Welcome to the Desert Control 2025 year-end and 2026 outlook webcast. Today's presentation will review our 2025 year-end report and financial results for the fiscal year ended on December 31st, 2025. We will also provide an outlook for 2026. Following the presentation, we will open a Q&A session, and you're encouraged to submit your questions anytime using the Q&A function. To begin, Lars Eismark, Chair of the Board, will deliver opening remarks, followed by our CEO, James Thomas, who will present the 2025 year update and 2026 outlook.
Thank you very much, Ari, and good day and good morning to everybody joining. Dear shareholders, I want to start my chairman's note by thanking all of our shareholders who've been following Desert Control with loyalty and interest through an intense and busy 2024. An impressive number of shareholders have stayed with us for years, and your support is priceless. Thank you. An increasing number of shareholders have also become very active in initiating dialogues with me and James Thomas. The absolutely vast majority of reachouts are very positive, and I want to thank you for good and well-intended ideas, creative suggestions, and good questions. I and my colleagues, we strive to answer your reachouts with due care. These reachouts come on top of an already very busy organization with limited hands. Please bear with us if it sometimes takes a few more days for response.
You are not forgotten, and we will get back to you. We strive to react to all reachouts, but there are some we cannot and will not respond to. While they may have a well-intended interest and curiosity, they are sometimes crossing a borderline of what we can comment on, and some are way over the borderline where even less response isn't appropriate. Looking back on the fourth quarter of 2024, I in particular have four themes in mind. One, building organizational strength. Two, building delivery capacity. Three, customer focus. And four, future-proofing our financial strength. As most of you likely recall from previous webcasts, we initiated a massive strengthening of our U.S.-based organization. We migrated our research and development organization in Norway to the U.S. and enlarged the team with highly qualified employees across the R&D space. Also, we enlarged the operations team with capable and experienced managers.
This momentum has continued into 2026, and we have recently onboarded salespeople for the golf and turf segment. We've also been very successful in getting a new CFO on board, David Borah, who I will introduce later, who comes with substantial experience from capital markets, a testament to the ambitions we have as board and management to strengthen our financial muscles. While new employees have joined Desert Control, we do still have ongoing searches with key positions in the U.S., and we look forward to updating you as we progress in these matters. The second theme, building delivery capacity, goes hand in hand with our ambitions to grow. We cannot sell what we cannot deliver, and vice versa. Therefore, substantial energy was thrown into finding a contract manufacturer of our new production units.
The efforts had to be changed along the way as our initial plan of manufacturing components and systems outside of the U.S. took a surprising hit with the tariff discussions. Hence, we are happy that we are beyond that point and now have a U.S.-based partner building our production units, however, at a higher cost. But we need delivery capacity to realize our ambitions, and we are convinced that this decision is the right one. Number three, getting our product in the ground across our focus segments is crucial for us. During Q4, we successfully applied LNC to one of the first mover almond growers addressing water scarcity in the U.S., and I personally witnessed the professionalism in which we collaborated with the owner. While delivering LNC to new pilots across the U.S., we also started getting results in water saving from earlier pilots.
We find the results quite satisfying, and we look forward to reporting the results once we are done with data analysis and scientific tests. Number four, as mentioned on several occasions, the board and management is on an ongoing basis pursuing options of building a balance sheet that will enable us to realize our ambitions. With our new CFO, David Borah, on board, these efforts will now be even more focused and strengthened. There are many areas of opportunity, some more attractive than others, and we have a clear ambition to aim for what's best for the company and for the shareholders. Last but definitely not the least, I'm so proud and excited to nominate our two candidates, Julie Jessen and Jakob Christfort, to the board of directors.
Both are based in the U.S., both are deeply rooted into the agriculture industry, and both are close to the industry and customer's ecosystem in our focus segments. Julie Jessen has a fantastic record of growing a company to a billion-dollar business, and Jajob Christfort comes with fascinating insights and experience from water-saving technologies that are applied across the world. I hope that you, our shareholders, are equally excited about this powerful duo that complements our existing board composition. On this positive end note, I will now hand over the scene to our CEO, James Thomas. But before going there, I would ask Dave to just shortly introduce himself to our shareholders. Please, Dave.
Great. Thank you, Lars. I'm excited to be here. For over 20 years, I was an institutional investor in small growth companies like Desert Control. I left this role because I wanted to have a meaningful position like CFO in a mission-driven entrepreneurial company exactly like Desert Control. My timing here is very good as the need for our solutions has never been greater. But it's only my second week on the job, and I look forward to communicating with all of you on the call at some point in the future. At this point, I'll hand the call back over to James.
