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Unknown Executive: Good afternoon, ladies and gentlemen, and welcome to the AFC Energy plc Full Year Results Investor Presentation. [Operator Instructions] Given the significant attendance on today's call, the company will not be in a position to answer every question received during the meeting itself. However, the company can review all questions submitted today and will publish responses where it's appropriate to do so. Before we begin, we'd like to submit the following poll, and I'm sure the company will be most grateful for your participation. I'd now like to hand over to the team from AFC Energy, John and Karl. Good afternoon.
John Wilson: Thank you. Thank you, Mark. Good afternoon, everyone, and welcome to our presentation on our full year results for the year ending 31st of October 2025. So usual disclaimer that we put up for everyone to read in their own time. Moving on, by way of an agenda, we'll run through the business overview, talk through the strategic progress the business has made products and technology overview, what we're focusing on commercially, the results for the financial year, a short time talking about outlook, and then we will take questions from you all. So when we joined the business, and I've said this before, what we did was we really started to look at why the global hydrogen economy hadn't really kick started. And it was clear that it was being held back by cost and infrastructure challenges. So we set out on a journey to develop a business and a strategy that would unlock those challenges. So our cracker technology allows us to deal with the infrastructure and the cost and our fuel cell technology helps us deal with the cost implications of those generator units. So in doing that, the most important aspect for us is ensuring that this business is commercially viable without the need for government subsidies or incentives. We can't control government actions. So if the business can stand on its own 2 feet, irrespective of which government is in power and what the legislation is, then this is then a business that is, in our view, is investable as a proposition. So what is the business? And I'm sure a number of you have seen this slide before. So we can take ammonia molecules and using our proprietary cracking technology, convert that into hydrogen. That in itself is a business, and we announced last week that we will be selling hydrogen produced from our pilot site in Dunsfold to offtakers. We can also take that hydrogen and using our fuel cell generators convert that into electrical power. So for construction sites, for example, backup power, et cetera. And why are we doing that? It's down to the size of the prize. So if we look at the generator market, it's an enormous market, $18 billion of annual sales. And in the area that we've launched, the LC30, our 30-kilowatt units, up to 50 kVA, the addressable market there is around about $6.5 billion globally and there's a forecast CAGR of 7%. If we start to break that down by geography, the 3 areas that we are targeting, so Europe, the MENA region and North America, there's an addressable market there of over 280,000 units per year. So if we were to price our generators at [ $95,000 ], then that would be an addressable market of GBP 27 billion. So 1% of that market per year would generate GBP 270 million of revenue for our business at that price point. Moving on to hydrogen use, hydrogen production. You'll see there's significant forecast growth of hydrogen use between now and 2050. If we just look at the U.K. government target, which is yet to change, it may well change, but around about 1.6 million metric tons by 2030. If we had a 5% share of that market at GBP 10 per kilo, which is what we're offering through our Fuel-as-a-Service offering on our High 5 units, then that equates to over GBP 0.75 billion of revenue per annum. And most importantly, that equates to only 480 Hy-5 units. So without substantial numbers of assets deployed, we can generate significant revenue. Into strategic progress. So if we just talk through last year from the time that Karl and I joined the business, we joined in January of '25. We're looking a lot more fresh dates than we are now. But we came in with 2 key strategic priorities. One was to preserve cash to arrest the cash burn, which Karl will walk you through. The second was to create a strategy for this business that would realize and generate significant shareholder value. So the first thing that we did was we announced that we were stopping the construction build-out of our AR2 units because each one cost us over GBP 0.25 million of cash to sell. And we also set about looking to productize the technology that the business has. And so we launched in March the Hy-5 portable cracker at GBP 10 per kilo, and that development is very much on track. And as we moved into June, we previously announced we were looking to take 2/3 of the cost out of our fuel cells. We actually achieved or announced in June, we expected to achieve 85% of reduction in cost. But we also needed somebody, a partner to really build out those units for us. We don't have the balance sheet to build a large manufacturing facility and associated capacity to do that. So we partnered with Volex to manufacture those fuel cells generators for us. And we also announced at that time a joint development agreement with an S&P 500 company to develop a 4-tonne cracker for a particular application, and I'll talk a little bit more about that shortly as well. And what that served to do is really kind of validate the IP that the cracker has and that the business has. And then as we moved into July, we announced a joint venture with ICL, Industrial Chemicals Group Limited, for us to jointly produce hydrogen using our Hy-5 units