Earnings Transcript for ILIKF - Q2 Fiscal Year 2021

Unidentified Company Representative: Good afternoon, ladies and gentlemen, and welcome to Ilika plc's Investor Presentation. Throughout this presentation, investors will be in listen-only mode. Questions are encouraged and can be submitted at any time via the Q&A tab situated on the right hand corner of your screen. Just simply type in your question and press send, that one would be present on the company's dashboard. The company may not be in a position to answer every question received during the meeting itself. However, the company will review all questions submitted today and publish responses where it's appropriate to do so. And these will be available via your investor meet company dashboard and we will send you an email to notify you when they’re ready for you guys to review. I would also like to remind you that this presentation is being recorded. Before we begin, we would like to submit the following poll, and this is to give that your attention that will be very, very helpful for the company. Thank you very much indeed. Now, I would like to hand it to Graeme Purdy, CEO and Steve Boydell, CFO of Ilika. Good afternoon to both.

Graeme Purdy: Thank you, Mark. Good afternoon to everyone. Many thanks for joining us for our half year results update. We are speaking to you live from Ilika's headquarters in Romsey on the sunny English Riviera. So let me speak to you over the next 20 minutes or so about Ilika's solid state battery technology. And for the avoidance of doubt, we are one of the few independent global experts in this particular field. We were enlisted back in 2010 and we have two parts of the business. We have Stereax miniature solid-state batteries. And then we have our large format, Goliath batteries that we're developing with partners from the automotive industry, supported by the U.K's Faraday Battery Challenge. So apologies for those of you who have been following the company for quite some time. I'm going to go over some of the fundamentals as we go through the slide deck. But for those of you who are experts already in our technology, feel free to submit questions into the Q&A. And Steve and I will do our best to answer those questions in as much detail as we can. So the markets that we're addressing are truly huge. First of all, MedTech and industrial sensors are the markets that are particularly suitable for miniature micro batteries for our Stereax cells. Whereas our Goliath cells are designed for consumer electronics, or perhaps more broadly, domestic appliances, such as the handheld vacuum that you see in the picture there, as well as ultimately, EVs. So why are people interested in solid state batteries? Well, first of all, they are ultra compact. So, my rule of thumb is that they occupy about half the volume of a traditional lithium-ion cell. And that is particularly interesting for a millimeter scale medical implants for Stereax. But of course, it's also useful for EVs by the time you get to that scale because of the design opportunities that opens up, and of course, the weight saving that implies the high temperature and that they operated up to 150 degrees C, and it's really opened up some of those industrial markets where you can't use a traditional lithium-ion cell. And they're also fast charging, we actually see charge rates of up to 25 C for [Technical Difficulty] rates out of our large format Goliath cells. But our rule of thumb is that we can expect 6x faster charging relative to traditional lithium ion. And of course, that's really exciting both domestic appliances were actually you need to recharge those devices when you need them. And also the EVs where you could have a recharging experience much closer to the one that we have when we pull up with our ICE powered cars on a forecourt. So how do we make money after this? Well, this is the business model for our Stereax thin film batteries. We are currently a battery manufacturing company. In fact, we have a pilot line here in Southampton in the U.K., where we produce a modest number of batteries per year. In fact, this technology uses a wafer-based technology for depositing the batteries. So we talk about wafer production. We actually use a 6-inch format for that. We actually outsource the dicing and thinning of those wafers to minimize the amount of substrates that we have to include in the battery packaging with endurance stacking to amplify the capacity of the devices. And we do our own battery forming and testing prior to dispatching the cells to customers who’ve given us a PO. And it's an exciting time for Ilika because we're scaling up that manufacturing capability, where we operate our own wafer fabrication line where -- I'll come back to that later, but we're in the middle of implementing this strategy this year. We will continue to outsource dicing and thinning to third-party companies, and probably also the stacking as well. Whereas we will continue to do the forming and the testing of the batteries before dispatch to customers. The next stage up, the next scale up for us will be into a licensing model, when we stabilize the manufacturing workflow that we've got for Stereax. We’ll be in a position to license that technology through to some of the larger wafer manufacturers, perhaps in the low cost production environments of Asia, and will be able to transfer that technology as a package so that those organizations will manufacture under license. So why now? Well, our pilot line usage or our Stereax products has been ramping up remorselessly. What you see here is a plot of the allocation of our pilot line for product sales, which is in dark blue, relative to research and development. So, improvement of our products, which is in green. And of course, it's great news, actually, that demand is ramping like this. Unfortunately, of course, that's squeezing out some of the R&D activities that we need to continue to execute in order to make sure that our product remains cutting edge. And so it's time for us to use this as a springboard to move into manufacturing on a larger scale. And by the end of this calendar year, we expect to have a 70-fold increase in the manufacturing capacity that we have at our disposal. So what are the areas? What are the industries that are wanting to buy these Stereax miniature batteries from us? Well, actually, they split into these two categories. So, on the one hand, industrial IoT, so these are really wireless sensors for measuring data in different environments, often hostile environments. This is, first of all, wafer sensing. So the whole electronics industry uses wafers for making new products like new silicon chips and other components. And these products are deposited in vacuum chambers, vacuum