Thank you, David.
Yeah. Thank you, David. Thank you, Lars. I am very excited to have David aboard, and he does deserve a grace period of only second week on the job, but he's already adding a lot of value. And I want to reemphasize some of Lars's points here in the early days of the presentation. So I am very excited to have Julie and Jacob join the board. They are exactly the kind of people we set out to look for at the time of our director search, and each brings a very relevant and unique perspective to our business. And in one of those very small worlds things, Julie Jessen actually lives and runs her company from Yuma, Arizona, which is where our original U.S. operating base was.
So I think both great additions, and obviously, I'm very excited to have David and his calm, rational, deep-thinking financial expertise combined with the mission and passion for it. So with that, I will not spend time just reinforcing all of Lars's points but walking through some of those through our slide deck. But I agree we had a very strong operationally back half of 2025, and I'm very excited about this launch into 2026. So with that, Ari, if I can get the next slide, please. So many of you on the call have been on other calls, and as Lars said, we have some very passionate and longstanding shareholders, and we are very grateful for that.
But we also have new shareholders on the call, and so I want to pause at this moment to just kind of come back to some fundamental pieces that are critical to the Desert Control story. So as the management team and as existing shareholders, we can rush through several of the actually really important parts of what makes Desert Control unique. One of the things that makes Desert Control unique is that adding clay to soil is not our idea, is not a new idea, and is not why Desert Control has the opportunities it does. For those of you who are clay geeks, clay has been being added to soil for a millennium. The Mesopotamians did it back at the Tigris and Euphrates, and you can still find the clay in the soil where they deposited it. So I want to be clear.
Putting clay into soil is a well-accepted, well-proven scientific concept over thousands and thousands of years. So that's not what Desert Control is about. Desert Control is about enabling the addition of clay to soil in an economical and efficient manner. And so the issue with adding clay to soil historically is that clay loves to stick together. Think of pottery. Think of anytime you've had clay in your hands and is therefore something that has to be either delivered in large quantities or has to be tilled into the soil, disturbing the root zones and the crop or both. And so the magic, as I say, of Desert Control is enabling the delivery of clay in this efficient and economic manner.
We do that by micronizing, occasionally nanolizing clay, and keeping it that way long enough for it to come through existing irrigation systems, penetrate ground that may be planted with a grass, with a tree, with another crop, and migrating that clay into the soil and improving its soil structure, not just holding water but improving its soil structure. Our technology is about enabling an idea that is well understood and is never a controversial part of our conversation with customers. We do that across our three segments: agriculture, trees and forest, and turf and landscaping. I just wanted to give some of the new shareholders the grounding. It's not about the clay. It's about getting the clay where we need it to be. Ari, can we get the next slide? So this is our standard slide on what it is to be Desert Control.
We are a scientific and technology company applying our products in agriculture. So on the left-hand side of the slide, and you've seen this before, being able to deliver the clay is not sufficient in its own right. We also have to know what clay and in what quantity to deliver it. We do that through soil sampling, through our large database of existing applications, and through working with the farmer or golf course superintendent to understand what they're trying to accomplish for their particular crop type or field. We make the product fresh on site, and that's the second panel. And we are able to deliver it through their existing irrigation systems, whether that's big sprinklers like you see here or on a golf course, whether that's micro emitters, very small sprinklers, or even through drip irrigation, the smallest of the bunch.
We have proof cases that we can do that in numerous examples across all of these crop types and these types of irrigation. Ari, can I get the next slide, please? Most of you, again, know this. We have a very focused commercial strategy. We are focused on as a direct provider of the product in the United States, and we address the Middle East through our two existing distributors and ultimately more distributors. We are in the United States offer the product as a pay-on-delivery or as a pay-as-you-save model, which we'll get into later, but as a model that I really, really like. In the Middle East, we receive royalties on our partner sales and also sell them hardware. Ari, can I get the next slide?
Even though we're highly focused with only two of our "current markets," they are two of the three largest markets that we perceive for this technology. The United States is itself a multibillion-dollar market, as is the Middle East. And so we are not worried about where we're not. We're very focused on where we are and growing the company and building the company out in the regions we are today. We get inquiries all the time from countries all over the world or even different states in the United States looking for this company, and we always say the same thing: not yet. We feel very comfortable where we are from a focus standpoint. Ari, next slide. I think this slide really backs that up. This is a slide of the market opportunity in just three states in the U.S.
