Hi, and welcome to today's webcast presentation with I-Tech. Today, we have the CEO with us presenting, Philip Chaabane. My name is Martin Westerlund, and I'm from Finwire. If you have any questions for Philip, please use the form that is located to the right. With that said, I'll hand over to you, Philip. Please go ahead. Thank you so much. All very welcome to our webcast regarding the third quarter of this year, 2022. We, as I-Tech, are proud to present this strong quarter, a quarter with a very strong movement in the positive direction. Actually, the strongest quarter so far in basically any aspect, and we will obviously dive into that. Other things that has happened over the quarter was a good technical conference, maybe not so big in the investor sector, but from a technical standpoint, we're happy to see that I-Tech is in the center of bringing this industry together discussing technical matters, knowing that there's no real obvious platform for this industry to discuss together. Our mission is to bring people together, make sure we enhance each other's capability to continue to innovate, and we're happy to take the lead in this initiative, so therefore, some proudness on that. If you followed us on LinkedIn, you've seen a lot of that. We also acknowledge, finally, I should say, some strong contributions, or at least starting to see the contributions from the larger number of premium products that now are available on the market. As you know, some of those came out under the COVID turbulent times in 2021, and that has been interesting time to see when they actually show up in our numbers, and now they do. That's the introduction to the quarter. I'll walk you through as many aspects as I can. Initially, there are a few slides on who we are for those who may be new. I-Tech is a Swedish-based, actually Gothenburg-based, biotech company acting in the coating technology field. We're listed as a Nasdaq First North entity. We are relying heavily on strong IPR, that is patents, both in the back end and front end. And it includes, in this industry, difficult to achieve regulatory approvals, where we are one of very few companies to actually hold regulatory approvals in the marine industry, for any kind of compound actually, but certainly exclusively for our compound. That sets a quite high entry barrier and a very unique position. The purpose with what we do is to make shipping more efficient. It is to keep the underwater hull as smooth as ever possible over the duration of time, meaning avoiding marine growth that will enhance drag and create fuel losses. The cleaner it is, the more efficient the ship becomes. The sustainability aspects are obviously important, and that doesn't only account for what's going up to there, but also what's released into the water. How is that done? It's through our one product, the ingredient technology Selektope, that is a part of an advanced coating system sold by the global paint makers, meaning that we become a supplier to them. The setup of all this and knowing that the number of leading paint makers is highly limited makes our business case very scalable. We can reach high numbers without adding other investments, new investments, or a lot of people. All of this makes the company unique and very interesting to look at from an investor standpoint, and also to work in, of course, for us. I touched upon the sustainability aspects and that is the big thing in this industry as well as in many others. It's the right window of the opportunity right now coming through with this kind of technology. Not the least because shipping is recognized to be responsible for some 2.3%-2.6% of global CO2 emissions, equaling the total consumption of Germany as a nation, as an example. That itself puts some light to the industry that there is savings to be made and forced to be made, actually, to make sure that global transport of goods can continue to occur without negative effects on the environment or on oceans as such. In this case, looking at the antifouling coatings or any hull coating, actually, the potential within the industry is claimed to be around 100 million tons of CO2 savings versus the average situation on the fleet as of 2009. If all those ships had the most optimal hull coatings, this is the number of CO2 levels that could be saved. Selektope is a part in that puzzle, of course, and that's driving our motivation to go to work. It's not only about emissions to air, it's about what's going into the sea as well. Protecting the marine ecosystems is an integral part. That's twofold. It's both what you release into the ocean, meaning approved active agents, biocides are clearly advantages, and certainly those who are very specific, like Selektope, has a very favorable profile in this area. It's also the combined effect of coatings and its ingredients to avoid transport of alien species, sometimes invasive species, which is recognized as a big problem on a fouled hull. That's an important area. The third area is obviously to preserve natural resource and to try to use as little as possible to do the job, so to say. The limited amounts of agents available are all needed. Question is how to optimize the matrices for the best possible output, both on performance and the leaching into the seas. Selektope plays a role here being an interesting candidate combined with most of the other agents. These three aspects is important for us. More in depth than what do we do, well, as I mentioned earlier, it's a biotech-inspired company, so to say. It started off with research in a very niche, almost geeky area called barnacle larvae understanding or sciences, that combines biological sciences, chemical sciences, and so on, to actually understand why these creatures settle and how they are built up to see if there's any way to repel them from a surface rather than use excessive amounts of previously at least questionable compounds to kill them. The result of that quite extensive research at University of Gothenburg and Chalmers was a molecule that we now call Selektope, that's part of the paint system and actually has the very repellent effect on specifically the barnacle larvae and to a certain extent on tube worms. The