Earnings call transcript: Clear Blue Tech Q2 2025 shows 12% revenue growth

Clear Blue Technologies International Inc. reported a 12% year-over-year revenue growth for Q2 2025, reaching $1.13 million. The company also improved its gross margin to 44%, up from 24% last year. Despite positive financial performance, the company’s stock experienced a 7.14% decline, closing at $0.07, near its 52-week low. According to InvestingPro data, the stock has fallen nearly 79% over the past year, with current analysis suggesting the stock is slightly overvalued at these levels.

Key Takeaways

• Revenue increased by 12% year-over-year in Q2.
• Gross margin improved significantly to 44%.
• Stock price fell by 7.14% following the earnings call.
• Operating expenses decreased by 14%.
• Net debt reduced by 61% from $14.7 million to $5.7 million.

Company Performance

Clear Blue Technologies demonstrated mixed performance in Q2 2025. While quarterly revenue showed a 12% increase, InvestingPro data reveals a concerning 49.6% decline in revenue over the last twelve months. The company has expanded its product range and focused on commercialization, shifting from heavy research and development. This strategic shift has contributed to a significant reduction in operating expenses and net debt. InvestingPro analysis shows the company maintains a healthy current ratio of 1.45, indicating sufficient liquid assets to cover short-term obligations.

Financial Highlights

• Revenue: $1.13 million, up 12% year-over-year
• Gross Margin: 44%, improved from 24% last year
• Adjusted EBITDA: Improved by 69% in Q2
• Operating Expenses: Down 14% year-over-year
• Net Debt: Reduced by 61% to $5.7 million

Outlook & Guidance

Clear Blue Technologies is targeting positive adjusted EBITDA for the year and expects stronger performance in Q3 and Q4. The company aims for cash flow breakeven at around $2-2.2 million in quarterly revenue. A potential contract with EUTELSAT, worth over €20 million, could significantly boost future earnings.

Executive Commentary

CEO Miriam Turk highlighted the company’s leadership in clean, managed wireless power, stating, "We are today already the world leader in delivering clean, managed wireless power." She emphasized the company’s goal to achieve positive EBITDA, saying, "We’re planning on bucking the trend, and we aim for an EBITDA positive company."

Risks and Challenges

• Market volatility affecting stock price and investor sentiment.
• Potential challenges in scaling operations to meet growing demand.
• Dependency on strategic partnerships, such as with EUTELSAT, for future growth.
• Economic uncertainties in emerging markets, a key focus area for the company.
• Technology risks associated with the commercialization of new products.

Clear Blue Technologies remains focused on its strategic initiatives, including expanding its market presence in emerging markets and developing innovative solutions in smart power systems. The company’s efforts to improve financial metrics and operational efficiency are evident, yet the market’s reaction suggests cautious investor sentiment moving forward. InvestingPro identifies the company as a niche player in its industry, with additional analysis and insights available in the comprehensive Pro Research Report, covering what matters most for informed investment decisions.

Full transcript - Clear Blue Technologies International Inc (CBLU) Q2 2025:

Miriam Turk, Co-Founder and CEO, Clearblue Technologies: Okay, everyone. Good afternoon, good morning. My name is Miriam Turk. I have the honor of being Co Founder and CEO of Clearblue Technologies. I’m joined today by our wonderful CFO, Farooq Anwar and our lead in marketing, Jonathan Vanderbeen.

Today, we’re going to be going over the earnings for Q2 and also talk about Clearblue two point zero, which is the transition we’ve made from the last few years and is really building up strength and momentum for us to have a very strong growth path going forward. We’re going to be recording this presentation so that people can download it and listen to it afterwards. And I would please encourage you to ask all questions that you would like to talk about today. Farooq and I are at your disposal to answer any of those questions. As always, please be aware of forward looking statements with any public company.

We do the best to give you the information we can. But as we all know, markets can change, third party external factors can change at any time. So please take that under advisement when you’re considering the information. So just want to talk a little bit about where the company is and where we’re going from an investor perspective and from a company perspective and thought I would start off a little bit on what the company is all about. So the market we’re going after is the energy industry.

And energy has become something that is now a very big channel a challenge across the world. The world needs smart off grid because the grid is becoming more challenging, in terms of its reliability, and, it’s not able to handle the capacity that we, we all need. Whether we were in emerging markets like Africa or whether you’re anywhere across North America, a reliable grid able to handle the capacity of the needs is very difficult. So the solution requires cost effective alternatives and integration with renewables. As a company, we have a grand vision, and that’s to become the world’s largest virtual renewable power utility.

