LiqTech International Inc (LIQT) 2023 Q3 法說會逐字稿

Good morning and welcome to the LiqTech Third Quarter Fiscal' Year 2023 Results Conference Call. (Operator Instructions) Please note this event is being recorded, and I would now like to turn the conference over to Robert Blum with Lytham Partners. Please go ahead.

早安，歡迎參加 LiqTech 2023 財年第三季業績電話會議。 （操作員說明）請注意，該活動正在錄製中，我現在想將會議轉交給 Lytham Partners 的 Robert Blum。請繼續。

All right. Thanks very much, Andrea, and good morning, everyone. Thank you for joining us on today's conference call to discuss LiqTech International's Third Quarter 2023 financial results for the period ending September 30, 2023. Joining us on today's call from the Company are Fei Chen Company's Chief Executive Officer, and Simon Stadil, company's Chief Financial Officer.

好的。非常感謝，安德里亞，大家早安。感謝您參加今天的電話會議，討論 LiqTech International 截至 2023 年 9 月 30 日的 2023 年第三季度財務業績。參加今天電話會議的公司有陳飛公司首席執行官和公司首席財務官 Simon Stadil官。

Before I turn the call over to management, let me remind listeners that there will be an open Q&A session at the end of the call. Before I begin with prepared remarks, we submit for the record the following statement. This conference call may contain forward-looking statements. Although the forward-looking statements reflect the good faith and judgment of management, forward-looking statements are inherently subject to known and unknown risks and uncertainties that may cause actual results to be materially different from those discussed during the conference call.

在將通話轉交給管理層之前，請允許我提醒聽眾，通話結束時將有一個公開的問答環節。在我開始準備好的發言之前，我們提交以下聲明以供記錄。本次電話會議可能包含前瞻性陳述。儘管前瞻性陳述反映了管理層的善意和判斷，但前瞻性陳述本質上受到已知和未知風險和不確定性的影響，這些風險和不確定性可能導致實際結果與電話會議期間討論的結果存在重大差異。

The company, therefore, urges all listeners to carefully review and consider the various disclosures made in the reports filed with the Securities and Exchange Commission, including risk factors that attempt to advise interested parties of the risks that may affect our business, financial condition, operations and cash flows. If one or more of these risks or uncertainties materialize or if the underlying assumptions prove incorrect, the company's actual results may vary materially from those expected or projected.

因此，公司敦促所有聽眾仔細審查和考慮向美國證券交易委員會提交的報告中所做的各種披露，包括試圖向利益相關方建議可能影響我們的業務、財務狀況、運營的風險的風險因素。和現金流量。如果這些風險或不確定性中的一項或多項成為現實，或者基本假設被證明不正確，公司的實際結果可能與預期或預期的結果有重大差異。

The company, therefore, encourages all listeners not to place undue reliance on these forward-looking statements, which pertain only as of this date and the date of the release and conference call. The company assumes no obligation to update any forward-looking statements to reflect any events or circumstances that may arise after the date of this release and conference call.

因此，該公司鼓勵所有聽眾不要過度依賴這些前瞻性聲明，這些聲明僅適用於截至本日期以及發布日期和電話會議的日期。本公司不承擔更新任何前瞻性聲明以反映本新聞稿和電話會議發布後可能發生的任何事件或情況的義務。

Now I'd like to turn the call over to Fei Chen, CEO of LiqTech International. Fei, please proceed.

現在我想把電話轉給LiqTech International 執行長陳飛。菲，請繼續。

Thank you, Robert. And good day to everyone on the call. I'm excited to get the opportunity to speak with you and share with you our good progress.

謝謝你，羅伯特。祝各位通話者美好的一天。我很高興有機會與您交談並與您分享我們的良好進展。

During the third quarter, we made continued progress executing against our strategic plan to drive the business toward profitability. Which saw a revenue increase of 53% compared to third quarter last year. Gross margins improved from 3% last year to 19% in this year's third quarter and our net loss improved by $0.4 million. Importantly, our adjusted EBITDA was just a negative $0.8 million as we move the business toward profitability.

第三季度，我們在執行策略計畫方面取得了持續進展，推動業務獲利。與去年第三季相比，營收成長了 53%。今年第三季的毛利率從去年的 3% 提高到 19%，淨虧損減少了 40 萬美元。重要的是，隨著我們的業務走向獲利，調整後的 EBITDA 僅為負 80 萬美元。

These improved results are due to the enhanced business strategy we enacted last year, with focus on delivering revenue on our established business areas, and we're driving growth through expansion into new targeted markets. To put it in other words, we are looking to protect and expand our established businesses, such as commercial pool systems, ceramic membranes, diesel particulate filters and components and enhance and develop our packet businesses, which includes areas such as phosphorus, acid, oil, and gas, and our overall strategic focus to increase our service business.

這些績效的改善歸功於我們去年制定的強化業務策略，重點是在我們既定的業務領域提供收入，我們正在透過擴張到新的目標市場來推動成長。換句話說，我們希望保護和擴大我們的既定業務，例如商業泳池系統、陶瓷膜、柴油顆粒過濾器和組件，並加強和發展我們的包裝業務，其中包括磷、酸、石油等領域和天然氣，我們的整體策略重點是增加我們的服務業務。

As I mentioned that in my recent cooperative presentations, the key word here is focus. We are focused on making sure that we can have a sustainable business by protecting and defending our position in key markets where LiqTech has a demonstrated history of success. We're enabling high upside growth in exciting markets where we can leverage our core silicon carbon technology and system design capabilities.

正如我在最近的合作演講中提到的，這裡的關鍵字是聚焦。我們致力於透過保護和捍衛我們在 LiqTech 擁有成功歷史的關鍵市場中的地位來確保我們能夠擁有永續的業務。我們正在令人興奮的市場中實現高速成長，在這些市場中我們可以利用我們的核心矽碳技術和系統設計能力。

This zero approach ensures that we are not reliant on any one project or customer for us to be successful. Taking a step back, at LiqTech zit is our vision to become a leading provider of advanced and sustainable filtration solutions. These key mega trends of water cleaning and reuse greenhouse gas emission reduction and the overall circular economy are all key to save the world's scarce resources and protecting the environment.

這種零方法確保我們不依賴任何一個專案或客戶來獲得成功。退一步來說，LiqTech zit 的願景是成為先進和永續過濾解決方案的領先供應商。這些水清潔和再利用、溫室氣體減排和整體循環經濟的主要大趨勢都是節約世界稀缺資源和保護環境的關鍵。

Beyond protecting the environment and preserving resources, our solutions provide real economic benefits to our customers. Whether it is the increased yields through product purification of our phosphoric acid systems, decreased costs through the ability to reuse water in our produced water, oil and gas solutions, or lower energy consumption and the chlorine dosing needs in the case of our aqua solutions for commercial swimming pool products.

除了保護環境和保護資源之外，我們的解決方案還為客戶提供真正的經濟效益。無論是透過我們的磷酸系統的產品純化來提高產量，透過在我們的採出水、石油和天然氣解決方案中重複利用水來降低成本，還是在我們的水劑解決方案中降低能源消耗和氯劑量需求。商業游泳池產品。

The recent sales wins that we have achieved and distribution agreements we have signed all due to this key idea of providing value to customers. Let me take a minute to talk about some key developments that took place over the past few months. Let's start with our commercial swimming pool products. We successfully delivered 10 swimming pool systems during the third quarter and have recently received orders for three more systems which we anticipate delivering in the fourth quarter.

我們最近的銷售勝利和我們簽署的分銷協議都是由於這項為客戶提供價值的關鍵理念。讓我花一點時間談談過去幾個月發生的一些關鍵事態發展。讓我們從我們的商用游泳池產品開始。我們在第三季成功交付了 10 個游泳池系統，最近又收到了另外三個系統的訂單，我們預計將在第四季度交付。

Year-to-date, we have shifted 18 systems compared to 6 systems in 2022, with a geographic focus in UK, Spain, Portugal, Australia, and New Zealand. With the great progress we have made in these new geographic areas, we have been looking at ways to broaden our sales footprint by entering into distribution agreement with key partners following a thorough process. Following a thorough process, we entered into two key agreements, one with Spa and Re, a UK and Dubai based group, to cover key areas of the Middle East, including Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the UAE.

今年迄今為止，我們已經遷移了 18 個系統，而 2022 年為 6 個系統，重點關注英國、西班牙、葡萄牙、澳洲和紐西蘭。隨著我們在這些新地理區域取得的巨大進展，我們一直在尋找擴大銷售足跡的方法，透過全面的流程與主要合作夥伴簽訂分銷協議。經過徹底的流程後，我們簽訂了兩項重要協議，其中一項是與英國和杜拜的 Spa and Re 集團簽訂的，涵蓋中東的關鍵地區，包括巴林、科威特、阿曼、卡達、沙烏地阿拉伯和阿聯酋。

As their CEO mentioned, LiqTech's pool filtration system is statistically a perfect match with the binary cutting-edge work in the design and the build of the most prestigious state-of-the-art leisure centers and spas. We also entered into an agreement with Waterco to cover Australia, New Zealand, and the Pacific Islands. Waterco is a well-established supplier in the swimming pool market and has worked with Vectus successfully over the past three years to bring solutions to their joint customers.

正如他們的執行長所提到的，LiqTech 的泳池過濾系統在統計上與最負盛名的最先進休閒中心和水療中心的設計和建造中的二元尖端工作完美匹配。我們也與 Waterco 簽訂了覆蓋澳洲、紐西蘭和太平洋島嶼的協議。 Waterco 是游泳池市場上的知名供應商，過去三年與 Vectus 成功合作，為其共同客戶提供解決方案。

We look forward to working with these two well-respected companies to broaden our reach and make a substantial impact in the global aquatic and water treatment industries in these key territories. Within the marine scrubber market, we saw the return of our first new marine scrubber system orders in more than 18 months as we deployed an upgraded modular design system through our recently enhanced distribution relationship with Yuyu in China.

