Aqua Metals Inc (AQMS) 2024 Q2 法說會逐字稿

Thank you, operator, and thank you, everybody, for joining. Earlier today, Aqua Metals issued a press release providing an operational update and discussing financial results for the second quarter ended June 30, 2024. This release is available in the Investor Relations section on the company's website at aquametals.com.

謝謝運營商，也謝謝大家的加入。今天早些時候，Aqua Metals 發布了一份新聞稿，提供了截至 2024 年 6 月 30 日的第二季度的營運更新並討論了財務業績。新聞稿可在公司網站 aquametals.com 的投資者關係部分取得。

Hosting the call today are Steve Cotton, President and Chief Executive Officer; and Judd Merrill, Chief Financial Officer.

今天主持電話會議的是總裁兼執行長 Steve Cotton；和財務長賈德·梅里爾。

Before we begin, I would like to remind participants that during the call, management will be making forward-looking statements. Please refer to the company's report on Form 10-K filed March 28 for a summary of the forward-looking statements and the risks, uncertainties and other factors that could cause actual results to differ materially from those forward-looking statements. Aqua Metals cautions investors not to place undue reliance on any forward-looking statements.

在開始之前，我想提醒與會者，在電話會議期間，管理階層將做出前瞻性聲明。請參閱該公司 3 月 28 日提交的 10-K 表格報告，以了解前瞻性陳述以及可能導致實際結果與前瞻性陳述有重大差異的風險、不確定性和其他因素的摘要。Aqua Metals 提醒投資者不要過度依賴任何前瞻性陳述。

The company does not undertake and specifically disclaims any obligation to update or revise such statements to reflect new circumstances or unanticipated events as they occur, except as required by law. As a reminder, after the formal remarks, we will be taking questions.

除非法律要求，否則本公司不承擔並明確聲明不承擔任何更新或修改此類聲明以反映新情況或意外事件發生的義務。提醒一下，正式發言後，我們將接受提問。

Questions will be accepted over the phone from analysts, and all other investors can submit a question using the online webcast portal provided in today's and earlier press releases. We will take as many questions as we can in our available time slot.

分析師將透過電話接受提問，所有其他投資者都可以使用今天和之前的新聞稿中提供的線上網路廣播入口網站提交問題。我們將在可用的時間內回答盡可能多的問題。

And with that, I'd like to turn the call over to Steve Cotton, CEO of Aqua Metals. Steve, the call is yours.

說到這裡，我想將電話轉給 Aqua Metals 執行長 Steve Cotton。史蒂夫，電話是你的。

Thank you, Bob, and thank you to everyone who joined us today. This past quarter, Q2 and subsequent time period has seen quite a bit of activity where we have control and also quite a bit of general industry environment development where we do not have control.

謝謝你，鮑勃，也謝謝今天加入我們的所有人。在過去的一個季度、第二季度和隨後的時間段裡，我們看到了相當多的活動，我們可以控制，也有相當多的一般行業環境發展，但我們無法控制。

Starting with what we cannot control. Since our last update call, critical battery minerals prices have plunged. One specific example is that lithium carbonate has retracted another 25-plus percent just since we signed an up to $33 million long-term sheet in May with one of the largest privately held companies in the world.

從我們無法控制的事情開始。自從我們上次更新電話以來，關鍵的電池礦物價格已經暴跌。一個具體的例子是，自從我們 5 月與世界上最大的私人公司之一簽署了一份高達 3,300 萬美元的長期合約以來，碳酸鋰的銷量又下降了 25% 以上。

For those of us following lithium-related companies, we have also seen significant drops in market capitalization and, of course, share price during the same time period. We have also seen that interest rates remain stubbornly high while metals and stock market negative trends have taken place.

對於我們這些關注鋰相關公司的人來說，我們也看到了同一時期市值和股價的大幅下跌。我們也看到，利率仍然居高不下，而金屬和股市卻出現了負面趨勢。

Based upon these macro dynamics, after exhaustive due diligence on our technology and processes and economics of our processes, our lender concluded and we concur that the squeeze of metals prices coupled with debt service payments and covenants become untenable calculations at this point in time.

