Photon Energy N.V. (PEN) Earnings Call Transcript & Summary

Good morning, ladies and gentlemen. It's a pleasure to welcome you at the earnings call of Photon Energy Group for the first quarter of 2025. And today, I will be presenting the numbers together with our CFO, David Forth, to my right or left.

To your right, yes.

And I -- today's presentation will follow, I think, a very well-known structure. We will first run you through the business results and our most important segments. Then David will run you through the financial results. And as usual, we'll also have space for questions that we will try to answer as best as possible. So on the business results, we'll start with electricity generation, which we also refer to as investments, as they also make up the most significant part of our balance sheet. Here, if you compare the size of the portfolio to the end of the period, the end of the first quarter of 2024, the net increase in our portfolio was around 3.6 megawatts. And however, there have been a few movements. We have, in the fourth quarter last year, sold our Australian assets, which led to a reduction of 14.5 megawatts. But over those previous 12 months, we have added 12.4 megawatts in Romania. And specifically in the first quarter of 2025, 5.7 megawatts of new power plants in Hungary, which for the time being, appear to have been the last utility-scale power plants that we are adding to our portfolio in that country. In terms of electricity generation, the year-to-year comparison shows a relatively significant decline, and that is directly linked to the sale of our Australian assets, which, as they were based in the Southern Hemisphere and Q4 and Q1 aligns with Australian summer, which means that, that generation levels were the highest. And after disposal in Q4 last year, they were not contributing to our portfolio and generation results anymore. And therefore, the overall number has declined significantly, as they were very strong in the production levels. However, when we look country by country, we can see that we have, in 3 of our core markets, managed to outperform compared to last year. So in the Czech Republic, we had a generation of 21% above last year's level. In Slovakia, we were slightly ahead with 6%. In Hungary, we've shown significant improvement only to a very, very small degree linked to those new power plants that we connected during the first quarter, they were connected in March. So their contribution to the Q1 volumes was negligible. So very strong outperformance. And where we have a shortfall is Romania, and that is linked to the switch off of some of our power plants, which are themselves linked to regulatory changes in the country. That is being worked on, and we expect these power plants, all of them, to be back online shortly. So these days, we should have one of them back and we should be back to full power in the next couple of weeks. Just a few comments on the revenue model of our portfolio. So as you can see, in Q1 last year, the vast majority of our production came from power plants running on a merchant model, and this has changed significantly year-on-year. Firstly, again, due to the sale of the Australian assets, which we are running on a merchant basis, but most importantly, by the return of our Hungarian portfolio to the feed-in tariff as of April last year, that means right after the end of the first quarter. So you can see that the stability of revenues has changed significantly year-on-year based on these 2 factors. And in terms of production volume, you can see that around 60% came from power plants that are in the merchant model. Looking at installed capacity, the shift was slightly less pronounced, but we're essentially now running on -- or the composition of our portfolio is 50-50. So around 50% of the capacity is in a support scheme and the other half is operating on the merchant model, which compares quite dramatically to the composition last year, where we were around 75% of our portfolio running on merchant. In the first quarter, we managed to increase our revenues despite the elimination of the Australian assets and despite the reduction in generating capacity -- temporary reduction in generating capacity in Romania, largely thanks to the higher production levels, we managed to increase revenues from EUR 3.7 million last year to EUR 4.2 million this year. And this change in composition -- because the Australian assets had relatively low prices. And for example, the Czech portfolio is still running on high feed-in tariffs and they managed to outperform. Our average realized price per megawatt hour, which, of course is the weighted average of a relatively widely distributed number of price points, we managed to increase by 39% from EUR 133 per megawatt hour last year to EUR 185. I think we mentioned during our Q4 call that we switched our Czech portfolio from the green -- sorry, from the feed-in tariff from last year to the so-called green bonus system, which means that we are receiving the subsidy element separately from the electricity generation. Electricity remains available for us to be sold in the market. And this is what we're running on this year. We can make this choice every year at the end of November for the following year. And as you can see this increase in revenues has also translated, I would say, it is proportionally in higher EBITDA during the first quarter, so a 