Good afternoon, and welcome to Blink Charging's Q1 2023 Earnings Conference all. All participants are in a listen-only mode. There'll be an opportunity for analysts to ask question at the end of today's presentation. If you should need any assistance during the conference, please press star zero on your touch-tone phone. Please note this conference is being recorded. A replay of this call will be available on the investor relations page of the company's website. At this time, I'd like to turn the presentation over to Vitalie Stelea, Vice President of Investor Relations. Over to you. Thank you, Jenny. Welcome to Blink's Q1 2023 Earnings Call. On the call today, we have Brendan Jones, President and CEO, and Michael Rama, Chief Financial Officer. The discussions today will include non-GAAP references. These are reconciled to the most comparable US GAAP measures in the appendix of our earnings deck. You may find the deck, along with the rest of our earnings materials and other important content on Blink's investor relations website. Today's discussions may also include forward-looking statements about our expectations. Actual results may be different from those stated. The most significant factors that could cause actual results to differ are included on page two of the Q1 2023 earnings deck. Unless otherwise noted, all comparisons are year-over-year. Now, regarding the investor relations calendar, Blink Charging will be participating in the Cowen Sustainability Week Fireside Chat & Investor Meetings on the 6th of June, Needham Automotive Technology Conference on the 7th of June, the ROTH MKM Ninth Annual London Conference on June 21st and 22nd, and at the same time, the JPMorgan Energy, Power, Renewables Conference also on June 21st and 22nd. Please follow our announcements for additional investor events in future. Now I will turn the call over to Brendan Jones, President and CEO of Blink Charging. Please go ahead, Brendan. Sure. Thanks, Vitali, and good afternoon, everyone, and thank you for joining us. Before I dive into our Q1 2023 accomplishments and financial results, I'd like to say a few things. First, I'm honored to be appointed as the President and CEO of Blink Charging. I'm also proud of the incredible team at Blink and all of that we have been able to accomplish for our customers, our hosts, our clients, as well as our shareholders and employees. As a company and management team, we would also like to thank Michael Farkas for his time serving as our Founder and our CEO. His commitment and forward thinking have helped shape Blink to become the company it is today, and that is a leader in the EV charging industry. We look forward to having Michael on our board and continue to work with him in the future. Let's get on with the earnings call. If we now allow everybody to go to slide 4, I would like to provide a quick refresher on Blink and our capabilities. Blink is the only fully integrated charging company in the U.S. market today. We offer the most flexible business models available to property owners. We control our own design, manufacturing, and network services. Our products have been designed to meet the charging needs of EV drivers, fleet companies, municipalities, auto OEMs, commercial real estate owners, and property managers. We provide a diverse choice of business models. We own and operate chargers. Of course, we sell chargers and services to our hosts. We offer hybrid options where Blink provides hardware and software, and we split the revenue with the host, and they provide the capital for installation. Our flexibility and our vertical integration of advanced hardware and software is what differentiates Blink from our competitors in the EV space today. Let's transition to some highlights on Slide 6. Our Q1 total revenue increased 121% to $21.7 million when compared with the Q1 of 2022. The service revenue increased by 216%, and very importantly, our network fees, which are recurring in nature, increased by an impressive 911%. That's a really big number, so I'll say it again. That was an increase of 911%, and we are very excited about these positive developments. In the Q1, we contracted, sold, or deployed 6,461 chargers. That represents an increase of 103% compared to the Q1 of 2022. Additionally, in Q1, Blink Charging dispersed 14 GW of energy across all Blink networks globally. A key thing is most of the chargers that provided this level of energy were all Level 2, and they did not have demand charges associated, which increases the cost of doing business. Subsequent to the close of the Q1, in fact, a little over a week ago, I believe, we announced the acquisition of Envoy, an EV car sharing company by our subsidiary, Blink Mobility. Previously, we announced that Blink was awarded a $7 million grant by the state of New Jersey to implement ride-share services and charging for electric vehicles in underserved communities. We are pleased to welcome Envoy into the Blink Mobility family. We'll have more announcements about the synergy of this acquisition as we move forward. If we jump on to slide 7 now, on March 16th, we announced an IDIQ contract with the United States Postal Service to provide up to 41,500 EV charging stations and network services provided by Blink and others. We are very proud of the Blink team. To date, this is one of the largest fleet contracts for chargers and services in North America. The selection process was extremely rigorous. This successful contract win is a testament not only to our products and our network, but also to our talented team. We have already shipped the first order in April, we look forward to continued collaboration with the United States Post Office and