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Jim Cramer explained three ways the market will react once the war in the Middle East is over. "Today we saw what would happen when you give peace a chance," Cramer said, pointing to Tuesday's rally in growth stocks.
U.S. stocks surged Tuesday on growing optimistic about a potential end to the the Iran war.
The optimism of Fed officials puts them somewhat at odds with a string of gloomy economic signals.
I strongly believe this is a correction, not the start of a bear market. That said, I take a devil's advocate approach in this piece and focus on the main brick in the wall of worry: the durability of U.S. earnings growth.
Barron's compiled a list of telling monthly and quarterly statistics with the Dow Jones Market Data team below.
The stock market powered higher Tuesday on the first day of its rally attempt as investors grew confident about a U.S.-Iran truce.
As we outlined last week, a quick and tidy conclusion to the war in Iran looks increasingly unlikely — which means markets are likely to remain volatile for the foreseeable future. What matters most is the magnitude and duration of the global oil price spike – currently around $112/barrel. Econometric analyses from Goldman Sachs, Moody's, and others place the ‘danger zone' somewhere above $125/barrel sustained for more than a month or two.
Currently, the media and stock market are hyper-focused on the relationship between the price of oil, driven by the damage caused by the Iran war, and expectations for an “end date” for the fighting. If or when the fighting stops, the next focus will be on how quickly international trade recovers and how depleted importing countries' critical resources, such as oil and fertilizer, are.
Plus, a judge halts construction of Trump's White House ballroom, and the splitter is driving MLB batters crazy again.
Marley Kayden breaks down falling consumer sentiment and a cooling labor market as the latest JOLTS data shows a low‑hire, low‑fire backdrop. Sam Vadas looks at pressure across semiconductors, recent moves in WDC, STX, and MU, and what upcoming data could signal about stagflation, while META and ORCL continue restructuring around AI.
Muddy Waters Capital founder and CEO Carson Block says investors are underestimating the risk AI poses to the labor market and US economy. Speaking on "Bloomberg The Close," Block also comments on credit spreads and where he is finding investment opportunities.
One of the most difficult parts of navigating the stock market for investors is the inherent unpredictability. On February 28th, the United States attacked Iran and began Operation “Epic Fury.
Wall Street surged on Tuesday, lifted by speculation about a potential de-escalation in the Middle East conflict that has sent oil prices soaring and fueled fears of global inflation in recent weeks.
Wall Street closed sharply higher on Tuesday, buoyed by growing speculation that the conflict between the United States and Iran could de-escalate, easing pressure on energy markets and global inflation expectations. All three major US indexes rallied after a report indicated that Donald Trump is willing to end the military campaign against Iran even if the Strait of Hormuz remains largely closed.
Comprehensive cross-platform coverage of the U.S. market close on Bloomberg Television, Bloomberg Radio, and YouTube with Bailey Lipschultz, Katie Greifeld, Carol Massar and Tim Stenovec. -------- More on Bloomberg Television and Markets Like this video?
The S&P 500 and Nasdaq now offer quality companies at attractive valuations, making broad US equity exposure compelling for long-term investors. Index heavyweights like NVDA, AAPL, MSFT, AMZN, and GOOGL have experienced EPS growth and multiple compression, improving margin of safety.
Microsoft, Nvidia, and other Magnificent Seven stocks are cheaper relative to the S&P 500, but investors remain uncertain about the durability of the AI trade.
March saw a huge spike in volatility due to a new regional war in the Middle East, which triggered a huge rally in energy and other commodity prices. Global recession risks may hinge on whether the Strait of Hormuz gets reopened for transit over the next month.
Operator: Good morning, ladies and gentlemen. Welcome to the Ceres 2025 Full Year Results Investor Presentation. [Operator Instructions] I'd now like to hand over to the management team, Stuart, Phil, good morning. Philip Caldwell: Good morning, everybody, and thank you for joining us for the 2025 full year results presentation. I'll talk you through an update on the company and the strategy to begin with, and then Stuart will obviously talk you through the financial numbers, and we'll obviously go into Q&A at the end as usual. So at Ceres, we're operating on 3 strategic imperatives. The first one is signing more licensees. So new manufacturing license partners is a key focus for us as a business. The second is once we have those partners, bringing those partners to market. So that's obviously assisting them as they scale up and put in capacity, but also actually helping to stimulate demand, which actually helps pull through the products that we're developing with partners. And the third is obviously technology leadership. We believe we have the best solid oxide technology in the world. We have a single stack platform, which we're actually going to be launching in April. And we need to maintain that technology leadership advantage because that's what our partners come to rely on from Ceres. So over the last 12 months, we've made significant progress on all these activities. The first thing to say is there is an acute need for power driving the commercial interest in our technology right now and particularly for SOFC technology in the wider landscape. As we go into partner progress, in the past 12 months, we signed a new manufacturing license agreement in China with Weichai, our partner. We'll give you a little bit more on that today, but that's going extremely well, extremely rapidly. In Taiwan, Delta is also scaling and starting to produce first prototype products and is also investing significantly in land and facilities to do that scale up as well. In South Korea, a big milestone for us in the past 12 months with Doosan starting production at the factory there, both for SOFC stacks and power systems, and that also generated first royalties for the company in this period. In Japan, our partnership with DENSO on the electrolysis side began production of first hydrogen with JERA and also led to government funding recently with an estimated value of about JPY 35 billion, approximately GBP 165 million to continue the advancement of SOEC technology. Great progress in India with Shell. The megawatt scale electrolysis demonstrated actually exceeded performance expectations, high efficiency but capacity as well. And we're progressing now towards the pressurized systems as well with Thermax and Shell and Thermax developing a new pilot facility for testing of those systems. We also undertook a business transformation plan around those 3 strategic imperatives that we talked about. And we've restructured the business, very much focused on accelerating the commercial opportunities. So after 25 years of developing this technology, we are now at that point of commercialization and the point of first production and scale up. We'll talk more about this business transformation, but there's a cultural change there, but also it's anticipated it will drive cost savings of around 20% this year compared to the 2025 cost base. And we finished the year with a very strong cash position of over GBP 83 million at the end of the period. So again, we'll talk in more detail about financial management in the second half of the presentation. We had some news this morning as well, which is very pleasing, partnership with Centrica here in the U.K. It's fantastic to be able to actually bring this British technology to the U.K. And this really is part of our second pillar of that strategy, which is how do we stimulate demand and how do we bring this technology forward at scale. Centrica, as you all know, FTSE 100 leading energy integration company. The statement there is about a multi-gigawatt opportunity that we see in the U.K., Centrica sees. And that's on this gap that we're seeing as we have more need for electrification. We have a time to power need that's becoming quite acute. And this modular high-efficiency technology can really service that market, both in terms of the data center needs, commercial and industrialization partners as well. So the purpose of this is we're introducing our licensing partner network to Centrica, the whole ecosystem of manufacturing partners. And we will support Centrica in terms of bringing that forward, if you like, acting as their technical advisory arm, helping them to set up this model of how they go to market with this. So that will include our expertise in things like installation, commissioning, remote monitoring, maintenance, recycling, all of those good things that we at Ceres know how to do. The initial focus will be the data center market, commercial customers and industrial power. So that's a fantastic step forward for us today, and we'll have more details on that. We have an upcoming Capital Markets Day on April 15, and we'll be able to provide you with more detail on that and from Centrica as well. But that's just in very exciting development today. I mentioned also the single stack platform. So we're going to launch that also at our Capital Markets Day. One of the things that's unique about Ceres is the solid oxide platform, the same stack, the same cell technology can run in both directions, both for power generation and for green hydrogen. That's an amazing benefit to our partners because as they develop the supply chain, as they scale up, that investment that they're putting into factories now for power generation also has this dual use aspect in the future for hydrogen as well. And as you can see in the chart here, that same stack technology is now going into products, Doosan, Weichai, Delta, but also we're using that on the hydrogen side with partners like DENSO, Thermax, Shell and Delta as well. Just wanted to spend a little bit of time on what we're seeing as the emerging demand for power. Our estimate is we see an opportunity for power generation using solid oxide of around 22 gigawatts by 2030. And we see that market roughly split about 50% the data center opportunity, but also a very significant part in the industrial and commercial applications as well. So around 50-50 kind of split. Geographically, it's an interesting split as well. About 25% of that is the U.S. market, which gets a lot of attention right now. I'm sure you're all covering data center applications in North America. But just under 20% of that is here in Europe as well. And the U.K. is a great market opportunity when you think about we have some of the highest power prices anywhere in the world. This is a market that really lends itself well to this application. And then about 50% of that market we see is Asia, the wider Asian opportunity as well. And with our partnership network, we're able to access all aspects of this market. So our aim here is to really establish the service technology as the industry standard, and we're doing that by embedding it in these global partners that are accessing and servicing these different parts of the market. Why is that becoming a critical factor? Well, today, if