And so California, obviously, being by far the largest market, and this is one of the reasons that you know we moved our focus from the Arizona side of the border over to the California side, and I am happy to report that we are seeing good traction in California and support for that decision. Again, I think there are some interesting things that can happen in Arizona, might happen in the next few weeks. But overall, California is just a significantly bigger market, and it's time that Desert Control attack it aggressively. Next slide. I'm going to spend some time on this slide because this is another thing that we sometimes presume everyone knows and that we can run through. But this question about the value of water, everyone gets it. We talk about it a lot. You see it on the TV. You see it in publications.
But the question has always been when and how much. And while every day doesn't bring a new water shortage, I think that we're seeing the powerful confluence of this tailwind, as I call it, coming together very much right now. Several of you would have seen a publication from the United Nations back in January that really called out the global problems with water and how we have been pushing the boundaries of what's acceptable and about the quality of groundwater in many, many places. In fact, they used the dramatic term bankruptcy, which obviously got a lot of headlines, and we've seen headlines in this area before. But all of the data continues to support a global crisis, and it is getting more and more attention and, importantly, action. And that brings us to the bottom of the slide.
There was an article last week in the Los Angeles Times. This is an article that addresses something that's very specific to our Western United States markets, and that has to do with something called the Law of the River, which many of you are aware of. But the way the Colorado River water is dispersed among the Western states was determined in 1926 with this Law of the River. The Law of the River was a 100-year agreement, which at the time seemed forever to them but has arrived, and we are now in 2026. There are furious negotiations going on between the states, three of our Native American tribes, and the federal government about how to allocate the water from the Colorado River, where they're already overallocated. There's something called the Upper Basin and the Lower Basin.
California and Arizona are two prime markets. They are in the Lower Basin. As you might imagine, it's better in the water game to be in the Upper Basin than the Lower Basin. We think we'll see a lot of press. We think we'll see some decisions. We think we'll see a lot of lawsuits. But all of this will transpire during the course of 2026 and 2027 and brings very real pressure to our customer base. We are hearing this from them as much as we're hearing it from the press. These are the kinds of macro trends that I think support the Desert Control business model, and I think we will see this play out in 2026 and in 2027 and beyond.
So I didn't want to spend too much time on this slide, but you've probably been hearing about water scarcity and making this an amazing business. It takes a really long time for big macros to play through, but this big macro has been coming for 100 years in some sense, but it's very much here today. So Ari, next slide. All right. So now getting into some updates on the business. On the golf side, golf and turf, I think it's important to remember that in addition to the golf courses, we also are active with places like Cal State Fullerton and other large sporting fields and continue to see good results. But since we tend to talk about golf, let's talk about golf.
So since we spoke with you last, we have continuously seen great performance at the Woodland Hills Country Club, and we'll share some data with that in just a second. I was actually out last week at the Golf Course Superintendents Association of America annual meeting. Yep. No more fun places to be than Orlando, Florida, with some golf course superintendents. But it was fun, actually, because I won't say we got the most traffic of any company at the show, but a lot of people came by and are starting to understand the LNC story. And at Woodland, we're going to show you some data in a minute. Berkeley, we continue in conversations with Berkeley. In fact, I spent a bunch of time with their superintendent in Orlando, and I would hope to see them come around to a full course.
Berkeley, unlike Woodland, which is owned by a single individual, Berkeley is a wealthy private club run by its members, and that always involves some politics. So I continue to work through some of those. Wood Ranch, I spent a lot of time with their superintendent. Wood Ranch is owned by a single individual, so I think that can move forward over the course of this spring as we get more traction with their ownership. It's important to note that while these three are the most kind of poster child in the process, the Los Angeles region has over 35 golf courses and more than 1,000 acres. The reason we focus on Los Angeles is because that's where the subsidies are available that more than pay for the product.
And since they don't pay anything if they use the PAYS model, not only will they get our product on a revenue share basis, they will achieve almost the same amount of money, at least in the initial years, through the subsidies. So excited about the L.A. Basin and excited about the team. We have recently added to the team Neal Noble, who is our Head of Golf Sales. Neal spent 20 years building golf courses all around the world and building a large agronomy business for himself personally and then spent 7 years as the Western United States Representative and General Manager for Rain Bird Sprinklers, who are one of the 2 big systems that irrigate all the golf courses, all the turf, everywhere in America. So very excited to have Neil on board and already seeing results. Next slide. So we promised you results on Woodland Hills.