specificity of the molecule makes it possible to use in tremendously small quantities, which is a big interesting advantage for the paint makers who then can find different ways of formulate. It also gets into the scope of being possible to combine with a lot of other things. It acts together with other active agents in the paint to deliver its effects. It's the first time ever biological sciences is driven into the paint system to actually create this unique effect. Needless to say, from the previous slides, it's also approved on both the regulatory end, but also confirmed and approved by paint makers that it does work quite, and it's also very powerful, as you see from the picture at the bottom here, where you have a smooth area with Selektope with no growth, and a more traditional type of coating with a lot of growth. Selektope acts as a booster, or it can even replace and reduce amount of other chemicals in the paints to deliver the performance needed. Obviously, we're in the shipping industry. The potential if all of the boats, the industrial boats and the big commercial vessels would use Selektope in every single liter of antifouling, we would head towards $350 million-$500 million market potential on sales of our product. Of course, there are other alternatives to protect your ship. We're trying to reach and grab as far as we can in this journey, but that's the maximum potentials. When we started off this, we were all thinking that the leisure boat market would be the easy grab because simply it's not five years between each repaint. It's maybe one year, maybe two years. There's a lot of boats laying still most of the time, and then hence having hard fouling as a main problem, which also is quite difficult to get away from a maintenance perspective. It turned out to be super difficult from a regulatory perspective as the whole industry is in a complete revamp of regulatory criteria, and therefore that market, at least in Europe, is not accessible for new active agents at the moment. That took a shift back in 2010, somewhere around there, where we start to understand that other markets are more compelling, and that's where they save fuel. The fuel driving aspect became so much more interesting and also obviously the volumes. We looked at the leftmost pictures, mostly then from 2010 onto where we are today. All our sales almost are into this commercial shipping industry of huge ships, transporting goods over the oceans, the large Atlantic Oceans, so to say. The further you go, the more important the fuel bill is and the more attention you pay to the efficiency measures, the hull coatings being one of those. The good thing with all this is that there are many of those vessels, and they have to dry dock every three-five years, depending on age and so on. That means there is a recurring amount of ships coming into the dry dock, and there's a recurring amount of opportunities to apply new paints. Hopefully, most of those with Selektope in the future. That's. We also see the working boats, could be supply ships, tugboats, e.g., a lot of other more local coastal ferries and ships that also uses antifoulings and pays a lot of attention to not only the fuel bill, but the environmental concerns in the more nearby water environments. Normally, that translates into avoiding transport of alien species that may come from the larger ships, and the smaller ships are then spreading this problem around the coastline. They also pay a lot of attention to coatings. Also in that area, a lot of ships very fixed dry docking intervals altogether. Very interesting annual opportunities for a paint maker. We are happy to say that despite we're not looking actively, or we are looking actively, but understanding there is a long delay in this process. We do have some products on the leisure boat market, but not explicitly in the larger European market. It's mainly related to Japan at the moment. We are trying to put ourselves in a nice position in the United States in this area, as well as some other countries, where leisure boating is prominent. This is what we do. This is the market. Now let's move into the quarter. Needless to say, I guess you have read the very strong numbers of the quarter of SEK 21.3 million in net sales compared to SEK 13.8 million. That's a 54% difference. Very proud after so many years, well, so many quarters during the COVID time to have not seen the growth curve coming back up, now it is. That is clearly exciting. Gross margin maintains at good levels. Growing with maintained gross margin is good and even better to also present a strong EBITDA on the growth curve. Essentially, this is the essence of our business model, actually. We have had some struggle with cash flow previously, at least from a quarterly report perspective, although we're quite solid on this over a year time, so to say. Now it turns out really good with on this quarter. Cash balance is also very strong. As you all know, there's large variations in currency exchange rates at the moment. We're happy enough to have sourcing in dollars, selling in dollars, and relatively low cost in Swedish kronor, which means we do have an effect on the magnitude of the numbers. Although the percentages on gross margin, as an example, remain the same, obviously, if the currency moves up or down. The magnitude clearly is affected. The organic growth is 26%, and that's an important number for you to keep in mind. Obviously, the EBITDA margin of 32% is very, very attractive, shows some indication of the potential in this business model. What's driving this? Well, this quarter was a strong dominant position from our largest customer who is, we believe, now starting to experience a stronger demand of their many Selektope containing products. There's 15 or more, not on the global scale, but in their different regions combined with the global availability of products. That is hopefully, well, that is likely the driving force in this quarter, and we hope to see more of that, of course. It's the first quarter we really see an effect of those launches of new products that they did certainly in Japan in 2021. That gives us some confidence that those are actually being pushed into the