GBC AG: dynaCERT Inc. | Rating: Management Interview

Classification of GBC AG to dynaCERT Inc.

Company Name:	dynaCERT Inc.
ISIN:	CA26780A1084
Reason for the research:	Management Interview
Recommendation:	Management Interview
Last rating change:
Analyst:	Matthias Greiffenberger, Marcel Goldmann

Vision for the Coming Years: Growth Strategies and Sustainable Innovation

GBC AG: Mr. Krüper, how do you see the future of diesel engines in a world that is increasingly focused on electromobility and alternative drives?

Bernd Krüper: First, I would like to emphasize based on my more than 30 years of professional experience in the automotive sector, as well as various stationary and mobile off-road applications, that many of these applications would not have been technologically and commercially feasible without classic internal combustion engines. But now, our focus is shifting to the future of diesel engines. I am also pleased that the discussion around fully electric drives is increasingly incorporating more technological understanding, realism, and pragmatism.

Of course, there are market segments where fully electric applications represent the most sensible and environmentally friendly solution. However, it is important to note that “one size fits all” does not apply here. There are numerous applications where a modern combustion engine still provides the best technological solution – especially in commercially competitive markets such as long-distance trucking, mining, and the oil and gas business.

I would especially like to highlight that it is often not just about whether an internal combustion engine is used, but also about which fuels are employed. This brings up the question of whether the fuels are fossil, like diesel, or non-fossil alternatives. These include hydrogen-enriched fuels, such as those used in our case at dynaCERT.

GBC AG: The diesel engine market is still huge. Which market segments do you see as particularly attractive for applying your HydraGEN™ technology?

The HydraGEN™ technology from dynaCERT works fundamentally with all combustion engines. Our previous experience is mainly in the diesel engine sector, but we are increasingly receiving inquiries, for example, for use in the natural gas sector.

The greatest fuel savings – and consequently, reductions in emissions – are achieved with our customers, especially in so-called 'continuous runner' applications. These include long-distance trucks, mining trucks, oil and gas drives, and generators. Our technology is also highly effective in the railway sector, as well as with so-called ocean-going vessels and inland shipping.

While we are already implementing significantly increasing volumes in the former application areas and thus growing as a company, we are still in the early stages with railway and ship drives. However, we are already receiving serious inquiries in these areas from various regions around the world.

GBC AG: Could you please explain how the HydraGEN™ technology works and how it reduces diesel consumption and CO2 emissions?

First of all, it is important to understand that at dynaCERT, we do not require an extensive hydrogen infrastructure – no pipelines or the transportation of hydrogen via trucks or trains to the consumption site, as is the case with many other currently discussed hydrogen technologies.

With dynaCERT’s HydraGEN™ technology, the situation is different and conceptually much simpler. Our customers generate the hydrogen themselves – in a separate, compact box mounted on the vehicle or generator. After an installation effort of about two hours, the integrated electrolysis unit in the box can generate the required hydrogen and oxygen 'on demand' and directly feed it into the engine’s intake tract.

By injecting the hydrogen before the turbocharger, the diesel mixture is thermally improved. This leads to an earlier and much more efficient combustion in the engine, which not only noticeably reduces fuel consumption but also significantly lowers emissions and particulate matter. The same applies to the reduced need for urea and the reduction of hydrocarbons.

To summarize: With minimal effort, fuel costs and environmental impact can be significantly reduced – what more could you want?

Another major advantage is the application in existing vehicle fleets. Our technology allows existing systems to be retrofitted without the need for costly new purchases of vehicles or generators. In this way, we also contribute to the concept of the circular economy, based on the principle of 'upgrading instead of discarding.'

GBC AG: What specific environmental benefits does HydraGEN™ offer, and how could it help companies achieve their sustainability goals?

As already mentioned, by significantly reducing fuel consumption, we 'automatically' reduce emissions, particularly in the form of CO2, THC, NOx, and other components that result from the combustion of diesel or other fossil fuels.

Furthermore, our 'upgrade instead of discard' principle not only contributes to resource conservation but also supports the principles of longevity and environmental friendliness.

GBC AG: What savings potential can your customers realize by using HydraGEN™ and HydraLytica™, especially in industries with high fuel consumption?

With the fuel reduction achieved by our HydraGEN™ by dynaCERT technology of at least 5%, depending on the application and individual driving behavior, our customers use significantly less fuel, which leads to substantial savings, particularly in the case of large vehicle or generator fleets – and all this with only two hours of installation effort.