基於這些宏觀動態，在對我們的技術和流程以及流程的經濟性進行詳盡的盡職調查後，我們的貸方得出結論，我們同意金屬價格的擠壓以及償債付款和契約在此時點的計算是站不住腳的。

I will note, however, that both our lender and we agreed after this diligence that even at today's battery metal prices, Aqua Metals can still produce margin without debt service, and that is a testament to the favorable economics of our electrically driven AquaRefining process that does not require expensive front-end, onetime use chemicals or back-end waste stream costs, along with environmental and worker safety benefits. We are still on very good amicable terms with this lender and maintain a solid foundation for a longer-term relationship under better macro circumstances.

然而，我要指出的是，我們的貸方和我們在經過這次調查後一致認為，即使在今天的電池金屬價格下，Aqua Metals 仍然可以在不償還債務的情況下產生利潤，這證明了我們的電動AquaRefining 流程具有良好的經濟效益。我們與該貸方仍保持著非常良好的友好關係，並為在更好的宏觀環境下建立長期關係奠定了堅實的基礎。

Moving on to the middle. What we cannot control and what we can control is how we finance the completion of the Sierra ARC commercial plant, given the unfavorable macro circumstances I just described that have taken place and accelerated this past quarter. We believe our alternative financing approaches for which we are well down the path on, inclusive of executed NDAs, data rooms, regular engagement on technoeconomic discussions can beget success with a bit more time for completing these engagements.

繼續到中間。鑑於我剛才描述的不利宏觀環境在上個季度已經發生並加速，我們無法控制和我們可以控制的是我們如何為 Sierra ARC 商業工廠的竣工提供資金。我們相信，我們正在採取的替代融資方法，包括執行的保密協議、資料室、定期參與技術經濟討論，只要有更多的時間來完成這些參與，就可以取得成功。

The models we are considering as alternatives to debt service for the whole facility include project finance models, joint venture and/or potential strategic investors. At this time, this is the most appropriate path to complete the ARC and operate it with positive economics.

我們正在考慮作為整個貸款償還債務替代方案的模型包括專案融資模型、合資企業和/或潛在的策略投資者。此時，這是完成ARC並以正經濟效益運作它的最合適的路徑。

Now on to what we absolutely can control. First, people and cash burn. As you saw on our quarterly press release, the company has downsized staff that are primarily related to the rapid completion of the Sierra ARC, such as commissioning operations and support staff to make that all happen. This aligns our go-forward cash burn rate with a longer cash runway of another year while retaining the team to continue seeking alternative financing and, of course, continue to operate our state-of-the-art pilot plant at our Innovation Center facility.

現在談談我們絕對可以控制的事情。首先，人員和現金都被燒毀。正如您在我們的季度新聞稿中看到的那樣，該公司裁減了主要與 Sierra ARC 快速完成相關的人員，例如調試操作和支援人員，以實現這一切。這使我們的未來現金消耗率與下一年更長的現金跑道保持一致，同時保留團隊繼續尋求替代融資，當然，繼續在我們的創新中心設施運營我們最先進的試點工廠。

I also want to take a moment to deeply thank each and every employee that was released today for their shared vision, courage, commitment and positive impact to Aqua Metals. Just this year, we were the only lithium-related finalist for Best Places to Work in Northern Nevada, and that is a testament to the great people and culture we have at Aqua Metals.

我也想花點時間深深感謝今天被釋放的每一位員工，感謝他們的共同願景、勇氣、承諾以及對 Aqua Metals 的正面影響。就在今年，我們是內華達州北部最佳工作場所唯一與鋰相關的決賽入圍者，證明了我們 Aqua Metals 擁有優秀的員工和文化。

Second, commercial partner development continues strongly with no direct impact. We are still operating our showcase pilot, providing battery-grade industry samples to major industry OEMs directly and in partnership with our first CAM or cathode active material producer partner, 6K Energy.