12% increase in revenues has actually resulted in a 38% increase of EBITDA from the electricity generation segment from roughly -- slightly over EUR 2 million last year to over EUR 2.8 million in the first quarter of 2025. The next segment is Engineering, which includes our engineering activities, or EPC activities, in Europe and Australia and New Zealand. And here, we have, on one hand, been able to increase our external revenues. So here it is important to point out that our Engineering teams are also involved in internal projects and build the power plants that then end up expanding our proprietary portfolio. So the numbers that we are referring to here and reporting here are purely linked to the external business. So on one hand, we've been able to increase our revenues by 30%. However, our EBITDA shortfall increased from EUR 345,000 to EUR 1.1 million. And this is -- there's a combination of factors here on one hand, the cost related. So these numbers include the costs related for all our EPC teams, which, on one hand, work on external projects. And here, we have seen certain delays in both in Europe, but also in Australia in the C&I segment. So quite a few of our contracts have been delayed, and this also leads us to actually a piece of very positive news, which is that in May, so after the end of the reporting period, we managed to sign our largest external EPC project yet, which is a 34-megawatt peak power plant that we are going to build for an external customer, Hyperion, their first investment in the Romanian market. And so the contract is signed. Construction is expected to start more or less 3 months from now, and completion is next year. And this is one of the projects we've been working on for quite a long time that also we originally, let's say, 12 months ago, we expected to be signed last year already and also to start contributing revenues to our last year's results, but there has been a delay. And this is unfortunately a part of the game in the EPC business, very often demand comes in waves. So we have had also delay with this project, but we've also had delays with utility scale behind the meter projects, both in Europe and in the Southern Hemisphere. A few words on our New Zealand project where we are building as an EPC for an external customer. So this was, to date, our largest external EPC with 21 megawatts. Here, we're expecting the project to be energized at the end of May or the first half of June. So the project is already very advanced. And we expect it to be handed over at the end of the second quarter, early third quarter. So this, of course, for us, will be a very important milestone. And the pipeline of projects, both for C&I projects, but also utility scale is strong and is growing. And we do expect these -- our subsidiaries in both territories to show stronger performance during the rest of the year and to actually be contributing positively to our group results. The next segment is New Energy, where I think we have been reporting and publishing news quite frequently. So the story here is relatively simple. The volume of contracted capacity year-on-year has been reduced or has been lower after 389 megawatts in 2024. This year, we contracted 326 megawatts for the full calendar year and more or less in line with the 16% decline in contracted capacity. Also our external revenues declined by approximately 20%, which is also due to lower prices that were achieved in the auctions for '24 compared to the auction prices for 2024. And it is also important to note that, I don't think -- we have also explained it already that prices -- while the capacity is contracted for the full year for 4 quarters, prices differ between quarters. So the first quarter was -- is strong in the business line and so will be the fourth when prices that we contracted for are strong. And in the second and the third quarters, both revenues, but also the financial contribution to the group results will be lower. In terms of electricity trading year-on-year, the trading volumes have declined by 16%. So this is electricity traded across the 3 markets where we have trading licenses. This is the Czech Republic, Poland and Hungary. And so from 38 gigawatt hours last year, we went down to approximately 32 gigawatt hours. And this is largely driven by the switch of -- the opting out of our Hungarian portfolio from the merchant model and opting back into the feed-in tariffs. So in the first quarter of last year, our Hungarian assets were still selling into the market on a merchant basis, and we were offtaking the electricity and selling into the market. So as of April 1 last year, so just after this period, this volume was eliminated from our activity. So this decline is more or less in line. So it means that the rest of the electricity business has remained more or less stable in terms of volume. In terms of profitability, New Energy contributed just slightly less than EUR 2.5 million of EBITDA in the first quarter of this year, after EUR 2.7 million last year. So based on -- so if you put it in context, it was a reduction in revenues of 20% -- we had a reduction in EBITDA of 9%, which also is a testament to our cost control in this business line. The next segment we would like to run you through is Operations & Maintenance, where you can see that year-on-year, we have a very positive dynamic in terms of contracted capacity, which went from 682 at the end