AnteoTech Limited (ADO) Earnings Call Transcript & Summary

Good morning, and welcome to AnteoTech's Investor Briefing following the release of the first half of Financial Year 2026 report. On the line, we have Managing Director and CEO, Merrill Gray, who will go through the presentation up on the screen. Just a reminder, we have had a number of pre-submitted questions. We'll allow a few to be submitted through the Q&A button at the bottom of the screen if we have time to get through them. But with that, Merrill, I'll hand it over to you. Thank you.

Thank you very much, Simon. First off, I'd like to thank you all very much for attending and taking the time to go through our half yearly results. And I've also included in the presentation a little bit of a look-forward on how we're positioned now and where we're heading. So next couple of slides through. And yes. Okay. So in summary for the half year, we have, as I said, a cost base structure reset. We've essentially set the company up in a way that we are both streamlined and highly focused on everything that the shareholders are asking us to do, which is conversion of sales as well as strategic partnerships, and I'll come to the sales pipeline a little bit further on in the presentation and cover the half yearlies looking backwards first. In that time, there have been a number of key developments for the company. And that's come about essentially as a far great -- as a result of a far greater market segmentation and real focus on the value proposition and the offerings that we have for customers. So as you can see, Ultranode X which many shareholders were very pleased to see the results that have been achieved there, and I've got a little bit more about our joint product with BDS, which has -- we -- I've already said in this presentation later on that we plan to get the first of those beta samples of that product by the end of this week. And then we've found Anteo S has quite a demand in the market in terms of ceramic-coated separators. And then, of course, we've got in the life sciences space. Quite a lot of work has been done, and I'm pretty excited about going through some of that as part of this presentation. So all in all, looking back, we have established a very solid base for moving forward. We did the $3.5 million capital raise, and that has given us runway to deliver on the things that we have in the pipeline, which I'll go through more. Next slide, please. So here, on this particular slide, if you take out the Serum Institute revenues, which is the pink box, and of course, those revenues are roughly every 6 months, but what happened in the half year was we did not receive -- we received the order, but we did not dispatch and we're not able to recognize the revenue for the Serum Institute. So -- but if you take a reconciliation between where we were last year at this time in terms of the half yearly results and where we are now, as you can see, there's quite a lot of work being done on really streamlining the business and making sure that the organization is very focused and essentially doing what's really critical and more with less. And on the right-hand side, you can see some of the things that have been achieved. Next slide, please. And this table is directly out of the half yearly report and represents that data similarly. And again, another comparative around where our operating cost changes have been. And the next slide is around revenue, which I know there have been a number of questions come in, and I'll cover a little more about our revenue and potential revenue coming forward. Obviously, I'm not able to provide sales projections. But the next one, please. But what I can say, and this is -- this slide is actually a month by month on samples dispatched. And you can see at the top, I've again reiterated, as we've discussed with many shareholders, the actual sales -- structured sales process that we go through. And what's pretty -- what's really important, obviously, is the evaluation and feedback stage. And when I come to some of the -- where we are in the pipeline for our business units, that's really where much of this half year has really -- the timing has really been spent and as well as sales negotiations. And I know there's a level can you go faster. And we are doing everything to look at better communication, being extremely targeted on who we're engaging with, making sure we have sales and marketing expertise in terms of professionals supporting the technical business units. And I'm very pleased, and we'll be very pleased to go through where that has gotten us to so far. So next slide, please. So really, going through this slide about what's been achieved for the battery business. As I've already said, BDS, we've got a formulation and we have got 6 identified potential customers, and it's all being run through our U.S. partner, Black Diamond Structures, who are obviously being based in the U.S. can manage the logistics of sending samples out and really look forward to. The team has committed to me that we are in the process this week of getting samples out, and I look forward to providing update through social media on that. Wyon, I've got a little more later on in the presentation about Wyon, and so I'll come back to that. But there is progress being made and actually sales are being assembled in the miniature Wyon cell design. That's quite a big step forward. They've actually moved on from coin cells into their own battery design. And we're very conscious of keeping shareholders up to date as there are material results that are provided to us by Wyon. I would like to mention that we will be in South Korea next week and in front of potential customers that have received samples and have already started testing. We'll be there with Kangshin and as part of the InterBattery conference. And that is a little bit -- that is how we are moving forward in terms of making sure that we are very targeted on the conferences that