Every single system we sell and deploy all over the world, and we have many of them deployed and lots of them all mine and connected, we manage and control and operate on behalf of our customers. And so we are today already the world leader in delivering clean, managed wireless power to meet the global need for reliable, low cost energy for mission critical infrastructure. There’s lots of people who’ve deployed technology and systems, but remotely managing, controlling them, operating them and integrated with renewable energy as a reliable component of the business, is key, capability that ClearBlue has. So we’ve entered the phase of Clearblue two point zero. And in order to do that, we’ve done a number of things over the last few years.

We had a challenging few years starting with COVID and through all of the iterations since then where the company became heavily burdened with debt because of challenges in our market from a sales perspective and in the investor investment market for small cap companies. As a result of that and additional third party factors, we were hit a point where we needed to recapitalize and recalibrate the company. We have now completed that, and we have emerged as a much more cost efficient cost structure. At the same time, we were making lemonade out of lemons and making sure that we invested in growing our products and growing our channels. And that has resulted in new partnerships to drive growth.

There are three key market pillars that we are focused on. The first is in the emerging markets, specifically Africa, taking cellular telecom infrastructure and moving it towards a renewable energy driven infrastructure that’s basically consuming zero diesel. Today, it’s almost 100% diesel, and we are on the road to zero diesel with our customers in getting off of that high cost, unprofitable, and difficult energy source. At the same time, high speed satellite Internet is now very quickly becoming a strong and key reliable alternative to cellular. It provides large amounts of data and gets people connected.

And enabling satellite Internet across Africa is a key area of our focus with the new products and partnerships we have built. And lastly, our smart solar lighting, business in North America, which and has a marquee customer list is starting to go mainstream through the interest of power utilities, and departments of transportation. So the transition from ClearBlue one point zero to two point zero is quite significant. Having a smaller product range, which was basically two products over the last few years, part of the investment that we did was to focus very heavily from an R and D perspective. And also, we did a small acquisition in Sweden to expand our product range so that we have full coverage to cover the three distinct market opportunities that we’re focusing on.

Significantly, because of that R and D investment that was needed and other higher cost structures, we had a higher cost structure related to the margins and the revenue that we were at, and we have now been able to pare that down significantly in order to position us at a point where we can get to positive cash flow, positive EBITDA for sustainable growth going forward. A big part of that was adjusting our debt. It was putting too much pressure on our ability to execute. And so we have now converted a lot of that debt to equity and are sitting at about a reduced debt of approximately $6,000,000 on the balance sheet. Of that $6,000,000 $3,400,000 is interest bearing.

The rest is noninterest bearing. I wouldn’t use low quality. I’m going to edit that. We had smaller customers and early adopters in our book of business, and we have now transitioned to newer, larger, better capitalized and more mature customers and partners. And that is also having an impact on the size of orders, the amount of orders, the ongoing rollout that we’re seeing.

And in the same way as our customers have gone that way, so have our distribution partners. So as an example, we are very thrilled with the fact that we are now dealing with a number of power utilities throughout the market. So I’ve talked about the three markets, the telecom road to zero diesel, enabling satellite Internet and solar mainstream. How does that translate into investor KPIs? Well, the three KPIs that we are tracking, and then I would think you would want to track as well, are commercial contracts, positive adjusted EBITDA and positive cash flow generation.

Those are the things that we’re keeping our eyes focused on. From a commercial contract perspective, I think we’re at over 120 orders this year. Many of them are smaller and still valuable growing, but we have some larger commercial contracts that we have in the funnel. And as they become online, we will be announcing them. And as you’re going to see today and going forward, strong momentum towards positive adjusted EBITDA and positive cash flow generation.

So this is quite an important slide because it’s important to understand that whether you’re zero to 20 watts and you’re an Internet small device powering a Starlink or a UTelSAD or an Intelsat or whatever type of application, in communities, in schools, in health care, or just for commercial uses, you might need the PICO product. Then your Nano, which is our core bread and butter project product that we’ve had for a while, our Alumiant, which also needed to have expanded capability to cover all use cases. And then last but certainly not least, our micro product, which now gets us into the very large power and gets us with an ability to tackle the diesel challenge. So to have a product range that goes from zero watts to 30 kilowatts and is usable in all of those ranges. Important to understand that nano, for example, wouldn’t work at 10 to 20 watts in an economical way.