deposition chambers that needs to be calibrated to run at exactly the right temperature to optimize the process. If they are run at the wrong temperature, then you get reductions in yield. So, having the right process conditions can have a very significant economic impact. And of course, it's really quite difficult to run cables onto a wafer. Actually, it's much better if you can measure the temperature directly on wafer. And so these thin miniature batteries are really perfect for being able to power the sensors inside the chambers. As a condition monitoring examples include other industrial hostile environments, like wind turbines, we already had a successful field trial which we communicated last year. Process equipment like chemical plants, power stations, refineries, oil and gas facilities where often you have elevated temperatures that batteries need to deal with. And then infrastructure in the Western world has got a lot of infrastructure that's starting to age, and needs to be monitored, things like railway tracks and bridges, et cetera. And then on the medical side, that there is an entire revolution that is engulfing the medical device industry, which is all about turning devices into smart devices. So historically, a lot of implants have been mechanical devices. But actually there's an increasing demand for them to transmit data about how effective they are operating. So one example is orthopedics. There's a huge number of hip replacements and knee replacements around the world. And often the success of those replacements is driven by the physiotherapy that happens after the surgical procedures. So are the patients being active enough? Are they doing the exercises, and by putting in a smart sensor into these implants, you can get a lot of information, particularly during those critical first few months after discharged from hospital to make sure that the patients are getting the most out of those implants. Then nerve stimulation, this is the great hope really of the healthcare industry that we can start to replace chemical based pharmaceuticals with electroceuticals or bioelectronics to deal with some of the world's biggest disease problems, so diseases that are pretty diverse, ranging from arthritis through to diabetes. Then sensors that are measuring things like glucose concentration in the blood and also blood pressure. And then ophthalmic applications, where you need miniature batteries to deal with eye conditions. So this is what the numbers of the scale that look like. We're able to produce currently on our pilot line, about 1,500 devices a year. We're looking for that 70-fold increase as we move towards the end of this calendar year through the fab that we're building here in the U.K. And then beyond that, into the mass markets with large scale license production. So here's a bit of detail about five implementation timetable. The major tools that we're installing are the massively titled [indiscernible], which are basically the key deposition equipment that we're using in order to make these batteries 201 [ph] is coming from California in the U.S. Actually I was just on the phone to the fabricators on Tuesday evening. That's making great progress. And then [indiscernible] is coming from Switzerland. They are both about to have the factory acceptance tests in the next month or so, which is where we test the basic functionality of those two. They'll then be delivered for installation by the time that we have completed our fab sites preparation, which is an activity that we'll be doing over the next 3 months. We're about to conclude the lease negotiations for facility and build our clean room inside of that facility. So like a building inside a building. We will then hook up that equipment and commission it. And in Q4 of this calendar year, we'll start our products qualification which will take us through into 2022. So that we'll be ready for product sales in the course of calendar year '22. There you go. There's a summary of those activities. We've also crucially appointed a new Technology Transfer Director, Paul Marron, who joined us with great track records in the aerospace and semiconductor industry back in September. And he's now running the team for the implementation of that process, and spearheading the tendering for the outfitting contracts of the [indiscernible]. So let's change gear a little bit literally and talk about Goliath, our large format batteries. We've currently got three programs that we're running with U.K automotive partners. First one being PowerDrive line. That's with Honda and Ricardo and that's focused on the rapid charging of vehicles. Then we've got a program that's being led by McLaren, which is called MoSESS. And that's all about using solid state cell in performance vehicles. And that's actually also including A123 Systems, which is a U.S headquartered Chinese owned battery company. And the performance vehicle market is really important for us because I see that as the leading edge of automotive deployments. And I expect that when we first get to market in automotive it'll be through the types of vehicles that companies like McLaren and their competitors design and commercialize. And then Granite is the third program. That's also supported by the Faraday Battery Challenge by Innovate U.K. And that's being led by Jaguar Land Rover. And that's all about making sure that the technology for solid state manufacturing is as compatible as possible with existing lithium ion cell production, because for rapid adoption and moving down the cost curve as quickly as possible, it's really important that actually we reduce the barriers for adoption, given the large amount of capital that's being invested in traditional lithium ion battery manufacturing processes. None of the bottom there, we've got a box called the lead partner framework. And this is really to allow companies who operate outside of the remit of the Faraday Battery Challenge to engage with us on a commercial basis to talk about developing cells for their applications. And in particular, this is useful for engaging with cells for consumer electronics, and also domestic appliance manufacturers, who you know, will have a different format for the cell that they want to use. But this is a really important sector for us. And I actually think that we will get to market with our technology in domestic appliances before we get to market in automotive simply because the number of cells that you need in order to address a market launch opportunity in domestic appliances is less. The price point that you have to reach isn't quite as low. And also the degree of testing or rather, more strictly, the volume of testing that you need, isn't quite as demanding in domestic appliances for automotive. The