Aqua Metals, Inc. (AQMS) Q3 2016 Earnings Report, Transcript and Summary

Good day, ladies and gentlemen, and thank you for standing by. And welcome to the Aqua Metals’ Third Quarter 2016 Corporate Update. During today’s presentation, all parties will be in a listen-only mode. Following the presentation, the conference will be opened for questions. [Operator Instructions] This conference is being recorded today November 7, 2016. Before we get started, I would like to turn the conference over to Greg Falesnik with MZ North America, the Company's Investor Relations firm who will read the disclaimer about forward-looking statements.

Thank you, operator. This conference call may contain, in addition to historical information, forward-looking statements within the meaning of the Federal Securities Laws regarding Aqua Metals. Forward-looking statements include statements about plans, objectives, goals, strategies, future events and performance and underlying assumptions and other statements that are different than historical fact. And the forward-looking statements during this conference call include statements concerning our intentions, expectations and believes regarding anticipated growth; market penetration and trends in our business; the timing and success of our plan of commercialization; our ability to operate our AquaRefining process on a commercial scale; our ability to maintain our competitive technological advantages against competitors in our industry; our ability to have our technology solutions gain market acceptance; our ability to maintain, protect and enhance our intellectual property and our expectations concerning our relationships with suppliers, partners and other third parties. These forward-looking statements are based on current management expectations and are subject to risks and uncertainties that may result in expectations not being realized, and may cause actual outcomes to differ materially from expectations reflected in those forward-looking statements. Potential risks and uncertainties include the fact that the Company has only recently commenced lead producing operations and completed its initial commercial recycling facility, thus subjecting the Company to all of the risks inherent in a pre-revenue start-up; risk related to Aqua Metals’ ability to raise sufficient capital as and when needed; to develop and operate its recycling facilities; changes in the federal, state and foreign laws regulating the recycling of lead-acid batteries, the Company’s ability to protect its proprietary technology, trade secrets and know-how and other risks disclosed in the section risk factors included in the Quarterly Report on Form 10-Q filed with the SEC on November 7, 2016. All such forward-looking statements whether written or oral made on behalf of the Company are expressly qualified by those cautionary statements and such forward-looking statements are subject to risks and uncertainties, and we caution you not to place undue reliance on these. At this time, I would like to turn the call over to Dr. Stephen Clarke, the Company’s Chairman and CEO. Steve, the floor is yours.