And, micro doesn’t really work below, I would say, one kilowatt to three kilowatt, you’re kind of in a crossover. And in the Olumiant business, needing to be able to have products that generate across the entire market. So having this comprehensive portfolio and all of the money and time and energy invested by the company to deliver that creates a very strong asset, both from an IP perspective as well as from a sales and marketing perspective to go after, projects and market share. So from a business model perspective, we have created and built smart power systems. We’ve learned that in order to be smart, you’ve gotta integrate and embed right into the power electronics, certain smart capabilities, edge computing and connectivity and communications capability with the cloud.

We take that, we connect it to the cloud, and we provide aftermarket service in terms of operating and manage, not just warranty, but running and operating and managing these systems in partnership with our customer and delivering energy as a service in a in a variety of different contractual and and service, capabilities. At this point, I’m going to ask Paruph to step in and talk about the highlights of our financials. Yeah.

Moderator: For sure.

Farooq Anwar, CFO, Clearblue Technologies: Thank you, Miriam. Hello, everyone. So as you can see, you know, based on on the new product offerings that we have, so what we’ve done is we are building a foundation for growth with all of these these four distinct products sizes that we have. In q two, revenue grew 12% to 1,130,000.00, bringing year to date revenue to 2,200,000.0. To put that in perspective, last year’s full year revenue was 2,760,000.00, and we are already near that level with two quarters still to go, which will have historically been our strongest like, our next two quarters have historically q three, q four have historically been our strongest quarters.

Recurring revenue also grew by 6% in the quarter, 280,000, while year to date, it’s slightly lower due to timing of renewals. The service base remains solid and expanding with over 15,000 units deployed worldwide, generating recurring services and data insights. We’re trying to build a strong foundation to scale profitability and deliver long term value. Maria, do you wanna take the next slide?

Miriam Turk, Co-Founder and CEO, Clearblue Technologies: So we’ve talked about satellite Internet. We’ve talked about cellular telecom. And as I’ve also mentioned, we’re seeing a lot of activity in the power utilities, in transportation, in municipalities. And starting this fall, we are going to be privileged to do we actually got two agriculture projects now, one in North America and one in Africa. These markets are expanding significantly.

Connectivity, the Internet of Things and having the telecommunications industry, which is really powering everything, is a significant growth for us across all of our markets. We have some very strong advantages, sorry, apologies for the dog. We have some very strong advantages, going into those markets. We drive higher performance and better economics than anyone else in the marketplace. We do that by delivering the smart power equipment on-site, by having analytics driven remote monitoring, Remote cloud troubleshooting and repair, fixing things, whether it’s power system, things that need to be managed and operated or even the telecom systems themselves need to be rebooted, we can do all of that remotely.

And when you are dealing with multiple power sources and sources that are dependent upon solar or wind, they’re not there 100% of the time. So weather and energy forecasting, for which we have some nice patents, is a key foundation of what we’re doing. Through that, we’ve got more than 15,000 systems that we’ve shipped in 55 countries. We make our systems more and more smart on an ongoing basis. We’re using big data and predictive analytics.

We can troubleshoot and remote remediate better than anyone else in the market, and we’re managing and operating for our customers alongside our customers. Strategic partners are very important, obviously, to us, and I thought I would just spend a few minutes talking about EUTELSAT. EUTELSAT is, you’ll be familiar with low earth orbit like Starlink and higher earth orbit satellite services. Both of them are getting much faster with much higher capacity. And EUTELSAT has become a strategic asset for France, for The UK and for all of the EU for a security, resiliency infrastructure perspective.

They recognize the importance of power alongside the connectivity, and we have signed an MOU with them for our partnership. We’ve been working heavily with them the last eight or nine months throughout all of this year. There’s been some changes on their side. They have received $1,600,000,000 of investment from the French government and the U. K.

Government and other reference shareholders. So they are making significant investments in rolling out their services across The EU and across Africa. And along with that, we are expected to provide the power infrastructure. This represents a multimillion dollar opportunity over the next multiple years for Clearblue. From a customer base, we have a marquee list of customers.

We have the top telecommunications infrastructure, customers across Africa, MTN being the largest telecom organization, IHS towers being the largest tower operator in Africa, satellite vendors, Eutelsat, ViaSat, Intelsat, Avanti, ISAT and infrastructure. Across North America, cities, municipalities, states, transportation, Pennsylvania Turnpike, Interstate 80 and commercial retail customers are our base of customers. And many of these customers have been using our services for four, five, six, seven, eight, nine, ten years now. Just a bit of a refresh on our board. There’s a lot of them that have gray hair or no hair.

