Eco Wave Power Global AB (publ) (NASDAQ:WAVE) Q4 2023 Earnings Call Transcript

Eco Wave Power Global AB (publ) (NASDAQ:WAVE) Q4 2023 Earnings Call Transcript April 2, 2024

Eco Wave Power Global AB (publ) isn’t one of the 30 most popular stocks among hedge funds at the end of the third quarter (see the details here).

Operator: Greetings. Welcome to the Eco Wave Power Fourth Quarter 2023 Earnings Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] Please note this conference is being recorded. I will now turn the conference over to your host, Inna Braverman. Ma’am, you may begin.

Inna Braverman: Thank you. And thank you, everybody for joining today. The economic landscape in 2023 was marked by unpredictability and numerous challenges. As this year’s start, both consumers and economies pray for possible recession. When faced with such challenges, we at Eco Wave Power understood that we must adapt and learn how to navigate through the turbulence and have learned over the past year that adaptability is a cornerstone of success in business, especially in today’s rapidly changing economic landscape. Our adaptation process worked and we were able to demonstrate our resilience by increasing our revenues by 1,076%, not including funds received from grants and other sources, and decreased our net loss by 36%, ending the year with $8.4 million in cash and deposits.

An aerial view of a power plant, symbolizing the company’s investments in energy infrastructure sector.

Although the company’s burn rate of cash has decreased substantially, we were able to achieve significant milestones such as the grid connection of our Israeli project which already sent the first megawatt hours of clean electricity from the waves to the Israeli National Electrical Grid, marking the first time in the history of Israel that wave energy was officially connected to the National Electrical Grid. In January 2024 we have also entered an investment agreement with Shell MRE for our first U.S. project at the Port of Los Angeles, according to which Shell will participate and co-fund the development of Eco Wave Power’s first project in the United States. The agreement was entered by Shell Technology Marine Renewable Program, which is an R&D group pursuing the mission of finding, screening, testing, and developing marine renewable energy technologies to achieve more value with lower emissions and help build the critical energy infrastructure for the growth of the blue economy.

For the terms of the agreement Shell will contribute 50% of the production, installation, and scheduled maintenance costs of the Wave Energy pilot station with scheduled payments in line with key project milestones. The project is expected to be up and running during 2024, this year. This is the second collaboration between Eco Wave Power and Shell MRE, with our first collaboration being in the form of conducting a comprehensive feasibility study for Shell aimed at identifying the top locations for commercial onshore wave energy stations on the US coastline and worldwide. The three month in-depth feasibility study, which now has been completed, has shown favorable conditions for clean energy production in multiple locations in the US and globally.

Harnessing the power of the ocean waves is a crucial step in reshaping the renewable energy landscape to meet the net zero goals we must reach if we want to save our planet. We are thrilled to partner with Shell to bring wave energy to life in the United States. This partnership not only underscores our commitment to sustainable innovation, but also signifies a pivotal moment as we move towards a cleaner, greener future. Our latest achievement during March 2024 is the securing of the final license for our first commercial scale project in Portugal that is expected to be finalized by March 2026, in two years. We are incredibly excited to be moving forward in transforming an unused marine structure in the City of Porto to a source of clean electricity.

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Q&A Session

Portugal’s 1,115-mile coastline presents a massive market for the ocean energy industry. We believe that this landmark project — with this landmark project, Portugal will serve as a global example of the power of wave energy. In addition to environmental benefits, the station will provide a boost to Portugal’s economy, adding many local jobs over the coming years. Lastly, we would like to update that we have also reinforced our financial position by providing feasibility studies and project planning engineering services for Shell, Chevron, Rogan Associates and Jesa Group, in addition to applying for and securing multiple grants such as our recently announced Innovate UK grant with leading UK universities, Toshiba and other prestigious groups.

While Eco Wave Power had an eventful year, in the financial market clean energy stocks including wave stock did not perform well as we believe high interest rates and lagging efforts to combat climate change have impacted the sector. According to CNN, Plug Power shares have slipped 63% this year, Enphase Energy shares have plunged 60%, SolarEdge Technologies have declined 71%, and NextEra Energy have slid 29%, showing that even the largest and most resilient energy companies have taken a hit by the financial situation in 2023. Even considering the above, we strongly believe that with the recovery in the economic landscape and other positive initiatives, such as the Biden Administration Inflation Reduction Act, which according to the Bank of America announced more than 270 new clean energy projects with total value of $132 billion in private investment.

There will be a significant opportunity for investors in the renewable energy market. We believe that renewable energy and wave energy in particular is a significant part of the world’s future and offers a significant opportunity for decarbonization combined with profitability. In fact, Peter Krull, director of sustainable investments at Earth Equity Advisors, that manages a portfolio that focuses on stocks in industries from alternative energy to battery technology to green transportation sees the current rut in clean energy stocks as a buying opportunity for investors. I would like to finish by saying that as the founder and CEO of Eco Wave Power and one of the largest shareholders of WAVE Stock, I am disappointed by the performance of the WAVE Stock on the financial market.

Currently, the company’s market cap is below its cash position. However, at the same time, I would like to say that since the incorporation of the company, none of the founders of the company have sold any shares, as we believe strongly in the company. And I’m very pleased to share that we believe that the company is financially stable and resilient and has enough funding, expertise, and support from strategic partners to proceed with the execution of its upcoming projects in the Port of Los Angeles, in Portugal and in other places. I believe in Eco Wave Power’s team, in Eco Wave Power’s technology and in the global ambition to fight climate change. As a result, we are looking forward to receiving the Financial Supervisory Authority of Sweden approval to purchase back up to 10% of the company stock on NASDAQ, which is the highest percentage permitted by law, to reinstate our belief in our company and our technology.

Thank you.

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

End of Q&A: