Earnings Call Transcript - WAVE Q4 2023

Inna Braverman, CEO

Thank you all for joining us today. The economic environment in 2023 was characterized by uncertainty and various challenges. As the year began, both consumers and economies were concerned about a potential recession. In response to these challenges, we at Eco Wave Power recognized the need to adapt and navigate through these turbulent times. Over the past year, we have learned that adaptability is key to success in business, especially in this rapidly evolving economic landscape. Our efforts to adapt have proven effective, as evidenced by a 1,076% increase in our revenues, excluding funds from grants and other sources, and a 36% reduction in our net loss, leaving us with $8.4 million in cash and deposits by year-end. Despite a significant decrease in our cash burn rate, we achieved important milestones, including connecting our Israeli project to the grid, which successfully delivered the first megawatt hours of clean electricity to the Israeli National Electrical Grid. This marks a historic occasion in Israel as it is the first time wave energy has been officially integrated into the grid. In January 2024, we entered an investment agreement with Shell MRE for our inaugural U.S. project at the Port of Los Angeles, where Shell will co-fund the development of this project. The partnership is facilitated by Shell's Technology Marine Renewable Program, focused on the research and development of marine renewable energy technologies to create more value with lower emissions and enhance the energy infrastructure needed for the growth of the blue economy. Under the terms of this agreement, Shell will cover 50% of the production, installation, and scheduled maintenance costs for the Wave Energy pilot station, with payments aligned to key project milestones. We expect the project to be operational during 2024. This marks our second collaboration with Shell MRE, following a comprehensive feasibility study to identify optimal sites for commercial onshore wave energy stations along the U.S. coastline and globally. The three-month study, now completed, revealed favorable conditions for clean energy production in various locations both in the U.S. and worldwide. Harnessing ocean wave energy is essential for transforming the renewable energy sector to meet our net zero goals, which are crucial for protecting our planet. We are excited to team up with Shell to realize wave energy potential in the United States. This collaboration not only reflects our commitment to sustainable innovation but also represents a significant step toward a cleaner future. Additionally, in March 2024, we secured the final license for our first commercial scale project in Portugal, expected to be operational by March 2026. We are thrilled about converting an unused marine structure in Porto into a source of clean electricity. Portugal’s extensive coastline offers a significant market for ocean energy. We believe this project will set a global precedent for wave energy. Beyond its environmental advantages, the station will stimulate the Portuguese economy by creating numerous local jobs in the coming years. We are also pleased to report that we have strengthened our financial position through feasibility studies and project planning services for partners like Shell, Chevron, Rogan Associates, and Jesa Group, along with securing multiple grants, including a recently announced Innovate UK grant in collaboration with top UK universities, Toshiba, and other esteemed organizations. While it has been a notable year for Eco Wave Power, clean energy stocks, including wave energy stocks, have generally underperformed in the financial market. High interest rates and slow climate action efforts have significantly impacted the sector. For instance, notable companies have seen considerable share declines, with Plug Power down 63%, Enphase Energy down 60%, SolarEdge Technologies down 71%, and NextEra Energy down 29%. Despite these challenges, we are optimistic that as the economy recovers and with positive developments like the Biden Administration's Inflation Reduction Act, which has led to over 270 new clean energy projects worth $132 billion in private investments, there will be substantial opportunities for investors in the renewable energy market. We believe that renewable energy, particularly wave energy, plays a vital role in the world's future and presents significant potential for both decarbonization and profitability. Peter Krull, director of sustainable investments at Earth Equity Advisors managing diverse portfolios, considers the current downturn in clean energy stocks a buying opportunity. In closing, I want to express my disappointment in the performance of WAVE Stock in the market, as it is currently valued below our cash reserves. However, it's important to note that none of the company founders have sold any shares since the company's inception, as we have strong faith in its future. I’m pleased to share that we believe Eco Wave Power is financially stable, resilient, and well-equipped with funding, expertise, and strategic partners to execute projects in the Port of Los Angeles, Portugal, and beyond. I have confidence in our team, our technology, and our mission to combat climate change. We are looking forward to receiving approval from the Financial Supervisory Authority of Sweden to buy back up to 10% of company stock on NASDAQ, the maximum allowed by law, to demonstrate our confidence in our company and technology. Thank you.

Operator, Operator

This concludes today's conference, and you may disconnect your lines at this time. Thank you for your participation.