initially at their site in Port Clarence. And strategically, that was very important for us because it's great to have cracker technology. But if you don't have any feedstock, any ammonia to crack, then you don't really have a business. And of course, being a chemical company, that gives us access to ammonia. So having reset the strategy and set out time lines for execution of that strategy, we went to the market to raise money to deliver it and successfully raised GBP 27.5 million gross to set us on our way to deliver, as I say, deliver that strategy. So then the second phase of hard work started, and that was really taking the business and the structure that we had and going about repurposing it, reorganizing it in such a way that we could set ourselves up to win. So we took GBP 1.5 million of cost out of the business, and we reduced the headcount by about 20%. We also bolted a front end onto the business, a commercial function onto the business through the appointments of both a Chief Strategy Officer and a Chief Commercial Officer. And the reason why we created both roles is it was very clear when we started to look for a Chief Commercial Officer directly in this space that has the Rolodex that would be required to understand what is going on and get us early entry points into the organizations that we believe are suitable for our technology. That commercial person just doesn't exist with a track record of delivery. So -- and given that Karl -- neither Karl or I are actually from this sector, we appointed Nick Walker, who exPeel Hunt analyst, who quite frankly, knows everything and everyone in this space. So the oracle of hydrogen. And alongside that, appointed a CCO from ABB, who ran part of their hydrogen business. We also and very importantly, created a project management office. So nascent technology businesses, R&D heavy businesses that are reliant on delivering technology often overpromise and underdeliver because they do not manage their projects as well as they should do. So that PMO office gives us insight on it in a real-time basis of what is being delivered? Is it being delivered on time? Is it being delivered on budget? And we also have a risk management framework around that as well. And obviously, the success of that is highlighted in the launch of the LC30 ahead of schedule. And a final point on this slide, in October, we supported TAMGO with Extreme E and Extreme H. We sent our 200-kilowatt unit fuel cell generator unit along with the team out to Saudi Arabia to support that. And that unit ran in the desert heat and the dust and the sand, producing 17 megawatts of power over the days that it was there with 100% uptime, which I think came as a bit of surprise to TAMGO in terms of that reliability. So that's last year. If we stop to talk through partnership updates before and then go on to talk about what we're looking to achieve this year. So as I mentioned, we announced an S&P 500 JDA partnership. We announced in November that the first stage of that was complete and the first stage was providing them with detailed analysis of the cost per molecule of hydrogen. So basically, how efficient our crackers are and the consumption of power in the generation of that kilo of hydrogen, for example, molecule of hydrogen. And initially, the agreement was we would develop, as I mentioned, a 4 tonne per day cracker. As our commercial teams that we've developed, our commercial front end that we've developed became much more involved in the conversation with their commercial teams, it became very clear that, that application, that single use case could be used and expanded significantly for multiple verticals. And what do I mean by that? So we were looking at a port-side application. If we start to look at certainly in Europe and the same applies in this country, as you start to move inland Tier 2 power consuming industries, let's say, Tier 2, so glassmaking cement factories, asphalt manufacturers that require 20 to 30 megawatts of power without a pipeline, a cracker at a port would not benefit them. And so the view of our S&P 500 partner that we support and we're working with them on, on a commercial basis now is working -- identifying and working with those types of industries. And the likelihood is that rather than a 4-tonne cracker it's going to be closer to a 10 or even 15-tonne cracker, which translates to 20 to 30 megawatts of power. So whilst we haven't kicked off the second phase of the development of the 4-tonne cracker, and it's unlikely that we will, the most likely outcome is that we end up developing a much larger cracker, 10 to 15 tonnes a day, as I mentioned. And the size of that prize is significantly greater because rather than one use case application, we're now looking at multiple verticals and industries that could use that cracker, and we would be cracking the ammonia at site. So we're very pleased with the way that, that is developing. We have biweekly calls with them to progress that. And as I say, the commercial teams are working hand-in-hand. And a point on -- and I think there's already been a lot of questions about the Phantom S&P 500 partner, who are they when they're going to be announced. We said at the time that we would be announcing who they were once we finish the second phase, which essentially, we've done the development work. We've got a contract in hand for a number of crackers and then they're comfortable with their name being released. The likelihood is it won't happen like that. I think the likelihood -- most likely outcome is that we will be announcing who they are much sooner than that because of the commercial association that we have and working together with some of these companies. So it's coming is the short answer to that. Moving on to ICL. So as we announced last year and updated in