AnteoTech Limited (ADO) Earnings Call Transcript

Hello and welcome to the AnteoTech Investor Webinar, and thank you to everyone who have joined us today. We're joined by Managing Director and CEO, Merrill Gray, who will take us through AnteoTech's FY 2026 results and provide an update on the business. Today, Merrill will provide an overview of the company's financial performance for the year, progress across its Life Sciences and Advanced Battery Technology businesses, and the continued focus on commercialization and growing the company's commercial pipeline. I'll now hand you over to Merrill.

Thank you, [ Kristen ]. Well, first of all, I wanted to say how great it is that I've got this opportunity to speak to you all about the milestones for FY 2026. Of course, for those who've been on this journey, you understand that I've been in this role for more than a year now. And the very first thing that we did, I with the Board, was the FY 2025 strategy. So setting a strategy, which was far more jurisdiction-oriented and portfolio-based. 2026 has really been about building. And I will be showing you those slides around what we've been able to achieve to-date. In 2027, we're excited about, which is execution and really showing what we've been able to achieve today. Now I do get quite often, we've heard it all before. And the thing is not for me, and I do appreciate the trust that has been put on me by shareholders and by the team to lead them in what is a really significant shift for the business. So we have systems in place now that we haven't had before. We have skills and a team that we didn't have this time last year, which has been critical to the progress that we've made. And we're in a better shape than we were. There's no doubt about that. I hope that the results that I'll show you will show you that. And we're excited about the prospects that are coming towards us, and I will be able to talk a little bit about that, too. We are in highly competitive global markets. We've done a great job of getting our name out there more, and I'll talk about that a bit more, too. But we are competing and there are some, essentially, mega dynamics around environmental factors that we are facing some headwinds and have to be very cautious about the way that we move forward. I guess that's frustrating for people, but we are doing everything as diligently and appropriate for shareholders as possible. So let's get -- dive right in, and I look forward to coming back to Kristen to answer some of the questions that we've received as well. Okay. So we've released our annual report. Very delighted to receive through the Investor Relations e-mail any questions around that. What's really important is making sure that we're clear about what is our core competency. Obviously, we're an advanced chemicals and materials company. And being able to put that foot first or put that core concept in front of institutional investors and brokers, which we're doing a much greater job putting a lot more effort into this year than we did last year to get the word out about AnteoTech and attract investors, is really critical. And we do have a chemical platform that is unique, that the time is right in both of the markets that we're in. And 1 of the questions came through about other platform -- other verticals rather, and of course, commercialization of the products we currently have is what we're focused on. That's what we're resourced up to do in terms of the sales that we achieve, that will then allow us to get into any other highly valuable markets. But it is a focus for us to commercialize the products we have. And that's in our 2 global markets, in Life Sciences and Batteries. This is just a snapshot that you -- most of you will have seen before about us as a company in terms of the shares on issue and where we stand commercially and about the Board. This 1 is really comprehensively, hopefully more graphically than we've done before, allows people to see a snapshot of what it is that we do in our Life Sciences business. So it's all about AnteoBind, the chemical that we sell in that business, and how it is applied into different diagnostic, immunoassay diagnostic platforms. So around Lateral Flow. Most people are aware of what we've done in Lateral Flow and our substantial expertise. Chemiluminescence or CLIA, as we've talked about in many announcements, is where we're branching out through large Life Sciences partner that we are partnership that we're pursuing as well as what we can do ourselves. ELISA and activation of ELISA plates has also -- I've also talked about that in various announcements. That's, again, our AnteoBind activating ELISA plates and making them far -- the performance of those plates far higher and in biosensors, which is part of us being part of MOBIUS and really where we see some significant future growth in terms of new markets. When it comes to our Battery business, just by way of background, again, for those of you who have been on this journey, you understand Ultranode X, 70, and 95. And what I would say to you is that Ultranode 95 is where it's at for us at this time. That is where the interest is, that is where the demand is coming from. And we are going as hard as we can in various markets, I'll come to that in a minute, various end