我們期待與這兩家備受尊敬的公司合作，擴大我們的影響力，並對這些關鍵地區的全球水產和水處理行業產生重大影響。在船用洗滌器市場中，我們透過最近與中國 Yuyu 加強的分銷關係部署了升級的模組化設計系統，因此我們看到了 18 個多月以來的第一批新船用洗滌器系統訂單的回歸。

Our dialogue with customers and partners has confirmed that Vectus' modular-designed marine scrubber water treatment system has been a success. It is highly reliable and delivers strong returns on their investments. Furthermore, our new generation design reduces OpEx for owners significantly by largely reducing day-to-day operational and maintenance costs. Vectus has more than 160 installations in the marine scrubber market, which occurred primarily between 2018 and 2020.

我們與客戶和合作夥伴的對話證實，Vectus 的模組化設計的船用洗滌器水處理系統取得了成功。它高度可靠，可為他們的投資帶來豐厚的回報。此外，我們的新一代設計透過大幅降低日常營運和維護成本，顯著降低了業主的營運支出。 Vectus 在船舶洗滌器市場上安裝了 160 多個裝置，主要發生在 2018 年至 2020 年期間。

This new order not only demonstrates the continued confidence from the market and the customers in our solutions. But also validates our enhanced commercial strategy. I mentioned a few moments ago as we focus on driving revenue, establish the business verticals where BT has proven technical capabilities and installations with a renewed focus on the market covered with capable distribution partners. I believe there is opportunity to regain our position in this market in the future.

這個新訂單不僅體現了市場和客戶對我們解決方案的持續信心。同時也驗證了我們增強的商業策略。我剛才提到，我們專注於增加收入，建立 BT 已證明的技術能力和安裝的業務垂直領域，並重新專注於有能力的分銷合作夥伴覆蓋的市場。我相信未來我們有機會重新獲得在這個市場的地位。

Finishing off our established business contributors from a memory element standpoint, we continue to deliver and memory orders during the third quarter, and we see new orders, which will be set for delivery in quarter four. On the DPF side, we experienced stable revenue contribution. We don't expect tremendous growth here but looking persistently into new application areas to hold this business steady.

從記憶體元素的角度來看，我們已經建立了業務貢獻者，我們在第三季度繼續交付記憶體訂單，並且我們看到了新訂單，這些訂單將在第四季度交付。在DPF方面，我們實現了穩定的營收貢獻。我們並不期望這裡有巨大的成長，但會堅持不懈地尋找新的應用領域以保持這項業務的穩定。

On the plastics side, in the third quarter, we did experience a bit of a sequential pullback as we ramped up a large order, we received at the end of last year in area of biological based material developments. We continue to look for opportunities to grow this area into the future.

在塑膠方面，在第三季度，隨著我們去年年底在生物基材料開發領域收到的大訂單的增加，我們確實經歷了一些連續的回調。我們將繼續尋找未來發展該領域的機會。

Finally we did see significant increases in the sale of spare parts in quarter three as we have more systems in operation this will become a nice recurring business opportunity for us. Overall, we are pleased with the program being made on our established business areas across all of the key areas. I mentioned we have improved our pricing discipline through enhanced cost visibility and elevated mass intelligence which is delivering increased gross profits and ultimately bring little closer to profitability.

最後，我們確實看到第三季備件銷售量顯著增加，因為我們有更多的系統在運行，這對我們來說將成為一個很好的經常性商業機會。總體而言，我們對在所有關鍵領域的既定業務領域制定的計劃感到滿意。我提到過，我們透過增強成本可見性和提高大眾情報來改善我們的定價紀律，這增加了毛利，並最終幾乎接近獲利。

Where we are pleased with the traction generated from our is business, we recognize that there is a very large address for market opportunity for our solutions in a wide variety of markets that can potentially drive growth for we take these large system solutions. In the areas of industrial water treatment, oil and gas filtration, acid purification and other industrial applications are ideally suited for this solutions in the long run.

我們對我們的業務所產生的牽引力感到滿意，我們認識到我們的解決方案在各種市場中都有很大的市場機會，這可能會推動我們採用這些大型系統解決方案的成長。從長遠來看，在工業水處理、石油和天然氣過濾、酸淨化和其他工業應用領域非常適合此解決方案。

As we have stated the downside is that this area have much longer sales cycles but i believe progress is being made. Within the oil and gas market our collaboration with NASA is moving ahead. We are currently building what I would define as a pilot system specifically for NASA to utilize in various demonstrations. We are similarly in close dialogue with two to three target customers in the Middle East for produced water solutions where our solution could be applied hope to have more to share with you in the coming quarters.

正如我們所說，缺點是該領域的銷售週期要長得多，但我相信正在取得進展。在石油和天然氣市場，我們與 NASA 的合作正在取得進展。我們目前正在建立一個我所定義的試點系統，專門供美國太空總署在各種演示中使用。同樣，我們正在與中東的兩到三個目標客戶就生產水解決方案進行密切對話，我們的解決方案可以應用在這些解決方案中，希望在未來幾個季度與您分享更多資訊。

We think for storage assets we delivered and recognized revenue during the third quarter and our pilot unit to silicon fitter in China. We believe this pilot unit will enable our partners in the region to demonstrate that our ultrafiltration technology can effectively help their customers enhance their process efficiency and the product quality. We look to further build up this pilot and our US-based installation to drive further phosphorus acid system sales into the future.

