Welcome to the Smart Wires Technology Ltd Q4 report for 2021. For the first part of the call, all participants will be in listening only mode, and afterwards there will be a question and answer session. Today, I am pleased to present CEO Peter Wells and CFO Julie Andrews. Speakers, please go ahead. Thank you. Please go to page two. Well, good morning or good afternoon, depending on where you are, and welcome to the Smart Wires Technology Limited Q4 earnings results call. The earnings statement was issued earlier today, and this presentation will provide a high-level overview of that report, leaving some time for any Q&A you may have after the presentation. As Simon said, my name is Peter Wells, the CEO of Smart Wires. I'm joined today by Julie Andrews, our CFO. Financial Hearings will be moderating the call on our behalf. You can submit questions through the webcast during the call and with the moderator at the end of the call. Page three, please. Forward-looking statements. Any forward-looking information is inherently subject to risk, both known and unknown, and does not constitute a guarantee of future results. Page four, please. A little bit more on the content today. I will now provide an update on key market dynamics that are reinforcing the opportunity for our business, give you an update on technology adoption, pipeline evolution and backlog, and cover the Q4 highlights for you. Julie will walk you through Q4 and total year 2021 financial performance. I will provide a quick summary, and then we can take your questions. Moving to page five. Let's start with the grid. The grid is often referred to as the greatest invention or engineering feat of the 20th century, and yet we typically overlook it. We take it for granted or simply fail to recognize its role in creating modern civilization and pretty much all technology around the world today. The world runs on electricity. There is a deeper issue, though, and simply put, the grid now needs to become the greatest tech story of the 21st century. At Smart Wires, we are in the business of energy transition, helping the owners and operators of today's electricity networks modernize and digitalize their grids. We deliver advanced technology and analytics to transform today's electricity grid into a next generation digital platform. Moving to page six. Why is the grid so critical? What are the challenges we face, and what are the solutions we can deliver? At the top of this page, we frame energy transition for you. On the left, large scale adoption of renewable energy generation that needs to be moving to four times the current deployment pace. On the right, demand side innovation and electrification like EVs, distributed solar and sector coupling. These two paradigm shifts are massive. Have a massive impact on the grid. A decades-old infrastructure with decades-old analog technology that was not designed for dispersed intermittent generation with two-way flow, let alone e-mobility and other demand-side innovation. To enable these changes, we need to invest in grid modernization for digitalization. At least $1 trillion over the next eight years and ramping up to $14 trillion by 2050 as reported by New Energy Finance 2021 February report. The challenges are far-ranging. Congestion and capacity, grid connection delays, stability and strength and harmonics, increased complexity in planning and forecasting, the ability to manage two-way information and power flow, fluctuations throughout the day, new load management requirements, and really complicated balancing of supply and demand. The new grid must manage these dynamics, connect generation and demand side innovation, enabling the scale and pace of energy transition that the world, in terms of economies and society, desperately needs. There is good news. There are solutions. The broad investment in the grid, for sure, but specifically grid enhancing technology or GET. That solves specific needs with targeted applications and in time will enable broader transformational services and new business models for transmission, distribution, and retail. New designs that better meet the demands and opportunities of a green economy, providing growth, innovation, new jobs, and addressing climate change. It's in this area of grid enhancing technology that we operate, with a near-term focus on solving medium to high voltage transmission grid problems. Moving to page seven. Let's talk about the global demand for our technology. In our Q3 earnings report last October, we showed you a step change from $2.5 billion to a $5 billion pipeline, coming largely through the identification of additional opportunities published by system operators in their long-term capital plans. This pipeline has continued to grow, and we have added a further $900 million since that release. Of more significance, we have progressed on advantage deals and those in final approvals or contracting, where we are up by $48 million since Q3 with a total that is now greater than $240 million. In terms of backlog, we ended the year with $58 million of orders with a 2022 delivery date. On top of this, we have $4 million-$5 million due to close before the end of the month with deliveries in 2022, and a further $20 million-$40 million of active deal flow that we expect to close in first half, where these deals have the potential for partial delivery in 2022. These orders are driving our total year revenue guidance for 2022 of $65 million-$70 million. Other key points to note. Our platform adoption strategy appears to be working well. At 60%-80% of the 2022 revenue will come from lighthouse customers working with us in multi-year platform adoption frameworks. Our regional mix continues to evolve as we grow as well, with notable elements as follows. The Asia Pacific region remains stable but arguably underserved by us, giving major potential for growth. European growth is projected to be significant due to energy independence and net zero goals that continue to expand. Latin America remains a strong market for us and stable as other regions expand. Finally, North America will begin to emerge as a strong region for the business due to infrastructure spending