其次，商業夥伴的發展持續強勁，沒有產生直接影響。我們仍在運營我們的示範試點，直接向主要行業 OEM 提供電池級行業樣品，並與我們的第一個 CAM 或正極活性材料生產商合作夥伴 6K Energy 合作。

Third, what we also control is the conviction we have that our technology and processes can make a huge positive impact on the economics, environment and worker safety throughout this burgeoning industry, rolling out the battery age. We all know that renewable energy and battery energy storage, electrification of transportation, the AI-powered data center world with increasingly massive battery storage systems are not all of that, but an inevitability.

第三，我們也堅信我們的技術和工藝可以對整個新興產業的經濟、環境和工人安全產生巨大的正面影響，從而推動電池時代的到來。我們都知道，再生能源和電池儲能、交通電氣化、人工智慧驅動的資料中心世界以及日益龐大的電池儲存系統並不是全部，而是必然趨勢。

We are as convicted in our belief as ever that Aqua Metals can ultimately be a leading player in how this industry closes the loop to support a growing domestic supply chain. Going forward, we will continue our engagement with our financing counterparties. We will continue provisioning equipment for the Sierra ARC, albeit more slowly and carefully in the near term.

我們一如既往地堅信，Aqua Metals 最終能夠成為該行業閉環支持不斷增長的國內供應鏈的領先者。展望未來，我們將繼續與融資對手方接觸。我們將繼續為 Sierra ARC 提供設備，儘管近期將更加緩慢和謹慎。

We continue to pursue some exciting strategic partnerships for which I'm hopeful to report in the future, and we will facilitate that with continued operations of North America's and perhaps the world's safest, cleanest, most economical lithium battery recycling facility.

我們將繼續尋求一些令人興奮的策略合作夥伴關係，我希望在未來報告這些合作夥伴關係，我們將透過北美乃至世界上最安全、最乾淨、最經濟的鋰電池回收設施的持續運作來促進這一目標。

Anyone is welcome to visit and see for themselves what we have created. We will, of course, keep the market apprised of our continued development. And I will now turn it over to our CFO, Judd Merrill, to discuss financials for the quarter.

歡迎任何人前來參觀並親眼目睹我們所創造的東西。當然，我們會讓市場了解我們的持續發展。我現在將把它交給我們的財務長賈德·梅里爾 (Judd Merrill)，討論本季的財務狀況。

Thanks, Steve. Our 10-Q reporting is finishing up some final reviews and will not be filed today. These final reviews will be completed shortly, and we expect to file the Q on or before the August 14 deadline. We have included our balance sheet and income statement in the press release that we just filed today. So those numbers are available for your review now.

謝謝，史蒂夫。我們的 10-Q 報告正在完成一些最終審查，今天不會提交。這些最終審核將很快完成，我們預計在 8 月 14 日截止日期或之前提交 Q。我們已將資產負債表和損益表納入今天剛提交的新聞稿中。因此，這些數字現在可供您查看。

Based on those financials, I will share a few key financial items with you. Let me start my comments with our balance sheet. As of June 30, 2024, we ended the quarter with total cash of approximately $7.8 million. Cash on hand will support costs related to our go-forward strategy, which includes engaging with leasing and/or equipment lenders to finance the remainder of the ARC equipment purchases, the continuation of enhancing and solidifying partnerships and continued pilot facility operations.

根據這些財務數據，我將與您分享一些關鍵的財務項目。讓我從我們的資產負債表開始我的評論。截至 2024 年 6 月 30 日，本季末我們的現金總額約為 780 萬美元。手頭現金將支持與我們的前進策略相關的成本，其中包括與租賃和/或設備貸款人合作，為 ARC 設備採購的剩餘部分提供資金、繼續加強和鞏固合作夥伴關係以及繼續試點設施運營。

On the balance sheet, I will also point out that we have increased property, plant and equipment by approximately $6.5 million and other assets by approximately $3.5 million. These increases are related to the purchase and deposit for the ARC equipment, allowing us to be fully ready for installation and construction. There are no other significant changes on our balance sheet since our last quarterly report, so I'll move to the income statement.