we attend on the leads that we pick up and the structured process we bring those leads through. So Kangshin, our distributor in South Korea will be accompanying us during that conference, that period that we are in South Korea. And we have specifically requested support from Austrade to assist us to get into other customers that sit outside of Kangshin's distributorship. So I look forward to keeping everyone up to date on that as well. And then, of course, Ultranode. So development of Ultranode is continuing at a pace, very much around where it is going to end up in terms of a product. And we are very -- really -- it's really exciting for us to be in front of 2 companies that are actually battery manufacturers and trying to negotiate to get Ultranode in as a next-generation anode for drones. We very much targeted these particular manufacturers because they are already manufacturing or have manufacturing facilities coming online in the near future. So we need to be in there and get a position in those new products. Next slide, please. When it comes to Life Sciences, that business unit has been incredibly busy and very successful with -- in a number of areas. So of course, the relationship with Serum Institute continues to be managed, and the head of the business has recently met with them in India, and they have taken some prototypes of new products. So we continue to keep that relationship as strong as possible. And then there's some other things that are in the pipeline, and we'd like to think big things coming soon, but we have -- I want to be very clear, we're very -- any news we have will be released. And what we can say is that we have been engaging with a number of other companies that we've engaged with in the past and have a relationship with, and they understand our products, which makes things a great deal easier. Okay. So the key thing for Life Sciences is that AnteoBind can be used in a number of different end users for diagnostics. So whilst we -- lateral flow and Luminex has been a focus for us, chemiluminescence and ELISA plates is where there's been work done. And we have actually been working on a comparison, a paper that sets out the comparison of AnteoBind's performance when it comes to chemiluminescence and have made very good progress on getting that out in the very near future. So looking forward to that. So yes, I think moving on to the next slide. Just wanted to -- that's really the key for the half yearly. So it's about getting everything sorted. We will, of course, continue to make continuous improvement, making sure everyone on the team is very focused on the bottom line and knows what they need to be doing to deliver and getting ourselves in a position financially to be able to deliver. So next slide, please. That's all centers around our strategy that we released, which was around making sure that we're in jurisdictions which are ready and really receptive to the technologies and the products that we've got. So whether it be South Korea in terms of its leadership and battery manufacturing or the U.S. in terms of particularly around drones and the opportunities that are really emerging there with very significant growth profiles or whether it be India, of course. And India brings with it some complexities and challenges, which I'll come to in another slide. So moving on, just a bit of a snapshot for those who are new. This is how we are now presenting our products for the battery business. So everyone is familiar with Anteo X. And on the left is Anteo S, which is our separated product which is still in trial stage but is with a number of customers for trialing. So we're really looking forward to feedback when we're in South Korea in particular on that. And then SiMRAX which is a beta test name for the joint product that we've worked up with Black Diamond Structures. Next slide, please. What I would say across all of those products is that when we're -- what's been very important for us to grow the number of samples that we've been able to dispatch and the genuine interest in our products has been making sure that we communicate at all times the benefits of our products to our customers, whether it be better performance of the batteries, whether it be cost reduction of their overall manufacturing or whether it be ease of use, and that is a high value. And it doesn't matter which business unit we're talking about whether it be batteries or life sciences. That's what our products deliver. On the alternate side, the battery business has also been making very good progress, significant progress, particularly around being able to show a potential partners how far the technology has come and how it's able to perform in different applications. So just the next slide is -- the next couple of slides are in here because I think that would be really very much of interest to our shareholders. Of course, people stand -- well, our shareholders understand but what's really critical for us out in the big market is for people to understand how Ultranode competes with other products that are available. That's what these partnerships that we're working on are all about. We need to convey just how beneficial it is, particularly at commercial scale from a supply chain perspective and the lowest cost production perspective. Micro silicon is relative to some pretty expensive and very complex alternatives. Next slide, please. And this is one that we really bring it together in terms of specifics around applications. And I would say, as I said earlier, this is what it's really about for us, is to make sure that the customers -- the potential customers that we're talking to. We're very specific about where we can add value to the end products. And so their sales and our sales. So for Ultranode 95, again, there's a fair few assumptions in here, but what's really important is about the power, the potential power that Ultranode can bring in combination, of course, with the cathode and the