Thank you, Greg, and thank you, Lisa. And welcome everybody to the 2016 quarter three earnings call for Aqua Metals. As Greg mentioned, I’m Steve Clarke and I’m here to take you through the summary of where we are since the last quarterly update, and here with me is Tom Murphy who later on I'll be handing over to and he will be taking us through a summary of the financials. So you heard Greg read the Safe Harbor statement there it is in writing and we will move on. So I am just opening this with - really the key points here and the headline is that we are now moved into - we are transitioning into commercial operations now and doing so we are proving that the Company has the potential to change $22 billion lead market. And as I go through this presentation, I'll be bringing out some examples of that. And the three key points that I want to talk about today is that we've made lead now at first of what would be several AquaRefining facilities and in a few minutes I'll show you a short video of the first lead being made and some highlights of that. And part of that is an update that the facility that we've built and are now transitioning into production has the capacity to produce 120 tons of lead per day not the 80 tons a day that we initially gave guidance on them and obviously I would say more about that. Where we are right now is we have a single six electrolyzer module installed and commissioned, five more being commissioned and in total we’ll have 16 AquaRefining modules on site. We plan to sell pure lead, AquaRefined lead in quarter four and we’ve also [indiscernible]. We figure out how to operate the facility in a more flexible way than we would originally considered and we’ve developed some intermediate products which allow us to accelerate revenue ramp up and accelerate into positive cash flow and we expand our capacity to 120 tons a day in early 2017. So we are a little bit behind where we thought we would be in terms of commissioning when I gave the last Company update. But I think we’ve more than compensated that with about 50% uplift in the capacity of the facility. The second bullet point here is that, I’ve mentioned before we want to build up to 800 tons a day of our own lead recycling capacity and with 120 tons under our belt we are looking to expand into the remainder. We've been talking to and I have given guidance on this in the past that we’ve been talking to providers of another non-diluting, non-equity funding and we progress those discussions to the point now that we are literally visiting sites today. Two of our guys are onsite looking at potential AquaRefining or places to sign AquaRefining facilities right now. As we look at those, as we look at building them, and as we built them and got numbers of our own first facility, we can now project that an expectation of a 30% IRR for each 160 tons per day AquaRefinery at a capital cost of about $50 million each which represents a fairly good sound investment opportunity. The other key point is that we have established and we continue to establish important permitting precedents which could - hopefully should accelerate our roll out. And then the third key point really is that we are generating very strong interest in licensing to third-parties. It’s been our stated goal that we would expand this business through a fully serviced license business model in which we will provide equipment to third-parties. We will maintain it and provide spare parts and continued maintenance to third-parties on a licensing basis. Well we have taken those conversations to the point that we have now tested feed stocks from third-parties, already successfully taking in feed stocks from third-parties who have been expressed and interested in licensing on equipment and we’ve made lead from them. And then we expect to start shipping licensed AquaRefining equipment during 2017. What we wanted to before that is actually operate our own facility, make sure we've learnt everything we can and absolutely not fall in to the trap of having our licensees beyond beta testers. We're not a software company, we are an equipment company and we live or breathe on the reliability of the equipment services that we provide through that. And then the last key point in there is that we’ve been looking hard and how do we manage very large regions like China, India and potentially the FSU. And we’ve developed a Master License approach and we are really working that hard with China as the example right now with parties who could be credible partners in China and would manage a Master License and manage the sub-licensing and all of the actions that go around that. And overall, we’ve said this number of times, we plan to do for lead what Bessemer and Nucor did for steel and then we can touch on that later on. So moving on, I’ve shown this slide pretty much every time I’ve given an update because it still shows just how important lead is to the global battery industry and even with a Gigafactory coming on stream and overall large-scale lithium production facilities announced around the world. When measured by production capacity lithium is still pretty much [surrounding] in the world of batteries and energy storage. And there is an interesting development that we’ve been watching; China is a country with the most advanced electric vehicle fleet in the world. And what we are hearing is that there is pretty strong evidence that China was beginning to refocus on low cost lead powered electric vehicles as their primary way of electrifying the morning commute and evening commute, so the mass transportation of people into and out of working school is the major transport challenge of the modern world. And China looks to be swinging back towards lead as a potential energy storage choice for that market which we think is pretty encouraging. So I have shown this slide a couple of times as well and it really outlines that the key process that in an AquaRefinery and I’ve used in the past to show that each one of our steps is wet. And if you keep something wet it’s pretty difficult to make a gas over dust. But it also shows is that there are number of key elements in an AquaRefinery, for example the front-end where we break a battery and then we separate out the plastics and the metallics and what is referred to as lead paste. And then there is a stream of production in which the lead paste is what's called desulphurized before its AquaRefined and then turn into ingots of high purity primary lead. And it’s a parallel stream that comes from the breaker in which the metallic lead that’s the lead alloys that are used to make the lead grids is a separate stream and that goes into an ingoting process and [indiscernible] secondary lead or as lead alloys. The most of our timing in building and planning this business, we viewed the process of commissioning is to be one in which we would have to get every single one of those process is fully commissioned in synchronization before we could turn on. And we came to realize that quite so obviously maintaining the ideal situation is difficult than unrealistic in the real world of operating large scale plant that’s going to consume hundreds of tons of batteries a day and produce hundreds of tons of lead a day. So we put a lot of work into looking how we can delink those processes from each other. So for example, running larger or lower quantities of metallic lead through the ingoting side and larger or lower quantities of lead paste through the desulphurization and ultimately into AquaRefining. And what we have been able to do is actually achieve the ability to delink those processes. That’s’ given as a large degree of flexibility in how we operate the plant. And it allows us to actually release additional capacity that gets us to the 120 tons a day. In that process, there are number of products that we can actually sell and selling to battery companies the direct using in battery production. I am not going to expand on what those products are; we are taking the decision to keep those as a trade secret. Obviously, our competitors would love to know what we are doing in the details of an AquaRefinery and something we are not going to release publicly. But essentially we’ve used the flexibility inherent in that process to allow us to go from 80 tons a day of plant capacity into 120 tons a day of plant capacity. So moving on, the photographs of the first facility and the key points we’ve build and made our first lead, we’ve assayed at is better than 99% pure. We are providing samples to battery companies and potential licensees for them to analyze and validate for themselves. One of the key precedents that we set or established rather is that the State of Nevada is determined that AquaRefining is not subject to NESHAP standard which is the permitting standard required for smelters. And that’s a federal rule, not a state rule and we think that’s an important part of establishing precedents that will help us accelerate roll out and expansion and we believe this is one of our core strengths. So I am going to move now to a short video which shows the startup of our first AquaRefinery. Unfortunately, we can’t do audio with video so you're going to lose my voice for just a minute as we run through the video and so we’ll be back as soon as we’ve play this. Now into licensing. It’s appropriate that we share with people what exactly is that we are doing. So what that video showed was a single module of six electrolyzers, each electrolyzer has a series of large rotating-disk cathodes. They rotate during the plating process and are continuously scraped. What we plate is a very, very high surface area form of lead that consists primarily of nanostructures of lead in very, very, very high surface area. The cathodes are continuously stripped, the lead comes off, drops on to a conveyor then it’s taken off to a machine that we call a [indiscernible] that compresses that soft lead. What it actually does? It consolidates the lead into solid metallic lead at room temperature and it’s quite a remarkable process. We’ve taken the decision to then put that into an ingot machine and make a standard ingot of lead for sale. Okay. So moving on, really I want to talk about business expansion at this point and the three elements: the Tahoe Reno Industrial Complex, we want to increase our projected capacity for TRIC from 120 tons a day to 160 tons a day and focus on establishing Aqua branded lead as a premium high purity lead. We believe we've got the capability to do that. Then we are going to add additional AquaRefineries in North America. And as I mentioned earlier, discussions on non-diluting funding to build a total of 800 tons a day, they are progressing well. We started visiting potential sites and firming up our power plants. And then the large part of what we want to do next is to launch into equipment licensing during 2017. And I mentioned earlier that we’ve completed initial testing of feed stock. We’ve developed a Master Franchisee model. And what we want to do is complete about nine months of operation of TRIC before we start delivering modules to third-parties, but that doesn't mean that we're going to wait for nine months before we actually establish any licensing relationships. So this next slide is really trying to show the scale of the upside to the business and we bounded this time around in $22 billion lead market. To put that in perspective, the AquaRefinery that was built at Tahoe Reno Industrial Complex is currently got a capacity of 120 tons a day and we are going to expand it to 160 tons a day. At 160 tons a day it will have 32 AquaRefining modules. But it will be just 0.2% of the world’s lead production and we’re projecting revenue between $100 million and $120 million a year of that scale. If we build five AquaRefineries totaling 800 tons a day that will be 160 modules which is still be just 2.1% of the world’s lead production, but it would give us somewhere in a region of $500 million to $600 million a year in revenue. To address the bulk of the market which is 38,000 tons a day and many people think that’s actually a significant under estimate. The number of AquaRefining modules would lead to having service is 7,500 to represent 100% of world lead and that’s a $22 billion market. So you can see - for us the key point is that transition into licensing. We don’t think we could build fast enough to actually manage the lead demand and you can see the scale of the upside as we roll out into licensing. And what we found is that as we built the facility as we did in our open-day and we invited people along to look at it. We are at the point now where a very large majority of North American battery manufacturing and distribution and even a significant amount of smelting capacity has been to our facility, looked at it and been incredibly receptive to it. What we are seeing is the lead market and the customers for lead-acid batteries and those who make lead-acid batteries are highly receptive to a clean alternative to smelting and a source of high purity lead. And one of the things that history shows is that if you have a traded commodity and you develop a step change into how that traded commodity is manufactured. A step change improves cost quality or some other important thing, in our case all three. You generally - to get it right you can generate exceptional returns and precedents for that include Henry Bessemer who invented the dominant process for manufacturing steel in the 1890s, Nucor who came along later on and displaced blast furnaces with mini furnaces. Pilkington who in the 1960s developed the way that all of the world’s glass is made and soon as we figured out how to make the silicon wafers in a form pure enough and cheap enough to trigger the silicon revolution. So very large returns are made with step changes to globally traded commodities. So at the point, I'm going to hand over to the financial guide. Tom?