I don’t have gray hair at all. That’s why my hair is nice and brown. But those of you who’ve seen me lately know that there’s a bit more gray there. We’ve been working really hard, and we are a very determined team. We have a disparate set of assets and capabilities.

The three founders, myself, John and Mark, couldn’t be more different people. But between the three of us, I think we make one hopeful super person with individual skills. And we are very focused as a company, making sure everybody plays their position well. As a result of the end of Clearblue one point zero and the restructuring, we have it’s time to refresh our Board. We were thrilled to announce in the quarter that Greg Ross has joined our Board as an independent director this quarter.

He has a significant amount of industry and investment knowledge in the Canadian markets and global markets and is already providing us with sage advice. And we expect to expand our portfolio of independent directors from a go forward perspective. Farooq, would you like to talk a little bit about the trend lines and the work we’ve been doing?

Farooq Anwar, CFO, Clearblue Technologies: Yes, for sure. So as we indicated earlier in the presentation, you know, we’ve been working really hard on our debt restructuring and, you know, bringing debt to a level that is manageable, and you’ve been successful. So over a bit. So over the last year, we have taken action to strengthen our balance sheet. As you can see from the graph, the net debt is down from 14,700,000.0 in q three last year to 5,700,000.0 in q two, a 61% reduction in less than a year.

This was made possible through stakeholder support as we converted convertible debentures, shareholder loans, and into equity. We restructured our debt to extend the terms and converted the short term loan into a mix of royalty equity and smaller debt balance, you know, payments. So the result is lower leverage, reduced near term cash needs, and alignment of our stakeholders with Clear Blue’s long term success. Most importantly, this structure gives us the breathing room to execute our growth strategy without an overhang of excessive debt. Right?

The next slide, please. So you can see if if you look at our revenues, they’ve been improving, and the gross margin is is is being supported by you know, and and giving us better profitability. So in q two, revenue grew 12% year over year to 1,130,000.00, with gross margin improving to 44% from twenty four percent last year. The improvement in gross margin was driven by a product mix, more skewed forward more more more more skewed towards our more mature products and higher margin services. On a year to date basis, revenue is up 20%, and gross profit has nearly doubled with margins expanding to 48% versus 32% in 2024.

While restructuring activities temporarily impacted revenue in late twenty twenty four, we are now seeing a recovery with stronger profitability. These results validate our push towards improving cost control and higher margin business. Next slide, please, Maria. So the key levers and revenue recovery leading to inflection point. We believe that we are at an inflection point in the business.

Having a couple of challenging years, our adjusted EBITDA has improved 69% in q two and fifty seven percent year to date, driven by higher revenues, stronger margin, and reduced operating expenses. In fact, operating expenses were down 14% year over year in q two and down 20% year to date. Thanks to thanks to workforce automation, lower overhead, and tighter g and a management. Our r and d and business development remain tightly focused on revenue generation with the shift from heavy r and d to commercialization. Past sales investments are starting to yield orders from higher quality customers, as Mary mentioned, and we believe that we are on track towards positive adjusted EBITDA and improved cash generation.

Mary, next slide. Do you wanna take it over from here?

Miriam Turk, Co-Founder and CEO, Clearblue Technologies: Sure. So, lots of changes to the cap table, but we think we fixed it, in terms of cleaning it up nicely now. We did a share consolidation in, q two as well. And so we’re now sitting with 78,000,000 outstanding shares, a number of warrants for all the people who participated last year in helping us make the transition. And where we sit as a result is we’re very honored that BDC Capital, who is our largest lender, is also now a very large shareholder.

And I think, as you can see, there is a significant management focus and Board focus and commitment to the company. And as a result of investments that we’ve made, we’re sitting at about 22%. The shares are still sitting at a level that are quite flat. And I think that our thoughts are that we need to show the trend line in a stronger way over more quarters. So we’ve got a good start.

When you look at where our EBITDA numbers are going and how our gross margin and revenue has been improving. But I think the market will want to see how we do for the rest of this year to make sure it wasn’t just a spot quarter and that the trend line is going forward in a strong way. And once that happens, we think that there’s significant potential for upside from where we are today. In terms of comparables, presenting a little bit of a basket of selected comparables, a range of small cap and micro cap solar, power electronics and energy management peers. We’ve provided a context here for valuation metrics relative to companies that are similar stage of scale and market position.