我們認為，對於儲存資產，我們在第三季交付並確認了收入，以及我們在中國的矽裝配試點單位。我們相信這個試點裝置將使我們在該地區的合作夥伴能夠證明我們的超濾技術可以有效幫助他們的客戶提高製程效率和產品品質。我們希望進一步建立這個試點和我們在美國的安裝，以推動未來磷酸系統的進一步銷售。

During the third quarter, we also delivered and recognized a very new natural cooling system here in Denmark. With another large market opportunity, it highlights the capabilities of our solution across a wide range of opportunities and the validation by yet another large international company.

第三季度，我們還在丹麥交付並認可了一套非常新的自然冷卻系統。憑藉另一個巨大的市場機會，它凸顯了我們的解決方案在廣泛的機會中的能力以及另一家大型國際公司的驗證。

Finally, on the monoethylene glycol, or MEG, fund, our fourth offshore installation in the Mediterranean with a large oil and gas plant continues to perform well. As I mentioned last quarter, this is first of a two-part order for the offshore project with expectations for follow and orders shown. That said, due to the location of the platform, which is off the coast of Israel, there is some uncertainty on the timing due to the current conflicts in the region. We should know more in the coming weeks on whether or not this will be shifted in fiscal 2023 or slip to 2024.

最後，在單乙二醇（MEG）基金方面，我們在地中海的第四個海上設施以及大型石油和天然氣工廠繼續表現良好。正如我上季度提到的，這是海上項目兩部分訂單中的第一部分，其中顯示了後續訂單的預期和訂單。儘管如此，由於該平台位於以色列海岸附近，由於該地區當前的衝突，時間安排存在一些不確定性。我們應該在未來幾週內了解更多有關此情況是否會在 2023 財年轉移或推遲到 2024 年的資訊。

In summary, as we look to the rest of the year and into 2024, we see a number of opportunities in our plastic packaging business segment particularly leaf phosphoric acid. (inaudible) As produced water component of oil and the gas market. That we believe we are the key contributors to growth hopefully in 2023 and certainly in 2024. Further, our newly established partnerships with leasing, the commercial swimming pool market are expected to expand our growth in this key market segment for us moving ahead.

總之，展望今年剩餘時間和 2024 年，我們在塑膠包裝業務領域看到了許多機會，特別是葉磷酸。 （聽不清楚）作為石油和天然氣市場的採出水組成部分。我們相信，我們預計將成為2023 年成長的關鍵貢獻者，當然也包括2024 年。此外，我們與租賃、商業游泳池市場新建立的合作夥伴關係預計將擴大我們在這一關鍵細分市場的成長，推動我們前進。

Where there is always uncertainty, such as what we are in company with our MEG installation in the Mediterranean, we feel confident in the guidance for the full-year 2023 revenue of $19 million to $21 million. Further, we also believe that we remain on track to achieve our full-year growth profit margin expectations in the range of 15% to 20%. Please remember that our growth margin last year was only 3.5%. We have a tremendous opportunity in the future.

在總是存在不確定性的地方，例如我們在地中海的 MEG 裝置的情況，我們對 2023 年全年收入 1900 萬至 2100 萬美元的指導充滿信心。此外，我們也相信，我們仍有望實現 15% 至 20% 的全年利潤率成長預期。請記住，我們去年的成長率僅為 3.5%。未來我們有巨大的機會。

We will be ahead of us to leverage our highly unique technological advantages, brand competencies and sustainability value to build a growing and profitable business. In 2023, we have succeeded in making continued progress in each quarter. I am extremely pleased that with this good performance and anticipate continued progress in the quarters to come. With that, let me turn the call over to Simon to review the financials in more detail. After which, I will wrap up with a few comments and then open the call to your questions. Simon, please proceed.

我們將領先於我們，利用我們高度獨特的技術優勢、品牌能力和永續發展價值來建立不斷增長和盈利的業務。 2023年，我們每季都取得了持續進步。我對如此良好的表現感到非常高興，並預計在未來幾季將繼續取得進展。接下來，讓我將電話轉給西蒙，以更詳細地審查財務狀況。之後，我將發表一些評論，然後開始回答您的問題。西蒙，請繼續。

Thank you, Fei, and good morning, everyone. Let me add some color on the financial highlights for the third quarter. The reported revenue of $5.1 million increased 53% compared to the $3.3 million reported in the third quarter of 2022. And also marked a modest, however, important increase compared to the most recent quarter ended June 30. Broken down by vertical, sales were as follows. System sales and related services of $2.6 million, up more than 200% compared to $0.8 million reported in Q3 last year, and up 24% compared to the most recent sequential second quarter.

謝謝費老師，大家早安。讓我對第三季的財務亮點添加一些色彩。報告的收入為510 萬美元，與2022 年第三季報告的330 萬美元相比增長了53%。與截至6 月30 日的最近一個季度相比，也出現了小幅增長，但增長顯著。按垂直細分，銷售額為接下來。系統銷售額及相關服務達 260 萬美元，與去年第三季報告的 80 萬美元相比成長超過 200%，與最近第二季相比成長 24%。

Looking at our ceramics business. DPF membrane sales ended at $1.6 million, down 13% compared to the quarter ended September 30 last year, reflecting a dedicated focus on improving profitability by carefully managing our revenue mix. And finally, plastics revenue and externally funded R&D projects, $0.9 million, up 25% compared to $0.7 million reported in Q3 last year, with stable plastics activity and progress on key external R&D projects.