You will see on this slide that water savings have varied from 13.6%-68.3%, depending on the time of the month or the month the weather, and that Woodland Hills is in the process through the incentive process and through their water bill savings of realizing almost $185,000 in six months alone. The data for December isn't here yet because the Los Angeles Department of Water and Power didn't read the meter in December, but we're told by the superintendent that he continues to see significant savings. This is actually an interesting thing about LNC and its mode of action. As a percentage, you will see, in fact, that we're achieving greater savings in the winter cooler months.
And that is because the LNC allows the turf to hold the rainwater, which they do get this time of year, and the irrigation water for a longer period of time, and in a cooler season may allow them to completely skip irrigating for a week at a time. In the summer periods where it is hot in L.A. in the summertime for anybody who's not been there, especially in Woodland Ranch and other places in the surrounding hills, they may be saving a percentage less water because the grass just does need the water. But these are their very high-volume times, so you're getting a percentage off a very large number, and hence, the savings can be dramatic also. So I, frankly, am very encouraged by this winter data.
And in conversations with golf courses, they find that attractive, even though it's not the majority of their units because it's not as hot. They really like the ability to have the turf remain in condition without irrigation. So good news at Woodland Hills. Next slide, please. All right. We'll move on to the agricultural area. But I do want to leave you with the sense that we are getting traction in golf. We're focused on golf. We have a salesperson who's deeply embedded in the world of golf, and I expect some significant action there in the course of 2026. So those of you who have seen these slides before, in agriculture, we remain very focused on these subsegments. Permanent crops, trees is a very important market for us. 200 million almond trees in California alone are success in date palms.
This is a natural for LNC, and we continue to push it. Vineyards is a market where we are now getting more interest. Vineyards is a very tough application because you have to go out for hours and hours at a time through their micro drip sprinklers. It's literally a tube with little holes in it. We have successfully done that in the recent months with a very large vintner. We would expect to continue to penetrate other wine grape growers, etc. Then we're in the specialty crops business. Here, I want to be clear. Specialty crops are everything from berries to high-value vegetables to high-value fruit. We continue to do some work in row crops and common broad crops. We actually have an ongoing experiment going with the University of Arizona at Maricopa.
But that's work to look at LNC's effect in different dose sizes over different cycles that would open up very, very large markets, but that is not a commercial focus for us at this time. Ari, next slide. So this is something that happened since we last talked that we are quite proud of, and Lars referred to this in his opening remarks. Almonds are wonderful. I love almonds, and they're a favorite snack for many, many people. But almonds are getting a bit of a bad rap out there in certain communities because almonds are also incredibly water-intensive. Numerous growers are facing that pressure, and we have spoken with many of them. We have targeted this market. In the last quarter of last year, we did apply LNC in a 15-acre block in a research-driven trial where we have multiple replicates, various doses of LNC.
In conjunction with the farmer, we are doing a lot of monitoring of not just water usage but tree health, nutrient usage, and ultimately yield. We're getting on the map in California almonds, and that was a first, very important pilot. Just as exciting as the Golf Course Superintendents Show was for us, next week, I'm sure you're all dying to go, the Pistachio Show is happening in Orange County, and we will be well represented at the Pistachio Show. Pistachios, while a much smaller market by number of trees, also share almonds' thirstiness. They tend to be planted in sandier soils, and we think that will be a very interesting market for us. I expect to do trials in pistachios this spring. Next slide, Ari. We couldn't talk about LNC and not talk about dates.
This is an area that we got an early start in. This is an area where we consistently see very, very good results. Our largest customer in this area is Oasis Date. We're involved, as you know, in this very large 1,000-tree study with them. That's a yield-based study but also with interim endpoints around water use, tree health, nutrient use efficiency. And this is a partner that we will do more for. We will continue to do more in dates with other growers. Here, I should probably take a minute to speak to a funding opportunity that's out there that I, frankly, hoped we would hear about before today's call but is still very real. The state of Arizona has been focused on water for a long time, not surprisingly. One of the focuses has been to actually reduce crops planted through a fallowing program.
You've heard that in the past on our calls. But simply taking land out of production is kind of a blunt way to save water. It would be a lot better if you could keep crops in production and use less water, and people are coming around on that side of things. Arizona put out a request for grants of $1.8 million in October of last year. We have five different customers who have applied for those grants. As I say, I'd hoped we would have heard before the call, but I think we'll hear in the next couple of weeks. Oasis Date is one of those and has applied for a lot of that money.