reason why solid state is of such interest for EVs is, most countries have got targets that the industry bodies set for what battery packs have to deliver. The U.K is no exception. It has the U.K Auto Council, which is a group that advises government policy. There are targets for 2025 that have been set. And actually you need solid state in order to meet those targets. It's just not possible for standard lithium ion cells to meet those industry expectations. So we've secured just over ₤5 million of funding from the Faraday Battery Challenge, which is supporting those three projects that we were looking at before. And we've also used that funding to outfit and open, what we call our pre-pilot facility, which we did last year. And you know, that was opened in September 2019, we had our Capital Markets Day. Some of you may have attended that at the end of 2019. And actually, frankly, you wouldn't really recognize the facility relative to the pristine condition that it was in then because we've used it pretty intensively. We make prototypes at a rate of about a kilowatt hour a week. You see some of the substrates on the left hand side and that rack there and some of the cells ready for processing to the top and a typical pouch cell that we produce being held up by one of our engineers, and we -- we've shared those samples with the automotive partners that have just been listing in previous slides. And we've demonstrated significant improvements in the capacity and cycle life and also power density of those cells over the course of the last year. There's still further development that's needed. And actually at this point, I should emphasize a couple of things. First of all, we use a different process for making these pouch cells than we use for making our Stereax cells. So the Stereax cells are made using a vacuum deposition process, and that process is great for making miniature batteries. But actually, it's certainly uneconomic for making large format pouch cells. So we've switched to a printing process and actually you can see one of our small scale printing stations in the background in that image on the left hand side and that allows us to make cells of the format that's being shown there in a cost effective manner. So it's a screen printing process that we use for depositing the materials in bulk. And the -- that's allowed us to make significant volume of cells for testing. The difference in technology maturity, though, is also important to understand. So our thin film Stereax cells are at a technology readiness level, that's about a TRL of 7. And I use this scale. This is a scale that NASA came up with back when they were making the space shuttle, because actually they wanted to be able to evaluate how mature and robust the technology is that they were being offered, really work. And so they've got a scale that goes from TRL 1 through to TRL 9. TRL 1 is really a sort of academic breakthrough in a university lab. And TRL 9 is the opposite end of the scale, where it's a commodity that you can order over the Internet, and it arrives the next day. TRL for Stereax is about 7, and what that means is that we make it reproducibly on our pilot line, and it's been used in evaluation devices, field trials, like for instance, the wind turbine trial that we did with that device. And when we get into the manufactured line that so the U.K fab that I was talking about earlier, will move into a TRL 8. Where we are with these power cells is that we're at a TRL of about 3, which means that we've got proof-of-concept. We're making these cells on a line, but actually we're improving the performance of these cells, so that they are acceptable for the application. And once we put them into battery module and attack [ph] and tested hat under automotive GT conditions, then we move into TRL 4. So consumer electronics just to emphasize, cordless roadmaps for new products are really driving battery adoption here. These are things like handheld vacuum cleaners, we probably all got a battery powered vacuum cleaner, but also gives you products, big demand for things like hair straighteners, hair dryers and hair curlers and things. The compact nature of solid state is really attractive there, the fact you can charge these packs rapidly, and that they've got a long cycle life. So what does the manufacturing scale look like for Goliath? We're currently in this pre-pilot facility, I talked about the one kilowatt hour a week. We probably increase the capacity of this existing footprint that we've got here to about 10 kilowatt hours a week over the next couple of years, the next 18 months. And that will allow us to produce more pouch cells for evaluation. But what we announced back in September of 2020 was that we would scale up into a facility that would give us about 5 megawatt hours per week, ideally with the U.K big, which is the battery industrialization center, which is based in Coventry, here in the U.K. And that will actually allow us to support our first commercial launch. So that's the attraction of going to something like domestic appliances, we can make enough batteries in that facility to be able to support a product launch. And then by that we'll probably be able to support one or two performance cars, performance vehicles from that facility. But then by the time we need to support mass market vehicle adoption, well then you need to get to Gigafactory scale. And rather than build our own Gigafactory, which is quite capital intensive. My rule of thumb is that you need about US$750 million to build 1 gigawatt hour a year. [Indiscernible] will partner with an existing cell manufacturing company and probably an OEM, much in the same way that here in the U.K the assembling facility was built as a JV between Nissan and AESC back in the day. Now of course owned by Envision. So we're not going to try and do that ourselves. We will make a contribution that technology as an equity in kind contribution towards the JV. So there's a picture of one of the engineers at the BIC having a look at our pouch cell format in front of one of the BIC drying lines that's already installed in that facility. The U.K BIC is a publicly funded facility. It costs about ₤135 million to build, and is an open access facility for U.K industry to be able to run production lines, initially in Phase I of traditional lithium ion cells. But in Phase II that will be extended to solid state. And as the U.K., if not Europe's leading, solid state cell developer [indiscernible] be working hand in hand with that facility for that commercial rollout that I was talking about. Right. Well, these are our half year results. So at this stage, I'm going to let Steve Boydell, our FD, talk you through the numbers in the next couple of slides.