you need power generation, you're waiting about 6 to 7 years for a gas turbine. Small modular reactors are also coming down the pipeline, but they're about 7 to 10 years away. And then high-voltage grid connections, 5 to 15 years away. So right now, with this acute need for power generation, behind the meter or on-site generation is becoming a really viable alternative because there just isn't the conventional power generation equipment available. I think it also opens a window for us in terms of the technology today is good enough. It's viable in terms of its lifetime, its performance and its cost to actually enter the market. And as we scale, we anticipate these costs coming down significantly. Just to show you some of the progress that's being made. These are the first units developed by Delta, took a license just under 2 years ago. So this is a Thai power in Taiwan. So you can see here the first prototype units being made using car stacks, but all the systems done by Delta. Delta are fitting out their production as well, and they're on track. Delta is a very exciting partnership for us because when we talk about that data center market, Delta are already very much in that supply chain. I think by market cap now, they're the second or third biggest company in Taiwan after NVIDIA and Fox. And where we fit in is they make solid-state transformers, they make power conditioning, they make UPSs, et cetera. So by adding in the power generation capability of the solid oxide, they're developing a complete offering from fuel in all the way through to power out. And that power out can either be AC power or in the data center application, 800-volt DC. So don't forget that the fuel cell technology is actually generating DC power and the way that you actually combine stacks, you're very close to being able to match up that 800-volt DC power direct from the power generation unit, which is the SOFC. It's fuel flexible. So we run on natural gas today. We can run on biogas. We can run on hydrogen in the future. It lends itself extremely well to things like carbon capture. And also, if you want to, you can capture the heat or convert that heat into cooling through absorption chilling as well. So you have the option to go from low carbon all the way through to zero carbon and also push very high efficiencies. In Delta's case, the same market applications apply. It's microgrids, AI data centers, even for the semiconductor industry and manufacturing in general. So I think this is a really good illustration of how our partners take this technology and put it into a complete offering for these kind of market opportunities. Weichai is an exciting partner for us. We've been working with them on system level for about 7 or 8 years now. Their systems are very impressive, I have to say. And I'm expecting this year, they'll launch their latest system, which is going to be a very impressive unit. We've taken the step with them. We've done the technology transfer. So we signed last November. already, we're going very quickly, and there will be more to come from Weichai this year, but they're probably going, I would say, faster than any of our partners have ever gone before. Doosan factory, I was privileged to go around the factory. I've been a couple of times, but this was in July with Doo-Soon Lee, the CEO of Doosan. First production was there. And when you actually get in there to see the realization, the single piece flow end-to-end, it's about the size of 3 football pitches, semi-clean room, it's an impressive facility. And they've actually fulfilled their first capacity orders in the past few months, and that factory is now up and running. So that's a big, big milestone for us going full circle. So Doosan is the first. We expect Delta starting to come on stream and then Weichai. So we are building out this ecosystem. On the hydrogen side, I think it's been fair to say that over the past 12 months, there's been more headwinds on the hydrogen side. But at the same time, I think that opens up an opportunity for, again, higher efficiency technology like the Ceres technology. And as I mentioned, all of the investments that are going in now are directly applicable on to the hydrogen side of the business. So extremely pleased with our partnership with Shell. We've exceeded expectations there. We've met all the targets that we set. And that's leading on to the pressurized development, which is now underway. So taking this one, which was the first atmospheric SOEC that we did and now actually putting that into a pressurized system that can be scaled to megawatt scale. And we're doing that engineering ourselves to begin with, but then in partnership with Thermax in India who can really drive down cost. And India is one of the big markets that we see for this green hydrogen in the future. So we see green hydrogen, particularly opportunities in China and India as those areas come on stream. We also did this with DENSO very quickly. So similar to the Shell container, DENSO actually deployed this on site within 18 months of actually taking the license, and that's using Ceres' technology. That's putting in hydrogen into a thermal power station to reduce emissions from conventional power generation. And that's unlocked further funding for DENSO as well. So great progress on all aspects of the hydrogen side as well. In terms of where we are as a business, we're building out this ecosystem of partners. And really, our aim is to be the technology provider of choice. So we now have manufacturing in Korea. We're seeing manufacturing being built now in Taiwan. That will come on stream in China as well and with DENSO in Japan. So really strong ecosystem of partners. Shell is more in the end user category, and we can add Centrica to that list of partners today as well for U.K. and Europe. So our aim is embed this technology to become the industry standard. So with that, I'm going to hand over to Stuart to give you the financial update for the past year. Stuart Paynter: Thanks, Phil. Good morning, everyone. I'm just going to take you through a few slides, just to give you a bit of an update on where we are from a financial position and financial planning position and some of the actions we've taken to put ourselves in a strong position to be able to execute the strategy Phil has laid out. So here's the headline numbers you can see. As you all know, the revenues of Ceres are largely dependent on how successful we can be in terms of signing MLAs. We signed Weichai in 2025, but towards the end of the year, we in sufficient time to recognize any revenue at all from that contract. So we're rolling that into 2026. But you can still see that the margins remain high, right? That's the asset-light model we retain, and we have good financial discipline around that. The other thing to note here is cash. We're still very strong on the cash side. You can see that the cash burn in the year was just under GBP 20 million. And like I said, that was without the benefit of having an MLA. So we're pretty efficient now. I believe we've got the optimized cost base, which I'll take you through. And you can see that the restructuring that we've been going through in the last few years has fed through to the cost saving in 2025 from 2024. There's more to come on that, but we'll take you through that and be very clear, we now believe we have an optimized cost base. So the actions we took towards the end of '25 will flow through to '26, but we really do think now we've got the correct team to prosecute the strategy, which we've chosen. So here's just a graphical representation of the revenue and gross profit. Gross profits remain industry-leading with the asset-light model we have. And of course, the success and the health of those are maintained by signing new MLAs, and we retain the confidence that we have the opportunities to keep on chasing that Pillar 1 on Phil strategy of signing new MLAs and be successful in doing that in 2026. So Phil mentioned business transformation earlier, very important to us. We now have that single stack platform commercially viable to get out into the market, and that started in earnest with Doosan with others to follow. And now we need to make sure that we are still innovating. Pillar 3 was keeping a technology lead, very, very important to a licensor. -- and we'll continue to do that with one of the biggest solid oxide expertise pools in the world. But now we believe we've reached a point where we need to just look at the focus of the company and be very, very commercially disciplined, commercially focused and make sure we have the right people in the background, giving the R&D sufficient attention that we have something to license in the future. And we believe during the end of Q4 2025, we've realigned the business to be able to do that. The flow-through of that will be a 20% cost saving in 2026, but all the actions needed to do that have been taken and are now finished. So now we're into a business transformation for this year, which is all about culture, team and making a cohesive unit so we can make sure that we succeed and our teams succeed at the same time. So we -- this is all crystallizing, as Phil said, in the Capital Markets Day where we're launching this single stack platform. We're very proud of it. And hopefully, that will make sense to everyone when they see it, and it's something we can go out and actively -- more actively sell into the marketplace. In terms of the cost base, so this is the optimized cost base we see for the next commercial phase. All the actions we've had to take have been taken. There will be a natural flow through into 2026 of this cost saving, but we are essentially building from here. We've still got a world-class R&D team. They're very focused on the things we need to do to be successful. That's cost down, that's lifetime. And we've strengthened the commercial teams in order that we can make the biggest impact we can on the top line. So we really do think we've got the right team, the right place, the right assets in place to make real success for the next few years. And why are we doing that? Well, you can see that commercial momentum essentially over the last few years has reduced our cash outflows. And we're very clear, we've now got the model of our business. If we can sign MLA on average every 12 months on that sort of cadence, we will be very close to breakeven and cash flow neutral. And that's important. That gives us control of our own destiny without having to rely on the capital markets. And it's building that MLA base so we can become that industry standard that Phil talks about. And why is that important? Well, the end goal for any company that's ultimately a licensing company is to build your royalty streams. As Phil mentioned, we're just at this orange blob stage here today. Doosan has fulfilled their first order at the very end of last year led to our first royalty revenues, a big milestone after 20, 25 years of development of this project. But we need now to push on if we can become the industry standard, essentially have a portfolio effect of many, many partners building, we're really going to be able to build these royalty streams, power first, hydrogen second. As Phil mentioned, this is the same technology, but you can attack 2 markets, one right and acute now and the other coming several years after. So we're in this in order to keep on signing licensing agreements, which we know we can for the next few years, and