Hello, welcome to today's Anaergia Q2 2023 conference call and webcast. My name is Bailey, and I'll be your moderator for today's call. All lines will be muted during the presentation portion of the call, with an opportunity for questions and answers at the end. If you would like to ask a question, please press star followed by one on your telephone keypad. I would now like to pass the conference over to our host, Darlene Webb, Investor Relations for Anaergia. Please go ahead. Thank you very much, Bailey. Good morning, everyone. This call will be discussing our earnings for Anaergia's second quarter of 2023 ended June 30, 2023. If you're following along with our slides, my comments are directed to slides 1 through 3. For our call today, I am joined by Mr. Brett Hodson, Anaergia's Chief Executive Officer, Dr. Yaniv Scherson, Anaergia's Chief Operating Officer, and Mr. Andrew Spence, Anaergia's Chief Financial Officer. Before beginning our formal remarks, we would like to refer listeners to slide 2 of the presentation, which contains a caution on forward-looking information and a note on the use of non-IFRS measures. Listeners are reminded that today's discussion may contain forward-looking statements that reflect current views with respect to future events. Any such statements are subject to risks and uncertainties that could cause actual results to differ materially from those anticipated in these forward-looking statements. Anaergia does not undertake to update any forward-looking statements except as may be required by applicable laws. Listeners are urged to review the full discussion of risk factors in the company's prospectus, which is filed with the Canadian Securities Regulators. Lastly, while this conference call is open to the public, for the sake of brevity, questions will be open for analysts only. With that, I'll turn the call over to Brett. Thank you, Darlene. Hello, everyone. Thank you for joining us on the call today. I will be speaking to slide 4. The second quarter has been a difficult and challenging time for Anaergia. The Q2 financial statements and management's discussion and analysis of the financial results have been released and describe and reflect our situation. A few of the significant items in the quarter that I want to highlight include Rialto entering into Chapter 11, a pretty significant event that occurred during the second quarter. In addition, the recognition of the loss on certain loans that were no longer deemed recoverable, and the company announcing a strategic shift in business reset that I'll discuss about more later in the call after we review these financials and Rialto in more detail. Given that, the financial conditions of the company, plus the manifestation of the current risks surrounding our Build-Own-Operate assets, particularly in Italy, in addition to the business reset, a strategic review was initiated on approval from the Board of Directors of Anaergia, as previously disclosed. The company has since engaged financial advisors to assist with the strategic review and is looking at options to maximize shareholder value. In the strategic review, includes discussions with lenders, and as a result, the company has possible implications of a lender option relating to a loan to the BOO assets in Italy. In addition, a loss on certain loans that were no longer deemed recoverable were recorded. With that, as a summary, I want to hand this over to Andrew Spence, our CFO, to provide the Q2 financial overview. Over to you, Andrew. Thank you, Brett. Good morning, everyone. My name is Andrew Spence. I was appointed the Chief Financial Officer of Anaergia on June 12th, 2023. I'm going to provide a brief discussion of the second quarter results, starting with key disclosures. I'm looking at slide 5. As was reported in our press release, note 1 to the financial statements and our MD&A, the company has disclosed that substantial doubt exists about its ability to continue as a going concern. While management has made efforts to improve the profitability, these efforts are unlikely to be sufficient on their own to address the financial challenges facing the company. The continued operations depend on its ability to meet its financing and liquidity requirements on a continuing basis. There can be no assurance, however, that the company can reach profitability, secure adequate debt or equity financing, or implement asset sales on desirable terms within the necessary time frames or at all. These material uncertainties raise significant doubt about the company's ability to continue as a going concern. Next, the company has disclosed in the press release, note 10 to the financial statements, and within the highlight section, the section on liquidity and in risk factors of the MD&A, that the loan from Arjun Infrastructure Partners, or AIP, for the build, own, operate projects in Italy, has an option for AIP to require Anaergia to purchase outstanding loans related to such projects if certain conditions are not met. The company continues to assess this matter as part of the ongoing strategic review, including discussion with lenders. Next, I will present key accounting charges and provisions.... The company recognized