Stephen Boydell: Thank you, Graeme. So we released our half year results this morning and this is a [indiscernible] of that exactly in line with the trading update that we gave in the interim [indiscernible]. The turnover for the 6-month period was ₤1.3 million relative to ₤1.5 million last year. Its [indiscernible] short from there and that's down to the government mandated shutdown of researchers at the universities [indiscernible]. That was shut for 3 months [indiscernible] we have an impact on mobility service [indiscernible] we have. We catch tight [indiscernible] our costs such that our EBITDA loss [indiscernible] remains steady at ₤1 million and clearly we got an increase in cash in balance at the year-end versus the last year due to the ₤14.2 million net [indiscernible] back in April. And the next slide would just show you the use of our funds in the 6 months period starting with just under ₤50 million. The CapEx there is [indiscernible] initial deposits for some of the key equipment that we’ve shown earlier. So [indiscernible] equipment manufacturing plus a little bit associated with [indiscernible] programs working [indiscernible] ₤12.4 million on balance sheet at the end of October. [Indiscernible] back to Graeme.

Graeme Purdy: Thanks, Steve. So just to wrap up, our focus is on the commercial scale for our Stereax miniature batteries through the implementation of that fab that I was describing. And in parallel, we'll be maturing our Goliath technology working together with those automotive partners through well-defined programs supported by the Faraday Battery Challenge. And of course, they will allow us to pursue significant revenue growth opportunities in the coming years. Many thanks for listening to our presentation this afternoon. So I think we're going to move over to Q&A.

