Earnings call transcript Q4 2022

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Operator

Good afternoon, and welcome to NuScale's Fourth Quarter and Full Year 2022 Earnings Results Conference Call. Today's call is being recorded. [Operator Instructions]. A replay of today's conference will be available and accessible on NuScale's website at ir.nuscalepower.com. The web replay will be available for 30 days following the earnings call. also also for accessible will a days replay link, registration on telephone be X available through A NuScale's website.

for over Director time, turn go this opening would Kozak. I At like ahead, the Mr. call Investor to of Kozak, Scott Relations. Please remarks, to

Scott Kozak

Conference provide President Chief Welcome Results will and call, update Officer; Chris NuScale's Colbert, Chief Officer. business financial XXXX to today On and NuScale us operator. results. Quarter and Executive With Thanks, Year on its are Financial today's Full an Fourth Earnings Call. John Hopkins, discuss and

lines We will then for open questions. up the phone

This afternoon, our set supplemental Investor slides we on posted a Relations website. of

and As uncertainties. which and forth reflected presentation of course are views discussed our on Slide the rooms session risks variety and harbor the current trends in subsequent forward-looking includes X, the the reflect of Q&A statements the subject safe information existing during a set our to in of

our You potentially of can Form which such S-X Form filings XX-K. find to in and could contribute a our on SEC discussion risk factors, differences

and the I'll President Hopkins, NuScale's Executive Officer. to John? John turn call over now Chief

John Hopkins

we you, mission us the milestones, important development enabling the presentation. see as XXXX delivered we can good Scott, XXXX as Slide everyone. year, a remaining accomplish of quarter progress of goals evident fourth of power on plants. safe, momentum innovative transition for our Thank of in SMR increasing the our NuScale you was This on our all at toward as VOYGR afternoon, X year our clean X our to X power of momentum the helping was energy and made through cost-competitive and

the in to power modules the customer progress, deliver this XXXX we have ability order. With NuScale to

points. you walk important these me Let development through

front-end will at the phase plant, specific Romania's site First, Power, of inputs work a turning the deployed our for SMR in first define FEED FEED completed VOYGR with of Road customer, Doicesti our power December, a of committed Phase major Slide a Romania, I the and and plant. work. the secured station for of the Activities be engineering design power X during power contract will coal-fired site which to signing formerly we second or In X.

faster, with At emission but economic diversify first-of-its-kind touted remarks As stability. help the goals. recall, GX with and their more illustrates for RoPower energy for efficiently. bring in mentioned, sustainable climate as as where Biden President committed European Partnership President We will development energy that to you online our our beyond to Europe NuScale's Infrastructure XXXX that scalable of couldn't just countries and help the seek cheaply RoPower billion President $XXX relationship plant our believe and we may at portfolios for raise the agreement presents technology his shared a more. strategic VOYGR SMR broader the region Biden and launch Global zero President the global not by our critical meet and investments more Romania, and safe, solution, to NuScale, Investment, agree to noted

far. design has engineered long-lead also site the advanced X. licensing refer SMR other commercial completed power and construction, starting facility this work designs. our serve customers our Slide VOYGR will also which time, specific standard design, Western NuScale with APC balance the have plant plant plan for resources to plant. save pleased completed SPD We're preparing of I'll will advances engineering step help readiness, providing template major of design to The moving ahead to equipment and Second, manufacturing important This contractor of for equipment an SPD, a a No as for them support schedule. as the point procurement overall efforts developer this us that

design standard safety second by another case customers well a power fundamental design power capacity approval new our or plant. of XX-megawatt No range The design indicator U.S. upgrade This economics. NuScale this is features readiness. NRC X our And improved application for support back will features a VOYGR to of progress licensing that made else NRC as third, XXXX, the date. the achieved to SMR with that Regulatory as to has module one same the approved needs application now for submitted wider Commission, has the industry a the in of of unparalleled our the Nuclear we in

as XXXX. discuss step the I'll of next is accept for a our for moment part plan to The in for review, which NRC application the

goals In addition power deployment. our already quarter, other in steps made closing we out NuScale the for module X to for in XXXX the