overall design of the cell and then the potential, as you can see, 2 to 3x thinner that space and volume side of things. So these are critical of course for drones and how drones -- the duties that drones have in terms of take off with payload, distance they need to travel. And this is really part of us getting into a joint development with manufacturers of batteries for drones. Okay. Thank you. So just coming back a bit to what -- to the progress we've made over the last 6 months with in terms of Black Diamond Structures and Ultranode. So we -- this is the bottom of this page on the left shows our beta testing flyer that we have to engage with the potential customers. And we've gone through and as a team, working in their collaborative joint development agreement. We've worked as a team on making sure that everything is done so that the customer experience with the trial samples is as positive as possible. On the Ultranode side, there's been steps in the right direction, and I have been communicated the frustration people have around Wyon, which is essentially going well. It's very slow, but it is going well. The steps are around commercial scale, ability to scale up. The quality of Ultranode going into batteries for testing and now the quality of anode going into Wyon's specific cell design as the anode. So we really look forward when we can, as soon as we can, we information from Wyon who, of course, running the test has been provided to us to providing information to shareholders. Thank you. So again, just to finish off batteries. This is where we stand in terms of the very specific, very targeted pipeline that we have been building over the last 6 months. And of course, those lead indicators of the samples being out testing -- being tested, the test results coming back and the sales negotiations is the nitty-gritty that people are expecting us to do. So here, we've got sales qualified leads and a number of samples for dispatch under negotiation. And then across our -- obviously, across all of our products, Anteo X, Anteo S and I concluded SiMRAX here yet, but also Ultranode what we've got with potential customers and then what we're actually negotiating. And as I've said earlier, we really use in a very targeted fashion conferences, particularly where we get support. So again, in South Korea, we have support from Austrade. So they have a booth. We don't pay for that booth, but we're able to have people come and meet with us and set up pre-meetings, which is what the team is focused on. So we're really looking forward to that. And in the U.S., there's a very -- the second biggest conferences coming up at the end of March. And we've already done started communications on our products leading up to that and expect to have some good meetings there. Thank you. Right. Flipping to our Life Sciences business, and many of you will have seen this slide before. The key here is that on the left-hand side in terms of Multiplex activation kits. What we sell to the Serum Institute and how they use it is not something that every company, in fact, a small percentage of the market can use our product in that way, and that's acknowledged across the team. So that then has meant there's been developments around what other immunoassays, IVD applications could AnteoBind successfully work in. And that's where the work in chemiluminescence and activating particles and then ELISA plates and ensuring that ELISA plate are cost effectively activated and a low-cost product that performs well can be provided to customers. The middle one is an area which is really next generation and where we see huge potential as well. And that's really in the Biosensor side of things. And really, the graphic at the bottom shows that someone wearing a sensor on their skin with AnteoBind in it that can communicate with their phone, which has -- which would pick up traces around heart attack. That's how sensitive things are becoming and how interactive things are becoming and obviously being part of the MOBIUS research group -- research institute is part of us being involved in that sort of that part, that sector. Now I have previously provided information on the overall market around lateral flow and Luminex as well as chemiluminescence and ELISA plates. So happy -- please go and refer to my previous presentations around how the market is structured. But that's really opening us up to plus USD 30 billion in market value, of which we're talking about activated beads, which is only a part of that. But it is a very significant expansion of our market potential for life sciences. Right, the next one, please. So again, in terms of opportunity pipeline and where everything is going for the business, there's very serious focus on a structured process with the sales and marketing staff supporting the technical team and bringing samples through more samples are out and have been for some time, and we are very pleased and excited about where we could go. Next one. So really, in summary, the key messages that I have for you today are around the fact that we have runway that we have the funds to deliver. Now make no mistake, we are clear on sales conversion being absolutely critical to our shareholders. And we think we have gotten ourselves in a position to be able to deliver on that. And I can certainly assure you that every effort is being spent on doing that. Every single day, the team is focused on how we can move forward with sales conversion and growing our sales. So people, processes, plans and opportunities, those are the things that we've worked on, and those are the things that are now starting to be in place and coming through. So overall, I think we're very well positioned for moving forward. And I would like to thank you all for your interest and your ongoing support of the company, and I really look forward to working with the team and moving everything forward in the way that is expected of us. And I look forward to questions, Simon.