Thank you, Steve. I'm going to start with just a brief recap of the third quarter 2016 results. For the three months and year ended September 30, 2016, we had an operating loss of $3.3 million and $8.3 million respectively. Less non-cash cost would include stock option compensation, depreciation, amortization and consulting warrant cost. Third quarter operating loss is $2.9 million and year-to-date operating loss is $6.8 million. The net loss for the third quarter of 2016 was $3.5 million and $8.6 million for the year-to-date. We had $16.5 million in cash and cash equivalents as of September 30, compared to $31.8 million as of December 31, 2015. Now I would like to point out a few key financial highlights for 2016. On May 18, we signed a strategic partnership with Interstate Batteries. Highlights of that transaction which we've talked about before, but are important to repeat is Interstate Battery purchased 702,000 shares of the Company for gross proceeds of approximately $5 million. Interstate Battery also loaned the Company $5 million pursuant to a secured convertible promissory note. The note bears interest at 11% and the loan will mature on May 25, 2019. Also we granted to Interstate two warrants to purchase additional common stock. The first warrant is fully vested to purchase 702,000 shares and it expires May 18, 2018. The second warrant vesting in just another week or so on November 18 of 2016 as a warrant to purchase 1.6 million shares and that expires on May 18, 2019. The average exercise price is $8.43 per share. The Company at the same time with certain accredited investors sold 719,000 shares for gross proceeds of $5.1 million. Liquid venture partners through National Securities Corporation acted as placement agents. Details of these transactions can be found in our 10-Q. In September of this year, the State of Nevada granted the Company property tax incentives which combined with tax incentives granted in May of this year are worth an estimated $3.6 million. As of September 30, we have spent $34.2 million on the Nevada plant inclusive of land, building and equipment. Staff including full-time consultants increased from 22 at the beginning of 2016 to 50 currently of which 22 are in our Nevada plant. Outstanding common shares as of September 30, was $15.6 million. With that, I'll turn the call back over to Steve.