I don't think they'll get it all, but under the premises of, "If you don't ask, you don't get," we are hopeful that Oasis Date will get some of that money, and we will go straight back to work at some of Oasis Date's 300,000 trees. So keep watching the datespace. Ari, next slide. Lars touched on this. We've talked about this before. Investors have been very interested in this, and that's how will we make all of the liters of LNC that we need to make to make the product hum. And this is an area that we were late on last year, to be perfectly straightforward, and the progress has been very substantial since our last talk. We are in production with a contract manufacturer in Arizona of our first module.
This is a contractor that is capable of building data center cooling systems and other very sophisticated equipment that looks a lot like ours. So I feel really good about our selection of our contract manufacturer. And that's because I don't want to build just one unit. I want to build multiple units over the course of time. So we do expect that the first unit, which is always the hardest one, will be coming out in late April to us. And then after we get the core module, we obviously need to integrate it with our tanks and some of the other production equipment. But I believe we'll have a new second large unit in the field in May, which will be in time to help with some of the spring pilots.
As we've talked about before, production capacity is not going to be spread out neatly every day of the week, every month of the year. We do face seasonal businesses in both golf and agriculture, so we need to have the capacity available to meet the customer, farmer, superintendent in their mode of harvesting or planting their crops. But I'm very excited about where we are. In addition to the unit that will come out in May, I already have the team planning additional units for later in the year, which I believe we will need, and units for the Middle East.
So this was a slow train to get on track, but we are now on track, and we are managing it to the point where, while we can't fine-tune, this is not a product we can order one week and have it the next week, where we have a regular cadence of deliveries and orders. And so I'm very excited about where we are there. But a unit itself doesn't produce LNC onto a farmer's ground. You need people and other operational issues in line to do that, and we have been working hard on that. During the last quarter, we've hired a director of operations who will be based in Bakersfield, California. We've hired a machine operator who will be based in Bakersfield, California. We've been looking at leases in Bakersfield, California.
And the reason I keep saying Bakersfield is, Bakersfield is in the heart of the California Central Valley, actually, the southern end, but in the California Central Valley and very, very close to all of our pilots and target customers and also within a 3-hour drive of almost all the Northern California opportunities. So we've been dragging equipment and crew from southern Arizona all the way up into California, and we're losing 25% of our capacity simply in moves. And by being based a second operational base in Bakersfield, we will shorten our time to deliver to customers, which enhances our overall productivity. So we've spent a lot of time working on both the system and the system for getting the system to deliver LNC to customers, and I feel really good about it. Ari, next slide. So a Middle East update.
Normally, Jan Vader would do this, but Jan is just back from the Middle East. I guess he's not even back. He's in transit from the Middle East, having just met with our partners. The story in the Middle East, frankly, is much of the same. They continue to work hard. They continue to make incremental progress. They continue to pursue very, very large contracts. But those contracts continue to be some number of months away. I remain very convinced this will be an important territory for us, but you will see when we get to the revenue estimates that I'm bringing down some of the revenue estimates for this year in the Middle East. There are very interesting things in conversation, including Green Riyadh Sports Boulevard Foundation and a number of others that we've talked about before. Nothing has gone away.
There have been no issues, problems. They're seeing continuous success. We actually have a, I think, early views on a dates study they've done, which will be positive, but it's just slow. So that's where we are on the Middle East. It's going to be a big it's going to be big, but we're pushing back that timeline. Let's get to kind of the milestones that we presented to you two calls ago, I want to say, and give you an update on that. We're using a very similar slide in fact, the same slide but updated for our current views. What we are seeing is we see traction in the U.S. that is accelerating. Super excited about the U.S. and the conversations we're having and the applications I believe we'll be doing this spring and then through the course of the year.
On the right-hand side of the chart, you'll see that we've increased the number of golf course pilots, agricultural pilots, and full golf courses that we believe we'll do in the remainder of 2026, all in the U.S. I've spoken to the better execution. I think we're going to be really good this year. I've spoken to you about the construction and delivery of the new units. With the new unit, we won't just stop using the prototype. So you should really think that we're going to double our capacity to deliver projects when the new unit comes in May and then triple them, essentially, when the new unit comes in the fall. Some of you who are really deeply knowledgeable Desert Control shareholders know that we actually have two sizes of a unit. We have a small unit we call the Mirage and a larger unit.