and an increasing focus on grid modernization and digitalization. Moving to page eight. If I frame these elements with some specifics, we see a positive and evolving picture. I mentioned platform adoption on the last page and refer to them here as global programs. I've used this page actually in some recent investor and industry events, and I believe it shows an exciting position for our business as well as an indication of what will come over time in other countries. Looking at these three countries here with lighthouse customers, strong market dynamics and multi-year commitments, we see a common thread. First, we are delivering high impact projects, digitalizing parts of the grid, solving congestion by adding capacity, moving faster than traditional means and generating savings for the consumer. As well as reducing greenhouse gas emissions and helping our customers move towards their net zero targets. Secondly, these projects are leading to near-term follow-on orders. Finally, we see ongoing expansion and technology adoption opportunities through the mid to long term when looking at published network investment plans. Look, we need to deliver on our core business, providing exceptional customer experience and work hard to ensure we capture the full potential of our solution. The stepwise approach and model for the adoption of our technology is clear. Moving to page nine. Switching to Q4 of 2021. We continue to deploy and deliver great projects, completing notable successes for IPTO in Greece, AusNet Services in Australia, APG in Austria, and GEB in Colombia. In 2021, we delivered and commissioned over 80 SmartValve units with both V102 and V103 devices for nine different customers in six different countries. Our business, and more importantly, our technology, continues to gain attention and recognition with two awards in Q4. We received the Cleantech Impact Award in Raleigh Research Triangle area of North Carolina for contribution to clean tech innovation and workforce development. In the U.K., we received the Collaborate to Innovate Award with National Grid and Anesco from The Engineer in their energy and environment segment for working smarter together to develop and deploy technologies that have a positive impact on achieving net zero goals. Significantly and importantly, Amprion completed a deep technical evaluation and tests on our technology, culminating in the approval of the use of Smart Wires technology on Amprion's grid in Germany for optimizing grid loading and asset utilization. We expanded our patent position to 63 granted patents, with 65% of these in the U.S. and the balance issued globally. These patents focus on core systems, technology, and value-added features that make our offering and our capability unique. It's worth noting that there is no prior art for these patents, providing an early priority date and broad coverage. In addition, we have a further 120 filed, another 20 in drafting. Finally, I wanted to highlight that we successfully closed a debt facility with Nuveen in December for $250 million, drawing down our first tranche of $30 million with a second tranche of $20 million available in 2023. This facility bolsters our cash position on top of the equity raise in May of last year and helps provide a buffer to cash inflow and outflow timing movement, and a glide path to becoming cash flow positive by mid-2024. Look, we recognize there are challenges of the global supply chain, both in terms of cost impact and delays, along with the importance of building backlog and driving milestone collections. We believe our position is good without the need to raise cash in 2022, with the option to bolster cash again in 2023 if needed. You can read more about our highlights in the earnings release that was issued this morning. I'll now hand over to Julie. Thank you, Peter. Good afternoon and good morning, everyone. Now moving on to slide 10. Our Q4 revenue outperformed expectations. Total revenue in the quarter was $19.2 million, an increase of 131% compared to the fourth quarter of 2020. This increase was driven by delivery of SmartValve projects in the quarter. For the year 2021, revenue was $47.5 million, which was greater than three times growth over the full year, 2020. This exceeds the previously provided revenue guidance of $38 million-$42 million as component availability, manufacturing output, and delivery logistics outperformed expectations, leading to higher- than- expected deliveries of SmartValve devices in Q4 2021. This revenue growth was driven by continued SmartValve technology adoption by new and existing customers in key markets across the globe. Moving to slide 11. Our growth margins steadily improved as production ramps up. Growth margins improved by 50 percentage points in Q4 2021 to 6% over the same period in 2020. This was driven by revenue mix and volume leverage of the fixed manufacturing cost base and was partially offset by a year-to-date reclassification of internal labor costs for production and installation support. In addition, we recorded a warranty provision of $1 million for earlier generation products, the SmartValve v1.03, which had a negative 5 percentage point impact to gross margins for the quarter. We believe this provision to be adequate for potential issues relating to a limited production run of SmartValve v1.03, where significant product improvements are coming with the release of SmartValve v1.04 in May 2022. For the full year of 2021, growth margins were 4%, an improvement of 98 percentage points over 2020, with a ramp in growth margins during the second half of the year as volumes increased and improved capacity absorption. Moving to slide 12. Operating expenses were $10.7 million for the quarter, a decrease of $1.5 million from Q4 2020. This decrease was a result of the year-to-date reclassification of internal labor costs for pre-production and installation support to cost of sales, and a reduction in spend on research and development. This was partially offset by an increase of $700,000 on non-cash stock-based compensation and investments in talent acquisition throughout 2021. For the full year, operating expenses were $55.6 million