other government entities. Now let's shift gears to slide 8. You will see the growth to date and forecasted growth for electric vehicles and EV chargers that power them. The transition to EVs is accelerating, and with our comprehensive portfolio of charging products and solutions and our unique approach to providing flexible business models to meet all preferences, we are ideally situated to capitalize on the expected exponential demand for EV charging as more and more EVs hit the road. Now let's look at slide 9. Within the last 12 months, Blink has contracted, sold, deployed, or acquired over 38,000 chargers, both domestically and internationally, bringing the total charge account for the company to nearly 73,000 chargers since Blink's inception. Right now, 78% of the total company-wide chargers were deployed in North America, 22% have been deployed internationally, with the majority being in Europe. On slide 10, you will see just a partial sampling of our customers. They represent well-established commercial entities, multifamily complexes, planned communities, healthcare facilities, fleets, and municipalities around the world. Our advanced chargers, combined with flexible business models, position us very well to attract new customers and long-term contracts. For example, in addition to the United States Postal Service, we signed a contract with one of the largest car dealership groups in the nation for a large number of DC fast chargers. Overall, the automotive segment is very strong for Blink. In Q1, we entered into agreements to provide chargers for over 600 different dealerships that span a variety of owners and brands. This is out of more than 3,000 dealerships that we've already installed to date. Some of the other notable customers in this quarter include one of the largest parking structure operators in Belgium called APCOA. We continue to evaluate sales and installation opportunities with CBRE property management company in Europe and Asia. In addition, we continue to provide chargers to our long-term partner, Interenergy. In fact, in Q1, we shipped over $1 million worth of chargers to Interenergy. Let's go and look at slide 11. You can see examples of our innovative product portfolio. We have a wide variety of products, ranging from residential L2 chargers to high-powered DC fast chargers, as well as our Vision charger. With these offerings, we service both residential and a variety of commercial customers. The ETA for our innovative Vision charger is the end of Q3. Let's go and look at slide 12. You can see our current selection of DC fast chargers. We think it is important to reiterate that Blink is a global company addressing the demand for power in different DC installation settings that vary around the world. In Q1, we contracted for the sale of approximately 300 DC chargers, and our backlog to date includes approximately another 400 chargers that we expect to be on the Blink Network once launched. This makes it a minimum of 700 DC chargers that we expect to commercialize during 2023, and that's the minimum. Let's go look at slide 13. In 2022, we completely redesigned and launched our Blink Network and Blink Charging mobile apps. The strength of our network is another competitive advantage, as it allows drivers to find chargers, book sessions faster and easier, while enabling our site hosts more flexibility in managing their stations with added features, seamlessly integrating chargers into everyday life. As we've said before, this is available on both iOS and the Android platform. Let's look at another topic: synergies. We announced in Q4, just to remind you, we did this with the help of McKinsey & Company. We performed an extensive analysis to discover and outline synergies with a focus on our acquisition of SemaConnect. As a result of this analysis, we identified are now targeting a total of $28 million in synergies related to this acquisition. This includes an additional $1.3 million in revenue synergies we identified during Q1 of 2023. Today, we have captured $5.3 million of operating expense synergies as of March 31st, 2023. We expect to begin realizing these expense reductions and revenue synergies in Q2 and Q3 of this year. While we realize there are synergies from the SemaConnect acquisition, in addition, we expect to achieve incremental synergies globally from integrating the acquired networks into the state-of-the-art Blink Network. This summer, we will have all Blink entities combined under one network. This will eliminate expenses related to engineering and maintenance of legacy networks today. With this, I will pass the presentation on to Michael Rama, our CFO. Michael? Thank you, Brendan, and good afternoon, everyone. Turning to slide 16, total revenue in the Q1 of 2023 grew 121% year-over-year to $21.7 million. Product sales in the Q1 of 2023 were $16.4 million, an increase of 104% over the same period in 2022 as customers purchased greater volumes of our commercial chargers, DC fast chargers, and residential chargers. Product sales for the Q1 of 2023 also include revenues generated from the 2022 acquired companies of SemaConnect and EB. Q1 of 2023 service revenues, which consist of charging service revenues, network fees, and ridesharing revenues, were $4.8 million, an increase of 216% compared to the Q1 of 2022. The year-over-year growth was primarily driven by greater utilization of our chargers, the increased number of chargers on Blink Network, revenues associated with the Blink Mobility Rideshare program, and incremental service revenues from acquisitions. Gross profit for the Q1 of 2023 was approximately $4.5 million, an increase of 186% over the same period last year. As a