then it's all about building the royalty base. So we like the model. Every time we make progress with Centrica and partners, we think it reinforces the success we need to have that model. But importantly, we need to show that we're financially disciplined to keep this asset-light model, which we're doing. So with that, I'll hand back to Phil. Philip Caldwell: Yes. Look, I think we have a very clear strategy. I think the steps we took last year put us in an extremely good position with the asset-light model. The 3 priorities for this year remain unchanged. We're working hard on signing new manufacturing licenses. I think we're at an exciting stage now where you'll probably hear more from our partners this year as they're starting to actually scale and launch things, but also helping to drive that demand as per the announcement with Centrica today, that also helps stimulate that demand for our partners as well. And then the single stack technology platform launch is a key milestone for us. We do believe we have the world's best solid oxide technology. And we're now at a point where we can actually bring that forward rapidly to new partners and existing partners to scale both for power first and then for hydrogen as that follows. And we're starting this year with a strong cash position. We have around GBP 45 million of contracted revenue based on existing contracts from today for 2026. So we're in good shape. And I think the market opportunity has probably never been stronger, particularly on the power side. And I think now we need to get on and actually grab that opportunity, and we're well positioned to do so. So with that, I think we'll probably move on to questions. Operator: That's great, Phil. Thank you very much indeed. Before we go to those online, Phil, if it's okay, I'm going to come to the room. If you do have a question, just raise your hand and I'll give you the microphone. Christopher Leonard: Chris Leonard from UBS. Maybe 2 questions from me. And to start with, can we go into Centrica. And obviously, you spoke to the time to power and the need there. You also spoke in the presentation to the evolution of cost and what you see is feasible here. It will be really helpful to get a gauge on where you think your partners when they first push out these fuel cell products, where you think they'll land at on CapEx price and where you think that evolution can get to? Philip Caldwell: Yes. I have to be very careful here because whenever I start forecasting our licensees prices, I get into trouble. But let's just -- if we talk in general terms, the SOFCs that are out there at the moment are available at around $3,500 a kilowatt. If you take that in the U.K. market context, and you look at the spark spread of gas and power, then you can generate power very efficiently in the U.K. I mean, obviously, gas prices are moving around a bit at the moment. So I don't want to be precise on this. But given we pay in the U.K., the highest energy bills probably anywhere in Europe and even worldwide, when we map the U.K. out, when we look at market attractiveness, spark spreads, cost of power, et cetera, the U.K. is right up there, Northern Europe, et cetera. So it's a very significant opportunity. To go back to your question, Chris, we think that we can significantly generate power at a lower cost, even at a relatively high entry-level CapEx compared to turbines and other generation because we're so efficient, because of the OpEx, et cetera, and because of the lifetimes that we can achieve. So we think that there's a big opportunity there in terms of that deployment. And then the thing I would add is I think that kind of level is a starting point because I think what we see is a window that's opened up. So people need power. I think SOFC can now fulfill that power. And as our partners scale, we expect the cost of those SOFC units to come down quite significantly. Christopher Leonard: Yes, that was the second part. And then following up on Centrica. Obviously, you spoke to the contracted revenue for this year at GBP 45 million in the books, but presumably, I don't know, but I presume that maybe didn't include Centrica's potential contribution. Like what should we think about for engineering revenues and consulting fees, et cetera? Philip Caldwell: Yes. Look, the role that we're playing with Centrica is more in the advisory support side. So at the moment, that's going to be fairly modest revenue. So it's not like -- don't think of this like an MLA, they're not an MLA partner. The big value add of Centrica, obviously, we generate some engineering support fees, et cetera, there. But really, it's the deployment of our technologies through our partner network that drives that demand that ultimately drives royalties. That's -- we see them in that Pillar 2 category, not in the Pillar 1. So that's where we see that. So the thing that would really move the needle for us this year is new MLAs. Alex Smith: Alex here from Berenberg. Just a quick one on the next-gen kind of stack technology. You kind of mentioned it in your kind of closing comments. Kind of what the real benefit you think that could have to offer? And is that like a key milestone for the business going forward? And then second one is just kind of a new licensee pipeline, how the discussions are going to kind of bring new people in and new manufacturing products. Philip Caldwell: Okay. So look, the stack launch is the culmination of several years of effort. Over the years, we've increased the cell footprint. We've increased the stack height. There's a lot of focus on the simplicity to manufacture. We will continue to drive that in terms of getting down the actual installed manufacturing CapEx of what it takes to build those factories. But that stack itself represents what we believe to be the building block that all our partners will now scale on. And our technology teams, our R&D teams are really focused on driving cost and lifetime, cost as in the unit cost of stacks, but also the manufacturing cost and then the lifetime of the product. So that's where we see that technology evolving. And I think it's a significant milestone for the company because we've been in that investment mode for quite a while on the core technology and R&D. I think by launching this product now, you can see from the optimized cost base, we've got the right team to keep on innovating around that particular platform. In terms of the pipeline. I think it's grown considerably in the past 12 months. I think we're getting incoming from most of the kind of players that are in the power system market, in particular, because I think that's the acute need that people see. Obviously, we're very strong in Asia, but we're looking at how we build out that ecosystem as well. So it's grown considerably in the past 12 months. I would say on the hydrogen side, it tailed off a bit towards the end of '24, et cetera. But I think the -- as I look at the pipeline now, I would say it's about 70%, 80% driven by the power demand side of things as well. Alexandro da Silva O'Hanlon: Alex O'Hanlon from Panmure Liberum. A couple of questions for me. Firstly, well done on the Centrica deal. I'm interested if you could give some more color on how that came about? And is there scope for similar type deals in the pipeline? And the second question is just on the cultural change. You mentioned a couple of times in the presentation. Clearly, you're shifting towards being more commercial now. How are you tracking that and making sure that the change that you want to see is actually permeating throughout the business? Philip Caldwell: Okay. So on the Centrica deal, I reached out and I saw what was happening in the U.K. we saw the opportunity in the U.K. market. It's like this market if this technology is so good, why are we not deploying it in probably one of the most attractive markets for this in the world. So Centrica was a logical choice for that. One of the biggest LNG importers, they're looking to diversify. They're making investments in small modular -- advanced modular reactors for nuclear, et cetera. And I think once we started talking with Centrica, they saw the same thing that we did, which was this acute need for power, et cetera. So we were very, very much aligned. And so I think they're an excellent partner for us in the U.K. I think the other thing we didn't talk too much about today is not just on the power generation side, but also there is the potential to combine this with nuclear in the future to do hydrogen generation on the back of modular reactors. So there's a lot of good synergies there between the 2 companies. And we're very excited about that partnership. And as part of that process, what I did is with Centrica I took them and they've actually visited our partner factories. So they've been to Korea, been to Taiwan, been to China. And at that point, I think they realized this is real. And I think this is the key thing is the question we get asked time and again is, well, yes, fuel cells have had about fuel cells. Yes, but is it real? Does it really scale? -- aren't they expensive? How long do they last, et cetera? And then you go and you walk around the Doosan factory and it's like, oh, right, got it. This is real. Even before they went into the factory, it's like, okay, we know what you're talking about now. Is there potential to do that with other partners? I don't think we need to in the U.K., but it's an interesting model. We have so if we can stimulate demand and then we can introduce our ecosystem of partners, I think it's pretty powerful. So as part of that commercial discipline in the future, we will probably look to replicate this in maybe in other parts of the world. But in the U.K., it's Centrica. So in terms of the commercial progress, how we're tracking it, et cetera, our Chief Commercial Officer, Filip Smeets, joined us last year. There's a lot of rigor now in terms of the pipeline progress. We put more people in regions. We're just getting better, better and better at it through some discipline as well. And also demand helps. So we're getting incoming, but also people are starting to realize who we are. And I think in the industry, already, we've got a very good reputation. I think people, competitors, they respect our technology. I think the thing that people have always maybe had the question mark on is, well, how does Ceres scale and go to market. And I think that's what we're going to see coming through this year. Lacie Midgley: Lacie Midgley here, Bloomberg Intelligence. Just a couple from me. Stuart, your comment on securing the one partnership every 12 months and that triggering the breakeven point. I mean, clearly, that's the place we need to be to before the royalty scale. But I mean, I'd be interested in both your comments really, but what in your mind is a realistic number there because no doubt the demand is there to have as many MLAs as you can across geographies. But presumably, your current partners won't want that number going too high given the competition that they'll likely face in certain geographies. I mean what kind of number are you thinking there on kind of a longer-term view? Do you have anything around that? I mean... Stuart Paynter: Well, if you look at recent history, we've signed 3 in the last 2 years from the beginning of '24 to the end of -- we have set ourselves up that on an average cadence every 12 months, we will achieve what you said, Lacie, sort of breakeven and cash flow