an expected credit loss on certain loan receivables in the amount of $55 million. During the company's ongoing strategic review, including discussion with lenders, we became aware that the loans for building, owning, and operating projects in Italy will probably not be collectible, and thus determined that a full provision was necessary in order to adequately reflect the balance. This resulted in an additional loss provision during the quarter. On May 25, 2023, the company's JV subsidiary, Rialto, filed a voluntary petition for Chapter 11 restructuring. Rialto is 51% owned by the company. Due to the bankruptcy, the company has determined that it no longer controls Rialto, and thus has deconsolidated the subsidiary as of the same day as the filing. The company has recorded a loss on deconsolidation totaling $37.9 million in the second quarter. Anaergia reported a second quarter operating loss of $22.4 million, and a net loss for the same period of $119.8 million. Cash used in operations year to date through June thirtieth was $33.9 million. Regarding our guidance, Anaergia, in prior periods, has provided guidance with respect to projected revenue and Adjusted EBITDA for the fiscal year 2023, which was based on the company having adequate liquidity and access to capital necessary to execute its plans. Due to a number of factors, including the continued deterioration of the company's financial performance, as reflected in the reported net losses and negative operating cash flows, weakened liquidity position, recent changes to senior management, and potential transaction, Anaergia now believes it will not achieve the estimates included in previous guidance, and expects such measures of revenue and Adjusted EBITDA to be lower than previously guided. All right, moving on to slide 6. Regarding our Q2 financial results, first, revenues were in line with the prior periods of 2022. Gross profit declined due to a combination of project cost overruns and certain non-recurring items. SG&A for the quarter was $13.4 million above the prior year. The larger items included a charge on terminated O&M project that was $5.3 million, credit losses on trade receivables of $4 million, certain pre-petition expenses at Rialto, $2.9 million, and an additional vacation accrual of $1.2 million. The Q2 2023 net loss increased by $103.4 million compared to the same period in 2022, mainly driven by the loss resulting from the deconsolidation at Rialto and the estimated credit losses expense of $59 million. Adjusted EBITDA is $16 million lower than the same period in 2022, which is consistent with the reported loss from operations. With that, I'll turn the call over to my colleague, Yaniv. Thank you, Andrew. I'm now on slide seven, discussing the Rialto Chapter 11 and decon- deconsolidation issue. As previously noted, Rialto Bioenergy Facility, entered Chapter 11 bankruptcy protection, as a protection measure while enforcement of the feedstock laws continued to be implemented. As part of the restructuring process, there is a court proceeding occurring in August concerning a dispute over the valuation, the outcome of which will clarify potential outcomes, and the future of the Rialto Bioenergy Facility assets. As a result of the bankruptcy, the company has ceased control of the RBF, and so from an accounting perspective, RBF has been deconsolidated from the financial statements. The impact as of May 24th, the RBF had about total assets of $363 million, current assets of $11, current liabilities of $18 million, and total liabilities of $250 million. Certainly refer everybody to the Q2 interim financial statements for further details on the matter. Now over back to Brett. Okay. Thank you, Yaniv. I'm on slide 8 now, discussing strategic shift in business reset. Anaergia acknowledges the business and financial results and recognizes there's a significant room for improvement. As previously disclosed, the company is undergoing a strategic shift in business reset. For all new build operate opportunities in the development pipeline, we plan to develop future projects with a financial partner who will fund all or majority of the capital in these projects. In these situations, Anaergia intends to recognize revenue and EBITDA from a development fee, capital sales, and long-term O&M contracts with each future build own operate opportunity. That shift is from where in the past, Anaergia has been one of the major capital risk contributors to these projects. That shift will hopefully de-risk these projects in the future for us, reduce capital requirements, and improve margins earlier in the recognition earlier in the projects. ... The, we're also in the process of evaluating, our current BOO assets as part of the strategic review, and are determining if certain financing options are worth pursuing at this time to increase capital resources available, so that we can use them for the remaining projects. We'll continue to seek equity partners and debt financing, on our current, Build-Own-Operate projects through the, strategic review process, along with other, measures. Shifting to margin improvement, we plan to enhance contractual requirements for margin protection and perform a