Greetings and welcome to the Brooge Energy 2023 First Six Months Financial Results Conference Call. At this time, all participants are in a listen-only mode. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Valter Pinto, Managing Director for the KCSA Strategic Communications.

Thank you, you may begin..

Thank you, operator, and good morning. Welcome to the Brooge Energy 2023 First-Half Financial Results Conference call. On today's call will be Paul Ditchburn, Chief Financial Officer and Chair to the Office of the Chief Executive Officer; and Saif Alhazaimeh, Research and Acquisition Manager and Member of the Office of the Chief Executive Officer.

We'd like to remind everyone that this conference call contains certain forward-looking statements. All statements that address our operating performance, events, or developments that we expect or anticipate occurring in the future are forward-looking statements.

These forward-looking statements are based on management's beliefs and assumptions and are not on the information currently available to our management team. Our management team believes these forward-looking statements are reasonable as and when made.

However, you should not place any undue reliance on any such forward-looking statements, because such statements speak only as of the date when made. We do not undertake any obligation to publicly update or revise any forward-looking statements, either as a result of new information, future events, or otherwise, except as required by law.

In addition, forward-looking statements are subject to certain risks and uncertainties that could cause actual results, events and development to differ materially from our historical experiences or our present expectations or projections.

These risks and uncertainties include, but are not limited to those described in risk factors and elsewhere in our annual report on Form 20-F filed with the Securities and Exchange Commission and those described from time-to-time in other results and other reports which we will file with the SEC.

During today's call, we will be presenting adjusted EBITDA, which is not a financial measure presented in accordance with IFRS.

Adjusted EBITDA should not be considered in isolation or as a substitute for or superior to analysis of our results, including net income prepared in accordance with IFRS, because adjusted EBITDA is a non-IFRS measure and may be defined differently from other companies in our industry.

Our definition of this non-IFRS financial measure may not be comparable to similarly titled measures of other companies, thereby diminishing the utility. We encourage investors and others to review our financial information in its entirety and not rely on a single financial measure.

Management compensates for the limitations of adjusted EBITDA as an analytical tool by reviewing the comparable IFRS measure, understanding the difference between adjusted EBITDA and profit or loss and incorporating this knowledge into its decision-making processes.

We believe that investors benefit from having access to the same financial measures that our management uses in evaluating our operating results. Lastly, after our prepared remarks, we will be going through the questions received in advance of today’s call. I'd now like to turn the call over to Paul. Paul, the floor is yours..

including an overview of our financial results for the first-half of 2023; an update on our operations; corporate governance; and details we can share as of today regarding the proposal to acquire all the businesses and assets of Brooge Energy Limited, we recently received from Gulf Navigation Holdings PJSC.

First, we are extremely pleased with our financial results for the first-half of 2023. Gross profit for the first six months of 2023 totaled $51.8 million, an increase of 191%, as compared to $17.8 million for the first six months of 2022.

Gross profit margin improved to 82% for the first six months of 2023, as compared to 63% for the first six months of 2022. The gross profit increase was mainly attributable to revenue growth, which was driven by obtaining higher storage rates.

Revenue for the first six months ending June 30th, 2023 totaled $62.9 million, as compared to $28.4 million for the first six months ending June 30th 2022, an increase of 122% over the previous corresponding period.

Revenue primarily consists of fixed storage and handling fees and to a less extent, variable fees for ancillary services provided under a contract with its customers. Brooge Energy provided storage capacity of 1,001,388 cubic meters and related services to numerous oil traders and producers.

For the first six months ending June 30, 2023 the Company reported net profit for the period of $37.4 million or $0.42 per basic and diluted share as compared to $3.9 million or $0.04 per basic and diluted earnings per share for the first six months ending June 30, 2022.

As of June 30th, 2023 the Company had cash and cash equivalents of $3.7 million and a restricted bank balance of $15.7 million. Total equity attributable to the shareholders totaled $142.5 million as of June 30, 2023 as compared to $105.1 million as of December 31, 2022.

Our Fujairah terminal storage and services are focused primarily on the storage and blending of crude oil and clean petroleum products. The terminal was built to award winning standards utilizing the latest technology to maximize company performance and efficiency, while reducing operating costs.

Brooge Energy is committed to ensuring the safety of its employees and the environment by complying with all applicable laws and regulations, promoting a culture of health, safety, security and environmental protection, providing a safe and healthy work environment, identifying mitigated potential assets and security risks, maintaining a sound [HSSE] (ph) management system, being prepared for emergency situations, designing operating services safely, using natural resources to energy efficiently, providing training to employees, and continuously improving its performance through challenging targets and benchmarks.

As we have stated many times historically, we are fortunate to be strategically located in a high-demand oil storage geography. This, coupled with our high-quality infrastructure, automated technology and state-of-the-art operations have been key to our success in not only growth, but profitability.

These positive results have been achieved for maintaining our exceptional health, safety and environment record and achievement the company is very proud of. In August, the Board of Directors commits to search for a permanent CEO.

While the company searches for a new CEO, the Board has established an office of the CEO to temporarily assume the role of the CEO of the company. Where I serve as Chair alongside Saleh Yammout, our current member of the board, and Saif Alhazaimeh, Research and Acquisition Manager of BPGIC FZE. Going forward, our strategy has not wavered.