of the first quarter last year to 1.1 gigawatt peak at the end of the first quarter this year. And while last year, this total was comprised of Operations & Maintenance, which means the technical -- the operations and technical maintenance of power plants, plus around 60 megawatts computed by our subsidiary, Photon Energy Cardio, which specifically services central inverters. There's a new category has been supporting our growth to 1.1 gigawatt on the management, and that is asset management. So we have, over the last 12 months, signed asset management contracts with 2 customers in Hungary. We're very close to signing our first asset management contract in Romania and may do so over the next couple of quarters also in other countries, where the service is largely different. So very often, these will be situations where we are not in charge of the O&M, somebody else will. But we are essentially the owner's representative, making sure that, that project companies are compliant with their statutory needs that the accounts and taxes filed properly, that we'll make sure that the O&M contract with the proper work, that the power plants are insured and already through reporting. So essentially, all the elements that are necessary, all the tasks that are necessary to make sure that, that the project company is well represented. And it may also include support in generating revenue. So we may also support the customers in finding the best offtake arrangements and additional -- and find additional revenue sources for their assets. So this is a service that we have found to be in significant demand, particularly in countries which do not allow our customer base to install their own asset management teams because of the size of the market. But thanks to our presence and thanks to our experience, also the fact that we are providing exactly those services to our own power plants, we are seen as a partner of choice in these activities for the service. And as you can see, it is helping us growing our asset base under management. And looking at our pipeline, it will continue being a very strong driver for our continued growth. In terms of external revenues, year-on-year, we have seen an increase by over 40%. And here again, I would like to draw to your attention that these are the external revenues, which means that these are the revenues that we charge our customers. In addition, of course, our O&M subsidiaries in the 5 countries where we are active are also providing O&M services to our own power plants, and the revenues from these services are excluded in this table. Whereas on the cost side, there is essentially no adjustments made. So what you can see as a result is that in that -- here, we are reporting negative numbers. And just to stay specific Q1 2025, so here, we're reporting a loss of EUR 273,000. If we added back our group internal activities, we would have a plus of approximately EUR 150,000. So it is due to the format in which we report our numbers, focusing on the external revenues. But this specifically is an area where there's a lot of group internal business. And of course, the important message is our O&M is as a business profitable. And as you can see, the dynamics are also very positive. So we are quite hopeful that even after stripping out the group internal revenues, we'll actually have a positive number. But at the level of the entities, we are profitable in this business line already. The next segment that has been, I would say, a very important and positive surprise in the first quarter of this year, and it's a continuation of what we've seen already in the fourth quarter last year after changing our focus and also having new management in this segment. We have managed to grow our external revenues fourfold in the first quarter compared to the first quarter last year to over EUR 6.5 million. And while the segment was a drag at our EBITDA -- at the EBITDA level of almost 400,000 last year, it is essentially breaking even in the first quarter, which in this business line tends to be among the weakest. So -- and as we have a new team and a new business focus, we also see that improvements happening rather on a week-by-week basis or month-by-month basis as we are expanding our customer base. So it is definitely pointing in the right direction. It's a significant improvement. And we believe that technology will be a very important contributor to our group results for 2025. And in the very last table, you can see that, particularly in relation to modules, we have had a quantum leap after selling only probably around 3 megawatts peak in the first quarter last year. We got almost 60 megawatts this year in the first quarter, increased volumes in batteries. And actually, among those 3 main components that we are distributing, batteries will probably over the next quarters show the most significant growth rates, as we see a lot of new projects coming for which our customers in the distribution segment are seeking components that are including batteries. So this will be definitely a picture to watch over the next couple of quarters. And before I conclude the part about the business, I would also like to highlight one project that we managed to complete at the end of the fourth quarter, early Q1 2025, which is a very important testament to our efforts in the PFAS removal. I think we have been -- we have explained our in-situ water remediation