看看我們的陶瓷業務。 DPF 膜銷售額最終為 160 萬美元，與去年截至 9 月 30 日的季度相比下降了 13%，反映出我們致力於透過仔細管理收入組合來提高獲利能力。最後，塑膠收入和外部資助的研發項目為 90 萬美元，比去年第三季報告的 70 萬美元增長 25%，塑膠活動穩定，關鍵外部研發項目取得進展。

In summary, the development in revenue is directly correlated with our strategic focus to strengthen the established business lines, more specifically, our core ceramics and system businesses with shorter sales cycles and a new complementary dedicated aftermarket strategy. To be specific, the key revenue drivers during the quarter was the record delivery of 10 pool systems shipped to clients across Europe and Asia.

總而言之，收入的發展與我們加強現有業務線的策略重點直接相關，更具體地說，是我們的核心陶瓷和系統業務，具有更短的銷售週期和新的互補的專門售後市場策略。具體而言，本季的主要收入驅動因素是向歐洲和亞洲客戶交付的 10 個泳池系統，創下了創紀錄的交付記錄。

But also, the delivery of our first phosphoric acid pilot to China, continued progress on key projects with oil and gas and metal cooling, and finally, increased aftermarket sales with uptick in orders for both marine and acid applications leveraging our global installed base. Zooming in on our components business, our ceramics and plastic businesses executed on incoming orders post-summer with decisive focus on improving throughput and cutting lead times.

此外，我們向中國交付了第一個磷酸試點，石油和天然氣以及金屬冷卻等關鍵項目繼續取得進展，最後，利用我們的全球安裝基礎，隨著船舶和酸應用訂單的增加，售後市場銷售增加。著眼於我們的零件業務，我們的陶瓷和塑膠業務根據夏後收到的訂單執行，重點是提高吞吐量和縮短交貨時間。

In terms of guidance, As Fei mentioned, we expect full-year revenue in the range of $19 million to $21 million compared to the $16 million reported last year, with a gross margin rate of 15% to 20%. It's evident that we are pleased with the progress on both top line and profitability. However, we are carefully monitoring the escalating geopolitical unrest amid the conflict in Ukraine and Gaza, which in turn may fuel uncertainty or directly impact our business. This in particular in industries such as oil and gas, or countries that are directly exposed.

在指導方面，正如費所提到的，我們預計全年收入將在 1,900 萬美元至 2,100 萬美元之間，而去年報告的收入為 1,600 萬美元，毛利率為 15% 至 20%。顯然，我們對營收和獲利能力的進展感到滿意。然而，我們正在密切關注烏克蘭和加薩衝突中不斷升級的地緣政治動盪，這反過來可能會加劇不確定性或直接影響我們的業務。尤其是在石油和天然氣等行業或直接暴露的國家。

Turning to our gross margin and more insight on our journey towards break even. The third quarter echoes the strong progress reported over the last couple of quarters with a reported gross profit of $0.9 million and an implied gross profit margin of 19% compared to just 3% in a comparable period last year. The positive development is a result of increased activity levels and equally important, stringent focus on optimizing our revenue mix and company-wide pricing discipline.

轉向我們的毛利率以及對我們實現盈虧平衡之路的更多見解。第三季報告的毛利為 90 萬美元，隱含毛利率為 19%，與過去幾季的強勁進展相呼應，而去年同期僅為 3%。正面的發展是活動水準增加的結果，同樣重要的是，我們嚴格關注優化我們的收入結構和全公司的定價紀律。

As reported earlier this year we're pleased to see the profitability remains robust across both our established business lines and new target business within oil and gas and phosphoric acid. From an operational perspective we decided to onboard incremental staff towards the end of the quarter to help accelerate the ramp up of our ceramics manufacturing throughput and compress delivery times to help execute on our order backlog.

正如今年稍早報導的那樣，我們很高興看到我們的既定業務線以及石油、天然氣和磷酸領域的新目標業務的盈利能力仍然強勁。從營運角度來看，我們決定在本季度末增加員工，以幫助加快陶瓷製造產量的成長並壓縮交貨時間，以幫助執行我們的積壓訂單。

Profitability was also underpinned by new quality and production optimization efforts seeking to standardize our manufacturing and system delivery platforms which again will allow our business to reduce scrap and increase yield. Taking a quick look at our contribution margin we remain focused on closely monitoring this important KPI to ensure we develop a profitable and sustainable business with accelerated focus on meeting our financial objectives of breakeven during the quarter when we back out fixed costs.

新的品質和生產優化努力也支撐了盈利能力，這些努力旨在標準化我們的製造和系統交付平台，這再次將使我們的業務減少廢品並提高產量。快速瀏覽我們的邊際貢獻，我們仍然專注於密切監控這一重要的 KPI，以確保我們發展盈利且可持續的業務，並在取消固定成本時加速關注實現本季度盈虧平衡的財務目標。

Our contribution margin was approximately 45% and thus well above the 335 reported in the third quarter last year. Our contribution margin has historically been very volatile as it directly correlates with the underlying revenue mix. However as reported so far this year we have succeeded in significantly improving and stabilizing, our contribution margin well above 40%. On that note we do maintain our quarterly breakeven target measured on an adjusted EBITDA basis of approximately $7 million in revenue. And potentially lower the right revenue mix, turning to OpEx, total spent for the quarter was $2.6 million compared to $2.4 million in comparable third quarter of last year.

