Good afternoon, and welcome to NuScale's First Quarter 2023 Earnings Results Conference Call. Today's call is being recorded. All participants are in a listen-only mode. After managements prepared remarks there will be a question-and-answer session. [Operator Instructions]. Thank you. 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 seven 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 First Quarter 2023 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 of 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 and discussed during the course of our remarks in 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-Q. 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. I will discuss our recent progress across several operational and financial priorities. Then my colleague, NuScale’s CFO, Chris Colbert, will provide a detailed update on our financial results and outlook. NuScale is growing and maturing as we continue to build momentum on our path towards commercialization. We are leading the charge as the only publicly traded, pure play company focused on zero carbon base load power generation and next generation nuclear technology that supports the critical emerging trends in clean energy and in energy security. As highlighted on Slide 3, our market opportunity is fueled by dual drivers. First, the energy transition. As power generation must increasingly be sourced from carbon-free sources, including renewables and nuclear, rather than fossil fuels. Second, the growing market need for energy, which is massive and growing. According to a recent McKinsey study, demand for electricity is expected to triple by 2050 as the world shifts away from fossil fuels towards electrification. The resulting need for new low carbon and zero carbon generation will be unprecedented. McKinsey estimates that this energy transition could require an additional 400 to 800 gigawatts of new nuclear capacity, about 10% to 20% of the future global electricity demand, to meet the need for dispatchable power by 2050. NuScale is preparing to help solve this need. We have numerous competitive advantages and are years ahead of our competitors in the small modular or SMR industry. Not only are we the only SMR design certified by the U.S. Nuclear Regulatory Commission or NRC, but we are also cost competitive, have an established manufacturing and fuel supply infrastructure, and are poised to begin manufacturing our NuScale power modules later this year. On Slide 4 we highlight the five 2023 company objectives that we detailed on…

Thank you, John and hello everyone. Our financial results are available in our press release and filings, so my focus will be on NuScale's performance drivers. I'll start by discussing our first quarter results found on Slide 11. All figures following refer to NuScale's first quarter 2023 results, unless I state otherwise. NuScale ended the quarter with a cash balance of approximately $252 million. Consistent with past quarters, our primary use of cash is related to operating expenses as we continue our pivot into production and commercialization. Operating expenses were elevated in the quarter due to compensation costs associated with a growing headcount and minor shifts in project schedules. While the shifts impact quarterly results, they are not meaningful to our overall project timelines. CapEx was minimal and, again primarily consists of software and computer hardware to support R&D, consistent with our asset-light model. Partially offsetting expenses in CapEx was the cost share earned from various federal agencies and revenue. As previously stated, the DOE's fiscal year 2023 appropriations available for NuScale were lower than anticipated. Consistent with our DOE award agreement, we requested an amount for the fiscal year 2024 appropriation that would make up for the shortfall in fiscal year 2023. This funding is critical to support our continued participation in the CFPP. The DOE appropriations process is ongoing, but I can relay that our outreach to Capitol Hill is proactive and extensive. NuScale continues to receive strong bipartisan and bicameral support, as well as backing from the Biden administration. We expect fiscal 2024 DOE cost share to be determined in the latter half of the year. Revenue remains limited, as expected, given the company's current phase of development. At this stage, we mainly generate revenue by providing consulting services to customers. As we pivot to manufacturing our…

Your first question is from the line of Shahriar Pourreza with Guggenheim Partners. Your line is open.

Hey, guys. Good afternoon. It's actually James for Shahriar. John, you had hit a little bit on it in your prepared remarks, but can we get a little more color on how the conversations are progressing with some of those entities to hit that committed subscription level, the CFPP?

Yes. Actually Shah, thanks for the question. It's going quite well. What we're looking at is members that can up their subscription from what they currently have. We're in discussions also with certain industrials that don't necessarily want to own a nuclear asset, but they certainly want the 24/7 clean energy that will be awarded from our CFPP project. So we continue to work it with the customer, and so far the progress is looking pretty good.

Okay. Do you expect to I guess update the Street on nuclear as they happen or more broadly, just what kind of visibility will we have on the process as it ramps up?

No. We'll continue to update as it goes forward, and like I said, we're – I got a chest cold here. No, we'll continue to update obviously as we continue to progress.