Slide on our power we plants. to plants. Framatome, continued These agreement fuel of see are energy in leader handling an an SMR equipment for international you'll with and important As racks X, fuel design announced our storage design the development components nuclear for VOYGR X

benefits of the design. many also agreement one of to NuScale speaks This the

Our with to fuel a light not technology who ahead of path took challenging available the suppliers chain more fuel longer actions energy transition. We global using quarter technology supply and in our that and infrastructure. the believe our existing reactor also competitors of and uses readily water ongoing are many them. in power in efforts will line NuScale have

a This and project to ammonia study pilot Ukraine using became of of goals ranges, Galushchenko. support security first-of-a-kind Envoy plant to oxide other and Presidential and production Special solid the from German a assess hydrogen food Ukraine. pilot, project electrolysis. Among SMRs SMRs the alongside Minister, the energy out John multinational to in proud we for the seeks will consortium Ukraine fuel Climate, join are part for Kerry, carry clean Energy We

develop VOYGR with and and research Global Services and production. use a We assess plant to hydrogen collaboration others also Shell clean joined supporting power a NuScale the of SMR

end transportation to X the that capability and potential of SMR boundary, or further, to These industrial off-grid an user close features I'll cases and therefore, an planning zone the industrial speak is our Our in eliminated many ability our use which site to initiatives of improves discuss technology. EPZ, emergency hydrogen, technology proximity facility costs.

our our carbon-free the we electric have to for leveraged Finally, indirect problem-solving company fundamental compact of also posted our Dhabi. compact consistent natural and climate direct is the technology a report NuScale. of a advance and Scope emissions Abu COPXX, is emissions. Indeed, is calculate our future. XXXX Global urge the related We to sustainability X carbon X, commitment footprint, nominal we consider change energy at Scope XX/X in to gas all become signatory sustainability being emission and to brighter you Nations COPXX on S&P impact joining service in describes of of United once of a purchase looking emissions website which NuScale with The cleaner,

financials, Now ensuring X. last before out milestones, I Chris our to these XXXX on I Similar to laser business and lay both year's readiness initiatives commitments. through growing want year, walk to focus to customer hand new the deliver our speak on to reflect on X are objectives our Slide for about call over and which this our

RoPower are and focused on securing ongoing our X building or sign-in CFPP. a we work customer diversifying with project with First, next a carbon-free power base momentum further an committed on and customers, our

part for a cost participants their fact, have recent recently In project made support the Class in we reaffirmed the year, estimate. strides project's project in continued already this with a as III

cost detailed completed planned in a we supporter Department NuScale begin to project CFPP. for II work path has the been necessary a on in advance important, we or this year. an of XXXX, to develop of Class deployment the The the Energy, later estimate toward As be consistent DOE,

as the DOE for funding proposed schedules, year CFPP sufficient critical forward, Going be in discuss. award XXXX also Chris will will to maintain fiscal

our SMR a expanding as domestic issues. both of security the X. technology NuScale's private at fits independence. international for our support ahead, enhanced sectors. partners change energy There opportunities public and robust, includes business across Nuclear demand and solutions growing and driving which well are Looking globe address a these that customer on as and dynamics intersection climate development diverse is innovative the and pipeline, Slide is the across These X

and Inflation some credits believe early for IRA utilities, increase accelerate companies local XXXX, they governments advantage the of the likely lines U.S. benefits better time projects earnest IRA NuScale take expect the Act which need ensure expiration We as tax benefits of in fully Reduction maximize by provides XXXX understand as trends benefits in to demand as need SMRs these to to can act or the they IRA. in forward XXXX will their available. throughout the potential the We industrial the moving the begin under to

methodology, new site quarter we when planned competitive reduces NRC bolstered planning options power safety boundary not the business approvals our emergency the significantly by drivers fourth only enabling in approval plant zone most. our was credits in also enhances most for underscores needed costs a locations. positioning tax of IRA design received from of but smaller zone significantly unparalleled the siting and where is This ownership NuScale's

For example, technologies at power high our coal while plants not. SMR can be other VOYGR facilities may retired zones population near installed

who As site. quarters. sharing this I first plant to plant by on the We're site in are seeing front RoPower retired benefit forward will mentioned this a confirmed we coming coal their earlier, our at already looking progress

system of protection of in the to approximately For the this that we'll plant delivery to in supply. in NuScale scope timely of is internals, focus for completion of vessel on components The XXXX, to XX in key key the will transition reactive packages areas and design, advancing equipment design progress SMR our both designs these schedule. continue include equipment mechanical milestone design crane design. component procurement is our activities critical the through make product for our maturing on building technology. reactor ensure our integrated year manufacturing second a the Significant

in are indisputably ahead of We respect. critical this peers

submitted In accepted standard by see review to design. we review approval as This can NRC process last the I we SDA the is obtain a for our for NRC by for SDA XXXX, the earlier, goal application which Our mentioned upgraded XX-megawatt the NRC. for year. third [indiscernible] application design expect for approval year, to

view, enhance a validation NuScale design VOYGR represents, readiness We this the because a of the prospects therefore, commercial are and our in commercial NRC of undertaking thorough approval SMR. effort in will,

to reactor pressure Fourth, manufacturing modules. our power we vessels new the for plan start steel