technology in the past already and the results of our pilot in Australia. On that front, we are progressing in relation to commercial projects, both in Australia and Europe. However, as the counterparties are public sector institutions, they move at their own time. But what I'd like to point out with this project, which is a first of its kind, at least for us, is that we are -- in addressing the problem of PFAS, we definitely don't want to be only, so to speak, a single trick pony that has one technology which we tries to apply. But our ambition is definitely to be a provider of the technology, but also a provider of solutions based on the project approach using multiple technologies. And we were approached in 2023 by a company in the Czech Republic, Jihostroj, which is a company active in the aerospace field that, I would dare to say, was probably the first country and it's like important to explain that PFAS only now starts being on the radar of various environmental agencies across the EU member states. Only very recently, the EU Commission has recognized the problem of PFAS. The World Health Organization is now jumping into gear. We're seeing lower acceptable levels in drinking water. And the Czech -- and Jihostroj was probably the first company in the Czech Republic that was identified by the Czech EPA as an emitter of PFAS in their wastewater. And in order to address the needs of this customer, we developed a containerized solution to eliminate PFAS from the industrial wastewater, which was a result of the electroplating processes. And we have managed to reduce the very high levels of PFAS at -- when we exited the production process by over 99.5%. Actually, when we really fully -- at the highest level of purification, we really get into 99.9%. And what is more important is, so we are not only removing the PFAS contamination, but we also make 70% of that water available for reuse in the industrial process. So the result for this customer, and it's definitely a very important pilot for us is that the company has become compliant. Here, just to add, there's 1 or 2 additional units we may install with them as they have also PFAS contamination there -- in the water runoff. But coming back to the production process, so the company is removing the PFAS from the wastewater, saving them from potential fines. And it appears that the regulatory framework in Europe is going into the direction where companies -- the contaminators, will have to pay for the removal of PFAS going forward. So there's definitely a medium-term threat for companies that release PFAS not only of fines, but also of significantly higher costs charged by the water utilities. And last but not least, the 70% recycling rate also means water charges and wastewater charges are significantly reduced. So on that last point alone, this installation has a payback of about 4 to 5 years. So making sure that the company is compliant, is not at risk of fines or higher wastewater charges that comes on top. But even without that, the payback is 4 to 5 years. So this is a very important project for us, and we see a lot of demand emerging as the regulatory framework in the Czech Republic specifically, but actually across the EU is getting stricter. And strategically, it means that we have multiple technologies at hand to help various types of institutions, whether these are industrial companies, airports or other known contaminators with PFAS chemicals to address their specific problem in a comprehensive way. So this concludes my presentation of the business results and progress. And I'm happy to hand over to David to run you through the financial results.

Thank you, Georg. So financial results, let me play on top of the technology here. So this has actually been our best first quarter for 3 years. So it does make us feel very happy actually. We've improved our total revenues by 27%, the electricity generation up by 11.5% despite having exited the Australian plants. This, as Georg has already said, is a mix of the generation volumes being at better prices. And our other revenues are also much stronger. And this is a mix of the technology, which is done very, very well. As we've said, we've now got a stronger team, a much wider geographic spread. And this technology area does seem to be consolidating and we seem to be winning in that area. In the Other segments, in revenue terms, we've performed strongly, except for New Energy, where capacity markets and origination and trading have declined. The EBITDA of EUR 1.206 million compared to EUR 800,000 in the previous period. This is mostly driven by better margins in generation and New Energy. Within our comprehensive income, we've got positive EUR 3.7 million. That's partly because of us now commissioning these new assets in Hungary and also the effect of foreign currency translation differences. This produces total comprehensive income pretty much nothing, but much better than the previous year where it was minus EUR 1.1 million in the balance sheet. There's a small growth in fixed assets, mostly because of the new Hungarian assets. In current assets, we've reduced our inventories by 2 million, thanks mostly because of the impact of our new technology team. We've cleared out some old stock. And we've also -- we've collected more in terms of our receivables. Our cash position remains pretty stable comparing to -- over the quarter. In terms of