percentage of revenue, gross margin was 21% in the Q1 of 2023, about 4,800 basis points improvement when compared with Q1 2022. Operating expenses in the Q1 of 2023 were $35.4 million compared to $16.6 million in the prior year period. The year-over-year increase reflects the increase in non-cash share-based compensation of $5.8 million in Q1 2023 versus Q1 2022, increases in non-cash amortization of intangible assets of $1.8 million, as well as operating expenses associated with the Q2 2022 acquisitions of SemaConnect and EB. We remain vigilant about cost reduction opportunities and additional synergies, as mentioned by Brendan earlier. Adjusted EBITDA for the Q1 of 2023 was a loss of $17.8 million compared to a loss of $12.4 million in the prior year period, largely due to the higher operating expenses, as I just mentioned. Year-over-year, Q1 Adjusted EBITDA improved by over 4,400 basis points as a percentage of revenues compared to the Q1 of 2022. Adjusted earnings per share for the Q1 of 2023 was a loss of $0.49 per share, compared to a loss of $0.34 per share in the prior year period. non-GAAP Adjusted EPS is defined as adjusted net income, which excludes significant non-cash items such as amortization of intangible assets and non-recurring acquisition-related expenses, divided by the weighted average shares outstanding. Turning to slide 18, you will see that sequentially, we saw a decline in gross margin when compared with Q4 2022. This is primarily due to Blink selling significantly more contract manufactured chargers, which carry a lower overall contribution margin compared to the units manufactured in-house. As we've discussed, we've been expanding our manufacturing capabilities to replace all contract manufactured chargers with in-house produced units. This will result in a significantly improved gross margin profile of our products. We expect the gross margins for the remainder of 2023 to meet or exceed gross margins realized in the second half of 2022. Moving to our cash position. As of March 31, 2023, cash and cash equivalents totaled $103.2 million. All in all, Q1 was another strong quarter for Blink. We saw record Q1 product revenues and service revenues. We continue to execute on our strategy, and we believe the foundation is strong. We see robust demand for our products and services in North America and internationally. Before I conclude, I would like to welcome our new board member, Christina Peterson, who is an experienced public and private company board member and infrastructure investor with over 25 years of operating experience in the finance, electric power generation, and tech sectors. I will now turn the call back over to Brendan Jones for a few final comments. Go ahead, Brendan. Hey, thanks, Michael. Clearly, Blink's 2023 is off to a strong start. We delivered another record Q1 revenues for Blink, and growth is in recurring revenue is nine times larger than the Q1 of 2022. What is particularly exciting to me is the strength of the Blink operating model. When we look at the industry, we appreciate that the industry is under some pressure and that there are hard questions starting to be asked about the path to profitability across the entire EV space, including Blink. There are a few points here to make about Blink. We are growing at a very rapid rate, and this industry is still in the very early innings. We have carefully built the structure and capabilities to support a larger company. As anticipated, we are very quickly growing into that structure we have created and continue to adjust. In the coming quarters, our operating losses will progressively come down as our business model scales and revenues grow faster than our operating costs. While I don't want to pinpoint an exact timing, given we have a lot of moving parts, including such things as acquisition, integration, additional synergies, new product launches, what I can share is that achieving sustained and positive free cash flow is our priority. Let me make sure everybody understands that. This is our priority. We have a clear path to get there, and we will scale, and we will continue to keep you appraised of our progress as we move forward. As we look to where the industry was and where it was headed, we are very excited about the opportunity that lies ahead and extremely optimistic that we have the right team in place building on our success to not only be a player in the energy transition, but to lead it on strength of our innovation, experience, and continued leadership development. As we implement our forward moving strategy, we are well positioned to continue and accelerate growth and bring electrification to more markets and more communities than ever before. I take this role with great confidence in our dedicated and passionate employees around the world to build the future of the companies. Before I conclude and hand over for the closing remarks, I would like to share a new Blink charger for the European global markets. This goes hand in hand with our comments that we are working to replace higher cost contract manufactured chargers with our own built-in-house. On slide 19, you all are the first to see this. You can see the final design of our EQ 300 connected charger that will come with single and dual-mounted plugs capable with our latest network functions. This charger fits the needs for most applications and has vast addressable markets in all EU countries and other international countries throughout the world. With this, I'm going to conclude. We are excited about the future, about what the future holds for Blink. With that, we will now open it up for questions. Remember, this is my first time, so be easy on me