Thank you, Tom. Well I'm just going to wrap up now with key takeaways. So first one is that after 18 months and I need to say that again after just 18 months what was a 12-acre patch of dirt in the Nevada desert is now the world's first recycling facility or AquaRefining facility and it’s transitioned into commercial operations. As I mentioned before it's got 120 tons a day of installed capacity. First lead samples assayed at 99% and potential customers and licensees have recognized this as a massive achievement. We are working hard to secure non-dilutive funding that will take us up to 800 tons a day of our own operations in North America. And I must say in addition to that, we would expect - do expect to provide equipment to other parties in North America for them to produce their own lead. We are evaluating sites for our second and third AquaRefineries. Transitioning into a licensee model in 2017 is underway and we’ve completed the trials with feed materials. And we are establishing additional strategic relationships as one of the things that we believe we’ve done well so far with the relationships we’ve worked with Battery Systems Inc., and Interstate has provided us the equipment and the supply of the used batteries. We’re now looking to expand and working closely with a number of potential strategic partners to extend our portfolio of strategic relationships. And out of that has come a process and idea and possibly a business around a Master Licensing relationship for China and other regions. We built a strong team. We have built a phenomenal team. We built a team in which one of our technicians got married and delayed her honeymoon for four weeks, so that she could be there to support us who also produced first lead. We built the team those who work hour after hour after hour through to 1 and 2 o'clock in the morning, making sure that we made first lead when we said we made it. I cannot speak highly enough of the quality of the guys and gals who work for us. And last but not least, we are establishing strong relationships in the community, in the industry and elsewhere and we are looking to build more. So with that, I’ll hand back to the operator for questions. Thank you.

Thank you, sir. We will now begin the question-and-answer session. [Operator Instructions] We will take our first question from Colin Rusch with Oppenheimer.

Thanks so much guys. Steve could you talk a little bit about the process capacity and where the improvements are coming from on the AquaRefining tools? And then as we think about the front-end of that facility, I am assuming that those systems are fairly well characterized or we going to think about additional CapEx as you scale up to 32 units in that facility? Or should we think about that facility sells the Master Capacity just with a lower CapEx number?

So as I mentioned earlier - thanks Colin for the question. So the front-end of our facility, the breaker and separating equipment has got a capacity of about 207 tons a day of lead output, if we chose to run a 24/7 52 weeks of the year which is not how you run a breaker conservatively, it’s nicely over capacity to support 160 tons a day of lead production. To jump into the last part and I’ll go back to the early part of the question. Ultimately, our plan is to have 32 AquaRefineries - AquaRefining modules rather onsite producing 80 tons a day of hard lead or lead alloys of some combination of hard lead and lead alloys and 80 tons of day of AquaRefined lead. And I have to be careful when I say 32 modules because we - it's quite possible that would change the capacity of the module. In the past, we got a little bit too precise around exactly how much lead comes off an individual module. A module is an electrochemical process; it's normally rated for 5,000 amps. We can actually run 500 amps and as we’ve learned it’ll actually run 7,000 amps. So the output per module is somewhat variable. There are tradeoffs and there is an optimum production ways and capacity for which you can run a module. You asked how we’re going to raise more capital to build out the additional AquaRefining capacity possibly.