applications around Ultranode 95 getting our ability to scale up, to pilot, to prototype, and scale up, and potentially supply. It is a long lead time. It is a long lead time for us to get Ultranode into batteries. We are in anode and that battery is complex. And in the backup slides, I've put -- where all of our products, including Ultranode, fit within the overall battery design and anode, and all of the other parts that make up the battery are very complex and work together synergistically and our job is to get in those batteries with a number of battery manufacturers in end applications. Then, of course, we have made great progress on our core or core chemical, which started with Anteo X but across different applications within the battery. So Anteo C through to SiMRAX, which I'll talk a little bit more about in coming slides. So we really are running the battery business as Ultranode and then performance additives as shown on the slide. Right. So just to recap again on the strategy, which really at the highest level is about let's get very specific with the customers that we're talking to and how they use batteries and let's make sure we meet their requirements. And you can see across the U.S., which has been a big focus for us for Batteries as well as Life Sciences. Europe, and particularly in the Life Sciences space, and South Korea, again, for both, but particularly in Batteries as well. India is a slower market for us to bring on as well as Japan, but we are obviously constantly pushing for further opportunities when we are talking to the right people who are battery manufacturers or in the supply chain into batteries where our products can be used. So a little bit about this map, which has been updated about -- and some of the questions that I've received. What I wanted to talk about is a couple of things. So first of all, about on WYON. So WYON is something that was initiated before I got here. The relationship is good. And what they will -- what we will get, and the team is working on it, they have a meeting with WYON today, European time. And they do have regular meetings and they do get regular updates. The feedback on the -- and yes, there is trialing in WYON's commercial cell format of Ultranode 70. It's the plastic casings, not metal, so they do have both, but that's what was decided. That trialing is still underway. I know that, and it's still being finished. And there's been a number of delays there because the reality is that this is not for a specific customer. So if I haven't said that before, this trialing was to put it in the portfolio for WYON, so that if a customer came and said they wanted high silicon anodes, it would be available. So what we will get out of this work, and we do plan to have those results out, obviously, as soon as possible, is we will have commercial cell format validation for Ultranode 70 and WYON cells. That would be the outcome. And we are all looking for customers that would want our Ultranode technology in the consumer product space. So as opposed to military drones, which I'll come to shortly, we are -- actually have an initiative around very -- far more actively working ourselves, AnteoTech, on finding parties that are looking for Ultranode as we can supply it in terms of the duties in consumer batteries. So I think it's quite important to understand that we will have some news out very shortly. I'm hoping for the quarterly report. And as soon as it's available, will be -- is the answer, and that's what we will have. In terms of what that means commercially, obviously, we are working on that. The other 1 I would like to talk about is around the JDA. So let's move over again. This is still Batteries and it's around first of all, the JDAs. We are going to the battery -- we're going to the North American Battery Show in about 10 days' time, nearly 10 or 11 days, we, the team, gets on plane and goes. And we will meet with the 2 parties that have Ultranode 95 and are doing in-house trials. We are in their system, and we are waiting for -- in the queue, for our materials to be trialed so that we can get into the detailed negotiations of the JDAs, which they have. So we are patiently, waiting constantly following up, and in front of the parties that we are seeking to do JDAs within 10, 11, 12 days. So that doesn't mean that we will be able to deliver JDAs, signed JDAs, out of that. But I can assure all shareholders that we are working very hard on working in with those parties so that we get into their batteries. That is a critical -- a KPI for the team and for myself. In terms of Black Diamond Structures and SiMRAX, that's also a matter that gets raised to me many times. SiMRAX is managed out of Black Diamond Structures in the U.S. What I would say is it is with multiple parties and trialing of it is underway. What that then means in terms of commercial -- subsequent commercial steps is, again, something we will be with BDS, talking about at the North American Battery Show we have. And we will be specifically talking to them about what might be happening or what potential for commercial sales out of the trialing there is with whom we're talking to. I can say to you that it has taken some time to get moving, and I understand the frustration with that. But we are in front, we are -- we do