Okay, perfect. Thanks, guys.

[Operator Instructions]. Your next question comes from the line of Marc Bianchi with TD Cowen. Your line is open.

Hey, thank you. I guess, I think it was Chris mentioned some of the vendors working with you on CFPP to sort of adjust the timelines there, a little bit to align with their timeline. I guess, does that help from the vendors also, potentially lower the cost estimate below the $89 per megawatt hour, that was the latest update?

Hey Mark. This is John. In fact, two weeks ago, I was in both Japan and Korea speaking with our strategic partners, and what we continue to talk about is anyways they and we collectively can continue to drive cost down. As you know with inflation and interest rates being what they are, these suppliers have taken a very holistic view. They are not looking at this as a one-off project and so their intent is to continue to drive competitiveness as much as possible. In Korea, I got to tell you, the fact that we're actually pouring steel and in the process of delivering or going to be delivering our first forging, their Doosan Enerbility is extremely excited. We're excited about it. And the same thing goes across the board with Samsung C&T. Everybody we meet with understands that cost of schedule is crucial to the success of our project. So they're willing to sharpen their pencils as much as they can.

Okay. Maybe more broadly on costs, if I look at some of the stuff that's in the budget for UAMPS and CFPP project, there's like a $9 billion number that they have for the cost estimate for that. And I don't know how representative that might be of a first of a kind cost, but maybe you could talk about sort of where you see overnight first of a kind cost and how many copies you need to deliver to get that down to whatever your Nth-of-a-kind target is going to be.

Yeah. Collectively Mark, we're just now entering to the Class 2 estimate. So, working with Fluor Corporation plus our suppliers as I stated earlier, every efforts being to drive that cost as low as possible. You know we're starting to see on the supply side, things are starting to free up a little bit. But with inflation and with the interest rates we're faced with, we will continue to focus on. Right now, we feel very comfortable with that $89 megawatt hour and hopefully we'll be able to, as we go through the Class 2 estimate, reduce it further down. Chris, do you have anything to add?

No, I think he covered it, John. Thanks.

Chris, the first quarter cash from operations was a $43 million use. I know you've got the guidance out there of 100 to 140 use for the year. But just curious, is there any thoughts on, besides the DOE money coming in later this year potentially, big things that could move cash up or down? And do you see it more likely at the high end or the low end of the guidance ranges given how first quarter shaped up?

Yeah. So, really in terms of the guidance we gave for a range that was driven primarily by the variability in the DOE funding that could come to us from the fiscal year ’24 appropriation, which would come in the last quarter of the year. So everything else we're seeing is probably some shifting between quarters. But overall, the cash flows and the schedule we have are still pretty good, so that the overall guidance we have of that range of $102 million to $142 million cash use is still operative for us and there's no reason for us at this point to change that. But, rest assured that if information comes to light where we can either solidify or need to update, we will certainly do that. But as of right now, we're still comfortable with that range.

Okay, great. I just got one more and I don't know what you guys can say on it. But Fluor, the other day on their call had mentioned kind of in discussions or working with their strategic investor to kind of get their position down to their minority target I think by the end of the year, which seems like a pretty aggressive timeline. But I would suspect that you guys might be involved in some of those conversations with investors. So, if there's any color you're able to add on that, it would be appreciated.

Yeah Mark, I don't know. With our NDAs in place and what Fluor's doing in their transaction, there's really not much we can say actually.

Okay, fair enough. I'll turn it back. Thank you.

That concludes our Q&A session. I will now turn the call back to Mr. John Hopkins for closing remarks.

Thank you, operator. Again, with the only SMR design certified by the U.S. Nuclear Regulatory Commission, with two secured customers and a robust business development pipeline, NuScale is well positioned to commercialize and deliver clean energy upscale. Nuclear technology is essential to powering the global energy transition, and we are at the forefront of that effort with our ability to deliver safe, scalable and reliable carbon-free nuclear power. As I stated earlier, we are off to a good start in 2023 with progress on all fronts, and I look forward to what we can accomplish together throughout the remainder of the year. Again, I'd like to thank all of you for your interest in NuScale and for participating in our call today. Thank you.

Ladies and gentlemen, this concludes today's conference call. You may now disconnect.