我們的邊際貢獻率約為 45%，遠高於去年第三季報告的 335%。我們的邊際收益歷來波動很大，因為它與基本收入組合直接相關。然而，正如今年迄今所報導的，我們已成功顯著改善和穩定，我們的貢獻率遠高於 40%。在這一點上，我們確實維持了以調整後 EBITDA 為基礎衡量的季度盈虧平衡目標，即約 700 萬美元的收入。並且可能會降低正確的收入組合，轉向營運支出，本季的總支出為 260 萬美元，而去年同期第三季的總支出為 240 萬美元。

The increase reflects the onboarding of additional sales reps, combined with investments in IT and marketing to help accelerate and scale our business. To reiterate, we remain focused on running a lean business by monitoring cost and carefully evaluating our spend to ensure we do not jeopardize our financial objectives. On that note I'm pleased to see that our picks came down $0.2 million from the quarter ended June 30 and evidencing that we are very diligent when it comes to managing our OpEx expense.

這一成長反映了增加銷售代表的入職，以及對 IT 和行銷的投資，以幫助加速和擴大我們的業務。重申一下，我們仍然專注於透過監控成本並仔細評估我們的支出來經營精益業務，以確保我們不會損害我們的財務目標。在這一點上，我很高興看到我們的選擇比截至 6 月 30 日的季度減少了 20 萬美元，這證明我們在管理營運支出方面非常勤奮。

All the income of $0.3 million came down compared to $0.5 million last year but the development explained by reduced gain on currency and the increase in the number of new investments partially offset by increased interest income as we benefit from more variable deposit rates on our US denominated excess cash. Concluding on the P&L we reported a net loss of $1.4 million compared to a net loss of $1.8 million in the same period last year. Again, benefiting from top line growth and increased profitability in a period where we invest in building a strong elite check from both another organization and operational perspective.

與去年的50 萬美元相比，所有收入均下降了30 萬美元，但這一發展是由於貨幣收益減少和新投資數量增加而部分被利息收入增加所抵消，因為我們受益於以美元計價的更多可變存款利率多餘的現金。根據損益表得出的結論，我們報告淨虧損為 140 萬美元，而去年同期的淨虧損為 180 萬美元。再次，在我們從另一個組織和營運角度投資建立強大的精英支票的時期，受益於收入成長和獲利能力的提高。

commenting briefing briefly on our adjusted EBITDA, excluding non-test items, we reported an adjusted EBITDA of negative $0.8 million compared to a negative of $1.3 million in a comparable quarter last year. Considering the reported revenue, it's evident that break even remains achievable, when adding an incremental revenue of approximately 2 million per quarter at plus 40 contributions. Thus, this remains our key focus.

在簡要評論我們調整後的 EBITDA（不包括非測試項目）時，我們報告調整後 EBITDA 為負 80 萬美元，而去年同期為負 130 萬美元。考慮到報告的收入，很明顯，如果每季增加約 200 萬美元的增量收入（加上 40 筆捐款），那麼盈虧平衡仍然是可以實現的。因此，這仍然是我們的重點。

Finally let me briefly comment on our cash flow and balance sheet before summarizing and handing over to Fei. We ended the quarter with $11.8 million in cash, down $0.8 million compared to the second quarter as we took delivery of key manufacturing equipment at our ceramic's facility in Copenhagen, more specifically new extruders and kiltons. From a cash flow perspective, this quarter marks the end to the investment cycle initiated back in 2021, with the planned capacity expansion both abroad and domestically in Denmark.

最後讓我簡單評論一下我們的現金流量和資產負債表，然後總結並交給費。本季結束時，我們的現金為 1,180 萬美元，比第二季減少了 80 萬美元，因為我們在哥本哈根的陶瓷工廠接收了關鍵製造設備，更具體地說是新的擠出機和窯爐。從現金流角度來看，本季標誌著 2021 年啟動的投資週期的結束，計劃在丹麥國內外進行產能擴張。

Hence near to medium term cash CapEx will be confined to maintenance and smaller investments. Also I'm pleased that we during the quarter negotiated improved terms with our core banking partner reducing our cash collateral and securing incremental lease financing for the equipment delivered during the quarter.

因此，近中期現金資本支出將僅限於維護和較小的投資。此外，我很高興我們在本季度與核心銀行合作夥伴談判改善了條款，減少了我們的現金抵押品，並為本季度交付的設備確保了增量租賃融資。

Furthermore, as mentioned in our release, we also proactively address our June 24 maturity related to our senior Commissioner notes have successfully extended to Jan,26 on terms mirroring our original agreement. In summary, the underlying cash flow profile is improving as we are showing progress on both top line and profitability. Which combined with less cash CapEx and the benefits of the improved capital structure will further support our path towards positive cash flow generation. Thanks for your continued support and over to you Fai.

