Good afternoon, and welcome to NuScale's Fourth Quarter and Full Year 2022 Earnings Results Conference Call. Today's call is being recorded. [Operator Instructions]. A replay of today's conference will be available and accessible on NuScale's website at ir.nuscalepower.com. The web replay will be available for 30 days following the earnings call. A telephone replay will also be available for 7 days through a registration link, also accessible on NuScale's website. At this time, for opening remarks, I would like to turn the call over to Scott Kozak, Director of Investor Relations. Please go ahead, Mr. Kozak.

Thanks, operator. Welcome to NuScale's Fourth Quarter and Full Year 2022 Earnings Results Conference Call. With us today are John Hopkins, President and Chief Executive Officer; and Chris Colbert, Chief Financial Officer. On today's call, NuScale will provide an update on its business and discuss financial results. We will then open up the phone lines for questions. This afternoon, we posted a set of supplemental slides on our Investor Relations website. As reflected in the safe harbor on Slide 2, the information set forth in the presentation discussed during the course of our rooms and the subsequent Q&A session includes forward-looking statements which reflect our current views of existing trends and are subject to a variety of risks and uncertainties. You can find a discussion of our risk factors, which could potentially contribute to such differences in our SEC filings on Form S-1 and Form 10-K. I'll now turn the call over to John Hopkins, NuScale's President and Chief Executive Officer. John?

Thank you, Scott, and good afternoon, everyone. 2022 was a year of increasing momentum at NuScale as we made important progress toward our mission of helping power the clean energy transition through the development of our safe, innovative and cost-competitive VOYGR SMR power plants. This momentum was evident in the fourth quarter as we delivered on our remaining 3 goals for the year, enabling us to accomplish all 5 of our 2022 milestones, as you can see on Slide 4 of our presentation. With this progress, we have the ability to deliver NuScale power modules in 2028 to the customer order. Let me walk you through these important development points. First, turning to Slide 5. In December, we secured our second committed customer, Romania's Road Power, with a signing of a contract for Phase I of front-end engineering and design or FEED work. Activities completed during the first phase of the FEED work will define the major site and specific inputs for our VOYGR 6 SMR power plant, which will be deployed at the Doicesti power station in Romania, formerly the site of a coal-fired power plant. As you may recall, President Biden touted our relationship with RoPower in his remarks at the G7 launch of the Partnership for Global Infrastructure and Investment, where the President committed to help raise $600 billion by 2027 for strategic investments critical to sustainable development and our shared global stability. President Biden noted that NuScale's first-of-its-kind SMR plant will help bring online zero emission energy to Europe faster, more cheaply and more efficiently. We couldn't agree more. At NuScale, we believe that our agreement with RoPower illustrates our VOYGR technology presents a safe, economic and scalable solution, not just for Romania, but as the President mentioned, the broader European region and beyond as countries…

Thank you, John, and hello, everyone. Our financial results are available in our press release and filings so my focus will be our performance drivers. I'll start by discussing our fourth quarter results followed on Slide 11 and touch on 2023 full year. All figures following our fourth quarter 2022 unless I state otherwise. NuScale ended the year with a cash balance of approximately $268 million. As you would expect, most cash is related to operating expenses as we pivot into production and commercialization. R&D increased due to higher professional fees associated with standard plant design completion as well as the increased headcount to support ongoing licensing efforts. CapEx was minimal and again, mostly comprised of software and computer hardware to support R&D, which is consistent with our asset-light model. Offsetting expenses and CapEx was the Department of Energy cost sharing of revenue. Our revenue is limited but growing as we would expect with the company's current phase of development. As a reminder, at this stage in light of our partnerships, we mainly generate revenue by providing consulting services to customers. Stepping back and looking at the full year, NuScale's with strong foundation both to transition our business into commercialization phase. When we went public last year, the company raised an additional $342 million. During the year, our cash position was augmented by the exercise of warrants and options that raised a further $29 million. Together, these actions strengthen NuScale's balance sheet and provided the business with considerable financial flexibility to support the advancement of our strategic and operational objectives in 2023 and beyond. On Slide 12, looking ahead, we provide insight on drivers for higher than previously anticipated cash use in 2023. Please keep in mind that the company with an asset-light model in the early stages of commercialization,…

[Operator Instructions]. We'll take our first question today from Marc Bianchi, TD Cowen.