neutrality, right? But that's not exciting for anyone. That's just a stop gap until the royalties come along and it helps us diversify, build a portfolio of clients. We think there's really plenty of room to play. Phil showed a 22 gigawatt solid oxide market by 2030. Even if Bloom have scaled to 3 to 5 gigawatts by that, that's 15% to 20% of the market. There's plenty of room for plenty of people to play with plenty of applications and with a much bigger market coming along later in hydrogen. So we really don't feel like there's downward pressure on this number. It's a case of execution for us, building a pipeline, instilling commercial discipline and executing. These are big agreements. So they're very -- it's difficult to predict. But we believe we've got the right team in place now, led by Filip, as Phil said, with some really, really strong people sort of backing his team up to give us the best chance of executing. It's still difficult to do, but we -- given our recent history and new commercial discipline, we believe we can as -- the short answer to your question is as many as possible. Lacie Midgley: I mean as the royalties are stacking, that makes the commercial proof point easier to sell, right? So that all becomes a lot easier. Philip Caldwell: Yes. I think also, we've done this now 5 or 6 times. So building factories is something that we're getting we're getting pretty good at, but it's a learning curve. The first time you do it, second time you do it, et cetera. So -- but we also -- what's good to see is when you -- when our first licensees came on, they had to take a fairly immature supply chain and scale that as well and equipment builders. So when somebody takes a license, it's not just to the technology, it's to that whole ecosystem of partners. And so new license discussions now are much faster, much easier because in some ways, you'd say, well, okay, this is where you would get equipment builders from. This is your choices in supply chain, et cetera. So we started off with a very European-centric supply chain. And now we've added to that to our partnerships with Doosan, but now with the Taiwanese and the Chinese, we're building out quite a formidable set of supply chain partners as well. So that -- in terms of that credibility, not only do we know how to build factories and help our partners to do that, but we can also introduce them to a whole ecosystem of very willing suppliers as well. Lacie Midgley: That's helpful. And then just lastly, on Weichai, I mean, you talked about them moving very quickly, quickest out of all your partners so far. Just trying to kind of work this out. So how much of that is because maybe of the historical work that you had with the sort of legacy partnership? And how much of that is kind of versus your own kind of technology developments, maybe reducing time frames there or just Weichai's desire to get to market more quickly? Just trying to understand, firstly, how quickly they can get to royalties, but then I guess, the time frames from MLA signing to actually getting to royalties, future partnerships? Philip Caldwell: Yes. So when we're talking to new partners, we kind of give a guidance of less than 3 years. And we're obviously looking to reduce that all the time. But some of that's incompressible in terms of technology transfer, the time it takes just to actually build either greenfield or brownfield factories and equip them. But we roughly talk about that kind of time frame. Now in parallel with that, you've got not just the stack manufacturer, which for us now is becoming more like a blueprint. We can take people around our own facility in the U.K. And like I mentioned, we can -- we've got blueprints of how you build factories, and we've got an ecosystem of partners there. But then they also have to develop the product, the power system product as well. I think we started the relationship with Weichai with a system license, and we've developed that system with them over a number of years. But now what they're doing is very impressive in terms of their own system development. So I think they can go fast because the system level maturity is very good. And then it's that desire to get to market is how quickly you build out that capacity. And I think that's -- that's what's happening extremely fast. It's a fairly typical approach in Asia, in particular in China, but they set incredibly aggressive time frame. So they're looking to obviously reduce that 3 years quite significantly. Christopher Leonard: Just a follow-up on that actually in terms of the royalty outlook and thinking about Delta scaling up this year, the target to be online end of '26. Has that changed at all? Are you still looking at that time frame? And Doosan as well? I mean, how are you feeling about them looking into '26? Obviously, you recognize right at the end of '25, some royalty perhaps, but is there more to come? And how should we look at this year? Philip Caldwell: Yes. Look, I think on this year, fresh royalties are there, but they're still pretty modest. So I don't think it's that material into '26 is our guidance. Yes, Delta is on track, but really, that's going to be like '27 type time frame and then obviously, new partners coming on. So in the near term, we're really focused on the license fees, the engineering services still through 2026 and probably into '27. And then -- but royalties build from that point. So that's how we see it. We're not changing guidance on that really. Unknown Executive: It looks as though we're doing well for much into the room. So we've got a couple online that we might start to tackle. So the first one is regarding the Centrica deal. And given they're based in the U.K., you mentioned that there's going to be revenue from U.K. and Europe. And what is the likely spread for revenue, be it U.K.-centric or more broad? Philip Caldwell: I think that's really one for Centrica to look at. But their presence predominantly, it's U.K. and Ireland as well is a very attractive market. So U.K. and Ireland, and then they're active across Europe as well. But I think initially, our focus is predominantly U.K. and Ireland. Unknown Executive: Another question coming from the supply chain. So given the fact that the technology transfer includes quite a bit of the supply chain upgrades, do we have any concerns for material, rare earth material accessibility or scaling up to match our partners for the supply chain potential constraints that you see in other industries at the moment? Philip Caldwell: No, we don't because the nature of our technology, we use Ceria where the company gets its name from the major rare earth material, which is the most abundant. We're not using Scandia. We're not using where we use other rare earths, we're using very small amounts. So we're not concerned about constraints in any of those kind of materials. Unknown Executive: We also have a question on the pipeline, which is wondering when and if there's opportunity for U.S. partners? And have there been any constraints of why we haven't signed any EU partners either recently? Philip Caldwell: There's no constraints. And look, as and when I can update you on commercial activities, I will, but I can't give specifics on particular opportunities or geographies at this point. I think there is interest in the U.S. I can say that clearly, given the market opportunity there. And yes, that's an area of focus for us as well. Unknown Executive: Switching topics slightly. We've got a question on hydrogen. So wondering if we can -- you can expand upon what the pressurized modules are, those and the balance of plant and how Thermax is looking to scale and what the time lines would be for that? Philip Caldwell: Okay. So the pressurized modules are basically taking the core cell and stack technology, putting them inside a pressure vessel. And the reason you do that is by working with OEM partners like Shell, you save a very significant compression cost even on first stage compression, just a couple of bar makes a big difference. So as we look at hydrogen at a refinery kind of level or in an industrial application like steel or fertilizers, et cetera, it makes a lot of sense to have modules that are pressurized and can be scaled. The reason for the partnership with Thermax is twofold, really. One is they're an EPC, so a contractor -- engineering contractor based in India, which is one of the key markets that we see for green hydrogen. And secondly, compared to European suppliers, et cetera, there's significantly lower cost in terms of the engineering and actually driving the unit cost of these things down. So again, we're always looking at what's the most economically advantageous way to bring this technology to market. And that's why we have the relationship with Thermax. Unknown Executive: Great. And Stuart, I'm conscious you've already touched on it, but we've got a couple of other questions on when we expect theirs to reach profitability or break point even. I'm just wondering if there's anything else you'd like to add to clarify. Stuart Paynter: Yes. I mean -- so hopefully, we've made it clear that if we can achieve a cadence of 1 MLA every 12 months, that's where we get to. These aren't as predictable as sometimes we'd like. But that would be the goal. So the moment we can continually execute the pipeline to MLA every 12 months, that's when we're going to reach that sort of profitability level. But that's not long-term sustainable profitability. That comes when the royalty streams become the dominant player in our revenues, and that's going to be a few years out. So the idea now is to have a cost base where we can maintain a technology advantage, execute the commercial strategy whilst preserving cash. And in the end, that getting new partners on board and pushing the technology forward will drive the royalties in the long term. So we think it's a really viable business strategy as Phil laid out those 3 pillars, both for the short to medium term, and it also benefits the long term when we get to royalties as well. So it's a really nice business strategy we're pursuing. Unknown Executive: Great. The only final question that's come up is regarding RFC and wondering what has happened to that investment? And are we continuing to pursue that technology? Stuart Paynter: Yes. So RFC was something we supported in the middle of the year and bought it into the Ceres Group. We're still looking to give that really, really viable long-term energy storage technology life. And we're pursuing some opportunities to see whether we can get that business funded. And when we got more news, we'll share. Unknown Executive: Great. I think that wraps up everyone. So Phil, I'll hold -- hand back to you for any final comments. Philip Caldwell: Yes, sure. Well, Yes. Thanks, everybody, for your time today. I think that we've got an exciting 2026 ahead of us. The company is extremely well positioned. We have a Capital Markets Day on 15th of April, where you'll hear more from the industrial applications with a guest speaker, hopefully from Centrica attending from that side of things. We'll have our new product launch. And then I think you'll hear more from our existing partners as well this year as they hit some key milestones. So the market opportunity is definitely very live, and we need to capitalize on that opportunity right now. But I think Ceres is extremely well positioned to do so. Operator: That's great, Phil. Thank you very much indeed. We will now redirect investors.