Unidentified Company Representative: Definitely thank you very much indeed, Graeme. Thank you very much, Steve. And ladies and gentlemen, please do continue to submit your questions using the Q&A tabs situated on the right hand corner of your screen, which is why the company take a few moments to review those questions submitted today. I'd like to remind you that a copy of the recording along with a copy of the slides and the published Q&A can be accessed via your Investor Meet company dashboard and we'll send you an email to notify you when that is ready. I'd also like to remind you that your feedback is important to the company, and immediately after the presentation has ended you'll be redirected for the opportunity to provide feedback in order the company can better understand your views and expectations. And if you could allocate just a small bit of time to do that, that'd be very, very beneficial and helpful to the company. Just to Graeme, obviously, we've got over 100 investors on today's call. And obviously you've had significant questions coming through in the Q&A tab. We did receive a number of questions that were pre-submitted by investors, which I know you very kindly in anticipation of these numbers provided some written responses which we will obviously make available when we publish the responses. But perhaps I could ask you to just go on to the Q&A tab on the right hand side of your screen as well. And perhaps if I could ask you to read out the question perhaps who it's from and more appropriate to give a response and we'll manage the next 20 or so minutes in that manner, if that's okay with you?

Graeme Purdy: Very good. Well, I'm having to take it from the top actually. Should we do that Mark?

Unidentified Company Representative: Yes, that'd be brilliant. Thank you very much indeed.

Graeme Purdy: Let's have a look. Let's see who was first out of the blocks here. I think that our friend John [indiscernible], can you please outline what IP you have in for solid state batteries? Yes, so that's a key question. There's quite a lot actually in the public domain now. There are probably 12 core patent families, which have resulted in 25 granted patents around the world. We typically focus on the key jurisdictions in Europe, North America, and Asia. And the reason I talk about patent families is because you make an application that turns into a PCT, and then you engage with the national officers. And those patent examiners normally ask you to adjust your claims, so you end up with slightly different patents from the original application in the [technical difficulty] by the USPTO that you might get in Europe through the EPO. And the patents generally cover materials, so that the materials that we put into actually, generally the electrolyte, because we tend to use commonly available cathode materials, then the processes that we use to deposits the materials. And you've heard that we use both vacuum deposition approaches for Stereax, as well as ink deposition approaches for Goliath. And then thirdly, battery architecture. And there's also quite a bit of knowhow actually, that we keep those trade secrets. So we choose many companies not to put everything into our patents, because there are some things actually that are -- it's quite difficult to patents in particular, process conditions because you can't really police those anyway. Because they always happen behind chain link fences. So you know, you keep some of that knowhow back as trade secrets. So I hope that answers that question. Then we got a question from Simon. It says, is the U.S listing in the pipeline to attract further interest and investment? What do you think, Steve? Do you want to answer that one?

Stephen Boydell: Yes. We currently don't have any plans to live in the U.S. We do -- we are attracting U.S retail customers onto our register, I mean getting it through an over the counter [indiscernible] products. So basically the shares are being traded in the U.S and [indiscernible] counter products [indiscernible]. I mean, that's an unregulated platform and we do recommend that [indiscernible] buying shares from our London listing are main which is [indiscernible] IKA. But at the same time, we have had a lot of U.S retail interest [indiscernible], particularly the Christmas period. And they now account for about 20% of our share [indiscernible] key area for us at the [indiscernible].

Graeme Purdy: So our next question is pouch cell manufacturing is scheduled in the U.K BIC Phase II. When do you -- sorry, that’s just moved in from to me one of [indiscernible] trying to answer that. When do you envisage actually being in the BIC? So yes, the plan is actually that we get up to 5 megawatt hours per week manufacturing capacity by 2024. So that will involve investing in equipments to be installed in the U.K BIC in advance to that, in line with that timing. And we got another question from Paul. He says QS, I guess that's QuantumScape and solid power have recently published performance data for their batteries. Can you share similar energy density and have you tested multi leg [indiscernible]? So actually our batteries have been shared with automotive development partners in those Faraday Battery Challenge collaborations. Frankly, the performance data for ourselves is still a fairly early stage, similar actually to the stage that QuantumScape are at a lot of that data actually didn't results from what I'd say were full cells, but in fact is half cell data. So we are in due course, in the course of 2021 likely to share some of us will cell data that will allow a comparison on that basis. And we are focused on single layer Goliath cells at the minute. We are not yet making multi layer Goliath cells in the ways that solid power have shown with their selected chemistry. Right, let's have the next one. Have the new rules of origin around U.K and EU exports had an impact on your forward looking volume expectation? So we'll let Steve answer that.