reviews of the business opportunities and improves discipline in our contracting and execution processes, including incorporation of enhanced third-party due diligence and improvement from past experiences. Many, many projects face risks of unique characteristics, and, at times, those, those risks do come home to create challenges for the organization. We've seen that in Q2, and the key is to how to take those forward and improve upon those in future work that we're going to engage in. Moving to SG&A reductions. Management is and will continue to target SG&A reductions during this current difficult phase. We're already seeing results from reductions in headcount, and we are striving to have significant run rate reductions in Q3 and Q4 heading into 2024. All of this is in the backdrop of prudent cash management and conservation, where management is and will continue to target cash retention initiatives to improve liquidity, and we look to the results of the strategic review to help guide us into the future. With that, I'm going to turn it back to the operator to open it up to questions and answers. Thank you. If you would like to ask a question, please press star followed by one on your telephone keypad. If for any reason you would like to remove that question, please press star followed by two. Again, to ask a question, please press star followed by one. As a reminder, if you are using a speakerphone, please remember to pick up your handset before asking your question, and please do ensure that you have unmuted locally. Our first question today comes from the line of Aaron MacNeil from TD Securities. Please go ahead, Aaron. Your line is now open. Hey, morning. Nice to meet you, Brett and Andrew Spence, thanks for taking my questions. Brett, you've obviously come into the company with fresh eyes and have had some time to sort of understand the opportunities and challenges of the business. Maybe you'll agree or disagree with my characterization, but on one hand, obviously, the technology and asset footprint has the potential to both decarbonize and generate returns for shareholders, but there have been obviously lots of unforeseen delays in several areas, and the leverage is high, which just sort of creates a little room for error. You've obviously got the strategic review underway, but in your view, what's sort of a plausible outcome for the review? What would be a great outcome for the review or a suboptimal outcome? Over what time frame do you think this all plays out? Aaron, thanks for, thanks for the question. Yes, I'm new to the organization, but understand, you know, obviously the infrastructure industry quite well from my past experiences. Stepping into the organization feels and looks a lot like many of the successful places I have been that have been involved-- been involved in such types of infrastructure projects. I think m-my assessment is similar to yours in terms of the market opportunity. It, it-- the demand for the solutions to offer are significant. Now, the... You, you, you meant-- made a comment regarding, you know, current projects and leverage in the company and leaving little room. These types of projects tend to have debt and leverage in them and, and other, other, other ways to minimize equity capital upfront in order to get to your run rates on these projects. They do have risks in these projects and, and they're relatively normal risks, but they're usually unique per, per projects. I think for us, the, the challenge has been the simultaneous manifestation of several risks simultaneously that's put us into a bit of a, a bit of a challenge here in Q2. That's, you know, leading us into the strategic review from the board of directors to look at all options going forward. I, I don't wanna forecast what, you know, what the time frame will be on this. We're, we're in the, we're in the midst and deep into the work on that review. The options and outcomes are, are varied and different, and, so it, it would be premature for me to comment on exactly where things are gonna go. I can say, though, that, you know, the, the, the future of the market and what Anaergia can do in this market encourages me quite a bit. I, I do believe that the, the, the services that we're offering, the technology packages we're offering, the people, skill set, capabilities are exactly in the right spot and, and give us some very significant competitive advantage going forward. The key will be in the strategic review to assess these options and how to get to the point where we can capture those opportunities going forward in the future quarters and years. Makes sense. Does the language around the AIP loan and the rescinding of guidance imply that there have been further delays to the ramp-up of the Italian BOO facilities? Can you just give us a sense of where those facilities are at today and what you expect the, the ramp-up period would be? Yeah, there are some continuing challenges with the Italian BOO projects. Again, from a risk point of view, one of the drivers of the value for doing these projects is the government incentives, which unfortunately have timelines attached to them of when they can be applied. They require almost like a bit of a