Operator: Good day, and welcome to the Bitfarms Fiscal 2025 Conference Call. [Operator Instructions] Please note, this call is being recorded. I would like to turn the call over to Jennifer Drew-Bear from Bitfarms Investor Relations. Please go ahead. Jennifer Drew-Bear: Thank you, and welcome to Bitfarms Fiscal Year 2025 Conference Call. With me on the call today are Ben Gagnon, Chief Executive Officer and Director; and Jonathan Mir, Chief Financial Officer. Before we begin, please note this call is being webcast with an accompanying slide presentation. Today's press release and our presentation can be accessed on our website under the Investors section. Turning to Slide 2. I'd like to remind everyone that certain forward-looking statements will be made during the call, and that future results could differ from those implied in this statement. The forward-looking information is based on certain assumptions and is subject to risks and uncertainties. And I invite you to consult Bitfarms 10-K for a complete list. Also, please note that references will be made to certain non-GAAP financial measures, and therefore, may not be comparable to similar measures presented by other companies. We invite listeners to refer to today's press release and our 10-K for definitions of the aforementioned non-GAAP measures and their reconciliations to GAAP measures. Please note that all financial references are denominated in U.S. dollars, unless always noted. And now turning to Slide 3. It is my pleasure to turn over the call to Ben Gagnon, Director and Chief Executive Officer. Ben, the floor is yours. Ben Gagnon: Good morning, everyone, and welcome to our fiscal year 2025 earnings call. In 2025, we made a bold decision to walk away from our legacy business, Bitcoin, and build the infrastructure in North America for what comes next, HPC and AI. It was a year of deliberate and consequential transformation with a clear mandate. Secure North American pipeline, strengthen our balance sheet, accelerate site development, and position ourselves to engage customers from a place of operational momentum at the peak of the energy bottleneck constraining the growth of AI. I can say with confidence and pride that we accomplished exactly what we set out to do. The foundation you see today, the capital structure, the sites, the team, the strategy was engineered through deliberate choices, developed with discipline and built to propel us forward. We made foundational changes to reposition the business and made 100% of our focus on North American HPC infrastructure development. No half measures, no compromises and in time, no Bitcoin. We built a new company. And while we are presenting as Bitfarms today, tomorrow marks our beginning as Keel infrastructure. The name says it all. A Keel is the bottom of structural component of a vessel. It's what keeps it stable and moving forward in the right direction regardless of the condition above the water line. It is structural, it is essential, and it is exactly how we see our role in the HPC and infrastructure landscape. We are not here to compete with hyperscalers or neoclouds. We are here to enable them. Our focus is providing the critical and largely invisible foundation that will allow the world's most advanced AI platform to deploy on time and scale without interruption. We expect to close the re-domiciliation and finalize our rebranding efforts tomorrow, April 1, and we'll begin trading under the ticker KEEL, 2 business days after completion of the transaction on the Nasdaq and the TSX. We are entering this new phase from a position of strength. With over 2 gigawatts in our pipeline, Keel is a regional leader with some of the largest power land portfolios in some of the highest demand markets in North America and with robust financial strength to execute against our plan. Our current liquidity is far in excess of the CapEx budgeted to get us through permitting and ultimately to start signing leases, giving the company significant financial flexibility to execute on our strategy. And our strategy is equally as clear. We are designing all of our site and campus developments as either powered shell or co-location facilities. We believe this is where we can deliver the most value to shareholders and serve our potential customers at the speed and to the specifications they need. We were originally exploring in parallel to co-location the potential benefits of pursuing a small amount of GPU as a service at our Washington site, Moses Lake, where due to the lowest cost power for data centers in the country and a relatively smaller footprint, we believe it could be an avenue to drive additional shareholder value. Since our last quarterly call, we have spoken with an increased volume of potential customers. And it's clear from those conversations, the most accretive business model for the site is one of co-location. This is not specific to Moses Lake and applies to all of our other sites as well, where demand is even higher. So we will focus on what we do best, being an infrastructure developer and owner. This plays directly to our core competencies. We are a team of developers united by disciplined action, building cost-effective institutional-grade infrastructure at the pace our customers require. The same capabilities have built our energy platform, speed to market, capital discipline, operational rigor precisely what HPC and AI deployments demand today. This is just the natural extension of what we do best. So with all the pieces in place and with the overwhelming support of our shareholders who voted over 99% in favor of the HPC and AI pivot, the U.S. redomicile and the rebrand. Starting tomorrow, we are Keel infrastructure. Turning to Slide 4. When we sat on our pivot, we developed a 3-year transformation plan, one that as of today, we are nearly halfway through completing. In 2025, we did the intensive foundational work for our transformation, including the Stronghold acquisition, securing more power in Pennsylvania, rebalancing the portfolio to North America, a $588 million raise fully institutional and oversubscribed, our U.S. GAAP transition, New York headquarters and establishing a new executive team. This work is done. With power and land secured in some of the power markets that matter most, a team of internal experts and strategic partners that have built data centers for the largest companies in the world and a balance sheet engineered to see us through 2026, we are well positioned to continue our site development and deliver against the time lines, our prospective hyperscalers and neocloud customers need. 2026 is all about execution. Effective tomorrow, we will have completed our redomiciliation to the United States and officially rebranded as Keel infrastructure. Two major milestones that position the company for the next phase of growth. With that complete, we expect the next significant milestones to come from executing against our development at Panther Creek, Sharon and Moses Lake, where we are moving full steam ahead and working diligently across three simultaneous and active work streams. One, finalizing permits, which we expect to be done in the coming months. Two, continued work on architecture and engineering in line with ongoing customer conversations and requirements. And of course, three, our go-to-market to secure highly financeable leases with investment-grade tenants. Commercialization is well underway. The upcoming milestones investors can expect are completion of preconstruction activities like permitting, progress in customer engagement and ultimately lease execution, which we are confident we can achieve this year and will be major catalysts. 2026 is also the year where we expect to leave Bitcoin and Bitcoin mining behind. While we were probably one of the first miners to commence wind down of our Bitcoin mining exposure to reinvest that capital into infrastructure for HPC and AI, we will be accelerating those efforts in 2026 as site developments progress. 2027 is all about delivery. This is the year when we anticipate that sites would come online, we'd begin delivering megawatts to customers, HPC and AI revenue really begins and we complete our transition to a premier North American HPC and AI infrastructure company. By the end of 2027, we expect Keel will be a proven infrastructure developer and a regional leader across Pennsylvania, Washington and Quebec, and we will just continue to grow and scale from there in 2028 and beyond to over 2 gigawatts as we execute against our expansion capacity. Turning to Slide 5. In HPC infrastructure, power, location and time lines are everything. We hold something scarce and valuable secured power, land and expansion capacity in Pennsylvania, Washington State and Quebec. Some of the most in-demand markets with some of the biggest barriers to entry. We know it and so do our potential tenants. Our campuses offer solutions to hyperscalers and neocloud's greatest scaling problems, location, proximity and fiber connectivity to major metro areas and data center clusters solving for latency issues and giving our tenants proximity to their own customers and other data centers. Time lines. Our robust secured power for '26, '27 and with expansion capacity in 2028 is highly coveted in an environment where energy capacity is hard to find and multiyear waitlists are the norms. We create value for tenants by enabling them to deploy years earlier by leasing from us rather than to invest in growing organically. An energy-efficient cool climate, the lower the PUE, the more critical megawatts. Panther Creek is a great example of seeing the hyperscaler and neocloud's appetite at play. While there is a lot of interest in the site last year, inbound customer activity surged after we secured zoning in February. This is not a coincidence. It is the proof point and one that we've been making for the last year, but may still be confusing to some investors. So we'd like to be clear that investment-grade tenants value derisk sites where they can move from lease to revenue fast. The more we advance, the better our leverage. The better our leverage, the better the leases, and the more long-term value we create for shareholders. Turning to Slide 6. It is indisputable that power is the binding constraint for AI infrastructure deployment and will remain so for the coming years. Leading investment banks, Goldman Sachs, JPMorgan, Wells Fargo, Guggenheim, Moelis, they've all published extensively on this. And the consensus is clear. New power generation cannot come online fast enough to meet AI demand today, tomorrow or in the next 5 years. This bottleneck is structural, not cyclical. Hyperscalers and neoclouds that used to plan on 12-month horizons are now locking in 24- to 36-month supply chain commitments. Not tied to specific projects, but as platform level agreements and are now actively competing for the power and land to deploy it. While you are probably familiar with this information, here you can see a summary of the five development sites. The power we have secured and in some cases, the incremental power opportunities that make up our 2.2 gigawatt pipeline. Turning to Slide 7. I want to take a moment to put our current valuation context because there is a meaningful disconnect between where we trade today and the value we are positioned to capture as a company. When we analyze our current valuation against our peers, the picture becomes clear, at approximately $1.9 million per available megawatt of secure 2027 capacity, we're trading in the middle of a Bitcoin miner Group, valued at roughly $1.7 million to $2.1 million for 2027 megawatt meaning we are being valued based on having power but not what we are doing with it. For shareholders and bondholders, we see three distinct catalysts, each capable of driving meaningful reratings. The first is obviously lease execution. Across our sector, companies that have signed leases trade at $4 million to $6 million per 27 megawatts, a 2 to 3x premium to where we are today. This is the market's consistent signal driven entirely by lease execution, not facility delivery, not revenue generation, just signed leases. A signed lease secures revenue and financing derisking the developments. The market pays for that with nearly 500 megawatts actively being commercialized today and visibility on permitting across Panther Creek, Sharon and Moses lake, this catalyst is well within reach. The second catalyst and arguably the most powerful for long-term holders is securing our expansion capacity. 