Hi and welcome to this presentation of Terranet's Q1 report for 2025. My name is Jesper and I will be moderating this call today. During the presentation, you can ask questions by writing them in the chat box that you can find below. We will start the presentation with a short summary video and then go into the interview section before we take all of your questions. Joining me today are Terranet's new CEO, Lars Lindell, and CTO Per Ekwall. First, let's have a look at the summary video. Welcome to the interview section of Terranet's Q1 webcast. As mentioned before, exciting to have Terranet's new CEO Lars Lindell here today and also CTO Per Ekwall. Let's start with a question to you, Lars. This is your first report as CEO. How has the start of the year been for you and for Terranet?
Thanks for that introduction. I started in March, so I have of course not been there for the full quarter. I would say that the year has started well for Terranet, mainly for two reasons. The first one is that we put a financing package together, which I think was very good. Shareholders should be happy about that one. R&D has progressed as planned. With those two things, I think we are off to a good start.
What attracted you to Terranet and the opportunity to lead the company forward?
First of all, in technology industry, I believe that for a small company to break in, you need to have a very, very clear and tangible competitive advantage. Blink Vision promises to take braking decisions up to 10 times as fast as the existing system. That's a very good number to go out and discuss with customers. Secondly, I'm very much of the opinion that a CEO for such a small company has to be present in the daily work. This company is in the region where I live, so that was also a very good match. The technology promises are good enough for us to break into the market. I think a local company suits me best.
Great answer. Thanks. Let's move on to the company's progress and the roadmap. Through your reports, Terranet clearly communicates the company's roadmap going forward. In the Q4 report, it was stated that a proof of concept through Mobility Xlab was planned for the first quarter of 2025. Pierre, what are the results here?
Yes, thank you. Yeah. Being part of Mobility Xlab gave us the opportunity to work closely with an established industry partner, something that's incredibly valuable for our current development stage. In the first quarter we completed the proof of concept together with the program partner, focusing on testing our technology in the scenarios they defined as highly relevant for their needs. The conclusions are positive, showing that our solution with the implemented updates performed well in the defined scenarios. Overall, we gained a better understanding of the partner's requirements and how to adapt the product to meet them. The collaboration confirmed the potential of our technology and gave us very valuable input for the continued development of our MVP. The dialogue is ongoing and the partners expect to be involved in upcoming evaluations as well.
I see. This year you're moving Blink Vision from a prototype to a minimum viable product. What does that actually mean?
Yeah, for us, moving from a prototype to an MVP is a big step forward that is to showcase what Blink Vision really can do, especially in its speed in detecting pedestrians and triggering braking in specific traffic scenarios. The MVP we are working on will be tested in real customer environment during Q3 and Q4 and completely standalone without any need of Terranet resources or any development specific equipment to support that. It needs to be easy to install, reliable in use and allow for smooth collection of data and analysis based on the MVP evaluation feedback. We will then adapt the design further to fit the future integration and customer specific use cases and requirements.
I understand. Exciting. The product development plan is ambitious for 2025. How are you building the organization to support this phase?
Right now we're strengthening the team with key expertise to support the next phase of our development. We are hiring in areas such as software development, computer vision, AI, and systems engineering. All important to bring the product closer to a finished solution. If anyone is watching this and has experience in any of these fields, you're very welcome to apply. You'll be working with a truly fantastic team on cutting edge technology that's about to revolutionize safety.
Okay, so your MVP is planned to be ready for testing in a customer vehicle during the third quarter. Could you tell us a bit about the level of interest you're seeing and what you consider when selecting potential partners?
We are in dialogue with a few promising partners and we plan to start MVP evaluations during the third quarter. When selecting partners, we look for things like technical fit, relevant use case, long term business potential, of course, and geographical location. The feedback will be very important as we continue to refine the product, build the foundation for future discussions around scaling the technology itself.
Thanks. Moving over to more business development questions, could you, Lars, share how Terranet is working towards commercialization and engaging with potential customers?
First of all, I think we have a very broad approach. We talk to a lot of different types of industry players. I think that when you sit on technology assets like Terranet does, you have to have an exploratory approach to customers. Blink Vision right now is very focused on ADAS and AD. As soon as we launch that, for the partners that are interested, we will take a discussion with them about when and how they will evaluate it. If that evaluation goes well, we will sit down with them and discuss how we can bring this product to market.
Okay, cool to hear. In December, China signed a collaboration agreement with a player in the mining industry. How has that progressed?