market in a good way. We do have some lower operating expenses that supports the profitability, meaning keeping control of cash, but also planning differently. Sometimes the third quarter comes in a bit lower on the expenses side. Quarter four, normally a bit higher on the expenses side, so that will probably shift a bit. There is also delays in the regulatory system. I wrote a bit about that in the Q3 statements that we have a delay in the U.S., administrative burden on these what do you call them? Institutions, the chemical agencies or environmental agencies is extremely high. It's not only related to us at I-Tech. We hear the same from our customers who need to register the products from our fellow colleagues with other active agents. It is super difficult to get attention and to keep any sort of timeline when it comes to authorities at the moment. Many of the investments that were expected to come in impacting cash flow, then of course in the year will not come in because we don't get the responses needed from authorities, mainly in the U.S. I should also say, which I also highlight in the annual report, and that's just for information, that for that same reason, there's been a delay in expectations of conclusions of reapplications and new applications within the European Union. That's just for noting, a noting remark, so to say. We have two and a half years ahead now before any re-evaluation will be performed. We look at the first nin months now, comparing the first nine months of several years, the last four years in this case. You see also our traditional 12-month rolling curve displaying the EBITDA figures, revenues, and gross margins. Starting then on the left-hand side still, we for the first nine months are exceeding the full year sales of 2021. We're exceeding any other quarter in the past. As you see, the 2020, 2021 were flat years, even decreasing a bit. Obviously, not the most exciting times. Now it's looking better, in the direction we were hoping and expecting, and the direction we saw until COVID hit in the middle of 2020. Gross margins remain strong, even increasing, at the same time as net sales are increasing. There is a certain volume correlation here, but it's also a customer mix discussion, and it's also incremental improvements here and there. Positives on all those figures for the first nine months, which I think is the first time ever, comparing these years. Very sound quarterly performance here. Retaking the growth curve is important, and we made our small calculation on the CAGR from IPO year 2018, comparing again the first nine months with each other, finding almost a 30% growth over that period on CAGR. A quality-based metric showing that we're on the move, although we had some disruption in the growth for a few years. I think that's about it on this slide. I mean, we have said that the business model is proving itself, that is maybe the main message of this, and that we really are on the right track again. There's still a growth potential, of course, as we do have less contributions from other customers this quarter. If all of these start to work, and come in with a growth figure on the same quarter, we will obviously have even better figures. Needless to say, there is a lot of potential out there. We're still only at the very start of the growth curve in all our customer accounts. We haven't really got the traction on the leisure boat market either, that will at some point contribute, although much later. To display a bit on what's going on in the past years, I'll give you some more ideas on explaining the result and maybe doing your own estimations for the future. We have seen an increase of products to the market. We're now about 20 commercially available products. Again, stating these are not globally available, all of them. They are heavily skewed towards certain Asian countries, but those are countries with high activity. That is Korea and Japan specifically. Another important metric is a number of customers that are picking up the technology from a commercial standpoint. We have 6 of the 9 largest customers in the world using the Selektope product in their paints on regular basis. That's an important quality measure that not only one customer is using it, although they're dominating, we're seeing a good pickup among the others. I also have to say that all of the nine largest brands, including a tail of a few, are working intensively in the R&D departments, finding ways to use Selektope in their best way on their markets. The underlying activity is more expanded than what you see on this slide. Unfortunately, many of these customers don't want to have communication out there, meaning we are not able to talk about who all these are. We only have three in the official domain, but now we know there are three more that are continuously contributing. This is a slide on some general aspects on the shipping industry. It's not directly related to Selektope, but sometimes good to give you a glance of what's in the analytical reports out there. So first of all is the ClarkSea Index, which is a weighted index of the earnings of the freight rates across all ship types. That you know it obviously has big variances between container ships and bulk ships and so on, but disregarding all that, you see that the ship owners in general are making much more money now than in the past. Even the index is at levels not too far away from the very extreme peak it was just before 2009. It's coming down lately now, but still at high levels. The earnings is positive because that means they are ready or putting themselves in position where they at least get more interested to invest in long-term efficiency technologies, such as the best possible antifouling coatings with the best possible hull preparation methods. That is good. That's the biggest takeaway from this slide. High earnings increases the investment appetite, and we look forward to see more of that, although there's a lot of uncertainty on inflation and so on at the moment. If this remains, it looks good. Another slide now relating to the new building market. As you know, many of our products out there are related to the new building segment of large ships. We see that the order book versus the total fleet is about 10%. 