2/3 of our 2.2 gigawatt portfolio or approximately 1.5 gigawatts is expansion capacity, which we believe the market is assigning little to no value. While securing these megawatts is a process that will take more time, we believe additional megawatts can be secured in the second half of 2026 requiring very little CapEx while representing significant embedded value as powered land even before a lease is signed or there is a shovel in the ground. The third catalyst is delivering in 2027. Once facilities are derisked through commissioning and begin generating revenue under long-term contracts, the development risk should drop dramatically and the operator valuation numbers become transformational yet again. We are not taking a leap of faith on technology, our ability to see our power or market demand. The tech is here. The power is secured, the sites are advancing, the inbound demand is real, but the market has not yet priced in is the transformation that happens when a developer becomes a counterparty when we move from site advancing to lease executing. This is the main opportunity ahead of us to accelerate permitting, execute leases, secure our expansion capacity and ultimately deliver to our customers. This is how we will create value for our shareholders and bondholders. Turning to Slide 8. Our execution plan is defined by six areas, each supporting our ability to deliver at the pace and scale our future customers require. First, we've secured our deep bench of talent by adding over 60 years of infrastructure and development in over 50 years of data center construction experience combined in just the past few months. People have delivered at scale for the most demanding customers in the world. Jonathan Mir joined as CFO, bringing 25 years of energy infrastructure strategy and project finance expertise. We have also added an SVP of construction and of power, a VP of HPC Operations and Head of permitting to oversee the execution of these critical functions. We've assembled the right team to execute on our vision. Second, we are engaging the right industry leaders as partners, T5, Turner Construction, Corgan, [ WWT ], Vertiv. These firms have built data centers for the world's largest hyperscalers not once but hundreds of times. When customers look at our project partners, which will be available on the new website when it launches tomorrow, they will see that we have also assembled the right partners to ensure better outcomes. Third, we have the capital required to bring our sites to market. As of March 27, 2026, our liquidity stands at $520 million in cash and Bitcoin, which we expect is much more than the CapEx budgeted to get us to a lease at Panther Creek, Sharon and Washington. Jonathan will go into more detail on our capital position and financing strategy shortly, but the headline is simple. We're well funded and can move fast. Fourth, a disciplined Bitcoin exit. It is clear we are no longer a Bitcoin miner. However, with strong, robust liquidity, we can have a disciplined approach to our exit strategy. We will continue to operate up until the time sites need to be prepared for construction maximizing free cash flow before selling the miners. We will also opportunistically sell Bitcoin into strength to capture and reinvest every dollar we can into HPC and AI infrastructure. Fifth, power assets that cannot be replicated. Our megawatts sit in regions with large barriers to entry, Pennsylvania, Washington State and Quebec, all have multiple year waitlists. No one is cutting the line. Our 350 megawatts at Panther Creek, 110 megawatts at Sharon and 18 megawatts in Washington were secured before the AI demand wave made these markets highly coveted. This isn't power others can easily replicate giving us competitive edge with high-quality tenants to understand these markets and are hungry for assets like ours, which leads us to our sixth point. In this market, speed to power is what drives value. For our customers, the opportunity cost of delayed deployment is huge. So the priority is getting capacity online as quickly as possible. Every day of delay is lost revenue. As a result, power availability and certainty of delivery are the primary drivers of lease economics. This dynamic has pushed lease rates higher since our Q3 call, exactly as we said it would. The opportunity in front of Keel infrastructure is real. We now have the assets and the team is ready. I'm so proud of what we built in 2025, and I'm confident in what we'll deliver in 2026 and 2027. With that, I'll turn the call over to Jonathan. Jonathan Mir: Thanks, Ben. Turning to Slide 9. I joined the team 5 months ago. My focus has been on sharpening our approach to capital allocation, strengthening our balance sheet and capital structure and ensuring the financing actions support long-term shareholder value creation. I've had a front row of the depth of talent, the operational discipline and the strategic momentum across Bitfarms. I work closely with our operations and development teams both to understand the current trajectory of our assets and to ensure our capital plans are aligned with the opportunities ahead. What stood out to me is the extraordinary potential we have driven by the quality and potential of our sites, a strong balance sheet, the best liquidity position in the company's history and a broad team that's both deeply engaged and committed to excellence. We're moving quickly and with purpose. I'm pleased to be here with you today and discuss the progress we're making. I'll use this time to walk through our performance for fiscal year 2025 and outline our current capital strategy that we believe supports the accretive growth we're targeting for 2026 and beyond. Turning to Slide 10. Before discussing our financials for the quarter, I want to briefly frame the results are presented this quarter. As of Q3 2025, the Paso Pe facility in Paraguay has been classified as held for sale. As a result, all revenues, operating costs and asset balances associated with Paso Pe are treated as discontinued operations in our fiscal year 2025 financials. So when I refer to continuing operations, I am speaking exclusively about our North American platform, the foundation of our transition into HPC and AI infrastructure. With that, revenue for fiscal year 2025 was $229 million, up 72% year-over-year. Operating loss for fiscal year 2025 was $150 million including noncash depreciation of $98 million and $28 million of impairment charges. This compares to an operating loss of $28 million in 2024, which included $102 million of noncash depreciation and $4 million of impairment charges. Net loss for 2025 was $209 million or a $0.38 loss per basic and diluted share compared to a 2024 net loss of $7 million or $0.02 loss per basic and diluted share. The differences between 2024 and 2025 were driven by a number of factors, including change in fair market value of digital assets, primarily due to the decline of Bitcoin prices and realization of gains on disposal of Bitcoin during the year. Two additional items also impacted year-over-year comparability. First, we saw a loss of $68 million, reflecting changes in our derivative assets and liabilities. Second, 2025 impairment charges were $25 million higher than in 2024. For the year, our adjusted EBITDA was $29 million compared to $31 million in 2024. Turning to Slide 11. 2025 was a deliberate year of balance sheet optimization and improvement, providing the foundation for our next phase of growth. We successfully issued an oversubscribed $588 million convertible offering, significantly expanding our liquidity. And in February, we repaid the Macquarie debt facility eliminating legacy debt, simplifying our capital structure and freeing the company from covenants. Each of these supports the pursuit of our HPC infrastructure strategy. The Macquarie facility had been originally used to accelerate development at Panther Creek, funding critical project activities, including long lead time item procurement and substation work. Retiring the facility was a strategic decision, strengthens the balance sheet and gives us the flexibility to secure a more cost-effective financing at either the parent or project level. Our current cash position of $520 million provides the runway to advance Panther Creek, Sharon and Moses Lake through lease execution without accessing capital markets. Though we may do so if attractive opportunities arise that improve our ability to deliver the best possible long-term risk-adjusted shareholder returns. Macquarie was an excellent partner, and we appreciate their support so early in our pivot to HPC AI infrastructure. Turning to Slide 12. As we pivot to commercialization of our development sites, we have a clear financial strategy based on three principles. Capital allocation, capital formation and capital structure. Taken together, they are designed to deliver the best possible long-term risk-adjusted shareholder returns. First, capital allocation. We deploy capital into projects where the earnings potential exceeds their weighted average cost of capital. We rotate capital from businesses that are noncore or earning less than optimal returns and deploy the capital into higher return investments. Second, capital formation. Our financing strategy is designed to fund our very large growth opportunities while maintaining the liquidity needed for a stable base of operations. We will be opportunistic in our financing execution. We will fund construction of our data center projects using project or parent level bet and project or parent level equity or equity-linked offerings. We're taking a disciplined approach and at this time, are well capitalized to actively commercialize and execute leases across Panther Creek, Sharon and Washington. Third, capital structure. Our capital structure is designed to capture the best possible long-term risk-adjusted shareholder returns while also retaining overall corporate flexibility and support growth. Our objective is to operate with a deliberate liquidity strategy in order to enable clear-headed commercial decisions and capital allocation decisions rather than having liquidity drive time lines. Stepping back, our road map is clear. We are building a regionally focused high-growth HPC AI infrastructure platform, grounded in disciplined capital allocation, a strengthened balance sheet and a development cadence that maximizes returns and minimizes risk. We're funded through the key derisking stages, permitting and leasing across Moses Lake, Sharon and Panther Creek and we're entering 2026 with momentum, optionality and a balance sheet engineered for growth. We have the right people, assets, liquidity and strategy and we're well positioned to capture for our shareholders the long-term value potential we have today. With that, I'd like to return the call to Ben for