,Good morning. Welcome to the HydrogenOne Capital Growth PLC Investor Presentation. Throughout this recorded presentation, investors will be in listen only mode. Questions are encouraged and can be submitted anytime by the Q&A tab situated in the right-hand corner of your screen. Just simply type in your questions and press Send. The company may not be in a position to answer every question it receives during the meeting itself. The company will review all the questions submitted today and publish responses where it is appropriate to do so. Before we begin, I'd like to submit the following poll. I'd now like to hand you over to Matthew O'Keeffe, Managing Director at FTI. Good afternoon, sir. Good morning, everyone. Thank Thank you very much for joining us here on the occasion of HydrogenOne's Q4 results presentation. My name is Matthew O'Keeffe. I'm here this morning with Richard Hulf, one of the principals of HydrogenOne's investment advisor, and Richard will shortly walk you through the presentation. As you just heard, we do have a Q&A session right after the presentation where we will be taking online questions from you, the webinar audience. That question portal is open now, it will remain open throughout. Just to reassure you, any questions that we don't get to today in the Q&A session, we will endeavor to answer later on. Let me hand over now to Richard. Thanks, Matthew. Good morning, everybody, and welcome to HydrogenOne Capital's Q4 2022 results presentation. Exciting times in the hydrogen sector. Plenty to talk about. I'm gonna take you through the high level sort of view from the fund, and then we'll talk about a few of the companies that featured in the Q4, and then take your questions at the end. I'll give you five seconds to read that, and then move straight into sort of like a recap of the fund. Bottom line is we're targeting NAV growth of 10%-15% per year. The idea is that we invested into hydrogen companies and hydrogen projects. We put GBP 1 into each of those companies and projects, and we expect to get at least GBP 2-4 out over a short period. This has been achieved by investing into low carbon technologies for climate positive impact, SFDR Article 9. We'll take you through that later on, but this is the highest accreditation for an ESG fund. Against the backdrop of strong macro tailwinds supporting a large pipeline of distinct opportunities. Clean hydrogen, don't forget, is a $2 trillion per year sector. We're attacking this by going in at the industrial level, converting gray hydrogen used in cement, steel, in desulfurization to green hydrogen. Over time, we start to see a role for transportation and mobility. What's our strategy? We invest into a diversified portfolio worldwide, both in supply chain companies making stuff, engineering businesses, and in hydrogen production, avoiding greenhouse gas emissions and generating NAV growth for you, the shareholders. That's the sort of the high end. Let's start to get into some of the macro. This is about playing the energy transition. Of course, hydrogen is zero carbon. We're also about air quality. We're seeing increasingly the drive towards improvements of air quality by addressing hydrogen fuel in heavy transport and power. Really what's changed over the last year, particularly in the fourth quarter, is the issue about energy security and Europe's realization about its heavy reliance upon Russian gas, then the drive to get hydrogen into the system. In 2022, we saw a doubling of the U.K. hydrogen target. We saw a nearly 4x increase in EU targets, for electrolysis, to make green hydrogen. In the U.S., of course, we've seen the much talked about Inflation Reduction Act, which is playing a material role in funding and getting political support in the U.S., for clean hydrogen. That's really a game changer. We're gonna see a lot more of that in 2023. Let's get into hydrogen itself. A lot of people will be saying, "Yes, but, you know, show me a hydrogen project." What this slide is designed to show you is there are already hundreds of green hydrogen projects on stream. On stream being the sort of turquoise that feature on this map. That's about 0.8 GW. That's 800 MW of green hydrogen projects already producing around the world, and we've highlighted a few there. But coming along, just to give you an idea of how quickly this sector is accelerating, under development, another 6 GW, 6,000 MW. That's what this fund is going after to invest into these green hydrogen projects. We started off the fund, thinking it was just going to be mostly companies and projects would come later. As we go on, we'll go on to show you in a moment, we've already started investing into green hydrogen projects, and that's going really well. Just a sort of a high level summary of the fund. Private assets dominate. It's 97% small allocation into listed companies. Why do we have that? It's important to have corporate access to see what's going on in the