Merrill. We'll get to the questions that have been pre-submitted as per the ASX announcement. Maybe first up, just around the slower pace of Anteo towards sales contracts in the clean energy sector. One example being Wyon that have been mentioned in the past and quarterlies and it's always been around more testing is needed. And we give an update in terms of when will we see progress with regards to Wyon. And how much testing is enough testing?

Yes. I can understand that, and I respect that. So we do have a dedicated team working with the Wyon team. There are fortnightly update meetings, and there is a structured program for Wyon to move through and release the results of their testing. So we're all looking forward to that so that we can make some -- we can make that public. Of course, we expect that, and we are trying to manage that so it's as positive as possible. So I certainly understand the frustration. But what we have spent time on is bringing that to -- trying to bring that to fruition, if you like, but it does highlight that we need more. Wyon is one, and we need more people testing. Ultranode, whether it be Ultranode 70, 95 or Ultranode X. We need more in the pipeline to be able to positively test with an end application, and that is the critical piece. We're really focused on that in the U.S. with what we're doing with Ultranode 95. I go -- I guess the bottom line for me is we are making progress. It is frustratingly slow, but we're clear on needing to bring that to fruition. But because it's run by Wyon, we are at the receiving end of the data, but the team is managing that.

Just a question with regards to sales team and executives. Can we just provide an update around how we're measuring success with regards to sales?

Very good question. Yes. So we're obviously tracking sales at a granular level. And we're now using the CRM more and more and that is particularly because we've taken on 2 professional salespeople and -- who really demand and understand the way the CRM is used, who will work with each of the businesses. But in terms of measures and first of all, we do have -- of course, we have targets, we have budgets, we have forecast, which we're trying to meet. And everybody is aware of them. So they're all aware of them. Everyone has personal KPIs as well, which a significant proportion around sales. And then furthermore, we are actually initiating a program which is around celebrating sales. So in the office, it's around making sure that we are celebrating and documenting when sales come through, so that the overall structured process that people are now getting on top of and understanding they see the end product. So I guess there's a little bit of culture, if you like, as well as measures in there. We -- the structuring of contracts, obviously, it's pretty standard in the industry for that to be -- there to be sales targets for the sales professionals, and that is the case.

Just a question around the website. When can we expect to see a new website?

Well and good. Thanks for the question. So we -- one of our new salespeople has been given the responsibility of going out and getting quote for a new website. So we want to make sure that what we come up with is fit for purpose for where the company is going. It won't be a matter of just changing and tweaking. And so we need to actually get essentially a briefing paper so that we can go out for quotes. So really, that's going to be by the end of this financial year. I would really prefer to do it properly. And so would he, and we will get input as we go along. So I'm sure there will be people who want to make have some input, but we are in the process of designing and going out for quotes for that.

And just question around the capital raising. Obviously, the stock, which you cannot control is trading at a discount to the most recent capital raising. Just a question around what are we doing or how can we rectify the share price going forward.

Understood. I understand that question. So we've always said that it's always about the progress we make in the business and the news that we have -- the news flow that we have coming through. Now I've covered progress, which in this presentation, which we've been working hard towards. So new product out in the U.S. and understanding of what we can do in the chemiluminescence space. We've also foreshadowed that we've got some work that we're wanting to do with a very large Life Sciences business. And we're waiting for there to be some commercial arrangements or negotiations finalize. So my answer to that is we have to show that all the things we've talked about are coming to fruition. And that is my answer to that is we actually have to do all the things we've said we're going to do in a structured, focused and cost-effective fashion. And we are very, very much trying to do that. And we have to be sensitive to some of our customers, some of them are very large and some of them have also got their own challenges because they're raising funds as well. So we are working down the road of making sure that we have very good customer engagement, and we are able to convert as soon as possible. So it's really -- that's on the sales side, really understands that journey. News flow is the key for me to be able to actually have real progress that I can put out into the market. And in terms of strategic partnerships, we do see some opportunities there, but really, the structured program for that is really just getting underway with some conversations in the U.S. And now that understanding what where we would sit is a pretty important part of that. We've done some work. We know what we've got, and we think we know how we might be able to get people attracted into what the business offers, but that will require us to work very hard and to engage, get feedback and then go again. So those will be my answer is it's about doing what we said we were going to do, making things happen and being clear in the marketplace that we are making progress.

A few more questions to go. Just a question around any discussions about the sale of AnteoTech's IP to any interested parties in the absence of any decent revenue-making deals.

Well, we do actually have a contract. I think it's just 15 years it's been with Thermo Fisher, which was a licensing agreement. That's probably a little known fact, but the answer is everything is on the table. And in some of the negotiations we're talking about may we expect, but it has to be led by evidence-based by us having a great product that people want to buy that they could lead to licensing arrangements. So the answer to that question is that is all embedded in the types of conversations we're having. We're looking at all opportunities for revenue for the business and returns to shareholders.

Can you rank the products or identify the top 3 in terms of how prospective they are, i.e., how close they are to generating revenue? And how does it work with drying battery manufacturers rank in there?

This is just for batteries. This is specifically for batteries?

Yes, I think so. So talk to that.