We will also be building another Mirage, small unit, to place in the Bakersfield location because we see that level of demand already, and the Mirage is the perfect unit to go out and do an initial pilot for somebody. So from a milestone standpoint, we're increasing the level of activity we're speaking to in the U.S. and modestly decreasing the opportunities that we see for this 12 months in the Middle East but haven't gone off the Middle East at all. It still remains tremendous potential. Next slide. As we get to this slide, let me also say this is an investor update call. This is not a quarterly results call. So you will see that we have taken the financials down to those metrics we consider most important in managing the company.
We've taken out any currency translation reporting, which I don't mean to be offensive to either the US dollar or the Norwegian krone. The relative values between those two currencies matter very little to us ever and certainly not from an operating basis. They do manage people who own the stock, including me, at the time you buy or sell it. But we have tried to focus on those metrics that we feel are most informative to investors and tried to focus this call very much on the company and the company's opportunities. So with that, David, I'll turn it over to you.
Thanks, James. Next slide, please, Ari. Thanks. So just quickly, as James said, just a very simple look at our results for 2025. These are unaudited. So NOK 2.7 million in revenues and EBITDA of -NOK 66.5 million.
The EBITDA, we should just point out, excluding non-recurring restructuring costs towards the end of 2025, was not that different from prior year, 2024. So we've managed to keep costs at a very conservative level, which should continue this year. And then balance sheet highlights NOK 62.5 million at year-end and no debt. So let me hand the call back over to James.
All right. We're going to go to Q&A. We got some questions ahead of time. Thank you. Very helpful. Love to see questions from investors ahead of time. But obviously, I think you've also had some in the chat, Ari, and people should feel free to put things into the chat. And we will parse out the questions to the relevant people as they get asked.
But I really do want to emphasize how much change has happened in the company in the last five months, how much these additional headcounts add to the picture for 2026, and how much having this unit be available will matter to driving Desert Control forward in 2026. We have had a period of time where, frankly, we haven't been out with customers as aggressive as we could be as we looked for high-quality salespeople, and we haven't been able to deliver the kind of volumes that some of those customers would have demanded. So I think we're now set up in a way that we will be supply constrained. If I look at the pipeline coming out of our sales force, we need 10 machines. But pipelines are pipelines, and you've got to high-grade them.
And there would be nothing more fun for me, frankly, than to tell a golf course that, "Sorry, we can't come till the fall." And I think we're going to get in that situation. So I'm really pleased about the people we're hired. I'm really pleased about our new directors. I'm really pleased about the way the water story is setting up in the West, and it's our job to get out there and get it. So, Ari, I'll take questions.
So the first question is, Desert Control has been developing and commercializing LNC products for several years. Despite this long period, investors have seen very few announcements of new contracts and limited revenue traction. Could management explain what the main barriers to customer adoption have been so far and what specific commercial milestones or contract productivity investors should we expect going forward?
Sure. Great outlook question.
I will say a couple of things on that front. One, the company's ability to deliver the opportunity has been somewhat limited to date. And that's back to my prior point about adding the people and the resources in Bakersfield and the equipment. The company couldn't have delivered the business that the demand would have generated. What's the primary obstacle we face? And the primary obstacle we have faced and the prior team faced is that water, in today's context, for many people, is not a driver of their costs. And when you think about farming in particular, people adapt their land mass and their planning schedules to their inputs, including water. And so if water is free, as it is to certain farmers in Arizona, right, you will behave in a certain way.
If water is expensive, you will behave in a different way. Where Desert Control lives is we need to focus on people who have expensive water or are about to have water constraints. We've talked about this in the past. A customer who has no water is not a customer, right? We need people to have water. What we need people is to have high-cost water or constrained water. As I touched on this Law of the River, these cutbacks that will come will be disproportionately allocated to cities being probably the least cutback, to alfalfa farmers being the most cutback. What we are seeing and hope to see is that farmers lose 20% of their water to pick a sweet spot because that's the kind of water we can replace and allow them to continue to farm their entire operation.
We don't need a farmer to lose 60% of his water. And so it's a long answer to a short question. But the number one thing we have faced is, do you spend enough on water today, not in the future, but today to justify putting the product down? One thing that's not in that question but back to my statements about adding clay to soil is not a new idea. We do not, by and large, face any fear of doing anything negative to the soil or the plants. If we were a chemically-based product or if we were applying very, very large volumes of product, I think we would get more fundamental toxicology agronomy kind of questions. We don't get a lot of those. We do get questions around yield and the ability to increase yield.
Those are longer-term conversations, but we don't get the fear of actually damaging the ground. Next question.