Stephen Boydell: A lot of our evaluation samples are actually being shipped to the U.S [indiscernible] outside these [indiscernible] origin. So we are monitoring the impact these [indiscernible] its more impacting us a lot, particularly in medical device companies that are trying our batteries are [indiscernible].

Graeme Purdy: Very good. Now we've got a question from FS. How do you differentiate illiquid solid state technology from QuantumScape's? Yes, so actually the -- some of the differences in our technology revolve around the materials choices and the chemistry as well as the device architecture. What we've got in common is that both of us are using oxide based electrolytes. Although QuantumScape haven't really talked very much about what the nature or composition of their electrolyte is. So they use a -- an approach that's commonly referred to as lithium free in the cell industry. And what that means is that actually they make a structure that hasn't got an anode when you initially make it. And then when you charge the cell, the lithium plates out between the electrolyte and the current collector, and creates a pure lithium metal anode. In fact, our approach is that we use a silicon anode, the layer of silicon that you need is actually much thinner than the layer of cathode that you would use in these cells. And we find that the capacity of silicon is easily enough to accommodate the amount of lithium that you push across the cell when you charge it. We've used this approach because we've successfully used silicon in our Stereax thin film batteries. In fact, in the early days, when we were prototyping those Stereax cells, we did test a lithium free or an anode less method, because a lot of the early solid state cells that were prototypes in the National Labs in the U.S use that approach. But we found that the mechanical strain from that approach led to the lamination of the cells over time and a reduced cycle life. So that's why we favor using silicon. Silicon has been successfully used by the competitors in the industry, for instance, that the work that Amprius is doing using silicon anodes. Let's have a look. Next one from Nick [indiscernible]. It says, are there any potential shortages in key commodities used in production that might constrain expansion? Yes, so that's a good question. And actually, we spend a lot of time making sure that we don't use anything too exotic in our materials. In fact, as part of that Granite program that I was talking about earlier that we're doing with JLR, we had a specific work stream that's been looking at ensuring we avoid any scarce materials, any scarce commodities, that would make the batteries unaffordable, or would create shortages that would put a brake on the mass adoption of ourselves. So that's an important aspect that we're taking into account. What's the next one? Next one is from Paul R. He says, given the recent announcements by EV OEMs, Toyota and Neo and GM, about solid state batteries, clearly, speed to market is important. What can management do to accelerate Goliath plans? Well, actually, I think we're a pretty agile group here. I think, our stated maturity and readiness is globally competitive. And we are expecting further resources to be made available by the Faraday Battery Challenge channel in the coming period. And as a company, we're continuously reviewing what collaborations we can enter into, what expertise actually we can acquire from around the world to accelerate our programs. We realize we haven't gotten a monopoly on [indiscernible]. And there are some really exciting groups that are offering to work with us, and that could really inject some pace into our program. So Brian says, you use a silicon anode, whereas a lot of other companies using lithium anodes. Are there benefits to use of silicon?. Yes. So I think that's not dissimilar to the previous question on differentiation. Silicon has a massive capacity for absorbing lithium, and we're working with some of the global suppliers of silicon. And we're seeing some great performance from using the right amount of silicon in ourselves and we believe that actually using a structured anode, as opposed to placing out lithium metal gives you a better control of the stackability [indiscernible] of these cells, so that when it comes to increasing the capacity of the overall devices to make them big enough to go into EVs, that actually having a structured anode gives us a benefit in that regard. So let's have a look -- from Phil H, the next question is the EV battery market is projected to be worth ₤84 billion in 2025 via both [indiscernible] manufacturing and also via licensing. What percentage of this market is Ilika going after? Well, actually, we take a bottom up approach to forecasting. So what we tend to do is say, who are the partners that we're going to engage with? What's the off take that we can expect those partners to buy from us. And what's the volume of cells that we can realistically manufacture. It's actually a very small percentage of that overall market value even by the end of the decade. We're selling into a very rapidly growing market. And we take a lot of comfort from that. We're certainly not constrained by market size. And I actually believe that just about all of the viable solid state battery offerings that are out there will enjoy a significant percentage of the market. In due course, I think, solid state will take over from the market that is currently defined by traditional lithium ion cells and own that market. In the same way that lithium ion has taken over from some of the traditional battery chemistries like nickel metal hydride and NiCd batteries. So I think it's really exciting time for solid state, and we're going to see some very large scale adoption of the technology. Just going to scroll down a bit. So Steve is going to answer the next one.