have samples with well-qualified, well-known parties. So it is moving forward. Beyond that within this map, you can see that there have been a number of business development and facilitation partners, if you like, added during the year because we understand that having on-the-ground presence, we manage those very tightly around KPIs and the cost and specific targets that we want people to talk to for us and get us into meetings with. So we do a lot of work in the background around sales qualified leads and making sure that who we're talking to is the right party to be engaging, who does have demand for our product, and is interested and I'll come a bit more to that about how we've grown the pipeline. We -- now this gets -- takes me into the actual financials for 2026 and just essentially presenting them in a 3-year trend fashion. So the -- this is sales revenue. And as you can see, our sales were down on last year. A couple of things, factors in there, which is around receipt of a purchase order and actual supply to Serum Institute, which we missed at the end of the financial year, it will be booked this year, and then some other timing matters. But this is a critical KPI for us, and we're looking forward to execution, sales execution in FY 2026. We made an announcement yesterday about our R&D tax rebate coming in for -- in -- which is in financial year 2027 of $1.9 million. Here, you can see total revenue for the business, which includes what was booked for FY 2026 which is $2.6 million. This is our operating expenses and how they've reduced over time. Obviously, our focus is on cost effectiveness. Cost reduction, continuous improvement, and cost effectiveness. So for all the things that we're working on and a span of -- which has expanded across the team and the number of contacts and sales leads that are being followed up and evaluations that are underway, it needs to be done systematically and efficiently, and that is what we are focused on. And then by way of wrap up around sales and expenses, here are our losses in a trend, again, over the last 3 years. Right. So this is a really critical slide for me to share with everybody, which pretty much chronologically takes you through what we've done in the last -- in FY 2026. So really spent a lot of time on our product and technology value proposition, again, with our strategy to make sure that we're in the right place at the right time with the right messaging to have the greatest success of engaging with our customers. And all of the collateral for both Life Sciences as well as Batteries has been updated. First of all, we have collateral for everything. We are clear on our messaging, and we are using that in marketing campaigns in a way that we've never used it before. We have a structured marketing program. We've also done validation. Now it's fine to have in-house validation, but what we've really done here is looked at independent third-party validation. For Life Sciences, we've done White Papers and they have been in demand for -- because it's very much -- the gatekeepers there are technical parties within the organization, very much B2B, at very technical level. And we are engaging on third-party independent validation, which we look forward to being able to release information around in the coming months. That's exciting. And then for Batteries, as everybody who's been on the journey understands, as we've been working with BIC. And we've had validation around how Ultranode 95 could behave in a high-powered battery. Now you'll see a picture on the side here of Airspeeder, and that's a recent announcement we made about just leading a consortium around piloting and prototyping entire batteries. So what I'm looking to do with the team is to bring other parties into this because the critical piece for us is for Ultranode to get into batteries. And for what high silicon, our high silicon formulation, can do, with matching high-powered cathodes is what this is all about. And of course, there's more to it, which is electrolytes, separators, us being able to use Anteo S in those thin, high-performance separators that we're doing with Xerabrid, and the battery management systems and the whole kit and caboodle. So it's pretty exciting. And again, when we go to the U.S. we will be talking to a number of parties around this. We already -- I've already talked about the JDAs. They are the types of partners we want to bring into this. So it was it's all about making sure that people -- we have good quality information that people can access. It's accessible for them to understand about what we can do with our products. We've also understood the market more on our journey, and we understand -- we've been able to expand our products. Now this is not about research and new products. It's about our product and applications in the market. So that's all market-led. So that comes down to SiMRAX, which, as everyone knows, is a blend of dispersion, carbon nanotube, dispersion and Anteo X, which is a cost reduction -- has potential cost reduction opportunities for our customers. Anteo S, which again, is all about cross-linking and ceramic coated separators. And then Anteo C, which is an additive, which provides adherence in primary coatings on Collector foils. So we are closer to the customer. We