now. Questions? Operator, please proceed with questions. I apologize. My mic was on mute. I apologize. Thank you very much. The floor is now open for questions. If you have any questions or comments, please press star one on your phone keypad. We ask that while posing your question, you please pick up your handset if you're listening on a speakerphone to provide optimum sound quality. Please hold while we poll for any questions. Thank you very much. Our first question is coming from Craig Irwin from ROTH MKM. Evening, and thank you for taking. Craig, your line is live. Good evening. Thank you for taking my questions. First, Brendan, I'd like to say, you know, welcome to the role of Chief Executive. We all look forward to working with you and to your leadership. Michael did an amazing job founding the company and, you know, we look forward to watching you bring Blink to the next level, so. I wanted to ask just a big picture question really around the leadership change. You've been a key person in helping the team execute strategy over the last, you know, couple years and, you know, played a role in helping form the strategy that's in place. Is this change, in leadership, is your assumption of the role of CEO potentially going to lead to a pivot or an alteration of the strategy as far as diversification to international, captive manufacturing, you know, a portfolio approach to, serving your customers and the other major items, in the business strategy at Blink that we've all been, used to and followed the growth and success with? There's no major departures. I mean, we're gonna continue as we have been under Michael's leadership to evaluate the marketplace and see what the market is doing. This includes in the manufacturing of product, new features and benefits that need to be added to our network strategy. We're gonna look at that both in the U.S. and globally. I mean, we are a global company. We're expanding in Latin America right now, which on a percentage basis is one of our hottest markets. We're gonna continue to adjust the product strategy to fit all these markets combined, whether it's the charger we just showed you, and that's predominantly for Europe, or other chargers that we're gonna have in development that might suit some of the needs in Latin America, where they have a little bit of a different standard because they follow the Chinese standard. We're gonna continue on a product and network basis to follow the path and pivot where necessary based on customer and market demand. Also, we're gonna continue to focus on the sustainability of revenue that we get from the owner operator model, where we put a charger in the ground, and especially when you consider that with L2 charging. 'Cause L2 charging is 10 to 1 at a minimum of the cost of installing a DC fast charger. When we install one of those, we look at our portfolio today, and 50% of our chargers on the owner operator model that are installed are producing in the double digits of utilization today. We're gonna keep doing that, we're also gonna be fully exploitive of the sales model, where we can provide sales, get network fees, provide better margins for Blink so they have a better return, and also continue to innovate for the fleet space and other spaces where they don't wanna be an operator. They just wanna buy the chargers. We can provide network services, fleet services, and maintenance contracts to have sustainable and recurring revenue on that model as well. That's the basic strategy that we set out. We're gonna continue to maintain that and improve upon it and flex where needed as the market develops. Thank you for that. I really like that you highlighted the European Level 2 charger, because my next question was gonna be about gross margins. You know, obviously, it's an important item to understand the sequential progression here. I was wondering if you could maybe give us a little bit more color on the mix we would need to see for gross margins above 30% as you indicated in your guidance. Is it just this Level 2 charger, or are there possibly other chargers that we should expect vertical integration to benefit margins in the second half? Yeah. It's across the board. As we've talked about before, in the previous quarter, we're developing 2 different versions of a DC fast charger. We have the Series 9, which is the low kilowatt DC, which we'll have on the market within the next 30 days. That's an in-house produced charger at a leading margin in the industry. Simultaneous to that, we're also in full development of the DC fast charger starting at 180 kilowatts and going up from there. That'll be manufactured out of the facility that we'll have open and operating as of July 2024. Both of those products will allow us to scale, innovate new products from there, and have greater margins on the DC fast charger market. Let's look at L2s. In the U.S., we designed and contract manufactured the majority of our L2s. That is shifting now where 50% plus are gonna be non-contract manufactured. By the end of the year, as we up capacity in our Bowie facility, we'll be able to increase that to 60%, 70%, and 80% of the chargers sold in the U.S. market are produced by Blink at a greater margin. We have some inventory that we have to play out, which you saw here in Q1, and some sell down strategies on some legacy products, both in Europe and the United States. We're gonna continue to push through all of that inventory in the coming quarter. Based on the bookings that we're looking at, we have a great influx of bookings, and that's new sales order that are on the newer higher margin product. As Michael indicated in his comments, we expect much improvement on margin as