Stephen Boydell: Yes. A question from [indiscernible] solid state. So [indiscernible] question for you. It's worth going back to last year, we did our fundraisers [indiscernible]. Once that was completed and the share price [indiscernible] it was effectively caps, and that was because we had a number of our [indiscernible] invested through enterprise and entities and venture capital trusts. It meant that once they held the shares for over 3 years like some significant gains that [indiscernible] and effectively they are selling those shares into the demand [indiscernible]. We're seeing some [indiscernible] share holdings, such that those shares will effectively increase the market just [indiscernible] large sellers in the market were satisfied and they're not [indiscernible] where investors particularly in the U.S are looking for other companies operating [indiscernible] space and elevating [indiscernible] publicly traded companies [indiscernible] we expect that [indiscernible] U.K and the U.S that we currently have.

Graeme Purdy: Thanks, Steve. So the next one from Edward H. Are you the market leader in small batteries like Stereax? And I would say that actually the competition, the global competition for miniature batteries like Stereax is far less intense than the competition for the development of large format pouch cells. So I would say that, we are viewed as being one of the key parties in that market. Next from Harish H. Would you consider -- sorry, who do you consider to be your main competitor in the market? And how do you compare to them at this present time? Well, I think it's true to say that for the Goliath solid state batteries, there are a lot of people actively working on this. And sometimes, it's a bit tricky to be absolutely categorically sure about the state of development by different organizations. So all of the big battery OEMs have got solid state programs, but they play their cards pretty close to their chest. So it's not always possible to say, the state of development at companies like Samsung and Panasonic, LG Chem Capital, because actually a lot of that data isn't really published, didn't really have a need to publish that. The technology development companies like Ilika are sometimes a bit more forthcoming. So we get more insight into what's going on at solid power and QuantumScape and to some extent for Logan [ph]. So we were able to monitor progress there. And I'd say, that there isn't one particular main competitor [indiscernible] very dynamic market, and I think also demonstrates how attractive the market is that it is such a vibrant landscape. So the next one from Brian E. Toyota is expected to be the first to launch an EV with solid state batteries. Does Ilika still have links with Toyota and any overlap with co-owned patents? Yes. So the answer to that is that, yes, we still have jointly held patents often covering some of the fundamental materials that are used in electrolytes. And so we are co-managing actually those patents with Toyota. And we have an open dialogue with them around the exploitation of those patents. So, yes, we still have links. Next one from Dominick. K. What precautions are you taking to secure your technology from either theft or copying by third-party companies? Well, we have an in-house patent lawyer, who is on [indiscernible] from a large patent firm. And her job is to secure our patent to have the ideas from the technical team and to file patents on our behalf, but also actually to prosecute them, and to monitor other patents around the world to ensure that we've got freedom to operate. And if we saw a product that was out there, that looked like infringed one of our patents, and of course, we would make that party aware of the case and take steps to protect our IP. Another one from Brian E here. So how successful has the lead partner framework being in identifying partners? Yes, so for Stereax, we've got a very healthy portfolio of around 16 customers that we are feeding with devices from our pilot line. So we feel that that's given us a lot of validation and comfort around the commercial demand for the cells that we will produce on that Stereax manufacturing line. And also for Goliath, well, we -- of course, engaged with those automotive partners that we consider really to be lead partners as part of that work. And then we've got similar relationships in domestic appliances. Next one from Jonathan H. Steve, do you want to take this question about our change in strategy? [Indiscernible] the fab strategies for Stereax?

Stephen Boydell: Yes, a number of factors that played in the decision that we made to manufacture Stereax [indiscernible]. One of them was the impact of COVID and probably restriction when we were talking to facilities around the world [Technical Difficulty]. But it's meant that we want to actually physically go and see them [Technical Difficulty]