10% of the fleet is under renewal, that is, compare that to around 50% in the order books in 2008. We think that although the contracts are lower 2022 than before, they will bounce back up because the fleet needs to be renewed in a faster speed to comply to future CO2 requirements, meaning being equipped with engines that can manage dual fuels, other technologies that are normally fitted onto new build vessels and so on. I think we're waiting to see a bigger pickup on this general industry. Limiting factor at the moment is the capacity at yards. I think there's about, you know, it's 40% below. Many shut down. There's about, I think, 110 or so active yards at the moment of larger scale compared to 300+ in 2009. There's been a huge shrinkage, shortage of newbuilding yard capacity in the world following the economic crisis since the supercycle that brought us up to 2008. That, of course, makes it difficult to place an order and have any sort of expectation of when to get it. It also pushes up prices on newbuilding, combined with increased steel prices and so on. That also is one of the explanations why the orders are not booming in 2022 despite the need to renew the fleet. The positive is the outlook moving forward. The challenge is the current situation on capacity and raw material pricing. This is our last slide. We try to share our own views on our opportunities and challenges for you to guide yourself in the estimations moving forward. We definitely see a continued effect of the introduction in January 2023 now. Of the CII, the carbon intensity index, which is a driver to improve day-to-day performance on a ship. That includes having to do a lot of investments to put yourself in a position where you get a strong rating, and then you get a better charter contract, and then you probably get better financing and better insurance terms, maybe even in the future. That is driving this industry in the premium direction, even to the ultra-premium direction of coatings, and that's where Selektope belongs. That's important and will be important for quite some years ahead. We do have a growing customer base. That's important. Everybody doesn't want to work with any customer. It's important for us that we are available and an option in any paint makers portfolio list. We hope to be able to expand from the new building area to the dry docking area. We do experience an enhanced activity in our customers R&D development portfolio. We cannot go into details at all or highlight any specific example. We're just confirming that we're getting closer, getting into more activity, and we're also, through our own investments, putting ourselves in a position where we can provide more relevant information on how to handle, how to formulate with Selektope, in the new circumstances that our regulatory bodies are putting forward in different regions. On the challenging side, it's obviously the delay of regulatory processes. EPA is delayed, you know, I think one and a half years since we started, and that's gonna be a long process. We're used to that in this industry, fortunately, but it's always tough. The EU BPR is also in delay. It doesn't affect us that much. The EPA does affect us because we need a starting point there. There's the global economy challenges with lower expectations on GDPs in many areas, short-term, hopefully, and that will pick up as soon as we hopefully get back to more normal geopolitical situation at some point. Yeah, that's estimations and expectations on all different directions. Raw material prices are still a challenge for many, although I think it's moving in the right direction. For us, this is not really a problem at the moment. It seems like from a customer perspective, certainly not in our own backyard. With those words, say thank you for tuning in. I'm ready to take questions. Thank you very much for that presentation, Philip. Now we'll move over to the Q&A section. Start off with the first question. With a growing cash position of about SEK 50 million, are you planning on dividends or are you looking for investments? If so, what are you looking for? That's a relevant question and a question that is being discussed at the moment because that's, you know, seeing the good trends in the company. We can make a different perspective on what kind of cash we need for bad times and so on. Now it looks strong. That's why we can start a discussion on how to expand and use this money in the best possible way. I would say that it goes more in the direction of finding a way to build I-Tech stronger rather than provide dividends. That's not finalized in a discussion with the board yet, but that's the direction I would believe it goes. Thank you. We'll take the next question. You mentioned in the report the administrative backlog of European authorities regarding biocides. Could you elaborate a little more firmly what this means to you? Definitely. I need to explain further. It's a backlog also on the paints. Both paints and biocides need to get through. I-Tech and Selektope, alongside our fellow active agents in the industry, are approved in the EU system. The problem is that that's not enough. The paint makers need to get approval of their paints as well in the system to be able to sell them. There's a 12-year backlog here. Although we, together with our fellow colleagues, were approved around 2014 to 2016, 2017 on the biocide level, only one single antifouling product has been approved since the regulation was implemented in 2012. Like 10 years down the line, only one product has come through. That doesn't affect those who had products on the market with known technologies before that date. That means traditional copper-based, you know, paints with agents that's been known longer than what Selektope has been known. They continue to sell, and can have read across on product updates and so on. For the new biocides, which means Selektope and another one called Econea, it's super difficult to get into the European revenue stream because it's just a total and massive backlog in the European system. That does affect us in the sense that our customers cannot get their products