can express what our products can do and value those for our customers than we've ever been able to do before, and there is demand and converting that is our focus. From a Life Sciences perspective, that business has also really understood around how AnteoBind and AnteoBind NXT can be used in different platforms, whether it be chemiluminescence in terms of magnetic particles, and activating those, and making them perform better. It's the same with ELISA plates but there is very strong demand in multiplex in Lateral Flow, which came out of ADLM, which is our bread and butter. And it is about, really, engaging with customers. What I can say is we've had a program there, which is around large life sciences companies, and many of them have had some experience with AnteoTech in the past and are reengaging. And we -- it's a very -- that is very exciting for the team, and we're looking forward to what comes from that. What that's done overall is it's created a portfolio and with -- which -- and an expanding total addressable market. And that is all about our options and our potential to convert, creating more options with the potential to convert. As I've already said, we've also -- it's about being on the ground and with our customer interactions because we do have a team that's now been brought entirely into Brisbane working globally, which is why we have links into people in different jurisdictions, whether it's through our facilities, our business development facilitators, distributors. And then creating partnerships is really critical to us. We are small. We want to be capital-light, infrastructure-light. What we want to do is work with partners who already have sales. They are already established, where we can buddy up and everyone benefits. We've made a very conscious choice around that. And we are -- and that's where BDS, Xerabrid, and what we see coming into the future, is all about, to give us the best chance of being in as many products as possible. Conferences are critical from a face-to-face and customer engagement. It's very technical selling. It's B2B and technical -- technician to technician, whether it be Life Sciences or Batteries. And of course, we've got a lot -- we've done a lot more on our digital marketing campaigns and how we prepare for everything, and you will see the evidence of that through our LinkedIn post. And then the CRM and the sales team, we have brought new skills into the business who have specific sales and marketing expertise. And as a result, we have record samples under evaluation. And as Kristen said at the beginning, sales execution, FY 2027, it's on all of our KPIs and is moving as fast as we possibly can. And here is the -- here, this is actually on the 7th of September, and it's we've had further samples dispatch since then. But what you can see is that we have very solid sales qualified leads and samples out under evaluation, and we're constantly adding to that, particularly through face-to-face conferences, but we have grown at what I would consider a curated, well-qualified. We have people on the ground who are very experienced and very knowledgeable, and they are assisting us to -- who comes into our pipeline and start to engage with us around samples to make sure that they have demand, are genuine buyers, potential buyers of our product, which is a big difference to where we've been. So again, this is the most -- again, 1 of the most important slides here, which is around sales conversion for 2027. So we have very specific initiatives underway in India for Life Sciences, India, the U.S., Europe, Japan, and South Korea, in particular, it is a big push for us into the U.S. I was heartened by the trip to ADLM, where there were a number of Australian companies who have been successful. They've been careful about how they've entered that market, but they've grown and about how we were received by people who had -- who knew -- who know about our technology, know that it's great technology, may have tried it in the past and are willing to reengage try it again. I was very impressed with the team in the way that they engage with customers, and we are working critically through how to convert those conversations. And we are going to MEDICA in 6 weeks' time, and we will be talking to ADLM -- parties we met at ADLM. Again, to make sure that they are confident, that we are an ongoing, capable business of delivering into their demands. When it comes to new product expansion in terms of immunoassay diagnostic platforms, of course, CLIA has been a massive focus in FY 2026, working with the large life sciences company, working out -- we understand magnetic particles, very deep understanding in the business, and some very exciting things there as well. But how to bring this into commercial reality and go as fast as possible is what we constantly look at. And we look forward to keeping everybody updated. The ELISA plate activation and market entry. We've started talking about that, and that was in the last update that I did, is there's demand there. And we're pretty excited about that, too. So watch this space on all of the things that we expect to be able to deliver in the coming 12 months or coming financial year. In terms of batteries, I've already talked about the fact that we made a concerted effort, and