We plan to continue on the success of the Fujairah terminal by expanding our storage facilities.

Upon successful expansion of the Fujairah terminal, this will position the company as one of the largest independent oil storage facilities in Fujairah with capacity to store clean petroleum products, middle distillates, high and low sulfur fuel oil, as well as crude oil.

In addition to our existing operations and expansion projects, we continue to innovate and seek strategic partnerships. With that, I'll now turn the call over to Saif to take you through the Green Ammonia Project..

Thank you, Paul, and everyone who has joined us on today's call. Your engagement with us is highly appreciated. During 2023, Brooge Renewable Energy completed the technical and commercial feasibility study alongside the market research for our Green Ammonia Project in Abu Dhabi.

The studies were conducted by leading players in their field, Thyssen & Krupp and Ernst & Young respectively. Green Ammonia has gained widespread recognition as an efficient and clean carrier of Green Hydrogen, poised to play a crucial role in meeting global decarbonization targets by 2050.

Recognizing its potential, the company has taken the initiative to develop a Green Ammonia plant, which is expected to contribute significantly to both UAEs and the world's net zero targets. The Green Ammonia Project expected to establish a world-class export-focused Green Ammonia production facility with a capacity of up to 1,950 tons per day.

Post obtaining the required governmental approvals, the project is expected to be executed in two phases, with Phase 1 commissioning 300 tons per day.

The company is projected to solidify its lead in the Green Ammonia market by commissioning its approximately 685 kilotons per annum of Green Ammonia production, positioning the company strategically in the competitive global landscape.

We have also previously discussed our partnership with Siemens Energy, one of the world's largest energy technology companies, to build the photovoltaic solar farm to supply our Green Hydrogen and Green Ammonia Project in Abu Dhabi.

Aiming to build up to 650 megawatts Solar PV plant to supply to renewable energies plant Phase 1 of the project with renewable energy. We are currently in the process to secure strong off-take ties in the identified markets of Europe and Asia, capitalizing on its early mover's advantage.

This strategic move is expected to enable the company to tap into the lucrative market -- the lucrative export market for 18 million tons per annum of Green Ammonia in these regions.

A key advantage of the Brooge Renewable Energy Green Ammonia Project is forecast to be its cost competitiveness, as compared to exports from other regions such as Australia, North America, and Latin America.

This competitive advantage is attributed to two critical factors; including the projected low cost of production due to favorable and renewable energy prices and the lower freight cost to key end markets. As a result, Green Ammonia export from the Middle East into Europe and Asian markets, it's projected to set new benchmarks in the industry.

The project is expected to be commercially feasible with an attractive internal rate of return IRR. With that, I'll now turn the call over to Paul..

Thank you, Saif. Last thing we received, a formal proposal submitted by Gulf Navigation's holding PJSC or Gulf Nav. The Dubai financial market listed maritime and shipping company to acquire fully all the businesses and assets from Brooge Energy Limited.

Golf Nav has stated that this proposed acquisition is part of its strategy to enhance growth and provide an integrated portfolio of logistical services related to oil, petrochemicals and gas.

The proposed acquisition is still in an early stage as Gulf Nav is in the process of conducting further due diligence on the company and its legal and financial advisors continue to evaluate the proposed transaction. This proposal is very early in the process.

We have responded to Gulf Nav’s proposal and there is no guarantee that the company will accept the proposal. The proposed transaction, if it moves forward, would be subject to customary closing conditions for transactions of this nature, including obtaining the necessary regulatory approvals.

Gulf Nav is optimistic that the proposed transaction if agreed by both parties would target closing in the fourth quarter of 2023. Nevertheless, any developments regarding the deal and the timeline will be appropriately disclosed from the market in due course.

Since the enhancement [Technical Difficulty] many questions, but as of right now and as mentioned earlier, the proposed transaction is in the initial stages and a full due diligence exercise is to be conducted by both parties to see if there's an outcome, mutually beneficial to the companies and shareholders.

As we make progress towards a transaction or not, we will keep our shareholders up to date on any material developments. With that, I'll now turn it over to Valter to moderate the Q&A portion of this call..

Thank you, Paul. We received several questions regarding the recent Gulf Navigation offer, specifically relating to how the public warrant holders would be treated if this deal was to move forward.

First, if it is done under $11.50 per share, are the warrants worthless? Second, if they are not, will they be taken out for a flat cash rate? Or will they transfer over to equity in the new company or the right to buy equity in the new company? And lastly, will there be a difference on how the warrants are treated if this deal is done in stock versus cash?.

The Gulf [Technical Difficulty] has just been received and is in the initial stages of evaluation. As such, the treatment of the public warrant holders will be discussed with advisors before and if a transaction is to occur..

Thank you, Paul. And thank you, everyone, for joining us today. This concludes all of the questions we received in advance of today's call. If there are any additional questions, please email our Investor Relations team at brog@kcsa.com. I'd now like to turn the call back over to Paul for closing remarks. Thank you..

Thank you to everyone who joined today's call. We look forward to providing you with further updates on our progress on future earnings calls. Thank you..

This concludes today's teleconference. You may disconnect your lines at this time. Thank you for participating..