Kickoff has been held. The next stage is really for our engineers to go and visit the site where the testing will be done. Finally, the mining industry is a very harsh environment. It will be a very, very good test of our technology in harsh conditions. We very much look forward to what the results will be from that trial.
Okay, let's turn to some financial matters. In April, Terranet announced a direct share issue and a rights issue pending final approval at the 2025 AGM. What does this mean for Terranet going forward?
A lot of financing is key for a company in the stage where Terranet is. The finance was 8.2 million in a directed issue which actually has already been received. On top of that there is another directed issue about 16.2 million and a repair issue where we, 2 existing shareholders, offer at the same conditions at the rights issue of another 15 million. In total we are guaranteed 40 million. On top of that, there is a TO in December that could bring in another 15 million. In our investor inbox, we received a lot of questions on how long this money will take us. The way we are planning our cash expenditure is that including the TO, then we should be able to take the company into Q2 next year.
Great, thank you. Last question here in the interview section. As the new CEO, what will your priorities be going forward?
Terranet is already an established company. It has a product idea, it has a team and it has a strategy. To some extent I'm coming to a certain table when it comes to that where I will be focusing and my background is in sales will be, of course, revenues. How do we come to revenues as fast as possible? Because I know that's what everyone wants to see. Also exploring different types of partnerships and finally also working with the maturity of the company. We are in an industry where there are very high requirements, both on the company, but also on the products. When it comes to certifications we need to start work with those as well.
Great. Thank you. As a reminder to all of you watching, if you wish to ask a question, you can type them in the chat box that you can find below me and the slides here. We received a lot of questions, which is very nice. In which other application areas do you see Blink Vision creating customer value?
Well.
I think there are many different areas and there are many different configurations. Right now Blink Vision is solely focused on ADAS and AD and that's the way it should be until we launch it. Once we have launched the MVP, I think it is time for us to sit down with other industry players and see how can we take this technology asset and use it in their applications.
Is the current organization well positioned to support commercialization or will further expansion be needed?
As Pierre said, we are expanding in our R&D area. The customer support for the MVPs will be done by our R&D organization. There will be a delicate balance between developing the product further but also supporting customers. I think we are covered in that area with the plans that Pierre already has. On the second side, I do not think we need any additional people, so we are fine there.
Thank you. This is a good question. Blink Vision is a complete system including both software and hardware. Could it become relevant to sell individual components separately?
Yeah, if you break it down, there are mainly three main, let's say, system components to Blink Vision. We have the laser scanner, we have the event cameras, stereo, and we have the AI trained perception stack. Right. There's great value in all 3 of these system components and we have already had companies reach out to us regarding, for example, using the advanced cameras in other applications than what Blink Vision initially has been targeting. That being said, yes, selling individual components in the future is a possibility.
Okay, nice. Moving over to the question about how many customer vehicles will Blink Vision be tested in during the third quarter?
Yeah, good question. The exact number is still being set as part of the MVP robot strategy. As the MVP systems cost quite a bit in its current prototype form and the organization is still operating on quite a slim budget. We plan for systems evaluations for a handful of customers during the second half of the year.
I understand we received a question here that why haven't you sent out a PM about the POC is done and finished?
From what you can see from today's report and what Pierre said, we have completed the POC. I think the main communication tool for a small company like Terranet are really the quarterly reports. We have reported on it in the quarterly report. Now we spend a lot of effort into the quarterly report and we do webcasts such as this where we can answer the shareholders' questions. We think that is a good format to answer questions about things such as the proof of concept.
Okay, next question. Do you see any companies currently developing comparable technology that might be close to your stage of readiness or performance level?
There is, of course, improvements in most of the sensor technologies that we're seeing today, but to date, we don't see anything coming even close to the responsiveness of our system.
Okay, I think this is a very relevant question at this time. Can the technology be used in the defense sector or is this something you're looking at?
Definitely. Of course, if you look at how much money is going to be invested in the defense sector, we would be crazy not to look at how can we use our technology in that sector. It is a part of, like the question I answered before, other types of industry. Definitely defense is high on the priority list.
Okay, let's see here. I think that was the last question at this time. So I give the word back to you, Lars and Per, for any closing comments.
Thank you for listening to this webcast. As you know, you can always subscribe for our press releases and news on our website. You can send questions to our investor inbox and you can follow us on LinkedIn. With that, thanks very much for listening and hope to see you soon in the future.
Thank you.