Nuvve Holding Corp. (NASDAQ:NVVE) Q3 2023 Earnings Call Transcript

Nuvve Holding Corp. (NASDAQ:NVVE) Q3 2023 Earnings Call Transcript November 9, 2023

Operator: Good afternoon and welcome to Nuvve Holding Corp.’s Third Quarter 2023 Earnings Call. [Operator Instructions] As a reminder, this conference today is being recorded. It is now my pleasure to introduce Eduardo Royes. Thank you. You may begin.

Eduardo Royes: Thank you. On today’s call are Gregory Poilasne, Chief Executive Officer; and David Robson, Chief Financial Officer of Nuvve. Earlier today, Nuvve issued a press release announcing its third quarter 2023 results. Following prepared remarks, we will open the call up for questions. Before we begin, I would like to remind you that this call may contain forward-looking statements. While these forward-looking statements reflect Nuvve’s best current judgment, they are subject to risks and uncertainties that could cause actual results to differ materially from those implied by these forward-looking projections. These risk factors are discussed in Nuvve’s filings with the SEC and in the earnings release issued today, which are available on our website.

Nuvve undertakes no obligation to revise or update any forward-looking statements to reflect future events or circumstances. With that, I would like to turn the call over to Gregory Poilasne, Chief Executive Officer of Nuvve. Gregory?

Gregory Poilasne: Thanks, Eduardo and good evening to all. Thank you for joining our third quarter 2023 results call. We came into 2023 with optimism that we were going to experience a well overdue inflection in growth in our business. In the first half of the year, we began laying the foundation of this to play out with record orders and much higher sales than in 2022. Momentum continued to build in the third quarter and so far in Q4. As discussed on our August call, we continue to evolve our AI capabilities by integrating Astrea AI into Nuvve’s FleetBox charge management app in July. The enhanced functionality helps us maintain our differentiated edge and comes at a critical time as we accelerate deployments of our software kits hardware.

With a 97% accuracy rate, Astrea AI is set to maximize revenue generation and bolster our V2G technology globally, revolutionizing EV usage and preparation. In October, we deployed a record number of 38 AC and DC bidirectional charging stations connected to our GIVe platform. While growing our megawatt on the management does not immediately correlate to revenue dollars, it is critical to our growth strategy as one, it increases our pipeline of potential future grid service revenue and two, with more and more people benefiting from the value of our V2G software, market awareness expands, which in turn accelerates demand for our products and services. These deployments were carried out by Nuvve K-12 which was only launched in June of this year, in order to provide a full range of services in order to support fleet electrification from North American student transportation.

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Q&A Session

We expect for record deployments in Q4 as the supply chain challenges that have plugged the last 2 years continue to abate. Last month, we are proud to hit a big milestone by launching in Texas. With EPF funding, Nuvve K-12 was able to assist the Martinsville Independent School District or ISD in converting their 5 diesel bus fleets with 5 Blue Bird electric buses, 5 Nuvve Level 2 chargers and our innovative AI powered Nuvve FleetBox 2.0 charge management software. With these deployments, we understand that Martinsville ISD as the first all-electric school bus fleet in the U.S. Finally, in California, we were honored to have received the highest score among applicants of a proposed award of $1.9 million from the California Energy Commission for our revolutionary RESCHOOL V2G project.

This recognition underscores our commitment to leveraging bidirectional EV school buses to enhance California’s power grid resiliency, marking not just a milestone for Nuvve, but at least for the state’s energy ecosystem. In Q3, we continue to see steady growth in grid service revenues, which came in at 3.4x the level recorded during corresponding period last year. We are also pleased to sell the 5 buses we have been carrying on our balance sheet for some time, which helped sustain the revenue growth trend for the first half of the year, while margin delivery were freed up working capital through these bus sales. Altogether, this puts us on pace to grow total company revenue by more than 50% year-over-year in 2023 with one quarter left to go.

As stated before however, growth can be lumpy, especially when there are substantial government dollars for electric school bus fleet customers to go chase, which can and does impact the timing of orders and sales. Further, we have no doubt operating against the capital market backdrop that has seen a continued deterioration in sentiment towards clean tech. It’s something that seems to have only worsened in recent weeks due to the results and commentary from clean tech companies and above the EV landscape. With our cash runway, we felt this backdrop gave us no choice but to continue raising capital, piecemeal fashion at depressed equity prices as we did last month. Moving forward, we will continue to evaluate all options to methodically and incrementally finance our business while we await for an improvement in market conditions.

This may include additional liquidity financing and/or debt financing. For example, we may continue to work towards putting in place an asset-backed lending facility, which David will expand upon. We have also been working on reducing our cost structure yet again to optimize our cash runway. Specifically, we are working towards lowering our cash expense rate to at or below $5 million per quarter as we get into 2024. This is the result of reducing our cost across administrative and legal functions we are still investing into our platform in a manner that is commensurate with our focused priority. In October, we issued a press release discussing our pattern. The messaging behind putting out this release should be clear. We have been at this for a long time investing significant resources into growing our V2G patent portfolio and developing a comprehensive V2G solution.

With IT and expertise around areas such as power flow control, charge management and power capacity and as we push our technology further ahead with Astrea AI, we have a market leading offering and we remain the pure-play public company today with a proven track record in deploying commercially available and scalable vehicle to grid technology worldwide. Our belief in and commitment to our role in the AI transition is unwavering. And we expect both the macro and capital market backdrop to get back on track after the current rough patch. We expect Nuvve to be there throughout as V2G forms a critical piece of the energy transition. And as we march towards a critical inflection point in EV adoption in the second half of this decade. The 2022 Edition of the EPA Clean School Bus program was a big tailwind for our increased orders and sales in the first half of 2023.