November, we're applying for permitting to operate our Hy-5 unit at Port Clarence. And importantly, the way that we're approaching this is not just locally with the environment agency in the Middlesbrough area. What we're focusing on is working with the EA centrally, so we can create a framework for future deployments of crackers. So what we don't want to do is have a Groundhog Day situation where we work with the environment agency locally, we get a permit for Port Clarence, then we come to do a second deployment somewhere else. And then all of a sudden, it's a case of, well, how do we do this? This process doesn't exist. So we're working on that central framework. But obviously, what we've done in the meantime is in parallel, discussed with the environment agency, receiving approval to change the permit that we have at our site in Dunsfold, so we can start to sell the hydrogen there, and I'll talk about that on the next slide. So that is working well. We also, last week, signed an agreement or announced the signing of the agreement with Komatsu. That's an 18- to 20-month $2 million circa $2 million project. It's actually more than $2 million. And the purpose of that is they're very large mining trucks. So they're the big 4, 5-story mining trucks. If you look on LinkedIn, Nick Walker's got a nice picture of himself stood in front of one. I think Mike Rendall's got one, our CTO as well. But those trucks, the engines cost between $0.75 million are absolutely huge. And what they're looking to do is determine whether or not they can run off a blend of ammonia and crack gas or hydrogen cracked from ammonia. And the reason why the cracker is needed is an ammonia engine burns very dirtily. So there's a lot of NOx, a lot of nitrogen-based oxidized emissions, which are not good for the environment. With the introduction of hydrogen, it burns cleanly. So you have a very, very small amount of NOx that you can kind of scrub out post burn. And so effectively, you can run that engine and it's 99.99% emission-free. So we've already done some desktop work. It's more than desktop work with a project that we received a grant for to convert a 250-kilowatt Volvo engine to run on the same basis. We've done that work. We've shared the information, the results of that with Komatsu, which is one of the primary reasons why they are going down on this journey with us. And Komatsu has already invested tens of millions of dollars in determining whether a hydrogen engine would be suitable for these large mining trucks and has determined it just isn't suitable because of the size of hydrogen storage that will be required, just isn't -- it's not able to put it on one of those large trucks. So a very exciting development. I'm not going to speculate on what it can lead to, but we see it as a strong promise for the future and a further validation of the cracker technology and the cracker IP that we have. Speedy Hire, as many of you will know, we have 20 units that we sold into the JV at the back end of 2024. We've had many successful deployments of those units, and it's really providing us with an understanding of the footprint that we require on a construction site or a deployment site what risk assessments need to be undertaken, how we get hydrogen to site. So that has been successful and continues to be so. And then TAMGO, after sort of a multiyear flotation, I think, is the right term that we've had with TAMGO, following the success of the 200-kilowatt liquid cooled unit in Riyadh in October. They're very keen to get an understanding of the LC30 once we explain to them that ultimately, it has the same engine, the same architecture, the same performance characteristics, albeit at a lower power. And following the launch of that, they're very interested in helping us showcase that and create commercial opportunities and take the partnership to the next level. And finally, in terms of Volex, we are continuing to work with them on the LC30 build. So the first 2 units we have built ourselves as AFC. Units 3, 4 and 5, Volex will oversee the build of at Dunsfold. And beyond that, it will be transferred to their facility for manufacture. So that's the partnerships. If we then roll into 2026 and the key milestones that we have achieved and expect to achieve. So as mentioned, we launched the LC30 in January, in February or just last week, in fact, the engine development work with Komatsu, also the approval of hydrogen sale and export from our site in Dunsfold. And the benefits of that to us are many. So firstly, it accelerates the revenue. We previously said we'd be expecting to generate revenues from that pilot cracker by the end of the first half of this calendar year, albeit that was going to be at Port Clarence. Now we're going to begin starting generating revenues from April, so we accelerate that revenue. Secondly, it allows us to train ICL operatives at our site in Dunsfold. Three, it allows us to demonstrate not just to ICL, but also to investors, our shareholders and to the market that there's offtakers for this hydrogen as we sell it. And three, there's also opportunities with our S&P 500 partner in this country where they have customers that are very keen on understanding how they can integrate cracked gas into their processes. So there's a lot of opportunity that is happening around that. And ultimately, it gives us flexibility around what we do with this cracker. Initially, as I said, we're going to move that to Port Clarence as really initially as a low-risk approach for ICL to engage in terms of a JV. We're going to be able to demonstrate that there are offtake requirements for that hydrogen in very short order. So whether we move it or not, we're not sure. It depends on the demand, depends on the Hy-5 deployment in Port Clarence, how quickly we can do that because ultimately, that