we move into Q2, and indeed, that should manifest fully in Q3. Excellent. Last question, if I may. This 700 DC chargers that you expect in 2023 is a pretty solid number. Can you maybe? Mm-hmm. talk to us about the diversity of customers and installations you expect there? Do we need to see any of those customers announced for you to have backlog and deployment visibility? Then, you know, other companies in the space have faced margin headwinds from their steps into DC fast charging. You know, I know you're vertically integrated. I assume this is a vertically integrated product. Should this be something that has margins consistent with the targets that you're pursuing? It's a great question 'cause when you look at DC fast chargers, they're much higher in gross profit than your L2, but they're lower in margin, right? While we continue to increase, and most of these chargers are going into grant programs that we have won in the U.S. They're going into dealerships. They're going into municipal developments that we've won contracts for, et cetera. On DC, what you're gonna get is higher revenue but lower margin as a rule, right? L2, you have the ability to get that margin up on a consistent basis above 30% on a per new unit retail basis. DC is a little harder there. As we shift the contract manufacturing to our own, away from contract into our own manufacturing, we're gonna see significant margin improvement on it right now. We are doing third-party contract manufacturing on most of the DCs right now. That'll begin to transition with the Series 9 charger, and then by next summer, we'll have fully transitioned out of that. Great. Well, hey, congratulations on the expanded role. I'll go and hop hop back in the queue. Thank you. Perfect. Thank you very much. Your next question is coming from Matt Summerville of D.A. Davidson. Matt, your line is live. Thanks. Same sentiment, Brendan. I wanna talk about, you know, again, kind of the gross margin sort of issue. I mean, if I look at product sales, I'm just rounding, $16 million this quarter, $16 million last quarter. Why would there be such a change in mix of units sold that were manufactured by, you know, contract manufacturers? That's not just readily apparent to me. Are you having manufacturing issues in-house? Are there transitory sort of things playing out as you're trying to ramp capacity? Can you help us understand that a little bit more? Yeah, sure. I mean, one of it is, we had a bit of an overstock situation in contract manufacturing chargers. We put an emphasis on the sales team to sell those down, to clear the warehouse of those units, and that are on the legacy units. Simultaneously, the bookings were all basically loaded into... The bookings and shippings were loaded in the March and the April timeframe of the higher margin product. When we look at on a per month basis, we had one of our best revenue months in March, which is indicative of the trend that Michael Rama pointed out. Most of those were the built in the U.S. chargers that we built at the Bowie facility. It was a bit of seasonality, a bit of a push on getting rid of the legacy pro-product in the beginning of the quarter, and which we did a great job on. We reduced that inventory by 50%. The same thing in Europe, where we were pushing to get rid of a lot of the legacy product there, and we were able to do that in Q1 as well. We still have a little bit to go, but yeah, it was seasonality, availability. At the same time, keep in mind we're increasing capacity. In Bowie, Maryland, we were able to get up to 12,000-13,000 units out of that facility. We have now signed a lease or we're about to sign it to improve the capacity out of that. We'll get to by the end of this year, up to 30,000 units per annual out of that facility just this year, and we're leasing enough space right now to be able to get that out up to 50,000. You got a little bit of availability mixed in there as we sold out some of the Series 7 and 8 chargers. You have a little bit of legacy in that we sold down on. When we crank the numbers and look at bookings, what the bookings will come in, bookings are, you know, are our best leading indicator of future revenue, we see that the revenue and the margin improves over time. As to your point, might be useful to cite a book-to-bill metric for product if you have that available. Similarly, I heard you make a comment on utilization. I was wondering if you could sort of frame up utilization rates now maybe versus a year ago and what the uptime in the field is for your install base now maybe versus where it was a year ago. Thank you. Yeah. To go back to the comment that we made earlier, that comment specifically looked at 50% of our installed owner operator chargers. Of those 50%, the current utilization is, they're generating revenue, and it's in the double digits. We're gonna have the exact number for you. We've committed to releasing next quarter. It's a good number. It's higher possibly than what some of our competitors have just recently released. Now, simultaneously, when you look at our overall portfolio, if you go back three years, we started instituting a much rigorous process in site identification for the owner operator model, and we will look at those group of chargers that have been installed in say the last three and a half years. The overwhelming majority of them are in that 50% that are in double digits in utilization and revenue. We're confident now in the systems we've put together to identify high utilization properties and then the cost of installation, which we've been able to reduce. That all corresponds to when you're looking at the owner operator model for L2, it's a quick return