在資產負債表上，我還要指出，我們增加了約 650 萬美元的財產、廠房和設備，以及其他約 350 萬美元的資產。這些增長與 ARC 設備的購買和押金有關，使我們能夠為安裝和施工做好充分準備。自從上一季報告以來，我們的資產負債表沒有其他重大變化，因此我將轉向損益表。

The costs related to plant operations were approximately $2.4 million for the quarter and $4.6 million for the year. This represents a 60% and an 80% increase, respectively, over the prior quarter and year-to-date. The increase during the first half of 2024 was driven mainly by preparing to turn on the ARC Phase 1 facility. We expect these costs to decrease significantly as we have reduced expenses going into the second half of this year.

本季與工廠營運相關的成本約為 240 萬美元，全年約為 460 萬美元。與上一季和今年迄今相比，分別成長了 60% 和 80%。2024 年上半年的成長主要是由於準備啟用 ARC 一期設施。我們預計這些成本將大幅下降，因為我們減少了今年下半年的開支。

General and administrative expenses were little changed compared to the prior year, both quarter and year-to-date. We expect G&A costs to decrease as we head into the second half of this year and into 2025. Our net loss for the three months ended June 30, 2024, were approximately $5.6 million or a negative $0.05 per basic and diluted share compared to a net loss of $4.8 million or a negative $0.06 per basic and diluted share for the same quarter in 2023.

與去年同期相比，無論是季度還是年初至今，一般費用和管理費用幾乎沒有變化。我們預計，隨著今年下半年和 2025 年的到來，一般管理費用將會下降。截至2024 年6 月30 日的三個月，我們的淨虧損約為560 萬美元，即每股基本股和稀釋股負0.05 美元，而2023 年同一季度的淨虧損為480 萬美元，即每股基本股和稀釋股負0.06 美元。

Our net loss for the six months ended June 30, 2024, were approximately $11.3 million or a negative $0.10 per basic and diluted share compared to a net loss of $9.4 million or a negative $0.11 per basic and diluted share for the same period in 2023.

截至2024 年6 月30 日的六個月，我們的淨虧損約為1,130 萬美元，即每股基本股和稀釋股負0.10 美元，而2023 年同期的淨虧損為940 萬美元，即每股基本股和稀釋股負0.11 美元。

Our cash flow and stockholders' equity statement and financial footnotes will be available for your review once we file the 10-Q on or before the August 14 deadline. From a cash flow perspective, management believes that the reduction in force, along with nonessential asset dispositions, deferral of certain expenses and more standard equipment leasing, along with the cash on hand will provide approximately one year of cash runway.

一旦我們在 8 月 14 日截止日期或之前提交 10-Q，我們的現金流量和股東權益報表以及財務腳註將可供您審閱。從現金流角度來看，管理層認為，人員減少、非必要資產處置、某些費用的延期和更多標準設備租賃以及手頭現金將提供大約一年的現金跑道。

That concludes my remarks on the company financials. I will now turn it back over to the moderator for Q&A.

我對公司財務狀況的評論到此結束。我現在將其轉回給主持人進行問答。

(Operator Instructions) Michael Legg, The Benchmark Company.

（操作員說明）Michael Legg，Benchmark 公司。

Thanks. Good afternoon. Could you give us an update on the DOE grant you were applying for and also on the USDA?

謝謝。午安.您能否向我們介紹一下您正在申請的能源部撥款以及美國農業部的最新情況？

Yes. The DOE, the situation there is that we've applied last -- this past March for a grant, the MESC 3099 initiative, and they have not made decisions on all applicants for that grant and have guided towards an October decision. So we don't expect to hear anything until October, probably at the earliest from the DOE.

是的。美國能源部的情況是，我們去年 3 月申請了一項撥款，即 MESC 3099 計劃，但他們尚未對該撥款的所有申請人做出決定，並指導 10 月做出決定。因此，我們預計要到 10 月才能聽到任何消息，最早可能是能源部的消息。

And as it relates to the USDA, those conversations are ongoing, and we're trying to work through what we would expect in terms of a time line for them to get back to us on our appeal with them.

由於與美國農業部相關，這些對話正在進行中，我們正在努力確定他們就我們向他們提出的上訴回覆我們的時間表。

Okay. Great. And then when you look at the current change of pace for the build-out, when you look at the supply chain now, are we going to have any disruptions to getting -- assuming you can get the financing in place over the next six, 12 months, is there going to be any issues with having that supply chain remain intact?