Actually so moving to other question. I am just wondering about the additional potentials are to spend more on CapEx there. I am assuming that you have multiple options for financing additional capacity that you’ve talked about that’s being non-dilutive to several quarters about that?

And that’s exactly, we would be - if we are going to raise more capital to expand the AquaRefining side of it, it would be debt obviously more than non-dilutive form.

And then just thinking about the stat in underwriting what are your lenders telling you in terms of kind of operational data they are going to want to see to get more comfortable with the process, obviously with the first of this kind facility, the first loan was a bit more complex that as you are up and running. So I mean are they looking for two quarters of data, are they looking for a full-year and are they going to take some of the information from the trust for your customers that clearly how foreign expertise and they will and the importance and production in many of the facility?

Good question. I’m not going to give the precise details of what individual lenders are looking for, but it is - there are terms that we’re quite comfortable with, it’s more towards the months or weeks of operating data rather than years and it’s really related to AquaRefining rather than breaking and other elements of it. So it’s complex, but it’s quite achievable.

And then how should we think about timeline on your decision making process around some of the licensing opportunities. Clearly, you want to keep this moving, but no need to rush into non-optimal decisions here, but are we thinking that you’ll make some decisions for the next couple of quarters and then implement that in 2017 or you thinking you are going to make those decision soon and then start implementing early in 2017?

So we already having those discussions and have been having those discussions for some time. We are taking the view that it’s building an AquaRefinery on a licensing basis is something that we need to know as much about the licensee, as they need to know about our process, so it’s been a long get to know you process with potential licensees. I am not really going to give any guidance on precisely when we expect to start closing licenses, but I can’t say that it’s likely that licensing will be announced way ahead of the master being built because just the whole processes of getting things permitted, sizeable and all that simply goes with it or size cleared rather and everything that goes with it is a significant undertaking.

Perfect. Thanks a lot and well done guys.

Thank you.

Thanks.

We’ll go next to Jeff Grampp with Northland Capital Markets.

Hi, Jeff.

Good afternoon, guys, and then congrats on all the success you guys are having. I'm kind of curios on this move from the 80 ton to the 120 ton. Was that's something that when you guys are first putting this together that you saw it was maybe possible? Was it something that maybe came together as you guys were going through the process? And then just kind of building off of that and at the risk of coming off as greedy? Are there further possibilities to expand off of that going forward? Or should we consider that as kind of pushing the limits of things for you guys?

So first question, yes, it's something that we considered might be possible early on. We wanted to make sure we could do it before we told anybody. It is a theme here of make sure you can do it before you tell anybody is kind of key within the Company. So we thought we might be able to do it. As we built the facility, as we staff on with expertise and operating the various systems, we started to test that idea and found that we could then we validated it and then we did. So it was kind of a gradual process, but there is a thought that we might be able to do it from the beginning into an opportunity to expand beyond that. I never say never, but we think 120 to 160 is optimal for that particular site.

Okay. Got it. That’s perfect. And then just as we think about expanding to other sites in new AquaRefineries, should we be thinking about it or maybe rather how guys think about internally as maybe kind of taking things one at a time and in terms of once you've identified a site and feel good about moving forward you guys go with that as kind of a sole focus or do you guys have the capacity internally to look at maybe building couple of AquaRefinery simultaneously?

I think ultimately we’ll be able to build a couple of AquaRefinery simultaneously, but honestly I think it would be crazy to attempt to do that straightaway. We’ve learnt a huge amount in building this first one. We like what we build, but we probably never build one quite like that’s ever again. There are things with numerous opportunities for improvement and savings in cost, and land and various sorts of things, so we think the next one will be better. So in an ideal world, I think I'd like is to build one more as a standalone project and then actually roll out from that. And the roll out would include just additional facilities we're building for ourselves, but facilities that third-parties want to build that we would be helping them build.