closing remarks. Ben Gagnon: Thanks, Jonathan. A little over a year ago, as our team began actively integrating AI into both our business and our daily lives, we came to a realization. This isn't just another technology cycle. It's a paradigm shift. More comparable to the industrial revolution than the Internet revolution. The fundamental measure, productivity capacity is no longer calories or joules, but tokens. This became strikingly clear 2 weeks ago at NVIDIA GTC, where I witnessed hundreds of companies applying AI to everything from straightforward tasks by cleaning and image generation to extraordinary complex applications, including protein folding, cystic simulations and even brain surgery. Walking the conference floor, speaking to the attendees, one thing was unmistakable. We've only begun to scratch the surface of AI's potential. Yet even in these early days, AI is already empowering individuals, communities and companies to accomplish exponentially more. We're witnessing Jevons Paradox unfold simultaneously across every industry, thanks to AI, where improved efficiency can paradoxically drive higher, not lower demand. It is literally never cost less to transform an idea into an action, a product, an image, a refined concept, a service or countless other outlets. The possibilities are truly limitless, and while no one can predict exactly how AI will reshape our future, uncertainty remains. It will require enormous amounts of power. Our 2.2 gigawatts of capacity and strategically position land across Pennsylvania, Washington and Quebec sit directly in the path of this transformation, and we intend to capitalize on that opportunity for our shareholders. We look forward to the opportunities ahead. With that, I would like to open the call to Q&A. Operator, please go ahead. Operator: [Operator Instructions] And our first question comes from Mike Grondahl with Northland. Mike Grondahl: First question, Ben, you talked about your decision not to go the GPU rental route at Moses Creek. And just the colocation route, could you talk a little about what a couple of the major drivers were that got you to that decision? Ben Gagnon: Yes, it's a great question, Mike. When we first started talking about in Q3, we were always evaluating this alongside with the colocation. We're trying to maximize the value for shareholders. So we're always going to evaluate multiple different business models at our sites. And because they have the lowest cost energy and all these other benefits, we thought it would make a lot of sense. But as we've continued to have increasing amounts of customer conversations for Washington and other sites. It was just really clear to us that the best opportunity for us is to just remain a pure-play infrastructure developer and owner and let these customers who really want these megawatts lease these megawatts. Mike Grondahl: Got it. Got it. And then maybe secondly, you articulated, I'll say, a philosophy a quarter or 2 ago about waiting and waiting on signing a lease as terms were continuing to improve kind of implying you're going to be really patient and wait on a lease. Could you kind of update how you're thinking about that lease execution strategy and the potential timing around it? Ben Gagnon: Yes. Our strategy on lease execution has been consistent. It remains consistent today. Our view is that the best way to maximize value for shareholders is to get the best terms in a lease because that's going to be what is going to be driving our NOI and our multiple. And so when we're looking to sign 10- to 15-year agreements, it's really important for us to take the -- maybe a little bit more time than investors may want us to in order to get better terms for longer. When it looks at what is really driving the value in these lease economics, one of the biggest elements is risk, and we've spoken to this multiple times over the last couple of months. And the biggest risk for most of the people -- to go out there and have conversations and get a lot of interest. And in some cases, you could even sign a lease prior to getting permits. But all of that risk is going to be priced into the agreement, you're going to be locked into it for 10 to 15 years, and that's going to negatively impact the long-term value that we're creating for shareholders. So our strategy has been incredibly consistent. And the benefit for us is that we are operating in high demand markets with high barrier to entry. So it takes a little bit longer to get permits going in Pennsylvania or in Washington than it does in Texas, which is the easiest market in the United States for that. But we believe that drives a lot of extra value because it's way more scarce, it's way harder to acquire and there's just not as much optionality. Operator: Our next question comes from Brett Knoblauch with Cantor Fitzgerald. Brett Knoblauch: Maybe to start, could you maybe just go into detail on what permits at what sites you guys are waiting to receive? Ben Gagnon: So permits is a complicated process, and we are develop -- we're getting permits across multiple sites in multiple jurisdictions. So they all have different rules, different regulations, different time lines, different reviews, different authorities. So it's far too much detail to get into exactly what permits are remaining on all the different sites. But we are continuing to make good progress and kind of -- we're looking at the visibility over the next couple of months. And with what we've had so far with the community engagement success that we've had so far, we think that in the coming months, sometime around the mid- to late summer time. we should be achieving the full permitted status across at least one, if not all of the sites. Brett Knoblauch: And then maybe just on the leasing environment across the different sites that you guys have. I guess we were under the impression that maybe Sharon would be first to go given it's relatively further along. Is that still how you guys are thinking about it? And then in the presentation when you guys kind of list the power pipeline and road map. How much of that is from generation on site that you guys are looking into? And do you have any update on where you guys are with respect to sourcing that generation? Ben Gagnon: Yes, sure. So the -- to answer the second part of your question first, all the power that we're talking about developing for our HPC and AI data centers right now is grid connected. So the two operating power plants that we have at Scrubgrass and Panther Creek. Currently, that math is not in those charts for the secured capacity or the site development plans. But in Scrubgrass particular, we are working to expand the generation capacity there with natural gas. So we've been working to tap into the Tennessee Natural Gas Pipeline. We're achieving pretty good results there with the engineering firms. There's still probably another month or two to go before we're getting a clear path forward on the engineering plans. But Scrubgrass is our more of our pipeline site. And so those -- that power generation opportunity is more of a 2028 and 2029 time line. Everything else is grid connected, it's secure today or it's currently active. And sorry, Brett, I'm blanking on the first part of your question, would you mind repeating it? Brett Knoblauch: Yes. Just on maybe the cadence of which sites are -- quicker to go? Ben Gagnon: Yes. So really, that's going to be driven by success on permitting time lines in the customers. So all three of the sites, Moses Lake, Sharon and Panther Creek are all actively in our go-to market right now. Every single one of those has customers engaged under NDA, and they have for quite some time. And so we're continuing to push forward on those conversations and those negotiations. Really, I think what investors should think about with regards to permits, permits are more of a closing condition to a lease, right? They're really not a starting condition to a negotiation. So we have these conversations and these negotiations simultaneously while we're working towards permitting. As permitting gets closer and closer, the negotiations will also get closer and closer in tandem and the first site to get leased is likely to be the first site to be permitted. Operator: Our next question comes from Stephen Glagola with KBW. Stephen Glagola: Just on that last point, if you could clarify the sequencing here between like notice to proceed and lease execution. So in other words, like can you pre-sign leases contingent on notice to proceed? Or is like notice to proceed required before any major customer would commit to a lease? Ben Gagnon: For a customer commit to binding in our view, they're going to want NTP, and that's based on the number of conversations that we are continuing to have and there probably are some customers who would be interested to sign prior to NTP, but those aren't the investment-grade counterparties that we're really seeking to engage with. Stephen Glagola: Okay. And then just one more. How are you thinking about like Vera Rubin hardware availability in '26 and like early '27? And to what extent could that variability in supply influence the timing of lease discussions at your sites? Ben Gagnon: Yes. That's a good question, Stephen. We've been talking about Vera Rubin, I think, since Q3 call because all of our sites are basically coming online in 2027. So we're trying to make sure that they are designed for the highest level of equipment that's coming out in '27 and '28, which is the Vera Rubin. In terms of supply, we haven't seen any impact so far. I understand there's always geopolitical uncertainty in the world that may impact those supply chains. But given that energy is such a huge bottleneck, and it's always been a huge bottleneck on the growth. I don't think that there is going to be a geopolitical situation that's going to make the bottleneck change from energy over to GPUs. So we don't have any expectation right now that, that's going to have any impact on leasing or demand for sites because power is still such an extreme bottleneck. It's hard to imagine what's going to overshadow that geopolitically. Operator: Our next question comes from Michael Donovan with Compass Point. Michael Donovan: Congrats on the progress. Can you provide an update on ESA progress, specifically Panther Creek's ISA to ESA conversion? Ben Gagnon: Yes. So that's a great question, Mike. As investors probably know, we have 350 megawatts secured ESA with PPL. But in addition to that, we also have an ISA that enables us to draw down approximately 60 megawatts from the grid, and that's associated with the existing transmission line and substation for the power plant that we currently have operating. In order to get that converted over, it's really more of a regulatory matter. And so it's hard to put an exact time line as to when those stamps are going to be received, but there's no infrastructure that needs to be built. There's no CapEx that needs to be spent. Really, it's just a matter of getting the regulatory approval to convert a nonfirm service into a firm service, and that would enable us to increase our capacity beyond 350 megawatts to what we probably expect is going to be maybe 400 megawatts or possibly slightly more. We expect this is going to happen this year, but it's hard to put an exact time line on it, given it's a regulatory matter. Operator: Our next question comes from Brian Kinstlinger with AGP. Brian Kinstlinger: Last quarter, Ben, you communicated, you expected the GPU as a service and Moses Lake site would be targeted for, I believe, the first quarter for go-live. How are you shifting to co-location change the timing if at all? And