on investment, and then it's sustainable revenue for the future as a result of the utilization of those chargers. We will continue to sharpen the tool. We use a combination of RGAS with some home-built software appended with a lot of other data sources in there to make sure we're accurately pinpointing locations that will be accretive to high utilization. We've been doing that for about 3 years, and it's working. I was also asking about uptime and then book-to-bill. You just broke up. Can somebody who hear it repeat the question? I'm sorry. I was also just asking about uptime and book-to-bill. Uptime right now on our chargers is in the high 90s. What we're doing now is we're working with other groups on a quality initiative, 97.5 is the minimum uptime you wanna get for your chargers, both DC fast chargers and LT chargers combined together. You also wanna make sure that you're building in redundancy in all your builds. We're not gonna build one charger or even two chargers anymore. We're gonna make sure that we install four plus as many spots as possible. That way, if a charger's down, we've got redundancy in every station we have across it. We're going on a lot of quality measures to improve quality. A lot of previous quality issues have been, in fact, related to legacy chargers that we had in the market. In 2022, the sunset of the 2G and 3G networks, old legacy chargers that didn't have upgraded systems, they of course went online. The customers weren't able to charge as a result. We've replaced most, but not all of those chargers. The ones that are site-owned, there's not a lot we can do if the site host does not want to upgrade and replace his charger. He has to be convinced to do that over time. Book-to-bill? Book-to-bill, I don't have that metric in front of me, but we'll get it for you. Great. Thank you, guys. Thank you very much. Your next question is coming from Chris Souther of B. Riley. Chris, your line is live. Hey, guys. Thanks for taking my questions here. Just on the charging margins looked down sequentially, any color you could provide there on the puts and takes this past quarter? I assume the lower sequential revenue is just seasonality, but, you know, the charging costs and host fees both increased. Any insight you could provide on the quarter and kind of the trend there would be helpful? Okay. Michael, you wanna take that one? Yeah, you're right. On the revenue side, it is a function of seasonality. As you know, obviously in the winter months, at least in the U.S. and, you know, West Coast had a lot of rain early in the Q1, so that caused a lot of, you know, a lot of, you know, call it, charging revenue, seasonality, if you will. You know, so that. You know, there's also a function or part of the charging costs that are gonna be costs regardless if you're using the charger station or not, right? They're still live, active and some of the costs we're seeing in Europe are starting to increase. That's what we're seeing coming through on the, in Q1. Got it. Okay. On the D.C. rollout, are all those product sales, or are there plans to use the ownership model for D.C. fast as well? You know, obviously those are higher ticket items, so kind of curious how we should think about, you know. There's a little bit of a mix. There's a mix in there, but the majority are sales with a Blink Network and a Blink service contract is on the majority of them. We're gonna get the network revenue on that. We'll get some service revenue on those. The ones that are owner operated will of course get the revenue. The owner-operators are mixed in there, the overwhelming majority, maybe with a few exceptions, and these would be. They're not included in the sales total that we gave you, but there's some charges that we're acquiring for replacement of existing charges that need to be ripped out of the ground, but those aren't in there. We have, in most instances, grant money to offset the installation of the DCs, where we're going on the owner-operator model. Okay, got it. How should we just think about maybe kind of the overall CapEx for the owner operated or for, you know, the Blink ownership model, you know, for the full year? I'd be curious. Let's segment it out, and I'll have Michael see if he has numbers to complement. When we look at DC fast charging, we're gonna have an initial outlay in cash to get the chargers installed, but up to about 80% on average of that money is gonna come back because they're under grant programs. We have a whole bunch of chargers that are gonna be installed in those. There is some one-offs that will need the capital, but not full capital for a new site. It's where we're replacing existing chargers with new and upgraded chargers. We don't have to put all the work into the ground on those. It's basically a rip and replace where there's available power. That's gonna be a lower cost, mostly what it takes to remove and refit the site, but not bringing in a transformer, no more trenching. None of the high cost items in the installation will occur on that. Now on L2, it's all in our forecasted budget in terms of the capital needed to install our forecasted amount, for the L2 model, and it's all very reasonable based on the much lower cost of installation. For details, if those are available, I'll turn it to Michael. Yeah. I'll just give a little color. Obviously, as you could see in the quarter, you know, we had a purchase of property and equipment of about $1 million and a half. Remember, that's not just all installation. That also includes we had some new vehicles for the rideshare program, but also we had another increase in inventory of about another $5 million. Right there, if you wanna take