equity, interestingly, it's not changed at all compared to the year-end. This is partly because you see positive OCI, and it produces adjusted equity ratio of 25.3%. As we've said in our statement, the Hungarian regulatory changes we -- was under the terms of the bond covenant be entitled to remove those, that would give an equity adjusted equal ratio of 26%. Of course, the equity ratio is measured once a year on the bond contract. And so the important thing is for us to stay active within the quarters. In terms of long-term liabilities, there's an increase, which is matched by a decrease in short term. This is because of the reclassification of one of our loans, the EBRD loan, which at the year-end was treated as short term. It's kind of actually long term. The current liabilities are reduced because we've managed to -- we've reduced our trade payables. And of course, the reclassification of the EBRD loan. In terms of cash flow, our operating cash flow slightly down on the previous quarter -- on the previous year position. Investment cash flow up slightly. This is really because of the completion of the Hungarian projects and some investment outlays related to certain EPC contracts. Financial cash flow down by EUR 800,000, but this is a mix of repayment of borrowings and new borrowings related to the Hungarian plants. Net cash position in total decreases to EUR 7.9 million from EUR 8.4 million at the start of the period. So really, a pretty good start to the year. As I say, a much -- it is our best first quarter for 3 years, and I think it sets us up pretty well for the rest of the year. That would complete the finance presentation. In terms of guidance, there's quite a few moving parts. We intend to issue a guidance statement shortly. I think that takes us to the end...

Okay. Thank you very much, David. So we've a little bit time to address the questions.

So there -- yes. So there's 3 questions on it today. So I'll start with the first one, which is what is the plan regarding the pipeline projects to build for own portfolio, to sell and receiving revenues from EPC and O&M? So well, at this point in time, the most immediate pipeline for execution is the pipeline in Romania. And here, we are just looking at what we have published and communicated already, our largest project in Photon Energy is in the process of being sold. So we have engaged on an exclusive basis with a potential buyer. So here, the path is -- at this time, it looks like we'll be selling the project. And the goal is to lock in that potential EPC and O&M of the project. In relation to our other project or other project pipeline in Romania, of which over 40 megawatts DC are ready to build. We are still in the process of securing the project financing and where some of the terms are not finalized yet. So our plan A, I would say, is to build those pipelines for our own portfolio, but we're also looking at other alternatives, pretty much along the line of -- suggested by this question. And maybe also not binary, it may go in one direction with one part of the portfolio and keep it for ourselves and sell the other one. So the Romanian market is a tricky one, as I think we have been -- we also had to share with you over the last couple of months in terms of regulatory changes. At the same time, in the medium to long term, it provides some interesting -- so some interesting opportunities. And I think to answer this question more comprehensively, definitely for us, where we will want to allocate capital in the future will be a lot more around energy storage. So building PV assets only is definitely looking 12, 18, 24 months ahead are going to be the main area where we allocate capital, but it will be at the very least hybrid projects. And here, the most important path for us is to actually add storage to our existing portfolio, which is something we're already working on in Hungary and also in Romania. It may include investment into utility scale, energy storage. But at the same time, also externally EPC. We see more and more of the projects, including storage. And the last area where we may -- or the last area where we may entertain PV only, beyond those 40 megawatts that we have in Romania, is behind the meter. So after completing the PPA project in Hungary last year, there's one project in the Czech Republic and there's some additional pipeline. So if we have a strong counterparty that is -- we need to sign 15-, 20-year PPAs on a behind-the-meter basis, and that's still something we're interested in and working on. The second question is how sustainable is the trading performance? Will it stabilize at Q1 levels or should we expect continued growth? I am very strongly convinced of the latter in the sense that what we did at the end of the third quarter, beginning fourth quarter last year is that we brought in a new team from a company that was fully specialized in distribution. And that team has significantly expanded, and I think our market reach, I think we have also described that in some of our reports. So a while before we were very much focused on 2, maybe 3 markets geographically, now we are essentially selling into 20 jurisdictions, ranging from the Netherlands and Germany, in Western Europe to the entire CEE region. Southern-Eastern Europe, but we're also exporting to Ukraine. But of course, we're also hoping that once the situation, and hopefully as soon as possible, comes back