Yes. Yes. So that's a very good question too. Obviously, Ultranode is a full formulation, right? And how we might deliver into that, whether we toll -- we had a contractor who manufactured our product, whether we license that in. We are far more present in the value chain as an anode than we are as a drop-in product, okay? And why I asked that question at the beginning is it's the same for Life Sciences. If you're an additive or a performance enhancer essentially in natural flow, where are you if you're an activator of particle and chemiluminescence. You're moving in the value chain to become a core ingredient. So back to batteries, that really needs to be it's really important to understand that anode -- Ultranode is a full anode formulation. And then our products, our products, so Anteo X and Anteo S are -- well, Anteo X is where we have spent money invested heavily in communicating what it can do. We obviously have done work with Black Diamond Structures to show that it can really add value by improving performance, reducing very expensive carbon nanotubes. So very good information on what it can do for our customers. So there's been a lot of effort in there. And then, of course, the team has identified that essentially, it's a variation of Anteo X can be used in separators, which are used in all batteries. So they're being very judicious around understanding the markets that we're in and how to make things go faster in various markets. So yes, I'd like to say that actually a significant proportion of our samples that are for Anteo X, which would not be a surprise for the battery team, and we're spending quite a bit of effort in terms of sourcing, seeking new channels of communication on a technical basis to make sure we're connecting with the decision makers who would be able to either adopt Anteo X or SiMRAX, which may be their preference.

Merrill, just a question regarding battery tech. It's hard to get across the line in Australia. What's required to happen if someone accepts a contract for supply? And is the company really now to supply?

Yes. Yes. So with respect to the products. On the product side, yes, we are. As much -- we do have -- obviously, we have a facility, the pilot plant, and we're able to -- it depends on the volume for Anteo X. It's a good question because whilst our focus is in the jurisdictions we've identified through the strategy framework around the U.S., South Korea, India and Europe, of course, we keep an eye on, but that's where we see things moving around leading technologies. So I guess the key thing is making sure that we are ready. I have been doing quite a lot of work with the team on export readiness because each of those jurisdictions requires a number of regulations to be met, not only for import, but also for distribution of product. So we are ready for the jurisdictions, which are very much outside of Australia, what we are getting ourselves ready. There's more work to be done, but we have plans for that. When it comes to Australia, of course, that is not our biggest -- that is not our focus. But what we have done in the last 6 months is we have gotten ourselves more familiar with the ecosystem. And there are a number of great Australian companies doing really good things. And we have been talking to them about perhaps working together, whether they're a drone manufacturer may be supplying into the Australian Defence Force looking to get into the U.S. whether they're doing unique and bespoke batteries or battery management systems. We're very positive about being able to work with great, hugely innovative Australian companies. And we're just working our way through how to do that where it makes sense and it's cost effective for everybody. So the answer is we're really focused outside of Australia. We have to get our volumes in our samples and our volumes into where we want to sell. So we are doing that. But also, Australia's ecosystem and the innovation base is very strong, and we're pleased to be part of that and have relationships that we're building.

Just last question. How can you explain to existing shareholders or potential news shareholder what's changed over the years and why now might be time to invest or look at AnteoTech?

Right. No, that's a good question. And essentially, what I've been trying to convey through this presentation is we have -- I'm here because of the commercialization piece. That's what I'm here for. That's what I took this job on for. That's what the shareholders want. That's where the 100% focus is. And you could say that's what everybody says. And probably is, right? But that's my view is we are razor-focused on -- laser-focus might be a better word on making sure we're having the conversations in the way that are meaningful for customers that we're talking to the right people, the structured processes that have been put in place are very particular. And they use networks. We're very happy to use networks and introductions, and it's always easier when you've got an introduction as particularly in the likes of the U.S. and South Korea, too, in particular, and India as well. So the answer is what's different? Well, we've heard what has been said that you really must deliver and everything is very, very, very focused on that. There is -- we've basically streamlined and shed anything that would not -- would potentially disrupt that. And here we sit at a very interesting and important time for the company. We need to show that we can deliver. I get that. But yes, done everything with the team in our power to get samples to the right -- in the hands of the right people who are interested in buying our products.

Thanks, Merrill. That concludes the Q&A. I might just hand it back to you for brief closing remarks.

Yes. So again, thank you very much for joining me today. And very happy to take any questions that might arise subsequent to this webinar. And of course, we're always answering questions that come in through our investor e-mail. I want to thank you again for the support that you've shown to me and the team to move forward. And we very much take that -- we don't take that for granted. We take that as very important, very real. And it's hard sometimes when it takes a long time for things to come through to get excited. But there have been times in the office where it's been really positive in the last 6 months, where really great technical work has been done. There's real clarity around who we need to speak to, and we definitely are focused on that. So I have to be very measured in the way that I say that, but it's really time for us to get some of the great things that we've been working on out into the open and for our people to be able to see that we are making progress. So again, I thank you for your support. Really pleased to be here.

Thank you all for attending. Thank you, Merrill.

Thank you.