compared to $45.5 million in 2020. The increase for the year was a result of key investments in talent acquisition, business development and analytic projects, patent expansion, and our product pipeline. These are critical investments as we scale the company for growth. Moving on to key balance sheet items and cash flow. We finished the year with $100.8 million in cash, restricted cash, and cash equivalents. The remainder of our current assets consist of AR, both billed and unbilled, of $14 million, inventory and inventory deposits of $23 million, and prepaids. Our current liabilities of $30.6 million primarily include $12.1 million of customer deposits and $17.1 million of AP and accrued expenses. Cash used in operations was $61.7 million for the year, compared to $66.5 million for the full year 2020. The decrease in cash usage was due to increase in cash inflows from customers due to higher revenue. As Peter previously mentioned, we secured a $50 million debt facility in December of 2021 and drew the first tranche of $30 million. This is reflected in cash from financing activities. Moving to slide 13 and the 2022 outlook. Our revenue is bolstered by our backlog and pipeline progression, and as announced in mid-February, we expect 2022 revenue between $65 million-$70 million. We anticipate continued growth and strong performance with $100 million-$120 million of orders throughout 2022. This represents an approximate 40%-50% conversion rate of the late-stage pipeline of $240 million. As we continue to work through supply chain challenges and cut-over production from the SmartValve v1.03 to the SmartValve v1.04 in May, we expect revenue to ramp significantly during the year with much lower volumes in the first half of 2022 compared to the second half. In addition, we expect gross margins to improve significantly from 4% in 2021 to 12%-14% for 2022 as we begin to see volume leverage of our fixed manufacturing cost. We expect the EBITDA loss for 2022 will be in the range of $57 million-$62 million as the impact of higher revenue and gross margins is offset by investments in our core business product range, technology adoption, and industrialization, as well as positioning the business for more rapid scaling in the midterm. This guidance is highly sensitive to our assumptions of the impact of global supply chain challenges related to component availability, sub-assembly production, and logistics. As actual conditions differ to these assumptions in either a positive or negative way, we may need to update this guidance and will provide calibration in future releases. Finally, we believe our cash position is solid for 2022, supported by a detailed operating plan. We expect a higher level of cash usage in Q1 and early Q2 as we complete our headquarters relocation project, lab build-out, and the timing of annual incentive payments. We will continue to monitor risks to the plan and take actions as required. Now back to Peter with closing comments. Thanks, Julie. Let's go to page 14. In summary, we're in the business of energy transition, modernizing the grid, and we know our future depends on our ability to meet the challenges of energy transition that our customers must address. The market fundamentals are so strong and continue to get stronger. Where are we focused? First, technology adoption. You can see our pipeline of backlog growth demonstrated in this release. In addition to that, we ask what underpins this. We track many metrics, but two key ones are around our patent portfolio and differentiation and our customer satisfaction. Here we are very pleased with our patent position, and the early indications on net promoter score are strong, being well above 30. We continue to gather data and aim to establish a firm statistical baseline in 2022. Secondly, we spend a lot of time looking at industrialization, meaning process control, repeatability, continuous improvement, and productivity. In 2022, we are targeting project commissioning on time delivery above 80%, allowing for some supply chain movement here and there, and unit cost deflation of 10% year-over-year. Lastly, we consider near-term growth, looking at new orders in 2022 of $100 million-$120 million, and profitability improvements with gross margins stepping up to 12%-14% in 2022. No surprises here. We are focusing on our path to profitability and sustained growth. With these results in 2022 and a further step change in 2023, we maintain our view for profitability by 2024. A final thought. The world has essential environmental goals to achieve by 2050, but these require immediate action with faster, greater renewable energy adoption, as well as significantly more innovation and electrification on the demand side. We won't get there with the business models and the grid designs of the past, but we can get there quickly with technology like Smart Wires. The opportunity is clear. The impact needed is now. If you're an investor, thank you for your support. If you're thinking about us, thanks for following our business. We really appreciate the time you've given us today, and we can now take any questions you may have. Thank you. Thank you. Ladies and gentlemen, if you do wish to ask a question, please press zero one on your telephone keypad. If you wish to withdraw your question, you may do so by pressing zero two to cancel. There will be a brief pause while questions are being registered. At this time we have no- We do have a- We have no questions over the telephone, so I'll hand back to our speakers. Okay, thank you. We do have a couple of questions that's come in over this email that I'll read and Peter and I will answer. From Gard Fredo. Congratulations with the solid revenue development in Q4. Could you comment on the drivers and the step up from Q3. Why from Q3 was so significant? In terms of the revenue? Mm-hmm. Yeah. Gard, we saw, as you remember, right? Q3 was quite light on revenue, and we were really struggling with material availability. Those challenges, quite frankly, continue to be there in the world today, and it's probably not getting easier with the situation in Ukraine. We spend a massive amount of time with our clear to start