We’re planning on bucking the trend, and we aim for an EBITDA positive company. We think we’re ready. We’re at the point where we need to be. We’ve got the technology developed. And once we’ve achieved that on a consistent go forward basis, this is a rarity seen amongst cleantech companies, and we think there’s significant opportunity for upside.

So just to summarize where we’re at. We have three core markets that provide a foundation for strong revenue growth and improved profitability. We’re in the commercialization phase with our new products, and that has allowed us to significantly reduce our operating expense our R and D expenses and some automation that you need to develop the product to automate it to get things going. And so that’s helped on the OpEx side as well. That doesn’t mean we’re not doing r and d.

It just means we’ve gotten a big chunk of it behind us. The twenty twenty four, twenty twenty five debt restructuring has really helped to stabilize the business and provided breathing room for us to execute our growth strategy. We’ve reduced our operating expenses, and we have pathway to positive adjusted EBITDA and improved cash generation. And we’ve got new partnerships that are being formalized that are moving forward, such as EUTELSAT and Growth Energy, and they are going to support larger scale deployments and revenue growth. So that’s the presentation for today.

I’m going to stop sharing, and I wonder whether there are any questions that we want to take at this point in time.

Moderator: Yes. If you go ahead and pull in the chat, Ola, to you and Farooq. Okay. So the first one is, what are you expecting in terms of the revenues for the 2025?

Miriam Turk, Co-Founder and CEO, Clearblue Technologies: So the second half of our fiscal year is typically when we see the highest revenue quarters. Last year was an exception because we were constrained by the restructuring activities. But we have a number of key projects that we are going to be in planning on delivering on, and we need to deliver those in order to ensure that we have the two strong quarters in the back half of the year, sorry. And our team’s focus is to make sure that happens and deliver on our goal of hitting a positive adjusted EBITDA this year.

Moderator: Awesome. Okay. Next one is, so what is driving the visibility for that stronger 2025 then?

Miriam Turk, Co-Founder and CEO, Clearblue Technologies: So this year is going to be particularly strong for our micro and nano products, which are mainly for telecom applications. The success in the second half will be predicated on making these deliveries on time along with winning further contracts to solidify the bookings for 2026.

Moderator: Okay. Now in terms of OpEx, are there any other costs that you can cut to reduce that?

Farooq Anwar, CFO, Clearblue Technologies: I can take that question. So we’ve already made a significant amount of reduction in our overall operating expenses. With this quarter, you know, it’s our quarter is down 16% year over year. There’s there’s also you know, there is a balance that we wanna hit between revenue growth and cost structure. And going on forward, we’re not trying to compromise our revenue growth.

So I I would say that our OpEx would remain flat. There are there there are opportunities we are gonna work on it. But, like, we’ve already made significant, you know, strides towards reducing our OpEx. And I think it’s it’s it’s a good, you know, position right now.

Moderator: Awesome. Thank you. K. Next one is how are you managing the debt on the balance sheet?

Farooq Anwar, CFO, Clearblue Technologies: Mhmm. So with the restructuring, the reduced you know, we’ve reduced our debt by approximately 61% from its peak. Most of the remaining debt is with BBC or FedDev Ontario. FedDev is industry and does not require any significant payments in the next couple of years. It’s pretty pretty pretty small payments over the next couple of years.

And with BDC, we did our restructuring recently, and, you know, we we’ve we’ve got manageable payments going on forward. So, you know, our our goal is to improve our profitability, and therefore, our ability to service the debt will go hand in hand with higher revenues. Once you get to that point, we have more flexibility and options on how to fund ourselves. But right now, I think, you know, we’re managing our debt amicably after the restructuring that we’ve done.

Moderator: Awesome. Okay. Now is the company thinking that it’s gonna need to do another equity raise is the next question.

Miriam Turk, Co-Founder and CEO, Clearblue Technologies: I can take that one. So we want to keep all of our options on the table as we’ve entered this new phase of growth. And there may be situations and opportunities where more capital could help us to accelerate that growth. Historically, we funded ourselves with grants, with debt, with equity raises, and the management team and Board are assessing those options on a go forward basis to decide if and when we want to approach that, when we put the pedal to the metal, etcetera, etcetera, and taking all of those things into consideration.

Moderator: Perfect. Okay. What is happening with the EUTELSAT partnership? So next one.

Miriam Turk, Co-Founder and CEO, Clearblue Technologies: Okay. So the EUTELSAT partnership is a huge ship. It’s not a little Sea Doo. It’s it’s a huge ship. This opportunity in front of us is for tens and tens of thousands of systems being deployed across, as I said, all of the Europe and Africa.

