solid oxide fuel cell business. Their technology runs on more than hydrogen. It can run on hydrogen, but it it also runs on natural gas.

46:06 And I personally think that solid oxide fuel cells will mainly be deployed in stationary applications where some of the the heat that's generated by that technology can be used usefully in in the environment, in in the application. And I I think, actually, probably in transport, you'll see more PEM fuel cell technology used rather than solid oxide. Right. Let's have another question here. Another one from Adrian. Must have been quick on the keyboard. To what extent are any lessons learned from Sterex applicable to Goliath, and are you effectively starting from scratch? Well, I think there's actually, one of the slides in the presentation that we gave speaks to some of the the learnings from Stereacts.

47:08 You know, we've got a a whole load of experience around the the right choice of anodes. We actually used lithium metal anodes in the early stereax prototypes, and we were struggling a bit with delamination of those composite structures largely due to the stresses that are caused by the plating mechanism that you get in in stereoc cells where you use lithium anodes because you've got a mobile layer of lithium metal, against the current collector, which, actually causes a stress that's, detrimental to long term cycling.

47:53 So we switched to a structured anode to to, to silicon, which we found gave a stability to the cells that introduced a decent longevity. And and that's why we're using, silicon in Goliath, which is rather, you know, different to to what's used, you know, by other large format solid state developers. So maybe just one final question. Let's have a a flip through the list here. So here you go. Here's an interesting one from Simon, actually, where he says, what do you think is the risk level of ILIKA being beaten to the finishing line on EV battery solutions?

48:52 So we we often get this question is, you know, are you ahead of the competition, and, you know, who do you think is the most advanced? It's actually quite difficult to be, categoric about this because, you know, a lot of the technology developers only make cells available for testing and evaluation to their customers. You know, you would do the same. You wouldn't make them broadly available, so your competitors would would copy you. And also, of course, in the big companies, they have no real need to, publish the the progress that they're making. So, you know, if you're working on cells and you work in, CATL, you you may not actually feel a need to to publish exactly where you are on solid state.

49:43 I I personally don't think that this market is gonna tend towards a monopoly situation where, you know, the the first company that crosses the finishing line ends up being a winner. Because what we've seen from the lithium ion industry historically is that different chemistries still proliferate even though we are sort of thirty years into the industry. You know, we see different types of cathode materials. We we see different types of anode materials. You know, for instance, on the cathode side, we see, LCO is often used for consumer electronics batteries.

50:33 We see that NMC and NCA are used in automotive, and and some companies use cobalt free LFP in their batteries because it's it's lower cost. And I think we'll see the same with, solid state is that a lot of these technologies will actually get through to commercialization. And I doubt that there'll be a single clear winner, but actually that you'll have a a number of different technologies that are used, you know, broadly across different niches. Okay. Thank you. Graham, Steve, thank you very much for being generous with your time and answering many of the questions there.

51:21 Obviously, for every question you you you answered, another one came in. And but, of of course, the company will review any further questions submitted and publish responses where it's appropriate to do so. Graham, I just wondered before before redirecting investors for feedback, I wondered if I could ask you for a few closing comments. Yeah. I'd just like to thank everybody for taking time out of their day to to listen to our update. Of course, there will be many more updates forthcoming over the next year or so. And, as I said at the outset, we hope to be able to organize an open day so that we can meet some of you face to face, and, answer some more of your questions at that juncture. Graham and Steve, thanks again for updating investors today. Could I please ask investors not to close the session as you will now be automatically redirected for the opportunity to provide your feedback in order that the management team can better understand your views and expectations?

52:21 And this will only take a few minutes to complete and is of great value to the company. On behalf of the management team, Villaica PLC, we'd like to thank you for attending today's presentation. That now concludes today's session, and good afternoon to you