pilot unit will be in time will be superfluous requirements as we move to the Hy-5s. So that's the cracking. If we then look at back to LC30, we have to put the unit through CE marking through regulatory approval, both the CE. We're also going to be putting it through SABER, which is for the Saudi Arabian market and for UL for the North American market. But we're focusing initially on CE. These things will happen in parallel, but we're focusing on the CE. We're unable to sell product until we have that marking, and we're anticipating that in the August time frame, which allows us then to sell units to customers in September. So we're looking at building units prior to then ready for delivery to customers from September and October. However, being prudent and ensuring that we protect cash at all time until we've got a real feel and understanding of what that demand profile looks like, we're only committing at this point to delivering 15 units, 1-5, 15 units through to the end of our financial year through to October 2026. That could change because you'll see there on that sort of. Is that magenta line? Sort of light blue line, the arrow. The key focus for the commercial teams from -- certainly from the launch of the LC30 is -- and also with the progress we're making with the Hy-5 is taking the pipeline that we're building that is expanding quite nicely and converting that into contractual orders. So we may well change that view in the next couple of months if we have very clear signals to a very strong order backlog for LC30 units. But as things stand right now, we are committing and scaling up to build 15 by then. In terms of capacity of what the medium-term capacity for LC30 units is, the limiting factor for us is availability of fuel cells, which is limited to 500 units per month. So that's 6,000 units per year. If we fill that capacity, that's obviously on a $100,000 a year -- sorry, $100,000 units about GBP 600 million of revenue. So we've got ample capacity that we can scale into very quickly. But as I say, just to stress again, at this moment in time, we are committing to having 15 units available for customers. And moving back into October, Extreme H, we'll be working with TAMGO. Again, we also expect to be showcasing a number of LC30 units as well as our 200-kilowatt unit to potential customers in the Gulf region at that time. And then finally, we are looking to commission our first Hy-5 unit with ICL import clearance in November. So a lot of delivery of technology, but most importantly, as I mentioned, the focus on building that commercial pipeline and converting it to contractual orders. We move on to product and technology. This is the LC30. I won't read all the words on the page, designed principally to replace the AR2 unit, the air-cooled unit that was designed for the Speedy JV. So it's gone to construction sites, can be used for EV charging and anyone that is coming to one of our demo days next week, we'll see this unit working in anger and also the backup power and things like events. The principal benefits of that unit versus the previous units are listed on here. But in summary, it will be an ultra-reliable unit that we have a warranty to stand behind because we're taking effectively an off-the-shelf unit that's been in use for as it says there, many million run hours. It uses 20% -- up to 20% less fuel than the AR2. The footprint is almost 40% smaller. The reason it's only 40% smaller is because we've designed this for 100-kilowatt fuel cell to fit in exactly the same chassis. So the LC100 when it comes, will be identical fit form and footprint as the LC30. The weight is reduced by half, and it also has an islet hook at the top, so it can be lifted off the back of a loader. It doesn't require a forklift and probably most importantly, as we start to look at addressable markets, the temperature range rather than being limited to minus 5 to plus 40 is extended to minus 20 to plus 50. So the benefit of liquid cooling gives us an ability to be comfortable deploying these units across all 6 inhabited continents. And then the reactor technology. So our IP for our crackers is built around the reactors that we have. So we have numerous IP filings in place for these. It is designed to operate over a wide pressure range. So we get a lot of throughput works with other purification technologies for fuel cell applications, so we can scrub out trace ammonia and post cracking, push the hydrogen into our fuel cells. It's very small, which is helpful because that also gives it low thermal mass and makes it very responsive. So we can effectively produce hydrogen on demand. This will heat up in 20 minutes. It's got very low electrical power consumption. It can utilize multiple heat sources, so it can actually run completely independently off grid, utilizing its own waste heat streams if required. And in terms of the progress of Hy-5, so as you'll see there, we've released new high-efficiency designs for prototyping filed further IP, validated our BOM costs as bill of materials, completed hazard assessments, very importantly, identified key suppliers and onboarded those, which is obviously something you look to derisk early new technology. And we have received a number of inquiries for Hy-5s despite the fact that the unit isn't physically available yet. And just a reminder why ammonia cracking is a lower-cost way of making hydrogen. The primary cost of producing hydrogen through electrolysis is electricity pricing. So electrolyzers efficiency range from 55 to 60 kilowatt hours per kilogram. So based on U.K. grid prices in this country looking at GBP 12 to GBP 15 to produce the hydrogen. That compares with our ability to produce hydrogen, if you look at low carbon, blue ammonia, which we can use, which is for any kind of U.K. government