Lightbridge Corp (LTBR) 2009 Q1 法說會逐字稿

Good morning, and welcome to the Thorium Power first quarter 2009 conference call. I will be facilitating the audio portion of today's interactive broadcast. All lines have been placed on mute to prevent any background noise. (Operator Instructions). At this time, I would like to turn the event over to Mr. Peter Charles. Please go ahead, sir.

Thank you, Chris. Good morning, everyone, and welcome to our first quarter business update call for Thorium Power. On the call with us today are Seth Grae, CEO of Thorium Power, Jim Guerra, COO, and Andrey Mushakov, Executive Vice President, International Nuclear Operations. There is also a slide presentation that accompanies today's conference call. A copy of this presentation is available in the Investor Relations section of our website, Thoriumpower.com.

I would like to remind everyone that this conference call may include certain statements that are not descriptions of historical facts, but are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, and Section 21E of Securities Exchange Act of 1934. These forward-looking statements may include the description of our plans and objectives for future operations, assumptions underlying such plans and objectives, and forward-looking terminology such as "expects," "believes," "anticipates," "intends," "projects," or similar terms, variations of such terms, or the negative of such terms. There are a number of risk and uncertainties that may -- that could cause actual results to differ materially from the forward-looking statements made herein. Such information is based upon various assumptions made by and expectations of our management that were reasonable when made but may prove to be incorrect.

All of such assumptions are inherently subject to significant economic and competitive uncertainties and contingencies beyond our control, and upon assumptions with respect to future business decisions which are subject to change. Accordingly, there can be no assurance that actual results will meet expectations, and actual results may vary perhaps materially from certain of the results anticipated herein.

Before I turn the call over to Seth, I would like to inform our listeners that the intent of today's call is to present a brief review of our first quarter 2009 financial results. Please be aware that our annual shareholders meeting will be held on June 29 in New York City. The annual meeting will go into further detail about our intent to list on a senior exchange, a possible reverse stock split, and our Lightbridge branding initiative. This year, the annual presentation will be particularly focused on our development strategy for our proprietary non-proliferative nuclear fuel designs. With that, I will turn the call over to Seth Grae, Chief Executive Officer of Thorium Power. Seth?

Thank you very much, Peter, and thank you everybody for joining us today. Good morning to you. Or good evening, where I am in Abu Dhabi today. Since we recently held our fourth quarter and year end conference call, we've kept our prepared remarks for this call fairly short. I'll provide a recap of our financial results and then we'll open the call for questions.

Starting with slide three of the PowerPoint that you can see on our website, I'd like to introduce our vision and mission statements as well as our corporate values. Our vision is to become the global leader in the development of safe, sustainable, secure and commercially viable non-proliferative civil nuclear generation programs. To achieve this vision, we will be a world leader in the commercialization of non-proliferative low waste fuel designs for existing and future civil power reactors, and we will provide world class strategic advisory services to governments and utilities, seeking to develop non-proliferative civil nuclear power programs. We are well on our way toward achieving these goals. While keeping true to our corporate values, namely, non-proliferation, transparency, safety and security, integrity, respect, performance and management discipline. Today's focus is on our first quarter 2009 financial results.

Turning to slide five in the PowerPoint, revenue for the first three months ended March 31, 2009 was $2.9 million, compared to $3.8 million for the first quarter of 2008. Revenues for the three months ended March 31, 2009 and March 31, 2008 were generated by our consulting and strategic advisory services business segment. The variation in revenue reflects the uneven nature of consulting projects and the timing of revenues recognized on the respective projects. It's important to note these contracts are for five year durations, and there will be fluctuations in revenue as we progress through the various cycles of the contract. Gross margins were lower than in the first quarter of 2009, as compared to the same period in the prior year. This was equally due to lower consulting revenues and to the mix of consulting services provided. The slight decline in total operating expenses reflects the lower SG&A and stock option expense combined with the higher R&D expense. R&D expense, of course, represents an investment in our future. As a result, net loss for the three months ended March 31, 2009 was $1.5 million, compared to a loss of $788,000 for the first quarter of 2008.

On slide six, we're supplementing our financial discussion with non-GAAP results that exclude non-cash items to better reflect our operating performance. Much of the non-cash expense in the filing is stock-based compensation. In an industry where nuclear expertise is in limited supply, it's the stock-based compensation to recruit top talent is important in maintaining our standing as a leading nuclear authority. In the first quarter of 2009, approximately $1.2 million of our operating expense was attributable to stock-based compensation. Excluding the impact of non-cash items, adjusted net loss for the three months ended March 31, 2009 would have been $243,000, compared to adjusted net income of $578,000 for the same period in 2008.

On slide seven, you can see that as of March 31, 2009, we had cash and cash equivalents of $4.4 million. Our total assets were approximately $10.6 million, and total liabilities as of March 31, 2009, were approximately $3.5 million. We had a working capital surplus of approximately $6.6 million, and no long-term debt as of March 31, 2009. As Peter mentioned earlier, our annual shareholders' meeting will be held June 29 in New York City. Details of the annual meeting are in the proxy statement or you may contact Peter Charles for the information.

Among the updates to be provided on this occasion will be a focused presentation on our proprietary nuclear fuel designs. We look forward to seeing you at the meeting and sharing our corporate and technology updates. Operator, we'll now open the call for questions.

(Operator Instructions). We'll pause for just a moment to compile the Q&A roster. Your first question comes from [Bill Penrod] who is a private investor.

Hi, Seth. Hi, Peter. My question is, I know in the past we have had some tests on and are awaiting results for some irradiation tests, and then testing on a larger fuel rod and seed blankets. Do we have any results on that? And if so, when can we expect some?

Thank you for the question. And yes, Andrey, if you would take the first answer, please.

Yes, sure. As you may be aware, we have been doing some in reactor irrigation testing in the (technical difficulty), on seed and blanket fuel samples in the IRA Research Reactor at Kurchatov Institute. And as you properly mentioned, we removed some of those fuel samples after they were radiated in that reactor for post-radiation examination. If you recall, we entered into a post-radiation agreement with Kurchatov Institute at the end of last year. The work is underway right now, pursuant to that agreement, and we expect the work to be completed sometime by the fall of this year. So once the work is completed around that time, I think we'll get the final results of that post-radiation examination.

(Operator Instructions). There are no further questions at this time. Mr. Charles, I'll turn the call back over to you.

Sure. Just one more time, I would like to thank everyone for joining us on this call. I just want to remind everyone that the annual shareholders meeting is in New York City on June 29. Again, we are very happy to share our fuel development strategy with our shareholders and investors.

We plan on recapping 2008, corporate developments. We plan on providing an outlook for 2009 and beyond. We'll discuss our reverse stock split, our intent to list on a senior exchange, and also we want to focus on our Lightbridge branding initiative. With that, I would like to close the call. And thank everyone for being on the call.

This concludes today's conference call. You may now disconnect.