we continue to expand that around U.S. military drones, getting into Ultranode 95 into high-powered batteries. We've validated that we can do that. We're talking to the right people who sell batteries into that. We're constantly expanding that. We have a CLIA sales and marketing lead in the battery team who's -- and we are following everything up. It's a focus for us, a really top focus for us. Converting Anteo S and Anteo C our performance additive products, essentially, into sales is also a key focus for us. There are a number of opportunities. We need to manage how we deliver those, around how we supply in volume, if that's what they're looking for, and how we manage the risks in different jurisdictions. These are all -- and moving chemicals around the place. All of those things are constructed in the way that we are looking to commercialize and execute sales. Again, I've talked about Ultranode 70 and WYON in the consumer battery market and trying to build out opportunities there in the Airspeeder and what that brings. So yes, for -- corporately, of course, we're looking to maintain financial discipline. And everything we do is around AnteoTech's success, and that around sales and strategic partnerships, which they are emerging as part of what we're talking to. They are part -- baked into our sales and how we want to work things by our products, getting bundled up with other people's products. What I hope we will get into is momentum, which will attract other strategic partners on a slightly different basis, and then the R&D tax rebate. Just very quickly, tomorrow -- this is the first sneak peak, but tomorrow, we will put out our information about a webinar, which is with a world-expert and how AnteoBind NXT has been used in India with NIPER. And all of that information will be available through our website and through our LinkedIn post. We've already started posting about us going to the North American Battery Show and MEDICA is still to come. We have a very active period coming up until Christmas, and I really look forward to keeping everybody informed. So I thank you very much again for attending and look forward to getting good news to all of our shareholders when it's available.

Thanks, Merrill. I hope that overview has addressed some of the questions investors had coming into today's webinar. We've now got some time to move through a few additional questions that have come through. The first question is around BIC, specifically in the cylindrical cell trials. Can you provide an update on the cylindrical cell trials at BIC, including the progress made to-date and current focus of the program?

Yes. Well, we're very pleased that we have trialed. It's not a lot, a few we're doing it in a very staged fashion, cylindricals at BIC. Now the way we see that is -- so there's been initial builds and functional testing has taken place on 18650 cylindrical at BIC. And essentially, that is -- every time we do that, we get greater information, particularly around electrolyte volume and how to maximize energy density and stability. So we're taking a very staged approach so that -- and we're very positive about where we might be able to get to in the near future. But we're basically taking the insights as we step through this with the BIC team. And the plan is for us to, essentially, optimize a format that we could, potentially, that we get -- that we can get basic performance data on, and that we could potentially look to do what we would call a prototyping run of 50 to 100 and be able to give them as samples to parties. Now that is a way down the track because we're still at the very early stage of making sure it functions and then we need to optimize for performance. And then we would be -- we've also already started work on a scale or a prototyping plan and who we could work with, who are able to do that. We're very conscious of -- obviously, the plan is to partner with a battery manufacturers. That's the ideal because they have all that expertise. For us to do it, working with BIC who has expertise, we are going down that path as well, right? I would really like to just say to shareholders that the likes of Amprius and Molicel, who are extremely well known in terms of cylindricals, they've spent tens of millions of dollars on optimizing their products. And those products are available, of course, anyone can buy their products. The -- I just want to be real clear about we're spending a certain amount of money in a judicious way to move through getting cylindricals that we would be able to announce their performance around. So it's a very positive thing. Of course, multi-layer power cells for drones is a format that is used. And of course, Airspeeder fits into all of those, and some other parties we've talked to who would be interested. They have said they would be interested in trialing cylindrical in their products when we have got a certain performance level. So overall, progressing well under the budget and the strict structure that we are using there. Thank you, Kristen.

Thanks, Merrill. The next question is around multiple ADO technologies in a battery. The question is, are there any opportunities to see multiple AnteoTech technologies together within a battery and this is part of the company's commercialization strategy?