contracts, is around about GBP 1.70 a kilo. Once you add on a couple of pounds worth of electricity, our cost to produce is around about 25% of the cost of electrolysis. And the further benefit is our crackers are designed to be portable. They're decentralized crackers. So we can position them at the point of use or where the hydrogen demand is. So we do not have very expensive transportation costs that are associated with the movement of hydrogen, the issues of moving hydrogen through tunnels and the CapEx cost of very expensive tube trailers. We rely on standard ISO tanks that have been moving ammonia around for 50, 60 years. And moving on to commercial focus and priorities. So we're building out our channel for our fuel cell generators. So in the U.K., we obviously have Speedy Hydrogen Solutions joint venture with Speedy Hire. We're looking at targeting an entry point into the North American market. Also the Middle East, I've spoken about TAMGO. And we expect to reengage with ACCIONA once we have LC30s available that they can then put on test on their site in Madrid with a view to and generating orders from that. And the focus for that commercial team, again, there's a lot of repetition in this slide deck is to bring in orders for those Hy-5 crackers and LC30s. We're going to continue to progress the JDAs and JVs to the product and revenues and as well as building out the commercial team, we've also now started to add marketing resource. Now we have product. We need to have collateral -- sales collateral that goes alongside that technology. Then if we look at the geographical markets and the drivers, so we're targeting markets where there are policies in place because the barrier to entry is low and where there is a clear demand for the technology and for hydrogen. So U.K., EU, U.S. and Canada. And then in terms of those chosen markets, and this is a piece of work that we've done internally, but also with our S&P 500 partner. We believe, for example, when I mentioned the 10 tonne a day cracker earlier, but that would be suitable for the 4 heavier industries here. So we need industrial heat, steel manufacture, chemicals and cement as well as Hy-5 units, which are suitable for equipment rentals and for hydrogen mobility. And over to Karl for trading performance.
Karl Bostock: Okay. So this year, you have seen that we posted a loss before tax of GBP 22.2 million. Now why that seems on the face of it, a big step backwards from last year's performance, which was GBP 4.8 million lower. Actually, the majority of the shift or more than the majority of the shift is around accounting rather than underlying trading performance, and I'll walk you through that in a moment. So in that accounting, there is GBP 12.4 million of noncash items. So in our profit and loss account, there are charges that don't actually cost us any cash, and that is an increase of GBP 8.4 million on the previous year. Again, I'll walk you through that in a moment. What we did spend, so we spent GBP 11.7 million on developing our technology. That's up from GBP 9.5 million in the prior year. And of that GBP 11.7 million, we capitalized GBP 5.2 million. The increased focus on development over other activities meant that we qualified for more R&D tax credits, which will come in, in the current financial year FY '26. And so we are looking to receive about GBP 3.3 million in sort of June and July time, which is an increase of GBP 1.4 million over what we received in the current year for last year. We went to the market, as John said earlier, and we raised net GBP 25.8 million. We also received GBP 2.2 million of government grant funding, which helped support the GBP 11.7 million of development spend. And most importantly, for this business is about cash preservation while we deliver the strategy. And we spent cash out of the organization before any financing activity, GBP 15.4 million. That is a reduction of GBP 11.2 million on what was spent in FY '24. And we'll walk you through how we did that and why we did that in a moment. We finished the year with the majority of our net fund raised in the bank, so GBP 25.3 million, and that gives us significant cash runway to do what we need to do looking forward, okay? So going back to where we started a moment ago, thinking about the accounting for our change in strategy. And just to recap, that change of strategy made us not want to build any more AR2 units. So we're not going to make any more sales. We stopped the development and focused our efforts on taking the cost out of that platform, which John just walked through, which delivered the LC30. And that, together with our Hy-5 gives the customer a TCO comparable to diesel. So 3 constituent impacts on our trading from a profit and loss point of view. We didn't make any sales. In the prior year, we made GBP 4 million of sales, but that was predominantly sales to the JV. This year, sales are negligible, only GBP 100,000. Because of the shift away from the AR2 platform and that change of strategy, we had ordered a significant amount of inventory that was set on the balance sheet at the start of this -- at the start of financial year '25, and we made the decision to write that off, which cost us GBP 2.6 million through the profit and loss account, but obviously, nothing in terms of cash because all that was paid for in the prior year. The other thing we look to do is to think through the impact of -- and this is an accounting -- it's accounting rather than any sort of relation or any -- sorry, this accounting rather than a formal agreement with Speedy Hire. We decided to essentially make provision for the cost of swapping out the AR2 technology with the LT30 at some point in the future. So the current technology works, it's fit for function. But as we look forward, we took the decision from an