好的。偉大的。然後，當你看看當前的建設步伐變化時，當你看看現在的供應鏈時，我們是否會遇到任何干擾——假設你可以在接下來的六年內獲得融資， 12 個月後，保持供應鏈完好無損是否會出現任何問題？

So supply chain for us, you mean, Mike?

那我們的供應鏈，你是說，麥克？

Yes, as far as getting the facility up and running. I mean I know you had procured most of the equipment to put in place, but is any of that being impacted?

是的，就設施的啟動和運作而言。我的意思是，我知道你們已經購買了大部分設備來安裝，但是這些設備是否受到了影響？

So in terms of securing equipment, we're going to continue to cautiously deploy the equipment that we've already purchased and take receipt as necessary, but we are deferring some of the other capital expenses for non-long lead time equipment. And that supply chain is still solid, and we've got the team that's working with the vendors. They're being very supportive of us.

因此，在確保設備安全方面，我們將繼續謹慎部署已購買的設備，並在必要時接收收據，但我們將推遲非長交貨期設備的一些其他資本支出。供應鏈仍然穩固，我們有與供應商合作的團隊。他們非常支持我們。

Yes. That's what I meant. The long lead time stuff. Obviously, that's the key component here, and that's good to hear. And then on the relationships with 6K and Dragonfly, what are you hearing from them?

是的。這就是我的意思。交貨時間長的東西。顯然，這是這裡的關鍵組成部分，很高興聽到這一點。那麼關於與 6K 和 Dragonfly 的關係，您從他們那裡聽到了什麼？

So overall, the relationships are solid with 6K and Dragonfly and we're continuing to work quite a bit with 6K. In fact, we are meeting with them with a potential strategic partner out here later this week. Dragonfly Energy right down the road continues to work towards their desire to procure recycled lithium from our process.

總的來說，我們與 6K 和 Dragonfly 的關係很牢固，我們將繼續與 6K 進行大量合作。事實上，我們將於本週稍後與他們和潛在的策略合作夥伴會面。蜻蜓能源公司正在繼續努力實現他們從我們的工藝中採購回收鋰的願望。

So those conversations are going very well. We do commensurate on the challenges and the macro challenges I was mentioning earlier in the call and the industry as a whole, but we're strong with those partnerships.

所以這些對話進展順利。我們確實應對我之前在電話會議中提到的挑戰和宏觀挑戰以及整個行業，但我們對這些合作夥伴關係很強大。

Okay. Yes. I mean we obviously saw that release a couple of week days ago. So understood where you're coming from and thanks for your time. Appreciate it.

好的。是的。我的意思是我們顯然在幾週前看到了該版本。所以了解您來自哪裡並感謝您的寶貴時間。欣賞它。

Thanks, Mike.

謝謝，麥克。

Sameer Joshi, H.C. Wainwright.

薩米爾‧喬希 (Sameer Joshi)，H.C.溫賴特。

Hey, Steve and Judd, thanks for taking my questions. Could you remind us what level of battery material prices, mineral prices would be a good level for you to still be profitable? I know you mentioned you can be -- have positive margins without the debt services right now, but what level of prices would be optimal for you?

嘿，史蒂夫和賈德，謝謝你們回答我的問題。您能否提醒我們，電池材料價格、礦物價格處於什麼水準才是您仍能獲利的良好水準？我知道您提到您現在可以在沒有償債的情況下獲得正利潤，但是什麼水平的價格對您來說是最佳的？

Hey, Sameer, this is Judd. Thanks for your question. So the company, with our conversion costs and the way we structure things, even at today's kind of low metals price, what we're seeing, the company still generates positives plant margin. And so that's positive. We would like to see it higher. It's probably -- what we said is it's not high enough to service debt. And these debt -- the terms that we're looking at for five years, the interest rates are pretty high right now. And so that makes the cost in a short turnaround period kind of high.