Right now, we’re focused mostly on Africa, but EU is entering the conversation as well. You may have noticed there was a huge outage in Spain of power, and that has triggered some concerns about the reliability of the grid in Europe, which is not unsurprising. So we are actively engaged with EUTELSAT. Most people in the company at Clear Blue touch many different people in EUTELSAT multiple times a week. And we’re working towards formalizing the commercial terms of our rollout with them.

They’ve had some significant developments on their side, €1,600,000,000 from the French government, the U. K. Government to fund their growth, and they have very accelerated plans. So we’ll update the market as things develop and become finalized. But as it stands right now, things are going all in the right direction with them.

Moderator: Okay. I think this one might be for you, Farooq. So with recurring revenue, do we book the entire so the annual amount, the month it was received, hence the timing issue on prepaid renewals or treat it as prepaid revenue and kind of phase that in over the payment period as it’s earned?

Farooq Anwar, CFO, Clearblue Technologies: So with with the recurring revenue, what we do is we don’t take it all at once. The way that it works is, like, if it’s a three year contract, we take it over the three year period. And then when there is a renewal, it’s generally an yearly annual renewal, and and then we we amortize it into income over the next twelve months. The so when when we mentioned that the timing issue on prepaid renewals, it’s basically the time lag between getting the renewal done. And so unless and until we get the money in, it’s not deferred revenue.

So just a time lag on between when the three year ends and the fresh renewal is gonna come in. There’s lots of processes that need to go in and and work on. And sometimes there’s a delay on that because, you know, the end customer changes and whatnot. Right? So so that’s just, why there was a delay in the long term prepaid renewals.

But, like, it’s it’s amortized accordingly, and you can see the monthly renewal over there as well.

Miriam Turk, Co-Founder and CEO, Clearblue Technologies: So you might you might have a telco or a city that is fully intending to renew their renew their ongoing recurring revenue, But we don’t have the signed contract or the payment for two or three months into the new term. So then the numbers go down in that quarter, but they come up the next quarter because it’s retroactive, that kind of thing. So it’s just those types of items.

Moderator: Awesome. Thank you. We have a couple folks that are interested in more information about the agriculture contract. So like if we’re powering irrigation pumps or kind of what what those projects are about?

Miriam Turk, Co-Founder and CEO, Clearblue Technologies: Yes. So in I don’t actually know exactly what we’re powering in Africa. I just know we’re doing an agricultural project in Tanzania. But the interesting thing about agriculture is it tends to be outside the city. So power utilities are looking at, I’ve got this large distributed power infrastructure.

I’ve got to provide mission critical power to them. It’s going through forest fire territories. And as a result, I would like to look at providing green energy as an alternative. So I think we have some pilots coming up that we’ll be announcing hopefully in the fall related to that type of an agricultural project.

Moderator: I see.

Farooq Anwar, CFO, Clearblue Technologies: And then just one more thing. Like our PicoPlus product, like our smart street lights, all in one lights, those are also, you know, like, easily transportable and whatnot. So those are also pretty good fit for for agricultural areas as well. Awesome.

Moderator: Perfect. Okay. So now we have another question. So of the $3,500,000 in bookings that we recognized in twelve months, how much of that are we expecting to be invoiced in the twelve months? And how much would we estimate that to be invoiced in fiscal year end twenty twenty five?

Miriam Turk, Co-Founder and CEO, Clearblue Technologies: So we would expect 100% of it to be invoiced in twelve months. In terms of the number for 2025, we’re not going to give exact guidance at this point because things can still move a month here or a month there, and it’s all related to execution and timing, etcetera, etcetera. What I can say is, historically, the last two quarters of the year have been significantly bigger than the first two quarters of the year. And that is what we have seen most of the time is the trend that we have, and that is the plan that we’re working on for the 2025. One of the other things that we’re focused on, so our definition success at the December is good, strong Q3 and Q4 and a nice bookings backlog to show that we’re going into a good, strong Q1 for next year.

That’s our plan.

Farooq Anwar, CFO, Clearblue Technologies: The only thing I’d like to add in there as well, like, is that there’s also recurring revenue inside the $3,500,000 So that would go more than you know, if it’s a three year contract. So that revenue is gonna come in in over more than twelve months. But, you know, the rest of that, the cash, we’re expecting to be received in the next twelve months for these

Moderator: Correct.