Okay. So the next question is specific, directly to Dave, which we welcome into our team. And it says, "Given your impressive professional background, could you please elaborate on your experience and the key factors that motivated you to accept the position of CFO in Desert Control and additionally, what will be your primary strategic priorities in the immediate term?"
Thanks. Yeah, I sort of addressed the first part of that question at the beginning of the call when Lars introduced me. And then the second part, in terms of my strategic priorities, I would just caution everybody that this is, I think, either my seventh day on the job, so it's fairly early.
I think once I gain a little bit more familiarity with the people and the company itself, I think that might be a better question maybe on the next call, for instance. But thank you for the question.
Yes. The next question is directed to James. "Are there currently any vacant positions within the organization, and which are the functional areas of this?"
Okay. And I didn't address it, I think, in my presentation, so thanks for asking. So as most people are aware, we made the very difficult decision to move our research operations with regard to the clay and the plants and those pieces out of Norway and closer to the customer in the United States. And that was a tough decision but one necessary for the speed of interaction with customers. We are currently recruiting chief scientific officers, and I'm interviewing a bunch.
Lars has been interviewing a bunch. We're using the best headhunter for the space. We're hoping to close that out this quarter, and that's the most important open position now with Dave on board. And we would expect to add more sales or more scientists under that person. We will, in my view, likely add another salesperson into the organization. And those are the critical hires at this moment. And to be fair, we'll add another engineering resource, likely in Arizona. We're making tremendous progress on the core production of the machine. But back to the science and technology company, we continue to evolve the intelligence in the machine and the intelligence in the cloud, and we'll probably add another engineering resource.
Okay. Thank you, James.
So next question is, "Could you provide further insight into the status of potential partnerships arriving with Syngenta or other strategic partners?"
Obviously, what we say about strategic partners is a function of what they'll allow us to say. So I want to be clear about that. We continue to work with Syngenta. We did an install this spring in the snow in eastern Colorado at one of their big research farms. Oddly enough, we're in the weather business at the end of the day. Not only was it brutal putting it down because it was still snowing when it wasn't supposed to be, it was brutal harvesting it because it was raining when it's not supposed to be raining in eastern Colorado. They didn't bring the final part of that harvest in till, I think, the 1st of November or even mid-November.
So we have some preliminary data, which I cannot release publicly, but I would expect the final data from that to be well expected. It's a big company. No offense, Syngenta, big company. Sometime probably later this spring. But I would say the early indications that I hear and what data I've seen look promising. We continue to pursue partnerships not just with companies the scale of Syngenta but also with some of these large farming operations. Some of these people have 20,000 acres of farming and actually do research on their own. And we have developed emerging partnerships with some of the better sensing companies because, obviously, the measurement of what we do is quite sensitive, and the environments in which we do it are a little bit sometimes hard: 119 degrees Fahrenheit, 40-mile-an-hour winds, etc.
So we continue to look for partnerships that will help drive better data accumulation and knowledge. Next question.
Next question is, "The previous CEO frequently conducted Q&A sessions on InvestorWeb following quarterly presentations. Is this a practice that you intend to continue, James?"
So I think Lars touched on this to start with. And I don't know, Lars, I could throw this one over to you as somebody who has strong views on this. Do you want to do it, or do you want me to do it?
Sorry, can you repeat the question, Ari?
The previous CEO frequently conducted Q&A sessions on InvestorWeb. That is a platform here in Norway where you can connect with investors as well. Is this a practice that you intend to continue?
So I think we will follow the investor dialogues that we have as we are set up now with our quarterly webcasts.
I think, as I mentioned in my introduction, that we are eager to answer any questions that are coming in from shareholders. I also think that we are very active in posting news and interesting articles around our doings and our results and our activities on the social media. And I think right now, we will stick with that.
Thank you, Lars. Okay, we have a lot of questions, so.
Ari, I think this investor question, this communication question, is very relevant, and I completely agree with Lars. And I also pointed out the change from prior leadership's approach to these things. I will say that we've been a little quiet over the last several months, and that has to do with activity level. Both of the businesses that we're fundamentally in, the agriculture and the golf business, take a break as winter hits.
Golf in Southern California may be less so, but agriculture and other things more so. So I would expect that you will see more news from us, certainly in the spring period, than you have, partly just driven by the rhythm of the business. We have taken an approach of trying to communicate openly around results that are important, indicators of how the business has gone. But I completely agree with Lars that the path we're on is the right path.