listed market. Ultimately, for some of the private companies that we've got, the exit for us, where we get that multiple on the pound we've invested will be through an IPO. Although we actually think quite a lot of this is gonna come from trade sale of strategic industrial investors realizing they've missed out on the, on the acceleration of hydrogen, and they'll start to buy into the value chain. We've invested in revenue-generating, supply chain companies, in the U.K. and the EU so far. And, projects, these are actual developer companies with plans, for production sort of, mid-decade. We co-invest with strategic industrials, and other institutions, as we'll show you on some of our projects. But we look for, portfolio diversity. It means a global allocation across the full value chain. We've just listed on the bottom right-hand side there the 10 investments that we've made so far, of about GBP 107 million of the GBP 130 million that we've raised. We've got a little bit of cash left over so far, to follow on with some of the investments in these companies. We'll be fundraising again in 2023, hopefully. I mentioned SFDR Article 9. This is the top level target. Basically the importance is that it shows that we are taking our environmental, social, and governance responsibilities very seriously. What does it mean? SFDR, really, we've got a third-party consultant who's been through the fund, auditing the way that we instigate our environment and social and governance responsibilities and going into the companies that we invest into as well. It's the next step beyond a sort of a box-ticking exercise to show that it's really part of our investment strategy. It's audited regularly by third parties. This is how we've earned this. We've upgraded to the fund to SFDR 9 and become a signatory to the Principles for Responsible Investment that we've outlined there. There'll be full reporting on SFDR and avoided greenhouse gas emissions in the 2022 annual report, which is due to come out in April. Let's get into the performance numbers. What this slide is really showing you is that from 31st of December on the top line there, with the NAV at 95.75, we've gone up slightly to 99.73, which, you know, in absolute numbers, doesn't look tremendous. In terms of the relative performance of the fund, we're very proud of this, that we've managed to increase our NAV, in spite of a lot of headwinds in the market, inflation, risk of markets, and spikes in energy prices. Relatively speaking, we think the performance has been really good. Financial highlights, fourth quarter, full year. We use IPEV guidelines for these numbers, review and approved by the board. We use a 12.9% calculated discount rate overall. That's broken down through the classic CapEx model, including quite high numbers for small company discounts because we're mostly investing into small companies. Really pleased to see the NAV rising over the year and sequentially. Good results. NAV per share up 1.6% over the year, NAV 0.8% from Q3 2022 to Q4. We made some small follow-on investments into Strohm, the pipeline company, and we'll talk about that before we get to the end. During Q4, that was GBP 1.1 million previously announced as part of the round there. Since the end of the quarter, we made GBP 3.8 million of follow-on investments into Cranfield Aerospace and a new production project in Germany. I'll update you on the project in Germany in a moment. From Q3 to Q4, portfolio value increased by GBP 3.5 million, and the cash position reduced slightly due to investments and fund costs. We'll talk about costs in a moment because there was an exception in that. Our portfolio continued to deliver strong growth. Over 90% of the invested portfolio is revenue generating, and that's important. The private revenues increased to GBP 33 million over 100% year-on-year. The projects, the development business is doing well and on track for mid-decade startups in green hydrogen. That's a sort of a snapshot of the numbers. Taking the sort of classic waterfall approach, this slide shows the net asset value movements in Q4 2022 compared to Q3 on a pence per share basis. The bottom line increase is by 0.88%. We saw improved valuations in multiple private positions and listed names totaling around 1.6% or 1.7% and exceeding offset fund expenses, which included costs for a share issuance program was put in place in the fourth quarter. Good to see the underlying growth coming through for our investors, despite a slight increase in discount rates at the end of Q4. This really demonstrates the underlying resilience of engineering businesses that are supplying electrolyzers and fuel cells into the hydrogen sector. Let's get into some of those companies themselves so you can see actually what's going on. We'll have these companies on our capital markets day to give you a chance to speak to them as well in person. First of all, let's talk about Sunfire. We're really excited about