accounting point of view to provide for the cost of swapping those out. And why do we want to swap them out? Well, once we get to scale, we don't really want to have a commitment of maintaining 20 different units from the LT30 in the future. And so -- if and when we do swap it out, we've essentially the cost of swapping them out is recorded in the financial '25 number, okay? So there's no -- to be totally clear, there's no -- we haven't gone to Speedy Hire and said, "You don't need to pay us anymore." They still need to pay us. It's just a provision that we made in the financial statements, okay? So I thought it might be useful to walk through the bridge. So last year, we posted a profit -- a loss, sorry, of GBP 17.4 million. The decision not to make any more AR2s actually benefited us GBP 1.8 million versus what we spent in the previous year. We invested some of that in development costs, as I say, developing the LT30 and the Hy-5. When you look at the utilization of labor, actually, the nondevelopment labor has actually went down year-over-year. So that saved us GBP 1.8 million. And because of the focus on research and development, our tax benefit in the year is GBP 1.4 million. So when we compare on a like-for-like basis before accounting and noncash items, the loss that we made in the prior year was GBP 17.4 million and the loss in FY '25 was GBP 13.8 million. To that number, a one-off transaction is to write off the stock. We won't be doing that. That won't reoccur in the future. We've also made this provision to swap out the generators at some point in the future. That's GBP 2.9 million. Again, that's a onetime item. In the prior year, the business spent a lot of money on development and assets and the full year impact of the depreciation on those -- on that investment in the prior year has increased depreciation by GBP 1.9 million. There's no cash cost to that. And then finally, there's a GBP 1 million increase, GBP 0.5 million in the share-based payment charge and GBP 0.5 million in remuneration to the management team, which has been settled in equity, again, primarily to preserve cash. So that's how we walk from GBP 17.4 million loss in the prior year to GBP 22.2 million loss in FY '25. For a business in our stage of development, it's all about cash. So as I mentioned earlier, last year, the business consumed GBP 26.6 million in cash to deliver what it delivered. This year, that cash has been significantly reduced -- the cash burn has been significantly reduced to GBP 15.4 million. Also, as you can see, a big part of that is around CapEx. So last year, in FY '24, we spent GBP 3 million. This year, we limited that to GBP 0.7 million, the majority of which was already committed to before we joined the organization. Just switch to the next slide. So coming in, what we needed to do very quickly was get hold of cash and put the controls and process in place to limit the spend, why we took a step backwards, reset the strategy, get the business in the right shape and now and then reinvest in the new strategy. So if you look back at the 15 months, the average quarterly spend in the 15 months prior to us joining, the quarterly cash burn was just short of GBP 7 million a quarter. What we did very quickly is come and hit the brakes on that. John mentioned earlier, we stopped spending on any project that wasn't adding value, and we managed to reduce the quarterly cash burn down to GBP 3 million. So on top of that, we went through a program of looking at every single cost that we have in the organization and rationalized everywhere we could. That unfortunately left us in a position where we had to make some people redundant. That redundancy or people exiting the organization will save us short of GBP 1 million a year. We also exited 2 properties, one in Dunsfold, one in Germany, which again will save us another GBP 0.5 million a year. So the business is now set up, it's lean, it's ready to go. We have reinvested some of that money in the commercial front end that John mentioned earlier. And you'll see the tick up in Q4 in cash going out of the organization. That is primarily driven by the cost to execute the manning reduction plan and the shutting down of the sites. and GBP 1.3 million of cash out of the organization to develop the 2 products that John walked through earlier, which is the LT30 and the Hy-5 product.
John Wilson: Okay. So just by way of a summary. So we feel we've made substantial progress with that strategic reset or the execution following that strategic reset because of the things Karl just walked through, the business is well capitalized to deliver the strategic initiatives that we have outlined. And I'll stress the point again, this year is all about as well as delivering the technology, it's all about taking that pipeline of opportunities and converting it to contractual orders, which will then start the sustained revenue growth that the business needs to see to begin to create shareholder value. Thank you.
Unknown Executive: That's great, Karl, John. Thank you very much indeed. [Operator Instructions] I would just like to remind you that recording along with a copy of the slides and the published Q&A will be available via your Investor Meet company dashboard. Thank you to everybody for your engagement. We received a considerable number of questions ahead of today's event, and you've had again increased engagement throughout today's presentation. I know you've covered a lot of topics that were sent in ahead of today's meeting through the presentation. So hopefully, that's given a number of investors some visibility around their particular areas that they were looking at. But if I may, John, just hand back to you if I could ask you to read out some of the questions that we've got there today, and I'll pick up from you at the end.