Miriam Turk, Co-Founder and CEO, Clearblue Technologies: So if you look at the bookings table, it shows a year one number and it shows beyond year one number. When we show a booking, it’s cash received from a customer. So we generally get the first three years of the ongoing service contract prepaid in the first year of the contract. So our cash receipts are higher than our revenue.

Moderator: Perfect. Okay, we have another question here. So is the energy as a service and recurring revenue at or above the corporate profit margin levels?

Miriam Turk, Co-Founder and CEO, Clearblue Technologies: Recurring revenue is a higher margin than one time hardware sales. Yes, That is in fact the case.

Moderator: Perfect. Okay. Another good one here. So is management still committed to long term or if the company comes along with, for instance, 50,000,000 takeover offer, will the company get sold? I’m asking as a diluted retail investor.

Miriam Turk, Co-Founder and CEO, Clearblue Technologies: So as we’ve said with raising equity in the future and will we need to do another raise, management and Board will always look at those things and figure out what’s the best opportunity. From management’s perspective, we’re not looking to get out of this anytime soon. We’re keeping our head down and building the business. And I don’t and sorry, I’m just trying to think through all the scenarios. We don’t see anything happening in the short term.

One never knows, though. But the key focus is to grow the business and have a long term road map and to make sure that the shareholders get the maximum return on their investment. Certainly, at the numbers we’re sitting at right now, we consider that not to be the value of the company at all. And our intention most strongly is to deliver significant return on investment to our shareholders. We would not have gone through all of this pain if we were just going to take a few pennies on the dollar.

This company has a significant amount of IP assets in both customers, in revenue, in product technology and know how. And we’re here to make sure that, that value is realized.

Moderator: Awesome. Thanks, Mario. Okay. So we’ve another good question here. So what percentage of like a big installation does the power component make up for a total project’s CapEx?

Miriam Turk, Co-Founder and CEO, Clearblue Technologies: It depends by product, but let’s take a typical telecom installation. If you’re establishing a new tower installation, I would say that the power is probably 50% to 60% of the CapEx. If it’s a retrofit, it’s probably 75% of it. In the streetlight business, it depends if we’re supplying the entire system or not. But of course, those percentages would be high.

So I would generally say, most

Moderator: of

Miriam Turk, Co-Founder and CEO, Clearblue Technologies: the time, it’s 50% of the CapEx of the project.

Moderator: Okay. I think another one here. So understanding we can’t give guidance, but do we expect to see revenue growth in the second half over last year, in the last two quarters year over year? To clarify, you say it would be we’re aiming to be EBITDA positive by the end of the year. Is that the goal for Q4?

Miriam Turk, Co-Founder and CEO, Clearblue Technologies: So our last two quarters are expect we are targeting and working hard to deliver strong Q3 and Q4. Strong Q3 and Q4 would be nowhere near what we did last year. Last year’s two quarters, last two quarters were significantly impacted by our the restrictions due to the restructuring. And that’s not what we’re targeting. Those are very low quarters.

We’re more looking back towards previous years and what we have traditionally been able to show in terms of growth on Q3, Q4 versus Q1, Q2. In terms of adjusted EBITDA, you could see on the chart that there was a very strong trajectory towards getting to positive adjusted EBITDA, and we are planning on continuing quarter after quarter to get better and better at that.

Moderator: Awesome. Kind of piggybacking off of that one. Someone’s interested in, like, what the sales level is required to be to become cash flow breakeven. I don’t know if we’re able to, yeah, share that.

Miriam Turk, Co-Founder and CEO, Clearblue Technologies: Farooq, you wanna answer that question?

Moderator: Yeah.

Farooq Anwar, CFO, Clearblue Technologies: Yeah. For sure. So we’ve got so right now, our for so to be EBITDA positive, so we looked at, to be EBITDA positive right now, we have, in q two, we had $1,100,000 in revenue, and our adjusted EBITDA was was 222,000 negative. Right? At 40% margin, you can see that that pry at at that, you know, at that level.

So if we get around, you know, around 2,000,000 or 2,200,000.0 a quarter, I think we would be a bit positive. And, again, with with the cash flow, our working, you know, we’ve got we’ve reduced our debt significantly. So if you look at our our margins at 40%, so if we on a quarterly basis, if we do do to 2,000,000 in a in a quarter and at at 40% margins. So and and then looking at our expenses, I think at 2,000,000 or 2,200,000.0, we would be cash flow positive as well.

Moderator: Awesome. Okay. Next question. So what is the payback time for a customer on replacing diesel in the telecom industry? And what is the IRR on this?