marks produce manufacturing of we few a design. materials select from providers our of have mark are product further differentiating as the our NPM pieces progress key the competition from a the delivery, in to one more this element their ability the of component recently the first NuScale will of lead the Commencing our we And power our to complex with advanced manufactured long placed singing essential materials of NuScale As announced, one [indiscernible] of manufacturing in fabricating the material execution transition Doosan of important significant is key in space. This SMR modules. the partner to in order first modules. manufacturing and

goal orders order made XXXX X fifth our to of is aiming finally, have material was them towards operation by their XX to NuScale progress secure for NuScale We're additional have XX in power And modules. carbon-free XXXX modules project. the power long-lead for already power and

well these objectives. will meet Our to as work our our to as customer advance ensuring be critical design can ecosystem, we expand

these a of making our committed XXXX X customers. and towards Taking continued progress our them meeting demonstrate advancement step back, goals against have needs the commercialization to and will we for the

ahead in excited are we XXXX. year the the of continue made to in NuScale and the front We that confident tremendous build us. opportunity off will I'm about progress

our Now as I share the quarter the to provide Chris to some over it and well for update as guidance will XXXX. for year hand financial

Chris Colbert

Thank everyone. you, John, hello, and

otherwise. focus release press fourth discussing will on our quarter XX figures following start in our and quarter filings on All available year. are be XXXX results Slide my followed our fourth I'll unless so by XXXX performance touch and results full our financial state drivers. I Our

balance year approximately cash NuScale with of $XXX ended the a million.

efforts. plant production Offsetting would professional due was you licensing well cash increased support CapEx as to most as consistent again, increased fees was Energy Department to pivot CapEx sharing support of expenses comprised model. operating design expenses R&D is we to with the with ongoing headcount of related and standard asset-light associated to hardware mostly and into the commercialization. As expect, completion as higher revenue. software R&D, minimal of and and is our computer cost which

but limited is revenue we the with would phase of development. Our company's growing as expect current

generate revenue As stage mainly consulting at to customers. a providing of we reminder, in this light by services partnerships, our

both into phase. looking last our the full year, strong transition we Stepping $XXX public foundation When back an with additional million. year, raised and company at business the commercialization went NuScale's to

operational exercise objectives sheet advancement During support of position the that year, and flexibility the strategic cash the Together, our $XX raised further by to options million. augmented in business beyond. of our was these and strengthen the with actions and NuScale's XXXX warrants provided financial considerable a balance and

Please we for cash Slide with looking in is of than cost where today, use and company XXXX. commercialization, insight anticipated NuScale early asset-light the an that drivers stages expenses. previously in On the through in mainly provide growth model mind XX, like ahead, keep on higher investment

building We R&D, as reflected marketing corporate balance not business is our on by are in our it and sheet. infrastructure, investing an though even asset

So investment. what about is we talking are

Next, I briefly describe our the driving will expectations factors XXXX. for key

share participation The our DOE available anticipated. year our program. shortfall year continued up the from cost fiscal the NuScale make an support lower have the requested in the with are and year in apportions agreement, First, XXXX CFPP. Consistent for DOE to fiscal fiscal award we amount XXXX appropriation in than XXXX

that with plan funding have rely cost-share As a funding on funding mentioned, DOE agreement John provided requested. through cooperative the with we our

out customer and shifting we suppliers scope and with to payment our spending more equipment projected the advance CFPP. the from out receive shipping we for of with to terms now CFPP. refining up schedules, anticipate payments payment first and Because and is to customer our passed us delivery favorable we out a the our second and in a costs to The which gets order, fulfill payments customers Essentially, revenue, without impacting current suppliers first schedule. margin on to procure associated equipment, terms shift ended factor through cost

and We out believe update including model, continue This plant the is economic shifts CFPP to valid. spending that profile. typical revenue the simply margins

XXXX on to increase an execution in added planned factor work third work and the to from XXXX, more up R&D The deferred to risk. increase of an in the increased cost mitigate spending catch future is

$XXX this anticipated XXXX, For negative equates range million. from cash to to operations $XXX an flow million of

to around I on U.S. inflation financial touch world. conclude, higher and want the I impact in Before the also of the

on is our the pressure expenses. For most NuScale, upward immediate effect operating

projections are pressure accordingly. our and unwelcome, managing this While we have adjusted

the the plants. is of cost inflation impact challenge other of the on The power SMR estimated VOYGR

them a in are estimate financial cost to regard incorporating top to changes, from discussions prospects. customers staying with to [indiscernible] earlier existing referenced of As perspective, communicating these on and we

impact NuScale important and is around all unique stewardship bear will our Higher nor But capital happening it's the be vacuum near- that this Overall, longer-term dynamic our in projected navigate NuScale the the Operator? create industry. disrupted world milestones positioned to materially and it in is we Energy providers decision-making in or to have mind well and same that U.S. levelized see some not equation and phenomenon electricity for to nuclear our demand continue time. not to may this that experiencing possible a inflationary will to customers. the we are forces, and meet customers over value considerable is and the by continue environment, diligent financial position, modules. a pressure. for of value our we the because of be raised confident