I want to first ask about the cash update here and just trying to understand the moving pieces. Like how much of a DOE -- what were you expecting? And what are you getting? And kind of what gives you confidence that you're going to be able to recover that in '24?

Thank you, Marc. This is Chris Colbert, CFO. So we presented a range for cash flow from operations of $102 million to $142 million to bracket the range that we would expect from the DOE, getting what we request or not getting what we request from them. That's what brackets the range that we're seeing for them. In terms of the level of confidence, every year, we go through the same drill where there is a request put in. And then we work with our folks explaining what we use the money for in the past, what we would use it for in the future. And then we receive at the end of the year a budget request or an enacted budget. For example, last year, budget request was for $30 million. The final enacted budget was for $165 million. And that's been a very typical sort of evolution through the last several years, where there isn't very much correlation between the President's budget request and what gets enacted. So we'll continue to monitor this and work through it. And if we have a sense of confidence on how things are moving forward, we'll be starting to update folks. But right now, we're just working with what is the very first step in the process, which is the President's budget request.

Okay. Great. And the prior outlook was to be free cash flow positive in '24, I believe. Is that still the expectation because there's some other stuff going on here, right? The progress payment shifting around, inflation. I'm just wondering, in light of those, are you still anticipating free cash flow in '24?

We haven't really forecasted out to 2024 at this point in time, but there's nothing for us to believe if we continue in the process we're on in terms of both the customers we have in hand and the customers we want to get in hand this year that, that objective could not be met. But that's something that will play out through the year, and we'll update it as we have a better understanding as to both how our markets are developing. And our first customers are moving forward through their process of engaging us on work to move forward with their plants.

Yes, okay. One thing that hasn't been discussed that kind of came up with UAMPS latest cost estimate and competitive test was that there was a 80% subscription requirement, I believe, put into the agreement there. So my read on that is basically the project needs to go from, say, 25% subscribed today to 80% by February of 2024 or you could be responsible for reimbursing UAMPS for the cost. Can you maybe talk about the update to the agreement there? And what level of confidence you have in being able to see the subscription levels up to that level?

So I think you got it very well, Marc, so good on reading the report and following through that. But what you stated is actively correct, that would go from 25% to 80%. We'd be liable for potentially reimbursement if they chose to terminate for failure to reach that point. In terms of our confidence of gain at that point, we are working with UAMPS in the carbon-free power project to bring in that additional subscription. And we'll be monitoring that throughout the year as we move forward with them. The news is that as you saw with them coming forward with 26 or 27 members voting to move forward with the project earlier this year at the $89 per megawatt hour price, that's very much indicative of a market that's changing and tightening in that area. And depending upon those factors going forward, we think that will continue in the Western region, particularly as coal plants continue to retire at a faster pace than expected, as we see people looking to get benefit from the Inflation Reduction Act we're making investments now as opposed to later on.

Is it more likely that the increased subscription comes from the existing members increasing their level? Or are there other parties that are more likely? I don't know if it's a power producer that would be looking to take a piece of the project or -- what are the likely candidates there?

All of the above. But to give you a data point, at one point, the U.S. members had signed on to 250 megawatts of electricity from the project, which could be a proxy of what they need. So they could do that at some point. We're also seeing interest from investor-owned utilities and increasingly, folks that have large energy needs and they need reliability are also interested in it, particularly data centers and the like moving forward. So those are all opportunities that we see that aperture opening, not narrowing and more people becoming interested in it.

At this time, everyone, there are no further questions. I'll hand the call back to NuScale CEO, John Hopkins, for any additional or closing remarks.

Thank you, operator. We're the only SMR design certified by the U.S. Nuclear Regulatory Commission. NuScale is well positioned to commercialize and deliver clean energy at scale. NuScale technology is essential to powering the global energy transition. And we are at the forefront of that effort with our work to deliver safe, scalable and reliable carbon-free nuclear power. I could not be prouder of our team for delivering on each and every one of our important goals over the past year. And we appreciate the support of our investors and partners around the world who are enabling us to deliver on the opportunities ahead. I look forward to what we will accomplish together in 2023. I'd like to thank all of you for your interest in NuScale and for participating in our call today. Operator?

And once again, everyone, that does conclude today's conference. We would like to thank you all for your participation today. You may now disconnect.