Miriam Turk, Co-Founder and CEO, Clearblue Technologies: So the payback period is months, not years. The key challenge is what we’re seeing in the industry is is is is everyone’s moving towards adding solar. But the operators who have historically run the site as diesel and a generator have not got the tools and the expertise to actually deliver the solar energy to the system. So we see a lot of customers who maybe have rolled out solar with other companies, and they’re not getting the benefit from it. So step one is to get the infrastructure built out, but step two is then to harvest the solar energy, and that requires significant configuration management analysis of the sites to make sure you’re setting up the parameters, adjusting the parameters to doing that.

So that’s why we talk about the road to zero diesel because we’ve seen sites where we start off with a system and, okay, it’s going to deliver 40% solar. And with us doing the management of it, we can get it to 90%, 95% plus solar operated on a way to getting it to zero diesel. So the payback is in months. But one of the key criteria is there are many, many installations we’re seeing where they do the work, they do the upgrade, but don’t actually get the benefit without the operational experience. That’s why we believe so strongly in our model of having the field operational expertise and skill sets, having the analytics and the data and the management team to do that and then even to the next level, changing the technology and the hardware to respond to what’s going on in the field.

I call it the red dot problem. It’s not about how to make this stuff work in the lab. It’s about how to make this stuff work in the field, whether it’s in Northern Saskatchewan at minus 40 and plus 40, sometimes within the same week almost, or it’s in Africa with dust, dirt, no local maintenance people and 40 degrees, 50 degrees Celsius.

Moderator: Awesome. Thank you. K. This may be a fruit question. But do we have the tax loss carryforward dollar amount?

Farooq Anwar, CFO, Clearblue Technologies: Yeah. For sure. So we can we can break that up into two. So we’ve got at the end of the year, last year, we had noncapital losses available for future periods of around $26,000,000, $26,600,000, and we had research and development tax credits that we had carried forward of around $8.68700000.0.

Moderator: Awesome. Thank you. Okay. And this is the last one that we’ve got in the queue. Is going forward, can we expect more frequent news release updates?

Miriam Turk, Co-Founder and CEO, Clearblue Technologies: Certainly, we expect to have more visibility in the market. I think the answer to that is yes. But I just wanted to emphasize that we’ve been keeping our heads down and making sure that we could deliver on a long term trend, not just a blip. We’ve now got two quarters behind us that have shown the new trend, and we’ve got more coming. So we believe that the market is getting ready to see the results and see the progress.

I do want to emphasize, as I said, we’ve got over 120 projects that we’ve done so far this year that we’ve got orders for. And some of these are strategic nice projects. I’ve got projects that are a couple of thousand dollars, but they lead to very significant follow on strategic projects. So we don’t announce everything. But yes, I would think that there’s going to be more visibility, more news coming forward now that we’ve kind of come out from dealing with all of the restructuring and are focused on sales.

We’re also seeing a lot of deals happening. So the activity is much higher as well, given that the revenue is growing.

Moderator: Awesome. We had one more come through. So turning back to the power components of those large projects. So if we got five percent of EUTELSAT’s $1,600,000,000 it would be $80,000,000 of revenue to you over time. Is that in that kind of 5% ballpark?

Miriam Turk, Co-Founder and CEO, Clearblue Technologies: Well, the money that they’re putting in is CapEx, not OpEx. So I’d have to take a look at that. But I think in looking at what the potential value of that contract is, we see the contract being potentially worth more than €20,000,000 over the next two to three years. I’d say more than 20,000,000 over the next three years is the potential that we see for that contract. And that is just for the Africa portion.

How Europe starts to come into play might be very interesting. Those are still early days discussions when it comes to Europe.

Moderator: Perfect. All right. Can we give thirty more seconds if anybody has any last minute questions? But that is all of them in the queue that have come in.

Miriam Turk, Co-Founder and CEO, Clearblue Technologies: Okay. Thank you very much, everyone. We really appreciate it. This webinar presentation and this PowerPoint presentation will be put onto the website for other people to listen to if they want. I do just want to give a shout out.

Many of you have been part of the team in terms of doing the transition. We want to thank all of our stakeholders for the support that we got through this financial transition. We would not be here without you. And it is something we think about and hold ourselves accountable to every day. So a very big thank you for all of the supporters we have had.

And every person in this company is working hard to deliver on that investment for you.

Moderator: Perfect. Yeah. No more questions. I think that’s good.

Miriam Turk, Co-Founder and CEO, Clearblue Technologies: Thank you. Have a great weekend.

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