to peace, there will be even further demand for not only PV, but also energy storage, but our furthest customers sit all the way in Armenia. So it's a much bigger -- much better diversified geographical footprint and, of course, a lot of new customers. Of course, that is not taking away the volatile nature of demand and supply in PV components. However, what we've seen already, I think, particularly in the last -- or since the beginning of the year, so the last 4.5 months, is that while module demand and supply are -- continue being volatile and also pricing levels go up and down, energy storage batteries are much more stable in terms of the demand profile. It's also not subject to this -- to such strong price swings. And so as the importance in our revenue mix of batteries grow, the overall picture will become a lot more stable, not to mention that the gross margins achieved on batteries are higher than on modules and inverters. So one is stability. We managed to expand our customer base. We were also present with the booth at Intersolar just a couple of days ago, which again has helped in putting us on the map. And as the distribution market for PV components and batteries is being reshaped and -- in Europe, we're actually very confident that we are coming out ahead. So we are seeing a lot of players that have been strong over the last couple of years, either skating back or in many cases, actually going out of business and creating room for, I would say, committed long-term players like ourselves. I think we've been -- if you look at it from a point of view of market share, we have been gaining in all the markets where we are present. And after 2, 3 years of relative chaos in the market where manufacturers were selling to small installers just to get rid of product, we see now also many of the supplier side an interest in bringing back the original structure into the market. So that means that they will be relying on strong, committed and reliable distribution partners, and also understanding that bypassing them is not a good business. So -- and here, we see a lot of support and a lot of interest by the top players in all the 3 segments, that means modules, inverters and batteries to work with us. So on that basis, I -- well, we are convinced that the trend we have been seeing over the last 6 months, that's almost 8 months, will continue. Of course, subject to certain disruptions, subject to seasonality, but other than that, we believe that this direction will continue. The next question is whether you're planning any bond buybacks given where the bond is trading? Well, we have taken some bonds back over the last 12 months. And of course, there's -- it is always a question and a function of our liquidity position. And I guess, as we have done it in the past, we remain quite keen to do so also in the future. The extent will clearly depend on how much liquidity is available for that. But clearly, when the opportunity arises, we understand the benefits of this. So we will act accordingly. The next question is, can you tell us more about your role as an investor in RayGen? Are there already some visible benefits of this investment? What are company expectations regarding this investment? Will it provide additional revenue stream? So thank you for that question. It's -- I will try to keep it brief, although there's a lot of aspects to this. So I'll start with our investment. So we invested for the first time in 2020, AUD 2 million, another AUD 3 million in -- 1 year later in April 2021. And so we also participated in the latest capital increase, which only concluded recently, which we also published here. I'd just like to point out that the actually cash investment happened already 18 months ago when we subscribed together with other shareholders to a convertible bond, where we invested another AUD 2 million. So that cash injection happened already some time ago. And only now was crystallized as this convertible bond was converted as part of this capital increase. We are developing the project in Yadnarie, South Australia, where we are getting very close to the point of getting the development approval. So the last hearing before the issuance happened at the beginning of April. So we are essentially now, I would like to say, in suspense, but let's say, expecting that within the 60-day period from that moment, which would come to an end, beginning of June. We will receive the development approval. And then, of course, it's about the next steps, what was a fully permitted regional project in South Australia. That's something we are working on quite intensively. But we've also announced that we are developing a project in South Africa, where we have secured grid capacity. We are going through the environmental impact assessment and -- which is going well. The project recently made it to the so-called President's list of strategic projects. It has a different name, but everybody in South Africa calls it like that. So it is a highly visible project that is strongly supported by the South African government. And there, we expect to get all the permits in place at some point in 2026. It's the first time we're developing there, so we have to see -- the fact that it's on the strategic project list, should shorten the development approval time line. So all seems to be going in the right direction. The investment cost of these power plants is very significant. So