Sunfire. This was our first investment, 2021. We put GBP 20 million into Sunfire. We invested alongside some other big, global important sustainable funds like Planet First Partners, Lightrock, and Copenhagen Infrastructure Partners, CIP, and more recently, the Amazon Climate Pledge Fund followed our investment into Sunfire. What does Sunfire do? Sunfire make electrolyzers. Electrolyzers split water into hydrogen and oxygen. But these electrolyzers are big, as you can see from the picture at the top there. Sunfire are selling to customers like RWE, like Uniper. These are grid-scale electrolyzers for supplying green hydrogen into the industrial complex. There's a bit of a crossover with one of our German projects here that may be using Sunfire electrolyzers. You might compare Sunfire to listed companies like Nel. It's similar. It's a big business, there are three factories in Germany and Switzerland, 500 staff. They also are starting to look at contracting out manufacture. That happened in the fourth quarter with Vitesco Technologies announcing that they would be helping to co-produce these electrolyzers. Also, in the fourth quarter, there was an announcement about delivery of one of these electrolyzers to RWE. You'll see a lot of this sort of news flow coming out of a number of the electrolyzer companies, and Nel's been doing the same. That's Sunfire. Next, I just wanted to talk about Strohm. Strohm was one of our more recent investments. We invested GBP 10 million from the fund in 2022. Strohm make a thermoplastic composite pipe or TCP pipe. All we need to know is that it's very dense. Hydrogen doesn't leak through it. You can wind it onto these large carousels. You don't need to have flanges and joins. You can run it from your offshore wind farm all the way onshore. What Strohm are doing are riding on the back of the trend of wind farm operators to start putting electrolyzers offshore to produce hydrogen to supply onshore. We're seeing, for example, in the U.K., it's not just the Teesside big project onshore, but there are a number of offshore green hydrogen projects being planned, as well as in Denmark and the Nordics. We're seeing a big order book filling up from companies ordering this sort of pipe. Strohm are at the forefront of offshore gas pipelines. They announced a deal to supply TCP pipe to the Wilhelmshaven gas project and terminal in Germany in the fourth quarter. It's not just us doing this with other key investors. ING joined a follow investment of a EUR 29 million investment in the fourth quarter news, which is why we mentioned Strohm here. A really exciting company, which is part of this whole sort of hydrogen value supply chain. That's Strohm. HiiROC we'd like to mention. We invested GBP 10 million into HiiROC in 2021. HiiROC don't split hydrogen in this unit you can see in the top right-hand side of that picture. They split methane. They split methane into hydrogen and carbon, and they use that using an ingenious process that uses an electrical field as well as plasma gas torches. This is a highly patented and very cost-effective way of dealing with methane, which otherwise would be flared, or for example, Centrica announced a trial of one of these units in the Brigg biomass facility to inject hydrogen into the gas stream, to be actually combusted, unusually, to produce renewable power. We believe this is a very exciting product which is going to start taking off, but with supply perhaps into the Middle East as well. We know that Noah at HiiROC are talking to a number of off-takers to deal with their flared gas. Very exciting technology and a breakthrough in the fourth quarter with Centrica. Centrica, incidentally, is a co-investor along with other names that we've mentioned there, Hyundai, Kia, and CEMEX because the carbon black that's produced in this process is very useful in other processes such as tire making, and in creating fertilizers for ground. That's HiiROC. I think we're... One of the projects that we're most excited about is the follow on from the earlier investment that we made into HH2E. What we've done here is we've invested GBP 5 million into HH2E in 2022 into TopCo. HH2E (TopCo) also owns a number of projects that it can, that it and others can invest into. We co-invested into HH2E with Foresight. Foresight and ourselves have got investment rights into these special purpose vehicles. One of those being Thierbach, that we announced in the fourth quarter, a EUR 13 million gross investment by us and Foresight into the acquisition of the land and into the Front-End Engineering Design of a 100 MW green hydrogen project. This is on that map that we showed you earlier, of Green hydrogen projects that are going ahead. Where does that hydrogen go? It goes into the industrial complex in the Rhine Valley, into the chemicals businesses that are currently using gray hydrogen that they're starting to... They need to start using green hydrogen. That's Thierbach. Those