rushing to getting these projects to completion. In that, i n that approach, that's when your execution risk and other risks can manifest themselves, and we've had that happen on those projects. We have, like, as I mentioned earlier, in terms of the strategic review, we're looking at all parts of the business and all aspects of it. Part of our work involves looking at all of those projects, looking at what is required in terms of additional capital and time to completion. As I said, we're in the middle of the review and the process, so I can't say exactly what, what's gonna be the end result of that. I'm hopeful that where we are today can be accelerated over the coming weeks and months so that the projects have a reasonable chance to meet their expected construction deadlines on those projects. We're making progress. We've had risks that have increased on those projects from various different things, from supply challenges to, you know, feedstock challenges, and other. In a lot of cases, because these projects have, as I mentioned, government aspects to them, whether they're in, in terms of permitting or in terms of the incentives themselves, those are risks that, you know, definitely change and adjust, and we're constantly having to pivot towards them. All of those require us over the coming weeks and months to, to make sure that we've got the right focus on trying to get those projects to their into their best place over the coming quarters. At this point in time, the strategic view isn't complete, so I'm a little bit short of details on being able to say, you know, this project here or that project there, but we are, we are looking at it in the context of the strategic review. Got it. Then I, I know it's been deconsolidated, but can you provide any updates on the current feedstock situation at Rialto? You know, have you seen volumes increase, even if immaterially. Mm-hmm. -or give us a sense of where- Yeah, good, good, good question. Yeah. Rather than my generalities, I'll turn it over to Yaniv to give you a bit more specific on that. Yeah. Thank you, Brett. Thanks, Aaron, for the question. The feedstock situation hasn't changed materially. You know, there's been slight impacts in a positive direction, there hasn't been a material change in the feedstock situation. As mentioned before, we're still anticipating improvements to occur with the installation of 2 additional OREXes, which will bring a, you know, step function increase in feedstock. Of course, the continued implementation of the with penalties that can start early next year. Understood. Thanks, everyone, for the responses. I'll turn it back. Thanks, Aaron. Thank you. As a reminder, if you would like to ask a question, please press star followed by one on your telephone keypad. The next question today comes from the line of Derrick Whitfield from Stifel. Please go ahead, Derek. Your line is now open. Good morning, all, and thanks for your time and taking my questions. Wanted to ask 2 follow-ups, maybe leaning in on the 6 Italian BOOs first. Could you help frame the incremental capital required to bring those plants on, and what a reasonable timeline to optimize the adjusters once they are online? Again, I'm looking for kind of parameters more so than very specific numbers. Sorry, Derek, I just had a cough there. Yeah, thanks for the question, Derek. It's difficult at this point in time for us to give specifics, as we're in the middle of a detailed review on all of the projects with our financial analysts who have been hired in the organization, hired by the organization to help us get to those exact answers on those, on those questions. I anticipate, you know, subject to the strategic review work being completed over the coming weeks and months, that we'll be announcing possible details with regard to that. However, you know, that strategic review is, is, is looking at lots of different aspects of the business at this point in time, so it's, it's uncertain when and, and how that information will be, will be put forward. With regard to the, the actual, you know, timelines necessary to, after you get the project to a commissioning state, to then tweak it to get it up to full optimal, is, it varies in each and in, and all conditions. In some of the, some of the projects we're doing in Italy, are. The feedstocks are different. They're, you know, whether it's coming from farm feedstocks or, or food waste feedstocks, make for different commissioning and also different debottlenecking at the plant once you get up and going. Those can, you know, those can vary from, you know, days and weeks of upgrading to. That's not my dog. The upgrading from days and weeks to, to many months. Like most processing plants, even after you get them up to the original, design specs that they were intended, operators at that point in time often start to identify numerous, ways to improve capacity at the plants. Sometimes that occurs even before you commission the plant, and therefore, you, you put change orders in, and you have, you have adjustments. The Italian projects are no different than that. They're, they're, they're in, depending on which project it is, they're having, different adjustments, different