very quickly, we're getting into the hundreds of millions of euros, which, of course, for us, is well beyond our capacity to do that ourselves. Our role is definitely that of a developer. And here, I think what is important to note is that developing -- finding the right sites and then getting the permits in place is quite different to what you would encounter in a traditional PV development. And there's quite a long list of lessons learned when we were developing the Yadnarie project in South Australia. And we believe that this experience, plus, of course, the direct contact with RayGen puts us at an advantage as we embark on the development of additional projects. So the question is, revenues from this cooperation then, classic revenues, probably not. But we do see a very interesting window of opportunity to create value, which means make money by developing projects based on the technology in the right jurisdictions and then by monetizing those project rights in the right way. For that, it will be important, and that's something that we're also working on now very intensively in relation to the South African project of getting in other interested parties. So whether this is offtakers for the electricity, whether that's potential equity investors, project financiers. And what is very crucial here is one of the other core shareholders in RayGen, which is SLB, formerly known as Schlumberger, so the world's largest -- when they call themselves -- they claim to be the world's largest engineering company in the oil and gas sector. They definitely are. And they are a very committed player in this -- in SLB -- sorry, in RayGen. And they will play a significant role in the EPC process towards investors and lenders. And that support is something that should bridge the bank ability question, because it is a new technology after all. And of course, both equity investors, but also debt providers are quite sensitive to that. And here, the next steps in relation to Yadnarie, but also it will be very important in relation to who the investor will be, the final investor, but of course, our South African project, plus other projects that RayGen is working on in other parts of the world. So the value creation beyond the value of our investment, which I would also like to point out is based on the last financing round significantly above our investment cost, so from that point of view, it has already been a good investment. But we believe that there's significant opportunities in developing RayGen projects, if you wish, around the world, but at the moment in 2 jurisdictions. The next question is what are your expectations regarding revenues from PFAS? Well, we expect them to grow, of course. What I would like to point out here is what we have found so far in relation to our in-situ technology is that counterparties that we have been engaging with like the Australian Department of Defense. We've participated, and this is public knowledge. There's a very significant tender in Australia run by Air Services, which owns all of the major civil airports. And I think we have presented our technology ourselves very well. It's just that time runs at a different speed with these type of institutions, which is quite surprised given the fact that media are monitoring the situation in Australia, very strong leaders. There's a lot of pressure also from regulators, from EPA and others. But it's moving very, very slowly. So of course, this technology will have its application. And I mentioned before, we are talking to some potential customers regarding commercial projects in Europe already. But the topic of PFAS, of course, is much bigger. And the unit I was referring to is a very important step going forward because regulations in Europe will become significantly stricter very, very quickly, and there will be a lot of companies in need of addressing this specifically for their PFAS emissions. And then there is another very specific area that we are now trying to address, I would say, in a hurry, and that is the upcoming ban for AFFF foams, the firefighting foams. That means that there's still a lot of firefighting foams that are in stock with professional firefighters, but particularly a lot of firefighting teams that are located at various factories in airports. And there's a ban upcoming for one type at the 3rd of July this year. It's an EU-wide ban, where -- sort of July this year, April next year, for a second old type. And by then, it will be useless -- unless we have an official exemption, you'll not even be allowed to own these firefighting foams. Not used, but owned. And it appears that, that is not as widely known as one thing. So there's a lot of organizations now waking up to this fact and in need of replacing these firefighting foams with the PFAS-free foams. And there's very, very little time left. And it is actually something that has happened already for a very large degree in Australia. We have actually our products in Australia last year -- our colleagues in Australia last year were involved in such a project. It's been going on, but it's still going on in the U.S. And here in Europe, a few institutions have done it, but there's still a lot -- a huge disparity between what is still out there versus -- against this tight deadline. And we believe that with the unit that we have shown you, plus something we're still working on and developing it now very