are the companies we wanted to bring out. We continue to invest into the best hydrogen companies and projects we believe through our unique network, targeting best management teams, established businesses with revenue generation, projects with demand and hydrogen offtake. It all adds up to profitable investments generating return. We're not about investing into startups, It's about businesses that are scaling up. We're doing this through our specialist team, actively involved at board level. Deji, Traynor and myself are on the boards of most of these companies we invested into, and in leading the way on the projects. We've got real first mover advantage here in the hydrogen sector, so we can identify the best profitable opportunities before others, and a massive pipeline of other projects and companies to invest into, which we'll be doing through the rest of 2023. Thank you very much, and let's pass it back to Matthew and take a few questions. Yeah. Thanks, Richard. We'll go to the Q&A portion now. Just as a reminder, we're still taking questions from you, the viewers. Please do carry on typing your questions in the question portal. Just to start us off with the first question, what sort of ROI do you look for when you're thinking about investing the fund's money in a particular development project? Yes. Yeah. In project. That's a good question. Return on investment. As I said at the beginning, this fund is about recycling capital, putting in a GBP, taking out, you know, GBP 2-GBP 5. With 5. With projects, the entry price is the entry cost to us is our share of the CapEx that goes into buying the land, putting the electrolyzers in place. We exit from the project after hydrogen is in production, and we will be selling to an infrastructure fund. The ratio between that invested capital, that CapEx and the value of the exit on projects is about 2-2.5x money on invested multiple invested capital. Which translates into an IRR of somewhere between sort of 20, 30% over a, and I guess that's over a time period of a, you know, sort of about a five-year in-investment period. Okay. Returns, multiples on companies is slightly better. Our ability to invest large scale capital into companies isn't as great as we think it is for projects. The fund at the moment is, you know, two project companies out of the nine investments we've made so far. I think over time, over the next couple of years, we're gonna be half and half projects, half companies. Over the longer term, sort of five years+, I think we're gonna be more projects than companies. Okay. Now it's growing fast, it's about companies. Companies that would have slightly better returns is what I'm saying. A question on inflation. The question being: What is your experience and the experience of your portfolio companies at the moment of material cost inflation and in particular electrolyzer costs? Yes. That's a good question. This is a positive thing actually. There is so much demand for electrolyzers in Europe, as Europe switches from Russian gas over to hydrogen, that we're having to put deposits down early on to even secure the order. Where inflation is well managed and under control, it's already factored into the discounted cash flow models that we make for each of these companies. It's the same as in any other sector, but it's manageable. Inflation has not had a material impact. What's more important is putting capital to one side into projects in advance to secure items. It's just the scarcity of items that is more of an issue. I suppose that's true in companies as well. We're seeing working capital being larger, and we will see some top up investments into these companies to allow them to put those deposits down to acquire programmable logic controllers, transformers, parts of the control system, pressurized containers. There's a shortage of those. The pricing has been reasonable, and not, and not out of sync with any other sector, really. Okay. Look, it's clear from your presentation that you've invested in a really interesting bunch of private companies. Mm-hmm. What are your expectations that some of those companies might go down the path towards an initial public offering themselves? Yes. I mean, I can't be specific, but we have been surprised by the fact that two of the companies in the portfolio are in the process of appointing investment banks, with an envisaged sale. Within the next 12 months. I think the pushback from the us and fellow investors is that we think those companies are being quite optimistic. Yeah. Nevertheless, it's important to prepare for that sort of eventuality. Yes, it's certainly true that it's coming along faster than we would have expected. We think when companies start to talk about IPO, that also sends a bit of a catalyst to the strategic acquirers of these companies, for trade sale as well. Okay. Sticking with the theme of the investments you've made thus far, in the event that some of those require further