scope changes in requirements, even some of them before, before commissioning, in order to improve capacity post-commissioning, based on what they're seeing on the ground. It's a... Unfortunately, I, you know, I understand you're, you're looking for a range of numbers with regard to the, the dollars necessary to complete off or get to that, call it commissioning stage versus the, the ramp-up stage, but I don't have those for you at this point in time. I do. That is a focus of the strategic review, and we'll continue to be looking for, for giving you more, more clear line of sight for that over the, over time here. Terrific. As my follow-up, and perhaps shifting over to the sector more broadly, we've seen a record amount of M&A across the RNG sector over the last two years. While not asking you to project a potential outcome for your strategic review, what's your sense on industry interest in your U.S. and Italian projects, and could you reasonably divest a couple to advance the broader portfolio? All, you know, all, all options are on the table for the strategic review. Without saying specifically which actions will be followed, and which will be approved by the board of directors, that would be premature for me to suggest that. I can generally comment about what I'm seeing in the industry and with regard to the trend that you're seeing. Obviously, Anaergia is in the industry and can be seen as facing similar opportunities out there. It is a reasonably dynamic marketplace. I would consider it to be still in its early stages of maturity. You know, it's not a full mature market by any means. There's a lot of parties, whether they be infrastructure funds, whether they be strategics, whether they be companies that are looking to expand into this market to improve their environmental track record or their environmental capabilities. That, that makes for as a, as a backdrop, there seems to be a lot of interest out there. I would agree, my, my dialogue, my, my instruction out there in the... What I'm getting from instruction out there in the industry is that is accurate. What I would say, though, that what overlays all of that is the macro environments that exist in, in the market condition anyways, and it feels to be more of a buyer's market than a seller's market out there. What I mean by that is there, there, given the uncertainty around interest rates, given the... Despite the fact that there seems to be a lot of interest and a lot of capital, there seems to be some caution relative to maybe some of the M&A deals that have been done, you know, in previous years, in a bit more of a, a frothier, frothier market. That, I mean, that's just my, my gut that's, that's saying that, and I'm trying to give you a bit of color of, of what I, what I see out there in terms of the opportunity. In terms of going, going back to us and Anaergia and our strategic review, you know, we're, we're more micro, obviously, and, and we'll be talking with all our, you know, closest stakeholders as to what the best options are for us to, and what paths for us to go down. Obviously, we've entertain incoming calls from parties that are interested in Anaergia services or even partnerships. As I mentioned, in terms of our strategic reset and moving to more of a capital-light model, we've been active and out there, looking for partners to come alongside us for what is a very healthy business development pipeline that we have. This is where a bit of the challenge is for this organization. We are in a challenging time right now. When I look at the market demand and the projects that we're lining up, if we can find the right financial partner or the right solution, or right solutions through our strategic review, I get very excited about the opportunity, post this liquidity challenge we're having. Right, I completely agree with you. Just one last, if I could, Priyanth. Shifting over to Rialto, the MD&A noted the city of L.A. is now operating under a corrective action plan stemming from its delayed efforts to adopt and enforce SB 1383. Could you perhaps speak to what measures have been taken in the corrective action plan? Absolutely. A number of measures have been implemented, most notably the passing of the ordinance, which did occur, and then subsequent events related to distributions of notices to generators to comply, multiple notices, in fact, and the announcement of, you know, penalties that would be forthcoming on generators for non-compliance. A number of mechanisms related to in outreach, repeated outreach, getting customers to be aware of the requirements, signing up, and aware of the consequences for not doing so. Thanks for your time. Thanks. Thank you. There are no additional questions waiting at this time. I'd like to pass the call back over to Darlene Webb for any closing remarks. Thank you very much, operator. As always, for additional information or should you have any questions, please do contact the IR team at ir@anaergia.com, or visit us online at anaergia.com. Thank you all once again for your time today. Operator, you may now end the call. This concludes today's conference call. Thank you all for your participation. You may now disconnect your lines.