John Wilson: Dangerous giving me the iPad and control of this, but here we go. So first question, when are you going to make real money? Profit? So having worked in private equity, I can tell you the 2 aren't the same. You can have a lot of profit and be burning a lot of cash through financial engineering. But if I take the question on the basis that I think it's meant, ultimately, not to be too flippant, we need to generate revenues that are greater than our costs. That's ultimately when the business becomes profitable. We don't have any forecasts in the market. So what I would refer people to is the fixed cost cash burn we said is under GBP 1 million a month. Margins that we would aspire to are 40-plus percent margins. So on that basis, people can do their own kind of calculations to establish what revenue we would require to get there. And what else I can say on that is we're working as hard as we can, as quickly as we can to get there. Second question, Hi. Is all hydrogen revenue produced in partnership with ICL split 50-50? The hydrogen revenue we produce with ICL will be split 50-50. The hydrogen that we are generating in Dunsfold from the permit variation we've received will be AFC-only revenue. Third question, Hi. How long does it take to build one LC30 hydrogen generator?
Karl Bostock: 85 hours.
John Wilson: 85 hours. Next question. Is any type of fundraise expected or required in 2026? Do you want to talk about going concern?
Karl Bostock: Yes. So as part of the audit this year, again, comparing ourselves to last year, last year when we issued the audit statement or Grant Thornton did, we had a material uncertainty, which essentially meant that there is -- there was a requirement to raise money in the period 12 months from signing the audit report. We've just signed the audit report this week, and we don't have that material uncertainty statement anymore. So in the notes that we built around the period that we looked at, it essentially says that by September '27, we either need a substantial order book or have some kind of fundraising event. And that's -- so for the next 18 months, we are in good shape, but that's the analysis that we've done so far.
John Wilson: Thank you. Next question. How many kilograms of hydrogen does the new LC30 use in a 24-hour period running at full power? It's between 40 and 45 kilos. How many kilograms of hydrogen is one of our 200-kilowatt fuel cells use, it's almost 7x that. So 270 or thereabouts. Next question, what are the Hy-5 production targets for financial year '26 to '27? We've got to talk through. Obviously, we're looking to deploy the first one in 2026. And based on -- firstly, we have to have CE marking for that unit. So based on that and customer demand will depend on the units that are produce in 2027. In terms of capacity, we believe we've got capacity for one Hy-5 a week. So roughly 50 a year based on manufacturing Dunsfold, which we would not be looking at doing long term other than for the cracker reactors. Okay. Hang on, where have I gone here? Okay. Oh, you're deleting them as I'm reading. That's why.
Karl Bostock: Yeah.
John Wilson: I'm thinking where am I? Okay. I told you it was dangerous leaving it with me. Hi, what are the Hy-5 production? I've done that one, You haven't deleted that one, Mark. Okay. Apologies, very professional this. Has the Hy-5 unit been actually proven to work at that scale? So I'd refer you to the pilot site in Dunsfold, that has a theoretical capacity of 400 kilograms per day. The Hy-5, obviously, 500 kilograms per day. So the short answer is yes. Next question, how will AFC Energy improve its media visibility in the future to attract potential institutional investors, pension funds? So what the business needs to do in the first instance is move from being a speculative stock to one that is highly investable. So we need -- as well as setting out a clear plan of what we say we're going to deliver, we need to start delivering it. We need to start generating revenues. And once we have that, we will be attractive to other institutions. The register as it stands now has changed significantly over the last 12 months, particularly due to the fundraise. I think when we joined, it was around about 15% institutional equity positions. Now it's closer to 40%, albeit there's only one, I believe, that is over 3%. Next question. I think this is actually a statement that's been submitted by the Chairman. I have complete confidence in the management plans of ASC Energy and would like to thank them for their work. They still have a lot of work ahead of them. The whole secret is winning over the masses of ASC Energy and its products. They will manage it. Many investors believe in them. Thank you. Well, thanks, Gary. Appreciate that. Next question, do you intend to take Hyamtec publicly -- sorry, public independently in the next 3 to 5 years? If so, what will be left for ASC Energy? We've got absolutely no intention of doing that. We are a PLC. Hyamtec is effectively a brand of AFC Energy. So no. Next question, what is the current status of your collaboration with ABB? Well, there isn't one. I think we outlined or certainly stated in one of the IMC meetings that I've never personally had any conversations with ABB, they are a shareholder. They still hold, I think, about 1.7 million shares, but we've had no conversations with them. Next