that on a linear between the two, you're looking at about, you know, $25 million-$30 million-$40 million, say, of CapEx. I include inventory 'cause that's really capital in nature. It comes to the cash flow statement as operating. We could see that type of profile going in, you know, for the remainder of the year. As Brendan mentioned, some of these dollars that are being spent this year already are for the grant money programs that we'll expect to see come back, you know, probably into latter part of 2023 and probably early part to mid part of 2024. Okay. The other thing to add to that is a significant percentage of our LT chargers that we're putting in the ground are under the hybrid model. Under the hybrid model, we provide the chargers, we provide maintenance, we provide upgrades if the charger breaks down. The site host pays for the installation of that charger. Under the hybrid, we don't pay and don't need the upfront capital for installation. They do that, we pay for everything else, and we split the revenue. Got it. That makes sense. All up in the queue. Thank you. Thank you very much. Your next question is coming from Sameer Joshi of H.C. Wainwright. Sameer, your line is live. Thanks, Brendan, Michael, for taking my questions. Once again, Brandon, congratulations on your appointment. Thanks. Could you just give us a little bit of update on the integration of the network in Europe and other, at other places? Have you faced any difficulties? Is it on track? Any color would be helpful. Yeah. You know, it's an interesting question. If you know, ask a developer if there's any difficulties, they'll tell me it's all on track. You ask a business person, you know, you're gonna get a different answer. You know, it's a Herculean task to take four networks and actually five, and combine them under one, right? We're fortunate at Blink. You know, when we made the move two years ago to bring Harjinder Bhade over from his endeavor at that time and to build a network that is equal or better to what ChargePoint has, they built the network with this in mind. We have the final SemaConnect integration is going to take place in less than 30 days. Blue Corner will take place 30 days after that. The rest of Europe, the rest of chargers we have in Greece, South America and all others will switch over at that time as well. We've had some minor delays in the development process as we looked at certain functionality and needs that had to be in different countries. That was predominantly the big delay. You had different specifications and different rules. In Europe, you need what's called a billing engine because they don't use credit cards like we do. You had a little bit of separate development there. Overall, the emphasis and the slowdown has been to ensure that we do the right usability testing and the quality is there, and we do it as bug-free as possible. We are very much looking forward in the U.S. to have one network, 30 days, and then throughout the summer we'll have one network globally, and it'll be one Blink. All of that will be nothing but savings for us as we move forward and we redeploy those engineering assets or take the save to the bottom line. Understood. Thanks for that. Next question is on the IDIQ contract. What is the revenue potential and bottom line impact or positive impact of this in 2023 and maybe 2024? It's to be determined. The margins of those products, I'll give you a little bit of feedback on that. The margins are good, so they're above our target. Our target, our minimum target's 30%, our goal is 35%. They're above that on the individual product margins today. You know, the volume of the contract is being released over time, and it's a little bit of performance. How well you perform, you could up your share of the overall bucket. I will say this: We've received positive feedback from United States Postal Service. We came in on time and earlier than any other provider. We made sure that our network passed the tests, that our hardware passed the firmware and hardware tests, and they all did it in flying colors. We shipped out the order and got it to them in record time. We're in great position to be able to reap higher revenues and more of our unfair share of the total of the 41,000 chargers. I believe we're really well positioned, and we'll continue to put the emphasis on delivering quality and timeliness to this very important client. Understood. you know, good luck on that. My last question is just, if you can share any update on the rideshare spin-off. I mean, I know Blink Mobility is a wholly owned subsidiary, but how easy is it to key without, and integrate the Envoy acquisition into it? Sure. What we're doing right now is we're looking at both the Blue LA platform and the Envoy platform. We're going through another synergy exercise on that as we speak. We kicked that off last week. We're looking at everything from customer service to IT support, to development, to how many agents you have there in the field, both sales and customer support agents. We're gonna, you know, keep separate business units in Envoy and Blue LA, but yet have shared services beneath the scenes, so we reduce the overall expenses. From there we will get, you know, an overall performer on the business. We'll start, you know, the roadshow on the spin-off once we put the business plan together. It really helps that, you know, we have additional grant money coming in from L.A. We have the new grant money of $7 million coming in from the state of New Jersey. We have other grant applications that want that. With the spin-off, with the grant money, with the synergies, we really believe that we're gonna put together a very, very good