my second question is, can you talk about also how the global memory shortage is impacting your site development or changing your near-term needs or planning for lead times? Ben Gagnon: Yes. So two parts to that question. In terms of switching from a GPU as a service to co-location just changing the business model doesn't really impact the development time line. So we don't really see any delay there associated with changing from GPU as a service, just to co-location. Really, it's just a matter of how we want to allocate our capital and how we want to focus the business. When it comes to the memory shortage. As a pure-play infrastructure developer and owner that really is not coming into our calculus very much, mostly that's a customer situation for them to resolve with their own supply chain because we're not the ones investing in the GPUs and the compute and the servers. Operator: Our next question comes from Martin Toner with ATB Cormark Capital Markets. Martin Toner: Good morning. Can you guys elaborate or [indiscernible] can you kind of give us some time line thoughts there? Ben Gagnon: So I'm going to repeat the question because it was a little quiet, just in case nobody else or other people had difficulty hearing. I believe the question was, can you give some time lines as to how we might be able to expand Panther Creek to 500 megawatts and beyond? So in order for us to move beyond the 350-megawatt ESA that we have secured, there's really two sources for expansion. The first is converting over that ISA from non-firm service to firm service that I just spoke to a minute ago. And that's really a regulatory matter that we expect to be resolved sometime this year. It could be tomorrow, it could be a few months from now. And then when it comes to expanding beyond that, what we have to do with that is we have to actually have new power applications. The good thing here is that the utilities are actually looking to invest in new generation in the area. So in this particular instance, and we weren't actually applying for new power. We actually have the utility call us and ask us how much more power we could take on site. Given the bottleneck constraint on power, that was obviously a very welcome call over here at Bitfarms to receive. And it's a pretty unusual one in the industry, but they're looking to scale up generation capacity in the area, specifically to service our site at greater capacity. So this is probably going to be 2 to 3 years time line because there's a lot of process involved with spinning up new generation and building those new transmission lines. But for a lot of our customers, what they really want is the fastest pathway to energization and a clear path to scale over multiple years. And so this really lines up with what the hyperscalers and what the neoclouds are searching for. Martin Toner: That's great. Hopefully, you can hear me better. Can you clarify when you expect to sign your first lease? Ben Gagnon: So I can't get into a specific time line. But in terms of milestones, as I spoke to earlier, it's really about clearing NTP as kind of the last closing condition or last milestone for us to sign a lease. So I think for the investors and the analysts on the call, the important thing to keep track of, especially over the next coming months is the continued progress that we have towards NTP because once NTP is clear, that's basically the last thing standing between us and a signed agreement. Martin Toner: Got it. Great. And last one from me. Can you talk a little bit about why mining exahash in Q4 was at the level that it was at? Ben Gagnon: So we continue to scale back our mining exposure as we continue to focus on our U.S. HPC infrastructure investments. So we haven't made any investments into Bitcoin mining. We're not spending any money on upgrades or new miners, and we're actively working to scale down the fleet and actively working to spin off assets like we have in Paraguay that are not suitable for conversion. So investors should continue to expect our hash rate to continue to trickle down over 2026 as we continue to execute on this transition to HPC and AI. Operator: Our next question comes from Mike Colonnese with H.C. Wainwright & Company. Michael Colonnese: So, Ben, I'm just curious, after securing the remaining permits across the three sites, which sounds like likely to take place in the coming months here, what does the time line look like from a data center construction and delivery standpoint? It sounds like you're pretty optimistic that revenue generation could commence as soon as next year, but any additional color there would be helpful. Ben Gagnon: Yes. I mean, really, this is the year of execution in 2027 is the year of delivery. And so at all three of our projects that we talked about today, Panther Creek, Sharon and Washington, we all expect them to come online and start delivering megawatts and start generating revenue to customers in 2027. We'll continue to provide updates as we go along. And I think once we have cleared NTP and we have signed leases, there's going to be a lot clear visibility that we can provide to investors for each specific project and their specific time lines. Michael Colonnese: Got it. And then back to Bitcoin mining operations, it sounds like you're progressively going to be scaling back hash rate as you bring some of the HPC AI data centers online. I guess what's the best way to think about hash coming offline and kind of flowing through your operating results over the near term here? Ben Gagnon: I'll speak to it at a high level and then maybe I'll pass it off to Jonathan for some further clarity. But right now, the Bitcoin mining remains profitable, but it's not it's not very -- it's marginal. So it's still contributing to the business. But really, it's not the focus of the business. It's not where we're investing our time, it's not where we're investing our efforts. And given that we have been so successful last year in raising capital and strengthening our balance sheet. It's really not super impactful for the developments that we have this year, the operations or the CapEx. So we'll just continue to scale that down, trying to maximize value in the disciplined exit. If it makes more sense to maybe sell some miners a little bit earlier then we might need to in order to begin instruction, we'll evaluate that as we will always do to maximize value for our shareholders. But really, we kind of see this as a pretty minor element of our balance sheet and a minor element of the financial plan for this year. Jonathan, do you want to add anything further? Jonathan Mir: Only that when we think about our liquidity going forward, the strategic objective is to ensure we are well capitalized through the lease process and beyond without the need to raise any new capital in the markets and that takes into account the current state of Bitcoin mining operations. It's not assuming any improvement in the economics there. So our plan is built on conservative assumptions around the status of the Bitcoin market. Operator: Our next question comes from Nick Giles with B. Riley Securities. Nick Giles: Good morning, Keel team. In the interim period where Bitcoin mining operations are wound down, but kind of pre-revenue generation on the HPC side, could the generating assets at Panther Creek and Scrubgrass be utilized in any way such as the PJM capacity auction? Ben Gagnon: So those power plants do actually participate in PJM capacity auctions. We've done that for quite some time. And so we do benefit from the capacity payments that we received there. Nick Giles: Got it. Okay. And any order of magnitude of what those could be kind of in the 2026 planning year? Ben Gagnon: So I mean, really, it's -- we've kind of maxed out on the capacity auction payments. They set a ceiling, and that's where the capacity auction payments closed. Nick Giles: Got it. Understood. Maybe one for Jonathan. You've made some progress on the capital structure, but just was hoping for any additional comments you might have on what you're looking for in an initial debt package, how you're seeing term shift and kind of what tools you have at your disposal during construction and kind of post energization. Jonathan Mir: Good question. Thanks, Nick. So our basic approach is to compare and contrast our financing options down at the asset level and upstairs at the parent level. And certainly, one of the things that we've seen in the market that has caught our attention like everyone else, is the tightening of spreads between folks issuing high-yield debt in the market that would seem like quite attractive levels for strong investment-grade counterparties or credit wraps. And those converging towards the levels seen in bank-originated classic construction of project financing. So we'll be -- each of those has its own advantages in terms of simplicity of managing the actual capital once it's raised versus negative carry costs. And as we get closer to a funding point, we'll make the decision as to what seems best for our shareholders in terms of how we decide to finance. I'm sorry, Nick, I was just going to say that the markets for our space and for infrastructure generally seem calm right now. Operator: Our next question comes from Brian Dobson with Clear Street. Gregory Pendy: It's Greg Pendy in for Brian Dobson. Just I guess one final one. Just I guess, one final one. Just on the redomiciling to the U.S., are there any implications to costs or structural implications in terms of ownership that we should be aware of as you enter this over the next couple of days? Ben Gagnon: One of the benefits and reasons for the redom is that we will now be eligible for inclusion in indices that require -- want to be a U.S. domiciled company. So for example, we'll be eligible for inclusion in the Russell 1000 and the Russell 3000 as well as for ownership in any other fund who was otherwise limited to the purchase of U.S. securities. We view that as being quite helpful in terms of moving our shareholder base to one that is institutional and long term. There are no other -- there are no cost or flexibility implications in our end. We simply see this as a nice path forward with a lot of benefits for our shareholders. Operator: Our next question comes from Bill Papanastasiou with Chardan Capital Markets. Bill Papanastasiou: Just wanted to touch on the Washington side and decision to shift towards colo. Can you confirm that this won't have any material impact on the purchase commitment that was entered into November? Or is the team considering the shift in development allocation to other sites? Ben Gagnon: Thanks, Bill. No impact on the capital commitments and the equipment we've already purchased for the Washington site by changing business models. In fact, actually, it just helps to reduce the CapEx because we're no longer paying for the compute. Bill Papanastasiou: Understood. And then how should we generally be thinking about maintenance CapEx on existing Bitcoin mining sites as you gradually shift over to AI HPC here? Ben Gagnon: We're not making any investments into the Bitcoin mining sites. Basically, we're just continuing to keep them up and running. And so no further investments are being made in the sites into new sites or into new miners. Operator: Thank you. This concludes the question-and-answer session. I'd like to turn the call back over to Ben Gagnon for closing remarks. Ben Gagnon: Thank you very much, everyone, for joining our call today and really look forward to speaking to you next time as Keel Infrastructure. Have a great day. Operator: Thank you for your participation. This does conclude the program. You may now disconnect.