Got it. Okay. And last one for me when you kind of talk about the permitting process and that being one of the core competencies for yourselves and having some of the precedents set as far as their quality and things like that. Have you guys had conversations with some other states that you’ve maybe identified as being potential? Have they come to the same determination as Nevada and do you guys feel comfortable about those types of discussions or have talks gone that far yet in the other areas you’ve identified?

So we have talked to the regions, so we've got a very advance dialogue with EPA Region 9, which is at the state of Nevada reports to EPA Region 9, which itself then reports through the Federal EPA’s various organs. We have a dialogue with EPA Federal level and regional level. We haven't specifically - yes, we have spoken to actually two of the states. We can’t say the precedent has been made because you don't know until you actually apply and get approval. But we think - we believe that what we did in Nevada has established a very important precedent for us. So what we think we’re seeing is a very large amount of enthusiasm with in the regulators for a cleaner alternative to smelting.

Got it. Understood. Appreciate the time.

Thank you.

[Operator Instructions] We will now go to Bhakti Pavani with Euro Pacific Capital.

Hi, guys. Congratulations on the success.

Thank you.

Thank you.

Just a quick question on the improvement of the process from 80 to 120 tons per day, was there any kind of additional CapEx involved in doing the process or was it like a very smooth transition?

That’s a difficult question, because it doesn’t really look like that. What we did right from the beginning was set the building and the support systems to be able to process 160 tons a day. So we already put more capital into the facility on the expectation that we would and we are going to expand it to 160 tons a day. So in terms of additional CapEx, I don't think it be true to characterize it, saying yes, we spent more money on doing that. What we are able to do was increase the flexibility of operation of the various subsystems to unlock the additional capacity.

Okay. And also would it be fair to say because I’m assuming the 120 tons per day is going to be produced using the same number of modules as you guys were going to produce 80 tons per day, so it would be expansion to 160. Would it be fair to comment that it would be more than 160 tons per day when you have that additional expansion done?

It would not necessarily be true to say that.

Okay.

And just to be clear, we will have 16 modules online when we are at 120 tons a day and 32 modules online when we are at 160 tons a day.

Okay. Also with regarding the samples that you have provided to the U.S. battery manufacturers, just kind of curious how long does this assay results take and what do you expect, I mean would the companies be sharing the assay results with you and when do you expect to kind of receiving the orders?

The assay takes very small amount of time. The industry all uses the same basic equipment; it’s called an arc spark. We have one, it’s been commissioned and validated and when we do our testing we are doing into the same standards that anybody else does. We have shift most of the samples I think. We are not really pushing people to come back to it straight away so we’re just letting people running through their normal process of making samples and alloys in the most lead and lead acid battery companies have got a backlog of things going through the analytical facility, so we’ll hay back, when we hay back.

Okay. Also the press release stated that so far you have commissioned five modules and you have remaining modules to be commissioned. From the timeline perspective, how much time do you think you guys would take in order to commission the remaining modules and also with regarding to the breaking system, would there be any kind of touched running done before you guys get into full scale production?

So we are going to run - commissioning the other four modules that we have on site, we’ve got the remaining, the balance of the modules here at various stages of assembly. We are going to run probably at least a month on the five modules that we have got before we complete the assembly and ship out just to make sure that we have got everything nailed down before we commit to building the others. We said that we’ll have the other - balance of the modules onsite in early 2017. Is it all about running the breaker? The breaker is being commissioned to full operation this week and next week and that’s just a process of [indiscernible] turning it on and running it. Yes, you don’t know it’s working until you see the batteries and get an output of product.

Okay. All right. That’s it from my side. Thank you very much guys.

All right. Thank you.

And that concludes our question-and-answer session. I will now turn the conference back to our management for any additional or closing remarks.

Okay. Thank you. Well, I just want to say thanks. It’s been a huge milestone for us to be able to make AquaRefined lead for me personally has been hugely exciting and I think it speak for all of the management team. We built our first lab scale AquaRefining test system nearly three years ago, more than two years ago we had a large scale pilot and then a single electrolyzer operating. So we all know it worked, but it doesn’t mean anything until you put into a commercial operation and make some lead and sell it and we’ve been able to get to that point and it’s hugely thrilling. So I want to say thank you for you guys who’ve invested in us and follow us and keep watch more of these spaces there is more to come. Thank you.

And ladies and gentlemen, that does conclude today’s conference call. Thank you for your participation.