Okay. We have a lot of questions, so we will continue with those. These questions are about, "What are the process or steps from signing a contract? How many pilots and how many phases it needs to get validation?"
Sure. And this is critically relevant to how we think about revenue projection and sales cycle and those things, for sure.
And like so many things in life, I could say it depends because it really does. When you've seen one of these, you've seen one of them. And I tried to point that out a little bit around the golf courses. If you have a single owner who can make a decision, that's one thing. And I'm not against boards. We've all served on boards and collective ownership. It just takes longer to make those decisions. What I've said in the past, and I will always believe going forward, is the vast majority of initial customers will pilot before they buy for the next year or two. I believe we will get to places where people go directly into purchase. And the conditions for that are, for instance, the Cal State Fullerton fields, right?
We went from one field to two fields to now we're just trying to figure out how to get over there to finish doing all of their fields other than their big stadium. So they're doing internal pilots, but we're also in conversation with other Cal States. There, I could see a situation where a reference customer, essentially an identical lookalike reference customer, will create a shorter sales cycle. And we obviously want to exploit those. I think that with the golf business in general, this year is going to be about pilots before buying.
But I would expect that in 2027, we will see some guys buy without piloting, either because we've sold to a multi-course operator, so again, they have their own internal pilot, or because their water problems are so large and the lack of toxicity of the product and the proven money that Woodland Hills and others will be saving will be so attractive, I think, will do that. So it's a combination of those things. I think in the almond business, I think 2026 is all going to be try before you buy. But by 2027, we can get into the buy it because we've seen the results of the pilots. We've seen the really good data generated by the existing install.
And the same for dates.
Oh, go ahead. Go ahead, Lars. Yeah.
No, I was just saying, and the same goes for dates.
Dates, right, exactly.
I think we're probably closest in dates, frankly. We've got so many dates for so long now. Yes.
Okay. So I will take these two questions here and mix it because it's about the same. "Do cultural issues, skepticism, represent huge obstacles for LNC, or there is a widespread fear for negative long-term effects with the apply of LNC?"
So I think I answered a lot of that in the prior question. No. Culturally, I would say the only cultural thing is if you have a situation where decisions are hard to make, right, that's a problem for us. But there's no toxicity issues. I mean, we're organic, right? I mean, that's not our biggest problems.
Yeah. Okay. "The company's market capitalization is extremely low relative to proven impact of LNC product and its demonstrated ability to significantly reduce water consumption while increasing crop yields.
This creates a real risk that the company's long-term value will not be fully realized in the public markets before a potential acquisition takes place. How does management view this situation, this valuation disconnect, and what concrete steps are being taken to ensure that shareholder value is properly reflected and protected? I think you covered on that, James, already, but it'd be good to clarify.
Yeah, maybe I can take that one. So first of all, I understand if people are impatient, but I can guarantee every single employee in Desert Control is also impatient. We would also love to see a completely different development in the share price. But I would also underline, again, that the capital strength of our company is a topic that we are painfully aware. Both management and the board is discussing this, I would say, almost on a weekly basis.
We are constantly pursuing opportunities across all the alleys of opportunity that exists. We are seeing people. We are seeing advisors. James and I are constantly traveling around, also in the U.S. and here in Continental Europe, to see and also market Desert Control the best way possible. Please rest assured that we are painfully aware of our balance sheet and our cash position. Of course, we have an obligation to ensure that we are strengthening our balance sheet and realizing the ambitions that we have and indeed the potential of the company.
Okay. That was our last questions. No questions were in the chat, so we can proceed to our cautionary note, James.
Okay. Well, thank you for attending. Thank you for listening. Thanks for the questions. More importantly, thanks for your confidence and interest in the product.
Hopefully, you've taken away from this call that we've made a tremendous amount of progress organizationally to put this company in a position to really realize the promise of the technology, that Lars and I are fully active with both outside influencers and with rebuilding the internal structure. I think the two new board members and David are symptomatic of that, and then the people who have actually added on the front lines also. I remain very optimistic about the level of activity you're going to see from Desert Control going forward. We had our problems last summer. I think those problems are truly behind us. Every application we've done since then has been a success. I think we've addressed root cause, and I think the company's in a position to really bring it forward.
I believe that particularly in California, where we've pivoted in a strong way. And look forward to future reports to all of you. Our next report, Ari, will be the report around the annual report, correct? Yes. Yep. You'll be receiving the proxy materials if you haven't already. I encourage you to get your votes back to get Julie and Jacob on the board as part of building that team.