fast, we'll be able to significantly speed up the process and economize the process of exchanging this firefighting foams, because the problem is it is not about pumping out -- only pumping out the old firefighting foam and putting the new one in, but you actually have to sanitize the entire equipment. And this can be sprinklers, that's where all the pipes need to be cleaned from PFAS chemicals, firefighting cars in the whole infrastructure. And then the firefighting foam needs to be thermally destroyed and the liquid that's used in cleaning the infrastructure needs to be treated. So there's -- so we're very close to something that will significantly reduce those costs, which are enormous. So just to give you a number, thermally disposing off 1 cubic meter of this PFAS firefighting foam at the moment costs between EUR 2000 and EUR 2,500 per tonne or per cubic meter. That price may even go up. And there's tens of thousands of tonnes across the EU. So this is just a firefighting foam. But actually, this exchange is a whole project that needs to be carefully planned. So there we see a significant opportunity in the next -- well, we expect these time lines to be shifted a couple of times because it's simply impossible to make all these removals in a couple of months, and we believe this will be a significant driver. So as we have more tools available, there's also more opportunities we can address, and this is one that we are now focusing our minds on very significantly. But coming back to the U.S., for example, today, there will be a lot of -- and it is pretty well known in which industries PFAS contamination is a topic. So we will be able to target those industries. And as now it has become clear what principle will be applied across the EU, which is -- it's not up to the water utilities to address this problem, but actually the companies that are emitting PFAS chemicals, that they will be held accountable and liable. It is relatively clear which way to go and how to market these technologies. And we have a technology available that is highly effective, and this pilot has proven it. So it is very hard to plan in this phase, but I think we are really on the right track, and we would expect this to be more and more visible in our results. Next question related, in the past, you mentioned that PFAS is a big problem in the U.S. and the market there is a huge one, if not the biggest one. Are we going to be visible in the U.S. with this technology as well? So a good question. We are visible to some extent. We have been presenting our technology and the results of our pilot project in Australia at [ Patel ] conference, which took place in Denver in the middle of last year, which is essentially for remediation, the most prestigious conference worldwide. There actually representatives from the Australian Department of Defense, the U.S. Department of Defense, which also is accountable for a lot of the PFAS contamination on U.S. soil, and it's pretty much the who's who so technology is visible. And we are currently also preparing our participation in 2 grand programs by the U.S. Department of Defense as a way how to get involved in addressing their PFAS problem. And they have essentially -- the U.S. Air Force has 800 sites across the world with PFAS contamination. Some time ago, I saw the list, which is actually frightening, how much they are above the regulatory level. So I mean we are talking several million of times. So it is a major issue. And we also believe that even under the new administration, this topic will continue being addressed. So in terms of full commercial market entry, I mean, the U.S. is a big market, but it's also a tricky market. So we want to treat it with a bit of respect. We are trying to look for potential partners or even customers. So we have some customers in Europe that also have factories in the U.S. that have a PFAS issue. So for us, this seems to be like a low-risk route into the U.S. market. But at the same time, for us, it's important to pay more and more references in Europe, but also in Australia. And then the next step, get a nice reference in the U.S. market. So it is -- so we're not going to just -- because it sounds like a good idea opening office in New York and try to conquer the U.S., it's just -- and I think we can see that in Australia, particularly when you're dealing with the public sector, time lines are very, very long. And one has to have -- so you have to work with that, but you cannot fully bank on these projects to happen when we want it to happen. So we're trying to find the right balance between public sector and private sector. And we have recently seen that the response times in the private sector are significantly faster, particularly if there's a strong regulatory pressure or, what we call, a compelling regulatory event. Like for example, this phase out of PFAS firefighting foams across the EU. That tends to focus minds, and this is now something that's also focusing our mind on helping those companies affected by it. Good. Are there any additional questions? Because as far as we can see -- okay. There's a thank you. So it appears we have been able to address all the questions. So we would also like to thank you for your -- for taking the time today for your attendance. And wish you a very nice day, and we're looking forward to our next call 3 months from now. Thank you very much.

Thank you. Goodbye.