Graeme Purdy: So next question from Eric. Could you talk about your patents that could possibly be used by Honda or Toyota? Is there a chance of revenue to come from that? So actually, Honda don't have any license from us to use our IP. And actually, we don't have any jointly held IP with Honda. Toyota is the partner that we've got some jointly held patents, the agreement that we've got is that both parties are free to use that IP for their own purposes. So, there is no expectation of revenue from Toyota for using those. Christopher M says, can you quantify the relative improvements of the [indiscernible] patch performance over the past 12 months? Well, that's been tracked very closely. We update our Board regularly about those improvements and actually we have been plotting those improvements on a log scale until recently. So that means we have seen orders of magnitude improvement in the capacity and power density of those power cells. That degree of improvement is starting to tail off. We now plot improvements more recently on a linear scale. But we're starting to see in a very important performance gains that are reassuring us that we're going to have a viable product in the foreseeable future. So, Edward H asked the questions and this is the one I just answered on Toyota. Marius R says, when do you think Goliath will be production ready? So we talked about getting up to 5 megawatt hours per week by 2024 in the BIC, and that's really when the commercial markets are addressed. So it’s that year onwards. John F says, in consumer product area, now I mentioned the mobile phones and [indiscernible], so we don't actually have any collaborations with mobile phone manufacturers. And actually that market is quite cost competitive. And that's not ideal for the launch of a technology. We're trying to choose markets where there is less price sensitivity. And frankly, probably slightly smaller volumes. So, we're likely to put it into other consumer electronics before it goes into mobile phones.

Stephen Boydell: Now a question from [indiscernible]. Given the volume of shares, which are traded on a daily basis in NASDAQ [indiscernible]. I think that one relates to Stereax. And actually lots of the [indiscernible] interest is around the Goliath program, I mean, the alternative battery. So I think the trigger to [indiscernible].

Graeme Purdy: Okay. So going to move on a bit now and go down to…

Unidentified Company Representative: Graeme, just to cut down to give you a few seconds just to carry on reviewing, obviously, I'm just mindful of your time. Feel free to take as long as you need to just through these questions. Some are, I think you have touched on in previous questions. And of course, if we don't get around to them during the meeting, there's always the option for you to address them posted in the meeting as well. And investors will be notified when they're ready for to be reviewed. So perhaps feel free to scroll through and take ones where it's appropriate.

Graeme Purdy: I think I'll answer another couple before we wrap up. Because I can see there's still a lot of interest, but we will undertake to answer all of the questions that have come in and deal with those [technical difficulty] have you considered incorporating graphene in your solid state batteries to improve their performance? So actually, that's not one of the additives that we've selected largely, because, in fact, we have done some proof-of-concept work, but we find that graphene because it's a 2D material doesn't survive some of the processing that we put our batteries through. So it isn't ideal for us in that regard. And then from -- and let me just select one more, that's a bit different. May be how will Ilika get paid for its three Goliath collaborations? And will it be via license fees for Ilika patented IP? Yes. So the minute we are getting those collaborations supported by the Faraday Battery Challenge. So actually that's on a 70-30 basis. So that means that for every ₤10 that we spend on those programs, and we get ₤7 back, and we retain all of the IP that is generated, or we know how that's generated by ourselves in those programs. And indeed, if somebody wanted to take a license to it, then that would be on commercial terms, although, our business model is actually to incorporate that IP into our batteries, and then to sell the batteries that we manufacture on the basis of the knowhow that we've accumulated. Thank you.

Unidentified Company Representative: Thank you. Well, Graeme, thank you very much indeed for taking such a thorough approach to the Q&A. And thank you to all the investors that have submitted questions most pre the events and during the event. And as Graeme and Steve has said, we obviously will review all of these questions. So thank you, once again. Graeme, perhaps I'll just hand back to you just for a few final words to wrap up. And I know that investor feedback is incredibly valuable and important to you, and then I'll direct investors so they can give you their views.

Graeme Purdy: Well, it's been absolutely fantastic to see the number of people who have shown interest in our presentation today. It's been a very vibrant Q&A. Many thanks for all of you who have taken the time to submit those questions. I think we've got a very well informed retail investor following, increasingly in the U.S., and I look forward to engaging with all of you going forward in the future, and many thanks for supporting our efforts here at Ilika.

Unidentified Company Representative: That’s brilliant. Thank you very, very much indeed. Could I please ask investors not to close this session as you'll now be automatically redirected to the opportunity to provide your feedback. If you access this meeting via our website, then the feedback page will appear. If you access this from the link sent to you by email, you'll simply be asked to log in to submit your feedback. And I cannot reiterate enough the importance that the company has your views and your expectations. On behalf of the management team of Ilika, we would like to thank you very much indeed for attending today's session. That now concludes.