one, does our manufacturing partnership with Volex have the confirmed capacity to deliver 50-plus LC30 units and 10-plus Hy-5 crackers? So capacity for the LC30 units, absolutely. Volex will not be manufacturing the Hy-5. The Hy-5 is a miniature chemical plant. That's not something they're interested in doing. As I said earlier, we will be looking at manufacturing the cracker reactors for the first units, we will build the whole unit. And beyond that, we would be looking to outsource that. Next question. Has ASC participating in the same bidding process for the contract awarded to GeoPura? How does this affect ASC? So this relates to the lowers crossing and the announcement, I think, that came out on Monday, which is one of the worst kept secrets in the construction industry. I think we've known for about 3 or 4 weeks about that going to GeoPura. So no, we weren't. The tender closed, I think it was July 2024. It was before Karl and my time. At that time, we didn't have a product. We had technology, we didn't have a product, so we weren't participating in that tender. What does it mean for ASC? It's actually a real positive thing. And the reason it's positive is, firstly, it's government giving some commitment to supporting the hydrogen economy. So there's a commitment for hydrogen to be available for construction companies to use on LTC, which is very important, which means there'll be investment in hydrogen assets, which is very helpful for us because obviously, our LC30s are hydrogen assets. In terms of what else it means for us, it's really quite interesting because the price per kilo of hydrogen hasn't been disclosed. But again, being a sort of leaky industry, we think the price -- the headline price is GBP 9 a kilo, which we assume is based on GeoPura benefiting from a payout from the HAR1 scheme. There's been no payout as yet of GBP 9.50 a kilo. So if that is the case, it's -- I think it's 2,500 tonnes is the "contract." That essentially is a GBP 22.5 million value, of which the taxpayer, you and I and all the rest of us that contribute to the economy will be paying about GBP 24 million for them to deliver GBP 22.5 million worth of hydrogen. But I think what it further shows to highlight is the competitive advantage that our technology has. So if we, for example, were able to access that level of subsidy GBP 9.50 kilo, not only would be able to give away the hydrogen to the construction companies, we'd actually be able to pay them to take the hydrogen, and we would still be profitable. So it really kind of highlights the kind of disconnect between government subsidy in our view, certainly in my view, in particular, I shouldn't try and tar Karl with this brush, just get myself into trouble, not both of us, that funding OpEx for hydrogen is going to do nothing to reduce the cost of hydrogen because you're back to how is hydrogen being produced through electrolysis. It's the cost of power that's an issue, and that is not going to change. So the subsidy should be going towards investments in capital equipment, and we have the technology to have a significantly lower price point that drives that commercial viability. There's a couple of other questions. Are you as bullish on AFC prospects as you ever were on EKT or your other management roles? So EKT was a micro conglomerate that I ran for 10 years. It went from 5p to 65p, so 13 bagger and then sold part of that on again for about 3.5x more. No comment on that. I think this is a business that's got great opportunity. It's the reason why I joined it. It's the reason I persuaded Karl to come and join me as well. But watch your space on that. I guess final -- actually, let me just sort of scroll through. I mean someone is asking when the cash comes out. We just answered that. I'll take one final question off here. Okay. Will you take preorders for the LC30 units prior to getting the CE certification? Yes, in the short term.
Unknown Executive: John and Karl, thank you very much indeed, and thank you to everybody for your engagement this afternoon, and we'll make any other questions available to you post today's meeting. John and Karl and I know investor feedback is important to you both. I'll shortly redirect those on the call to give you their thoughts and expectations. But perhaps John, a couple of closing comments and then I'll send investors for feedback.
John Wilson: Yes. Thanks, Mark. Well, I think the final thing I'd like to say is to thank everyone for listening to us today. Those that have already invested, thank you. We appreciate that. Hopefully, it comes across that we believe in the business. We're doing everything we can to progress the fortunes of the business. And to date, everything that we set out to deliver, we have delivered. It doesn't always work out like that. The path to successful development of nascent technology businesses is nonlinear, but we're certainly doing everything we can, and we'll continue to do so. So thanks for the support.
Unknown Executive: That's great. John and Karl, thank you very much indeed for updating investors. Can I please ask investors not to close this session. We'll now automatically redirect you so you can provide your feedback in order the company can better understand your views and expectations. On behalf of the management team of AFC Energy, I'd like to thank you for attending today's presentation.