嘿，薩米爾，這是賈德。謝謝你的提問。因此，根據我們的轉換成本和我們的結構方式，即使在當今金屬價格較低的情況下，我們仍然可以產生積極的工廠利潤。所以這是積極的。我們希望看到它更高。我們所說的可能是它還不足以償還債務。這些債務——我們考慮的五年期限，目前的利率相當高。因此，這使得短週轉期內的成本有點高。

So any improvements that we would see in metals prices would not only add to that, but would be better for us. And when we look at kind of where prices are heading to '25 and beyond '26 and some of what we're seeing other people predict the metals prices, if we look at some of the analysts' reports who follow that. Those are well within the range for us to be -- to do very well and to be able to service that if that's what we should choose to do moving forward.

因此，我們看到的金屬價格的任何改善不僅會增加這一點，而且對我們來說會更好。當我們觀察價格走向 25 年和 26 年後的情況以及我們看到的其他人預測金屬價格的一些情況時，如果我們看一下隨後的一些分析師報告。這些都在我們的範圍之內——做得很好，並且能夠提供服務，如果這是我們應該選擇繼續前進的話。

Understood. And just following up on Michael's question, and sort of adding on to that, 6K, Yulho Dragonfly, think they are still engaged. Is it possible to get some kind of financing going with these partners? Or like can you let us know if those discussions are being had?

明白了。就邁克爾的問題而言，6K、Yulho Dragonfly 認為他們仍然訂婚。是否有可能與這些合作夥伴一起獲得某種融資？或者您能否讓我們知道這些討論是否正在進行？

So in terms of financing, I think every business is financing its own business at this point in time. And then there's no co-financing that we're looking at the moment with any -- with those partners. If that answers your question?

所以在融資方面，我認為每個企業此時都在為自己的企業融資。然後，我們目前沒有與任何合作夥伴進行聯合融資。如果這回答了你的問題？

Yes. I mean like some investment from them into Aqua Metals. Is that a possibility?

是的。我的意思是他們對 Aqua Metals 進行了一些投資。有這種可能嗎？

Yes. So that's what I was basically saying is that all companies now are seeking financing of their own. And less are investing in each other at this stage.

是的。所以我基本上想說的是，現在所有公司都在尋求自己的融資。現階段互相投資的情況也越來越少。

Understood. And then last question on the cost-cutting initiatives. Should we expect some onetime severance-related costs in the current quarter? And then going forward, what level of CapEx do you expect to incur for these smaller lead time items that you are going to continue to procure?

明白了。最後一個問題是關於削減成本的措施。我們是否應該預期本季會產生一些一次性遣散費？然後，您預計將繼續採購這些交貨時間較短的項目，從而產生什麼水平的資本支出？

Yes, I can't comment in detail, but there will be some severance expense that hits in Q3. And then in terms of CapEx going forward, we actually have purchased most of the equipment for the building. You see that in our balance sheet that we released today, over $6 million of equipment that we bought this year in deposits. And we plan to hold on to that and keep that steady where we need it to be.

是的，我無法詳細評論，但第三季將會產生一些遣散費。然後就未來的資本支出而言，我們實際上已經購買了大樓的大部分設備。您可以在我們今天發布的資產負債表中看到，我們今年以押金購買了超過 600 萬美元的設備。我們計劃堅持下去，並保持穩定在我們需要的地方。

And so there won't be a whole lot of CapEx, just a few items that we're bringing in, some of those stuff, they're sitting in deposits on the balance sheet will move to equipment once we bring those in. And the idea there is to allow us to be ready. We're looking at some different alternative funding sources that will help us out and get that plant fully constructed.

因此，不會有大量的資本支出，只有我們引入的一些項目，其中一些東西，它們位於資產負債表上的存款，一旦我們引入這些項目，它們就會轉移到設備上。這個想法是讓我們做好準備。我們正在尋找一些不同的替代資金來源，這將幫助我們擺脫困境並全面建造工廠。

And so we want to keep that equipment that we've already received and bring in the few pieces that we still need that are critical that maybe have long lead time items. So we won't see a whole lot of CapEx spend kind of going into the second half of this year. Almost all of that was done previous.