此外，正如我們在新聞稿中提到的，我們也積極解決與我們的高級專員票據相關的 6 月 24 日到期問題，已根據我們最初協議的條款成功延長至 1 月 26 日。總之，隨著我們在營收和獲利能力方面取得進展，基本現金流狀況正在改善。再加上更少的現金資本支出和改善資本結構的好處，將進一步支持我們實現正現金流產生的道路。感謝您一直以來的支持，祝福您一切順利。

Thank you, Simon. And pleased with the progress our new leadership team has made to transform the Liqtech operationally and commercially to become a leading provider of advanced and sustainable filtration solutions around the world. We look forward to finishing '23 on a high note and saving ourselves up for continued success in 2024. With that, operator we would be happy to take a look at the questions

謝謝你，西蒙。我們對新領導團隊在營運和商業上將 Liqtech 轉型為全球先進和可持續過濾解決方案的領先供應商所取得的進展感到高興。我們期待以高調結束 '23，並為 2024 年繼續取得成功做好準備。因此，運營商我們很樂意看看這些問題

(Operator Instructions) And our first question will come from Robert Brown of Lake Street Capital Markets. Please go ahead.

（操作員說明）我們的第一個問題將來自 Lake Street Capital Markets 的 Robert Brown。請繼續。

Hi Fei, hi Simon. Are you made nice progress in building out the distribution relationships? Just wanted to get your sense on how much more there is to go there and other geographies or other markets that you need to where Conor do you feel like you've kind of got?

嗨，費，嗨，西蒙。您在建立分銷關係方面取得了良好進展嗎？只是想了解您還需要去哪裡以及您需要的其他地區或其他市場，Conor 您認為您已經擁有哪些地方？

Yeah, we are still have a great many areas, geographic areas to be explored for them. We don't have a niche to distribute in US and also some other European countries. So we will definitely continue our journey and find more distributors, we'll extend our geographic reach.

是的，我們還有很多領域、地理區域有待他們去探索。我們在美國和其他一些歐洲國家沒有可以分銷的利基市場。因此，我們肯定會繼續我們的旅程並尋找更多經銷商，我們將擴大我們的地理覆蓋範圍。

Okay, great. And then I guess from the scrubber market, you had some orders in the quarter. How's the pipeline looking for that and you feel like that's sort of the are reengaging in the next year or what's your sense on that market?

好的，太好了。然後我猜，從洗滌器市場來看，本季你們收到了一些訂單。管道尋找的情況如何，你覺得明年會重新參與，或是你對這個市場的感覺是什麼？

But so, Rob, we were not commenting on the pipeline. Clearly, we disclosing orders as they come if they are obviously relevant in terms of tapping into new markets, are there and reflecting it and a new product or a sizable order. Now we are diligently working through our marine portfolios also alluded to on our conference participation back in September, where we are trying to really address that market through multiple channels.

但是，羅布，我們並沒有對管道發表評論。顯然，如果訂單明顯與開拓新市場相關、是否存在並反映新市場以及新產品或規模較大的訂單，我們會在收到訂單時予以揭露。現在，我們正在努力開發我們的海洋產品組合，這也是我們在 9 月參加會議時提到的，我們正試圖透過多種管道真正解決該市場的問題。

As we also alluded to that point, we have onboarded a new sales rep for that margin per experienced person that will help us build more channels. So we are working diligently to really strengthen our marine pipeline, and we'll elaborate more on that on future calls and hope to be able to disclose that on relevant press releases in due time.

正如我們也提到的那樣，我們已經按照每個經驗豐富的人員的利潤聘請了一名新的銷售代表，這將幫助我們建立更多的管道。因此，我們正在努力工作，真正加強我們的海上管道，我們將在未來的電話會議上對此進行更多詳細說明，並希望能夠及時在相關新聞稿中披露這一點。

Thank you. And then maybe on your efforts to kind of get spares and services improving, I think had some nice progress there, but how do you see that playing out? And what sort of goes into it ramping that business.

謝謝。然後，也許您在改善備件和服務方面所做的努力，我認為取得了一些不錯的進展，但您認為效果如何？以及如何推動這項業務。

I mean we do have 160 marine systems in the market and that gives us a very good basis for our service business and we're also selling more systems for the oil gas. And also, for three assets and also even for the swimming system so we are actually in the process we look into our service offering. And build up the professionalism on that so we do hope we do expect next year the service will contribute very significantly than you know before.

我的意思是，我們市場上確實有 160 個船舶系統，這為我們的服務業務奠定了良好的基礎，我們也銷售更多的油氣系統。此外，對於三項資產，甚至對於游泳系統，我們實際上正在研究我們的服務產品。並在此基礎上建立專業精神，因此我們確實希望明年該服務的貢獻將比您以前知道的更加顯著。

Great, thank you I'll turn it over.

太好了，謝謝你，我這就轉過來。

(Operator Instructions) And our next question will come from Bill Chapman, a private investor. Please go ahead.

（操作員說明）我們的下一個問題將來自私人投資者比爾·查普曼。請繼續。

Hi, everyone on the phosphoric acid., one of your presentations, you said the ROI is well under one year. and is that still proving out and then if so, what obstacles having to deal with for a company to adopt this? For example, they have to shut the plant down for four days and that's difficult. What are the issues that the plants have to deal with to adopt this?