process, meaning that we have a really detailed analysis of the bill of materials unit by unit, week by week when we look at the production plan. We spend massive amounts of time with the team, with Jabil, understanding what's the availability of every single component going into a SmartValve, what's on order, when's it arriving? If we see disconnects there, basically the team expedite and work really hard. That comes with a cost, right? We've been offsetting that a little bit with sort of buffering on material, but also paying, you know, through distributors and basically any way we can get hold of the material, expedited logistics and so forth. I think that what we saw really in Q4, Gard, was that effort and that process really took hold. The team did a good job, partnered with Jabil and our supply chain, and we simply just delivered on our production capability, frankly, in Q4. Julie, anything you'd want to add? I think that covered it. Good. Another question from Gard. You expect orders of $100 million-$120 million during 2022. Could you provide some insight into these potential orders, the geographical exposure, expansion, new orders or repeat orders from existing customers? Yeah, I can, Gard. I'm just gonna look at some data here, as I think about that. Rough makeup, if we think about the regional spread there, I would expect in the range of 20%-25% to be coming from Latin America. We expect in the range of 20%-25% coming from the U.S. Another 10%-15% from Canada. We've got in a range of 30% plus coming from Europe. And then the balance is really mostly Asia-Pacific, mostly Australia actually. And then there's a few various sort of other deals that would make up the balance there. That could change, right? Just to be clear, we're tracking what we think is our most advantaged position within that range. We also have about the same number, frankly, of what we call backup deals. Things can move around, and so if we have some sort of in for out movement, then those percentages could shift. The regional spread is shifting a little bit from what we saw this year. As I said earlier, Latin America is really stable, but we see some really nice growth in Europe and also in the U.S. and Canada. And so that's sort of where I think most of the step changes will be coming in those markets. Repeat business. I don't have a precise number in front of me, but that indication I gave you for this year, 60%-80%, I would expect looking quickly and we can follow up with you, Gard. It's gonna be. I don't expect it to be that high because clearly we're bringing in new customers. I do think that sort of 40%-60% range will be probably customers that we're already working with. Again, as we're adding customers, that sort of mix changes, but we see the follow on, as I talked about earlier, that follow-through year-over-year from key lighthouse customers is holding strong. Good. We have a couple of questions from Carsten at Pareto Asset Management. He is asking about our growth margin trajectory, talking about moving towards 12%-14%. We'll be back-end loaded with revenues. Any thoughts on growth margins in 2023? Should we continue to see a positive step change? I'll talk about that. The 12%-14% is really driven by increased productions and will be more back-end loaded as we ramp production throughout the year. You know, as we look into 2023, we're not providing specific guidance on margins, but we are confident in our continued path towards increased margins and a positive step change again in 2023. Marcus had a similar question from AP-fonden too around margins, and asked more specifically, why were Q4 margins down despite the significant stronger sales in Q4 versus Q3? That was really driven by a couple of things. The warranty provision that I spoke about had about a 5 percentage point impact in the quarter. Adjusting for that gets us to about 11% for the quarter. Then also we did have a year-to-date reclassification of internal labor costs for production and installation. That also would have had an impact as well. As we look out, I mean, we're very confident in our positioning of our growth margins and being able to expand those over time, and again, starting the journey in 2022 on that. Marcus also asked about lower sales in H1 versus H2, and can that be quantified? For this year? Yeah. Yeah, Marcus, we definitely expect second half to be significantly higher. The main driver is really, honestly, and that is we're obviously closing off now the production runs at the v1.02 and the v1.03. As those sort of come to an end this month or next month, we're then going into the process of, like, ramping up again for the new production. Clearly, you end up in that process, you've got really two-three months where the volume's quite low. I think we probably, when we think about our total year, you know, I'm gonna say, and Julie Andrews, you may have better numbers in front of you, but, like, probably a good 60%-70% is second half. That's right. Yeah. Yeah. Yeah. Yeah. Okay. Another couple of questions just on our cash burn and, you know, roughly what we think we can do in 2023 and are we targeting, you know, breakeven in 2024. You know, I'd say, and this is specifically from Carsten. You know, we're not issuing 2023 guidance today on our cash burn, but we do expect to continue to improve on that and even improve as we exit 2022. Again, you know, our guidance was that we would see a higher level of cash burn in the first half of the year and start to see that improve as we exit the year and would expect another step change in 2023 as we have higher revenue, higher margins, and expect higher profitability, and then bridging into, you know, a cash breakeven in mid-2024. Okay. Good. Anything else? No? I think that's it. That's it. Anything on the phone at this point, Simon, or still no questions there either? No, that was our questions we had. No more further questions. Okay. All right. Well, guys, thanks again for your interest in the company. If you're an investor, again, thank you. If you're looking to invest in following us, we appreciate your time and interest. We wish you have a great day and take care of yourselves. Thanks. Bye-bye.