Operator

[Operator question Cowen. We'll Marc Instructions]. TD our take Bianchi, today first from

Marc Bianchi

just are moving you pieces. be how to confidence and cash to here And first gives And were you what update understand 'XX? trying of to -- kind of expecting? a Like DOE you much to you're in the able what that going recover what about want that I getting? ask the

Chris Colbert

you, Marc. Thank CFO. Chris is Colbert, This

or what not would So million a we for we getting what brackets to range them. operations range flow for bracket million that we we DOE, request range $XXX that we're presented the the getting from from cash request $XXX expect to of them. what seeing That's from the

every there we request And drill terms of work And where receive a explaining then we we In folks is then year our the we enacted end a an level the we put the in go the through budget. use year, the or of what confidence, with in. for request in would for of future. past, money at the the use budget it what same

years, the request what the was For The And been $XX evolution very was example, very $XXX of typical year, last final budget for between through million. President's enacted enacted. request sort several last isn't gets much for budget that's correlation million. there a and where budget

on sense very continue update confidence President's just work forward, now, we're things through of working starting right to we we'll be the monitor are folks. is a which is process, first in step have it. So we'll if request. what But the how the And budget to this and with moving

Marc Bianchi

flow Okay. shifting just I'm Great. around, 'XX, there's those, be light in cash prior cash of in flow believe. stuff still And 'XX? payment to here, anticipating the in free wondering, that free Is because progress on expectation right? positive outlook The was I some you still other are inflation. the going

Chris Colbert

to in but in get But to this nothing terms customers out customers forecasted play year, met. we we'll at our to in hand move and us we believe we're of year will forward on time, update customers it this process we with there's point hand the have continue are both on process their developing. moving XXXX the want plants. objective in first out our how if really that be are haven't and for not We markets could And that, to as us understanding we both as that's the their in to have through better forward something work engaging a that through of the

Marc Bianchi

One was cost up competitive into came that believe, with latest the a kind requirement, been okay. I that of estimate thing that there. UAMPS Yes, there discussed XX% test and agreement put hasn't subscription was

levels subscription up to maybe agreement the And confidence see able level subscribed in on be have for or project of XX% XXXX go reimbursing is about read update level? February to talk you could to you UAMPS you to needs Can of there? the my today the cost. basically So say, what XX% the that to the from, by for responsible being that

Chris Colbert

report on through so for terminate be chose it to stated go reading they think that the following liable XX%. failure you is potentially But We'd what reimbursement actively that. I would point. XX% and got well, reach very correct, that So you good to from Marc, if for to

In our the that point, project in move monitoring carbon-free of them. at in terms the UAMPS additional are of throughout confidence forward with subscription. we'll we power gain year to bring we with working that as be that And

much factors region, with that Act that's hour retire that a XX think in we now voting upon going tightening with market them The year as continue earlier expected, this forward, members you on. And continue saw coal see at per to forward as as will forward is area. pace those move in a benefit Reduction or very megawatt we $XX we're making investments of the to the to news Western from coming depending than with changing Inflation that's the that project indicative and the as XX opposed plants particularly to faster get looking people at later price,

Marc Bianchi

level? their it Is subscription or members the comes would producer from there other existing a take the it's that more increasing are what likely? to of likely -- that parties Or piece are I candidates know the don't looking there? that likely are the more power if project increased be a

Chris Colbert

But proxy need. above. from at XXX give on a electricity to megawatts point, which to the of you signed could what members of they be All the the a project, had U.S. data point, one of

interested need centers it, point. seeing and interest utilities So reliability they We're at forward. the could and particularly increasingly, that data folks from they energy in and moving that also investor-owned needs large have do like are also some

opportunities aperture that it. becoming we opening, interested narrowing more and all are not see that So those in people

Operator

for back everyone, the closing NuScale additional John further CEO, call any or Hopkins, remarks. there I'll to At no this questions. hand time, are

John Hopkins

SMR to Commission. at by year. are We're the forefront reliable and energy and the and the what partners deliver essential each the past of our our appreciate forward Regulatory is energy we positioned of one power. could work effort carbon-free global Operator? you look investors in on Nuclear accomplish together are technology we our in of to transition. nuclear XXXX. well like And delivering at for goals powering who deliver enabling design U.S. interest for I'd with every thank NuScale will I be And the our of I NuScale all call prouder commercialize for we us to that today. NuScale support team scalable safe, you, world not important is ahead. our around opportunities scale. in deliver to over to clean operator. certified participating Thank only to the the on of your and and the

Operator

you all And once everyone, today's today. conference. We for conclude that would your participation again, thank does like to

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NuScale Power (SMR) 15 Mar 232022 Q4 Earnings call transcript