大家好，關於磷酸的大家。在您的一次演講中，您說投資報酬率遠低於一年。事實是否仍然如此，如果是這樣，公司要採用這項技術必須克服哪些障礙？例如，他們必須將工廠關閉四天，這很困難。為了採用這種技術，工廠必須解決哪些問題？

It's nice to have you have seen our presentation. It is true the return of investment is very short. It's less than a year and that still stands. So why the sales cycle is longer for this application is that we are actually going to put our ultra-filtration system into their production line.

很高興您看到我們的演示。確實，投資回報期非常短。不到一年的時間，這種情況仍然存在。所以為什麼這個應用的銷售週期更長是因為我們實際上要把我們的超濾系統放到他們的生產線上。

So, they always want to make a pilot testing before they really put into their real system. So that's also why we have sold our pilots to us, for example, silicon feature, and we're going to have more pilots sending out. And when the pilot is up running, then they will become more reliable for them to really open their pipeline.

因此，他們總是希望在真正投入實際系統之前進行試點測試。因此，這也是我們向我們出售飛行員的原因，例如，矽功能，我們將派出更多飛行員。當飛行員開始運行時，他們將變得更加可靠，可以真正打開管道。

So these are these our process because they want to take hard work and they want to take the pilot process. But the return on the investment is a very impressive for all the customers.

這些就是我們的流程，因為他們想要努力工作，並且想要進行試點流程。但投資回報對所有客戶來說都是非常可觀的。

And maybe just adding to that, Bill, I think the key thing here is also, as we mentioned, that the system is performing well. I think that the quality of the system and the fact that we have a client that is really benefiting from this, I think gives us the long-term view that this is the right market for us to focus on. But obviously, we can't control the decision process on the client side, and as Fei correctly mentioned, when we are tapping into the co-production line, it unfortunately takes time. But I just want to reiterate that the system that we have installed is performing extremely well.

也許只是補充一點，比爾，我認為這裡的關鍵也是，正如我們所提到的，系統運作良好。我認為系統的品質以及我們擁有真正從中受益的客戶這一事實，讓我們從長遠來看，這是我們值得關注的正確市場。但顯然，我們無法控制客戶端的決策過程，正如費正確地提到的，當我們進入聯合生產線時，不幸的是需要時間。但我只想重申，我們安裝的系統運作得非常好。

Okay. Would this be considered substantial cost savings to the average manufacturing plant, or is it marginal cost savings?

好的。對於普通製造工廠來說，這是否被視為大幅成本節約，還是邊際成本節約？

I mean, it's a substantial savings because they're both saving the process cost and also the product quality increase, and that is very much value for them.

我的意思是，這是一筆巨大的節省，因為他們既節省了流程成本，又提高了產品質量，這對他們來說非常有價值。

Okay. One last question. How big is the market on this? I don't think I've seen anything on that. If I did, I just overlooked it. So how big is the market for this?

好的。最後一個問題。這方面的市場有多大？我認為我沒有看到任何相關內容。如果我這樣做了，我只是忽略了它。那麼這個市場有多大呢？

I don't think we have published exactly the market size for this one, but we did in our presentation. You have seen, and for the new target business area, we're saying something about more than USD2 billion potential address for market. So it's a huge market there.

我認為我們還沒有準確公佈這一市場的規模，但我們在演示中公佈了。您已經看到，對於新的目標業務領域，我們所說的是超過 20 億美元的潛在市場地址。所以那裡有一個巨大的市場。

Just one last question. Of all of the products, offerings you have, which ones have the biggest revenue potential for the company, the way it seems right now to you?

只是最後一個問題。在您擁有的所有產品和服務中，哪些對公司來說具有最大的收入潛力，您現在看來是這樣的嗎？

You know, that's exactly why we have defined. Our commercial strategy as we have done today, and we do not want to take the same situation as we had before, and we stand on one leg. We would like to have several different segments, and it's more stable for the company. So I would say all the areas we focus on, the commercial swimming pool and the marine swimmers, and the preferred assets and oil and gas, they all could be very substantial revenue contribution for our market.

你知道，這正是我們定義的原因。我們的商業策略就像我們今天所做的那樣，我們不想採取與以前相同的情況，我們是單腳站立的。我們希望有幾個不同的部門，這對公司來說更穩定。所以我想說，我們關注的所有領域，商業游泳池和海洋游泳者，以及優先資產和石油和天然氣，它們都可以為我們的市場做出非常可觀的收入貢獻。

Okay. Thank you very much.

好的。非常感謝。

Thank you.

謝謝。

You're most welcome.

非常歡迎您。

This concludes our question-and-answer session. I would like to turn the conference back over to management for any closing remarks.

我們的問答環節到此結束。我想將會議轉交管理層發表閉幕詞。

Thank you all very much for being with us today. We look forward to communicating with you soon again. Thank you for attending.

非常感謝大家今天和我們在一起。我們期待很快再次與您溝通。感謝您的出席。

The conference has now concluded. Thank you for attending today's presentation, and you may now disconnect.

會議現已結束。感謝您參加今天的演示，您現在可以斷開連接了。