因此，我們希望保留我們已經收到的設備，並引進我們仍然需要的一些關鍵零件，這些零件可能需要較長的交貨時間。因此，今年下半年我們不會看到大量資本支出。幾乎所有這些都是之前完成的。

Got it. Thanks for that. And good luck.

知道了。謝謝你。祝你好運。

Thank you. I'd like to turn the floor over to Bob for any further questions.

謝謝。如果還有任何問題，我想請鮑伯回答。

Thank you. Yes, a few here on the financials that were not asked. First question, was there a breakup fee?

謝謝。是的，這裡有一些關於財務狀況的信息，但沒有被問到。第一個問題，有分手費嗎？

Yes. So there was no breakup fee. We actually have a great relationship with this lender. It's probably one of the better lenders that I have ever worked with. And it's just very professional and kind of mutually agreed that now isn't the right time. We could be working with them again in the future, but no fee from Aqua Metals.

是的。所以沒有分手費。實際上，我們與該貸方有著良好的關係。它可能是我合作過的最好的貸方之一。這是非常專業的，而且雙方都同意現在不是合適的時間。我們將來可以再次與他們合作，但 Aqua Metals 不收取任何費用。

Thank you. Next question. Have you thought about unconventional options such as IP lending?

謝謝。下一個問題。您是否考慮過知識產權借貸等非傳統選擇？

Yes, we actually have. We did complete a recent IP valuation. It was done by a third-party pretty [good]. They do a lot of these, and they came back with a very meaningful, large number that we can't disclose, but it's part of our ongoing discussions with counterparties. It's actually a valuable asset to talking about those.

是的，我們確實有。我們最近完成了知識產權評估。這是由第三方漂亮人完成的[好的]。他們做了很多這樣的事情，他們帶回來了非常有意義的大量數據，我們無法透露，但這是我們與交易對手正在進行的討論的一部分。談論這些實際上是一筆寶貴的財富。

Great. Thank you. Next question, pivoting to operational activity. And some of this was discussed, but this is pretty specific. The extension of the ARC means an extension for material to be shipped to 6K. Has that been worked out?

偉大的。謝謝。下一個問題，轉向營運活動。其中一些內容已經被討論過，但這是非常具體的。ARC的延長意味著要運送的材料延長至6K。事情解決了嗎？

So the ARC was actually ahead of the 6K PlusCam 1 facility timeline in Jackson, Tennessee. So at this point, we do not yet see any impact on our ability to supply that facility. In the meantime, however, we are continuing to enable 6K to produce samples of lower cost can or cathode active materials in our partnership with them.

因此，ARC 實際上領先於田納西州傑克遜的 6K PlusCam 1 設施時間表。因此，目前我們還沒有看到我們供該設施的能力受到任何影響。但同時，我們將繼續與 6K 合作，生產成本較低的罐頭或正極活性材料樣品。

And this is through our pilot operation and also through our nitration work with them from our previously announced nonrecurring engineering development for 6K Energy to produce nitrates as an input to their process and produce those from both [virgin mind] and of course our recycled materials. This combined value proposition of our partnership can turn really produce low-cost US-based decarbonized cathode active materials with a significant recycled content to those OEMs that were both engaged to work towards.

這是透過我們的試點操作以及我們之前宣布的 6K Energy 一次性工程開發與他們的硝化工作來生產硝酸鹽作為其工藝的輸入，並使用 [原始思維] 和當然我們的回收材料來生產硝酸鹽。我們合作關係的這一綜合價值主張可以真正為雙方共同努力的原始設備製造商生產低成本的、含有大量回收成分的美國脫碳正極活性材料。

And we believe that we're going to have more to say about these ongoing activities as we get a little further down the path.

我們相信，隨著我們在這條道路上走得更遠，我們將對這些正在進行的活動有更多的說法。

Thank you. Next question, also a little bit of a continuation of some of the early remarks, but broadly about the battery materials industry and Aqua Metals projections around getting past the recent market headwinds. Do you -- can you offer some color on that?