through, and we cannot get the sales in Europe to the levels they should be. There are certain exceptions where some European countries have said that they will use old legislation until agreements are reached on the new one, but that's limited to a few countries. Sales in Europe are to a very limited amount of countries. That's in direct effect in Europe. I think that was the only question. There was nothing on EPA in that question, right? Correct. The next question here. Do you see any risks for inventory buildup from your largest customers, or should one consider the accelerated growth trend to continue driven by underlying demand? The inventory levels are said to be in good balance. We believe this is the effect of actual growth. Okay. Thank you. Take the next question. Why isn't Selektope included in all paints your partners sell? Why it's not included in all paints? Was that the question? Okay. Yeah. Most importantly, because there are other more established alternatives that have been working for many years, and that creates comfort. It's also so that all ships doesn't need all type of active agents all time have the same profile on the antifouling coatings, so to say. Some simply are in less need of a Selektope version maybe, while others are more in need of that power. That explains it. Also the fact that some authorities are very late in approving products puts them in a position where they need to have a different products portfolio in one part of the world and a different one in Europe. That may have its issues as well. I think the third thing is that, generally, it takes a long time to optimize a coating that is compatible or possible to compete with in terms of cost, performance benefit to those who's been proven for a long, long time, where they have the guarantees in place and all that. It takes time to build up a new product portfolio with a guarantee scheme on the same level they have on the ones that they have been running for the last 20-25 years. Regarding your European customers, would you say that they're impacted by the negative macro trends at all? Our customers are definitely impacted by in a certain way. I would assume. I'm not sure in what magnitude. I think shipping is doing quite well, as I just saw on the slide. Our paint maker customers are probably having quite decent discussions with their customers because there are money there, and they need to do a transformation to more sustainable operators. In that sense, I think that's overweighing other problems at the moment. Of course, if the negatives of this inflation cuts consumption, cuts the need for shipping goods, then we're in a completely different situation, of course. The only thing we need is the ships will anyway need a coating. Question is if they're well-financed enough to continue the efficiency journey or if they will have to pause it. I do believe, and that's only my own reflection, that the pressure on creating a greater efficiency gain on the shipping level will be stronger than the negative effects. Thank you. Take the next question. You had an increase in other operating income. What is the underlying driver for that? That's a good question. I have to check that with the CFO, of course, but we do have currency contributions that potentially are there. There's no other sales going on in the company. We're not getting paid for other things than our product, so I will have to come back to that more in detail. Please email me that question again. Do you expect currency-adjusted growth to accelerate the coming quarters or to remain constant or even decline? Difficult to say where the currency is going. A lot of people know tremendously more about that than I do. We focus on organic growth, the actual growth on the volumes we ship out, and we believe there is good grounds to expect a positive outlook on this, as long as the global trends doesn't change completely. Where the currency will go, I don't know. Very difficult to say. I could also maybe clarify that, we're buying in dollars and selling in dollars, which means the magnitude of the numbers you see is obviously dependent on the exchange rate quite a lot. The relative numbers within each quarter, such as the percentage of gross margin, remains the same, even if currencies go up and down. Could you elaborate on the reasons of the slowdown from some of your leading customers? There is no logical explanations there. That's just variation over the years that comes in. They maybe didn't get the contract they were expected to get. These products are normally for the new building market. They maybe lost projects to a competitor. They may have found other deals to make with that ship owner, applying different coating of a lower grade because there was another issue in other end of the ship. I don't know. This is the movements that come and go all the time, so there's no conclusions to be drawn from this. Would you classify the macro environment as favorable or unfavorable given the inflation and oil prices? Oil prices are generally good because the good payback on the efficiency investments. On that end, that's good. Inflation, as long as it doesn't impact global trade, I guess I'm hoping that everybody can absorb the inflation all the way through, then that doesn't matter. If that starts to put an impact on how people consume and how much goods is then needed to be transported, the whole industry will be impacted by lower profitability, and at some point, that will harm also the more high-end products in this industry. Finally, what's your outlook for 2023? Again, we don't provide outlooks to the public, although we at some point quite soon, within probably quarter one next year, we'll have new public targets out there. We continue to do our work, continue to try to grow organically as much as we can. We see a lot of positivism in this end. Then there's things that we can't control that we, you know, we'll have to talk about quarter by quarter. Okay. Thank you very much, Philip, for presenting today and answering our questions. A big thanks to all of you who listened to this presentation with I-Tech. I hope you have a great rest of the day, and I'll see you next time. Thank you and goodbye.