product for the market. Look for more details on this as we get through the month of May and into June. Michael, do you have any additional comments beyond mine on those? I think that's accurate. Good. I'm good. Great. Thanks a lot, Brendan, Michael, and good luck. Thank you. Thank you very much. Your next question is coming from Oliver Huang from TPH&Co.. Oliver, your line is live. Good afternoon, everyone. Thanks for taking our questions. Just a couple of quick ones at this point. First one being a follow-up. Is there any color that y'all are able to provide with respect to how margins at the Bowie facility will ramp once it's kinda fully ramped to that 30,000 and 50,000 unit benchmarks on the Level 2 chargers? I can provide this, and I'll see if Michael if he has some other additional color to add that. Bowie, when we did the SemaConnect deal, we wanted the manufacturing footprint when we acquired them, right? Also, on pure product sales, they had one of the best margins in the industry. It hovered between 40% and 50%. That same product is the one that we're innovating upon now, and we're using that product in place of lower margin products that we've been selling for the last four or five years. As we continue to have this shift from Blink contract manufacturing to those higher margin products coming out of our Bowie facility, you're gonna see this improvement in margin. Michael can elaborate further, but when we look at the company as a whole, we like the chargers, we like the manufacturing, both in the US and India, we like the margins, and we really love the customer base, that they had. Those now are all proving very opportunistic as a combined company as we move forward. Michael, any other color around that? Yeah. No, I'll add a little more color. As we saw in the second half of 2022, and even prior to the acquisition that we saw in due diligence and even in the financials that were filed, you know, the margin profile overall, not just on the product side, but on the total gross margin on SemaConnect, including the network fees, they have a high network capacity and they drive a large revenue, large margin on the network side of it as well. That was in excess of 50%. The product might be at the 40%-50%, but there's additional margin that came from that part of their business. As we see more of the product, I don't want there to be an expectation we're gonna start seeing 50%-60% margin 'cause remember, we're still own and operate, and until utilization gets to a higher level, we'll still have a little bit of, you know, cost run on there. Plus, as we put more units in the ground, depreciation amortization affects the gross margin. Just wanna give that expectation. We're confident with the manufactured product is gonna, you know, like the profile that we saw in the second half of 2022 will bring those margins up. Awesome. Thanks for the color there. Just for my second question, just on the cost side, given some of the cost reduction initiatives such as the $5 million from the SemaConnect synergies and just some other noise, whether from recent acquisitions and stock-based comp, any sort of guideposts that y'all are able to provide in terms of compensation and G&A run rates relative to the $30 million or so that we're seeing per quarter over the last couple? I'll add. Obviously, we haven't seen the full impact of the synergies that we've started in Q1. We'll start realizing those and seeing those come into play more in the towards the end of Q2 and to the Q3 of 2023. I think on an OpEx compensation levels, we are very conscious of compensation levels. Our share base comp, if you recall, there was an award in the second half of 2022 that is just about fully expensed through right now. We'll start seeing the share base comp come down. Again, we're very conscious on the cash part of compensation expense, and we're really monitoring hires and integrations and synergies and, you know, to ensure that the integrations and the synergies are taking full effect. Yeah. The only comments that I'd say, it's a major focus, right? We'll continue to go through all the various entities of the companies, both here and in Europe, and look for these opportunities of redundancies and synergies that have been achieved as a result of an efficiency gain. We'll also continue to look for these opportunities of where the best cost of labor is gonna be for a particular function, and we're doing a lot of that work right now. As many of you know, we have 3, 4 different facilities in the United States that are in operations. We got Phoenix, we got Bowie, we've got the Miami office, we have the office in Los Angeles. We have 3 offices in Europe, and we have a major manufacturing facility and a development center in India. We will shift jobs to get the best bang for our dollars. We'll continue to eke efficiencies out of that. We still have some G&A reductions that are going to happen within the U.S., in Europe, that we haven't yet taken action on. They will hit later this year. We're going to have some upticks as we add more manufacturing and technician to build and develop more chargers as well. Overall, we're going to continue to get more efficient, reduce redundancy, go to more system-based process away from manual processes as we continue to move forward and improve the company on all access points. Awesome. Thanks for the time. Thank you very much. That appears to be our last question. That concludes our question and answer session. I will now turn the call back over to Vitalie Stelea, VP of Investor Relations. Thank you, Jenny. We thank you all for your interest in Blink Charging. This concludes our call today, and you may disconnect.