謝謝。下一個問題也是一些早期言論的延續，但廣泛涉及電池材料產業和 Aqua Metals 圍繞著克服近期市場逆風的預測。你能對此提供一些顏色嗎？

Sure. Thanks for the question. So on one hand, there's a 1.2-terawatt hour build in the US cell manufacturing that's projected to be in place by the end of this decade. That was upgraded from 1 terawatt hour, so it's a lot. And all of these cell manufacturers are looking to source US-based critical battery materials. And that's for production inclusive of recycled materials, right? And so particularly recycled materials at competitive costs and decarbonized are going to contribute towards the entire industry's net zero emissions goals.

當然。謝謝你的提問。因此，一方面，美國電池製造業預計將在本十年末建成 1.2 太瓦時的產能。這是從 1 太瓦時升級而來的，所以數量很多。所有這些電池製造商都在尋求採購美國的關鍵電池材料。這是包含回收材料的生產，對嗎？因此，特別是具有競爭性成本和脫碳的回收材料將為整個產業的淨零排放目標做出貢獻。

The value of those US produced minerals is also in certain tax credit benefits for OEMs and for, frankly, consumers of their products. And recycled materials for producing new cells come from two key sources, we've talked about in the past, that first being from production scrap from all of these new gigafactories ultimately being recycled and put back into the ecosystem and closing that loop. And the second, of course, is from end-of-life batteries that are already being recycled and put into the ecosystem.

這些美國生產的礦物的價值也體現在對原始設備製造商以及坦率地說對其產品的消費者的某些稅收抵免優惠中。我們過去討論過，用於生產新電池的回收材料有兩個關鍵來源，第一個來自所有這些新超級工廠的生產廢料，最終被回收並放回生態系統並關閉該循環。當然，第二個是來自已經被回收並放入生態系統的報廢電池。

But on the other hand, due to the precipitous drop in metals prices, the ecosystem is currently really being squeezed hard. And coupled with the lack of legislation and government attention, in my opinion, to date on preventing black mass from being exported out of the US and/or in support incentives to keep those materials in the US in a closed loop, we're going to likely actually see recycling capacities turn out to be a little bit lower year-over-year than initially projected in the near term. For example, RC or ARC seeing a delay in its production.

但另一方面，由於金屬價格的大幅下跌，生態系統目前確實受到了嚴重擠壓。在我看來，迄今為止，由於缺乏立法和政府關注來阻止黑色彌撒被出口到美國和/或支持激勵措施以將這些材料保持在美國的閉環中，我們將實際上，短期內回收能力可能會比原先預期的略低。例如，RC 或 ARC 的生產出現延遲。

We still believe, though, that in the mid- to longer-term, the closed loop within the US and frankly, other regions of the world will have to continue to solidify. The opportunity that we still see in the short term is the Sierra ARC completed and produce those first truckloads of materials as soon as possible. And that will have a direct impact in our belief in not only Aqua Metals' success but will also demonstrate at scale the ability for the US and really ultimately other regions to close the loop.

不過，我們仍然相信，從中長期來看，美國乃至世界其他地區的閉環將必須繼續鞏固。我們在短期內仍然看到的機會是 Sierra ARC 盡快完工並生產第一卡車的材料。這不僅會直接影響我們對 Aqua Metals 成功的信念，而且還將大規模證明美國以及最終其他地區實現閉環的能力。

Great. Thank you. That's all the time we have in our slot today. I'll now turn it back over to the operator. And I believe Steve will have some closing comments.

偉大的。謝謝。這就是我們今天的全部時間了。我現在將其轉回給操作員。我相信史蒂夫將會發表一些結束語。

Well, thank you, everybody for joining the call today and really appreciate your support and ongoing support of Aqua Metals. We'll be back with more updates soon. Thank you.

好的，謝謝大家今天加入電話會議，非常感謝你們的支持以及對 Aqua Metals 的持續支持。我們很快就會帶來更多更新。謝謝。

Thank you. That does conclude today's teleconference and webcast. You may disconnect your lines at this time and have a wonderful day. We thank you for your participation today.

謝謝。今天的電話會議和網路廣播到此結束。此時您可以斷開線路並度過美好的一天。我們感謝您今天的參與。