funding, for example, to expand manufacturing capacity. Mm. What's the position of the fund in terms of participating in further investment rounds within-? Yes. companies you've already invested in? Yes. We had always intended that we would follow. There would be follow-on investment, and that's why the fund needs to continue to expand and continue on its cycle of fundraising and investment. We've got enough capital remaining at the moment that we've kept as dry powder to top up some of these companies with short-term funding needs, as I've already mentioned, for working capital. We absolutely will. We'd be participating as we go forward, trying to minimize our dilution as we see, for example, Amazon coming into Sunfire. Well, the hydrogen sector is starting to attract much bigger investors, and we intend to keep up. Okay. everybody out there, please support us with our further fundraising because this is what we need to do as well as investing into new companies and projects. Okay. What's the particular significance of your investment in HH2E, and how will that impact... Yeah. Yeah. expected returns for your shareholders? Well, this is how we invest into hydrogen projects. Eventually, we will be investing directly into projects as a working interest holder in green hydrogen projects in mainland America. We've seen a few. We're looking at, in Louisiana, for example, already. You know, that's a sort of separate story. HH2E is the early stage access to green hydrogen projects. It's like investing into a mini version of BP to get access to BP's oil fields that you can also directly invest into those oil fields as well. We're investing into HH2E, but we get investment rights into all the projects that it secure and manage. For us, that's very exciting. It's come a lot sooner than we thought. You're going to see quite a bit of our capital going into these green hydrogen projects from scratch. You've clearly diversified by product or by sector in terms of different parts of the value chain you've invested in. Yeah. Should we expect any kind of geographic diversification in terms of how you deploy the fund? Yes. Yes. I know it's the U.S. in particular... Yes. ... I wanted to ask about. Yeah, yeah. No, I'm glad you brought that up because as the audience will see, most of what we've done is mainland Europe, and that has been where the best products have been so far. We cannot ignore the Inflation Reduction Act. There's some politics involved here about, you know, obviously it only benefits U.S. companies and U.S. projects. As a fund, that doesn't bother us because we're a global fund. We can invest directly into those companies and projects to secure the best returns for our investors. Yes, we are targeting a number of projects, and we're in dialogue with some parties on the East Coast and around the Gulf of Mexico to start pushing forward. Okay. I think we have time for one more question, but it's an interesting one. Yeah. After the significant falls that we've seen in the value of a number of quality hydrogen companies. Yes. is that not a compelling opportunity for you to be looking at? We think the best opportunities are still in the private space. We don't, I mean, the listed space is the wrong way to look at the hydrogen sector at the moment because it's a new sector. Things take more than one quarter to deliver. The listed companies are finding it tough because they're, they can't meet the expectation of investors on a quarterly basis, whereas in the private sector we've got more patience. We can take a step back and see what's going on. Listed companies we think are. We've seen the discount rates analysts use on listed companies, and they are too low. That is why there is a value increment increase from being a private to a listed company. That will always be in place. We, by definition, we see the, you know, the private space just because the way it's valued and perceived as being more of a bargain than the listed space. Got it. Got it. Well, I'm afraid that's all the time we have for questions. I do see a lot of questions in the chat room. We're not ignoring you. As I said at the beginning, we will revert on any of the numerous questions that we haven't had time to deal with this morning. That concludes the presentation today. Let me just hand over to Richard to close with a few words. Thank you, Matthew. Thank you everybody, for taking time to listen to our fourth quarter results. We really have got a lot going on in the fund in terms of the pipeline for 2023. More projects as well as more exciting companies. Keep following us and stay with us. Thank you very much. Richard, Matthew, 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 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, but I'm sure will be greatly valued by the company. On behalf of the management team of HydrogenOne Capital Growth plc, we'd like to thank you for attending today's presentation. Good morning to you all.