Ocean Sun AS (OSUN) Earnings Call Transcript & Summary

Welcome to the presentation of Ocean Sun's second quarter results. My name is Kristian Torvold, and I am the CEO of Ocean Sun. Here, you see the current status of our Maldives project. Installation of the floaters has taken longer than originally planned, but we are forging ahead now. Today, as always, we will first talk about Ocean Sun in brief before we go through the highlighted updates and project developments. Then Karl will present the financials. Ocean Sun's proprietary technology is the world's best FPV technology. It offers low CapEx due to the low material use, fast and easy installation and lean transportation. It sees high efficiency due to the PV modules being on water and water cooled and the structure derived from Norwegian Maritime Heritage offers a seaworthy solution. We're in the final stages of constructing the Soneva Secret power plant in the Maldives with completion targeted for Q3. This is our first deployment of the OS70, an impressive 74-meter diameter floating solar ring, making it the largest and most cost-effective structure we've built to date. Despite the site's logistical challenges included limited space and equipment, the installation is nearing completion. Thanks to Ocean Sun's 2-megawatt peak floating solar system and a 3-megawatt hour battery pack, the resort will shift from relying on diesel to running on renewable energy, 90% of the time. It is not just a smart investment, but it's a major win for reducing air and noise pollution. We're excited to replicate this model with partners such as Canopy Power across Island Nations and resorts in the Maldives, Caribbean and Pacific, all waiting for an enabling solution like Ocean Sun. Alotta has successfully launched 2 installations using Ocean Sun patented floating solar technology, one in Norway and one in Chile. These projects target the fish farming industry where replacing diesel with solar power offers both environmental and economic benefits. The end customers include well-known companies like Mowi and Emilsen Fisk, highlighting the market's readiness for sustainable solutions. Built by Alotta and their partners, these installations demonstrate the benefit of Ocean Sun's licensing model, showing that when partners master the build and commissioning process, they can scale independently and effectively. It's a promising step for Ocean Sun and towards greening the aquaculture industry. In other business updates, we have signed an MOU with the municipality of Zhytomyr in Ukraine and the EPC HICC. This is an ongoing and collaborative process where we are working closely with our Ukrainian partners to assess the potential for a future 25-megawatt peak installation. The assessment will likely be partially covered by funds earmarked for Ukraine reconstruction and development. We're looking forward to start this important work. In terms of website, our previous website is -- has served us well, but has also become quite outdated. We're now thrilled to unveil a fresh new site next week, one that better reflects our advanced technical capabilities and the innovative direction we're heading with a clear call to action. Lastly, we are approaching the prototyping phase of our cleaning robots and anticipate beginning tests of the world's first autonomous cleaning system in Q4. This innovation is set to disrupt markets frequently affected by sand and dust events such as in South Europe, Africa and Middle East, regions that are also prime for Ocean Sun deployment due to the efficient cooling of our modules. So soon, we'll be enabling the cleanest and coolest solar panels in the world. Project-wise, there's only been minor changes since last quarter. A lot of projects have been deployed and new initiatives are entering the pipeline. Our focus remains steady and clear. We're concentrating on Tier 2 opportunities, including promising engagement with Caribbean Islands and resort developments. Progress in India continues, and we've now secured the supply of PV modules tailored for the Ocean Sun solution, an essential step towards unlocking the Indian market and scaling our presence there. So in all, we're seeing strong momentum in Ocean Sun with more projects underway and increased activity across key regions. We've sharpened our internal processes and clarified our focus. The energy is high, and we're generally excited about the upcoming quarters. With that, I'll leave to Karl to talk about the financials.

Thank you, Kristian. End of first half year of '25, we had a revenue of NOK 3.8 million, which overall resulted in a NOK 9.8 million loss for the first half year, this was further amplified a bit by negative working cash flow effects and the deposit paid for guarantee to our new rental agreement for the office lease. And as such, the cash flow ended at NOK 12.3 million negative. That leaves us with a cash balance of NOK 17.2 million going out of the quarter, and in light of this and the positive developments to the pipeline and operational excellence and technology, we have started the process of acquiring new funds to support further expansion, and with the positive and committed owners that we have, we are confident that this will be successful. And with that, we open up for Q&A.

Any questions?

Any questions? We have one here. Any updates on the collaboration with Canopy Power?

Yes. We're, of course, working closely with Canopy Power in Maldives. That is our first project together, and it's a very, very important project for both of us, and then Canopy Power in Australia has also been doing very well. They have progressed several of the dialogues, and we're hoping to see positive results from these efforts in the coming quarters.

Okay. What is the current status in Brazil?

So the Brazilian market is ever expanding. There are many opportunities there that are opening up and starting now. We are still working on our first pilot that we hope to start installation of by the end of this year. This is, of course, an R&D project together with our partner, Uapê in Rio, and it will be an exciting opportunity for us, both to test new technology, but also to enter the Brazilian market in an efficient way.

Thank you. And then a lot of focus on the ocean, but what about hydro?

Yes. Our projects this quarter have been focused on the ocean, but that doesn't mean that we've changed our focus away from hydropower reservoirs. Still hydropower reservoirs is where we will most likely see the largest installations, and this is a market that is developing, although not as fast as we initially thought. We see countries like Malaysia, and we see Turkey and India, all now en mass putting floating solar on reservoirs, so we are excited about focusing on hydropower reservoirs, and we're definitely not losing that focus.

Then any updates on the project in Mainland Spain? I guess that refers to the ACCIONA demo.

Yes. So we have a demo in -- outside of Madrid with ACCIONA. That is performing well. It's now 1 of 6 technologies being tested by ACCIONA, and the results are promising, and we are hoping, of course, that ACCIONA will take these results and start building more power plants using Ocean Sun technology, but that will -- we will leave it up to them to decide on their time line.

Perfect. And that was the last question.

All right. And that concludes the second quarter presentation. Thank you very much for tuning in, and we'll see you next quarter.