Or, financially speaking: The ROI for the CapEx of our boxes is typically less than one year – this is certainly an impressive figure, and one that we at dynaCERT can proudly showcase in the market!

GBC AG: How do your technologies benefit from the current political and regulatory frameworks, which are increasingly focused on climate protection and CO2 reduction?

Of course, technologically sound and yet pragmatic legislative requirements are helpful for our business with hydrogen technology. This is especially true after the correction of the rather one-dimensional 'full-electric promotion' and requirements of recent years, particularly in the EU and specifically in Germany. Because in many applications, diesel fleets simply cannot be replaced in the short and medium term.

Therefore, we welcome meaningful and realistic political frameworks.

This also applies to the state-regulated CO2 trading system, in which we are increasingly participating with our HydraLytica™ telematics software by dynaCERT. Through this, we can generate and market carbon credits for our HydraGEN™ users and for ourselves at dynaCERT.

However, even without regulatory requirements, our HydraGEN™ customers would already benefit from significant fuel savings. Additional revenue from carbon credits and the associated positive environmental impact are wonderful 'add-ons' that both our customers and we at dynaCERT are happy to take for the environment and our wallets.

GBC AG: How do you collaborate with your customers? Is there a typical integration of the technology, and what does long-term support look like?

As already mentioned, we mainly focus on larger fleet operators who are looking for a retrofitting or upgrading solution for existing vehicle fleets. These include, for example, transport and logistics companies, shipping companies, or food transporters in long-distance traffic, as well as various vehicles in the mining sector.

Typically, we agree with our interested leads to install 3-5 HydraGEN™ boxes on the corresponding number of vehicles or generators. The goal is to confirm or even exceed the promised fuel and emission reductions in real-world practice and daily usage. If we succeed – which is usually the case – we increasingly gain access to the fleets of operators, with the aim of equipping the entire fleet with HydraGEN™ technology over time.

Depending on the volume and the space available, as well as the specific load profile, mechanical or technological adjustments in coordination with the fleet operator are also possible.

GBC AG: In which markets or industries do you see the greatest potential for future customers of dynaCERT? Are there any geographic regions that you are particularly focusing on?

As mentioned at the beginning, our HydraGEN™ by dynaCERT technology is fundamentally suitable for all common combustion engines that use fossil fuels.

So far, however, we are mainly focused on the areas of heavy-duty vehicle long-distance transport, mining, and the oil and gas business. Nevertheless, we are also receiving increasing inquiries from sectors such as construction, agricultural machinery, railway drives, as well as ocean-going vessels and inland shipping.

GBC AG: What are your personal goals for dynaCERT in the next 12 months to three years? What milestones would you like to achieve during this time?

First of all, I am very impressed by what my predecessors and the entire dynaCERT team have achieved over the past two decades, both technologically and in terms of environmental protection. Our HydraGEN™ hardware and HydraLytica™ software solutions are mature and comprehensively tested in theory and practice – they are 'ready for market.' This cannot be said of all the hydrogen or blending solutions currently advertised on the market.

As President and Director of dynaCERT, it is my job to further increase the global visibility of the company and its great products. In cooperation with my long-standing, senior business and customer network, I aim to rapidly expand dynaCERT's revenue, sales, and results.

Internal structures and processes at dynaCERT also need to be optimized, creating professional and highly efficient workflows that are continuously developed. In addition to increasing revenue and sales, it is also important to combine strategic foresight with high cost efficiency and customer proximity on the international supplier side and with the goal of later regional production and procurement localization.

And of course, I also want to make a significant contribution to increasing the stock price so that it better reflects the true value of dynaCERT, benefiting both our shareholders and the company.

As you can see, there is still much to do – for me and for the entire management team at dynaCERT!

GBC AG: If we look back at this conversation in five years, what would be your ideal vision for dynaCERT and its contribution to the global mobility and environmental transformation?

I have many images in mind, but let me start with this one: dynaCERT is THE global leader in upgrading vehicle, ship, and generator fleets. Through easy installation and mostly maintenance-free and robust operation, many customers and the environment benefit from significant savings in fuel and emissions – because they know: The HydraGEN™ technology from dynaCERT is reliable!

This is reflected in the dynaCERT stock price and our strong, profitable growth – for the benefit of dynaCERT, its shareholders, and its customers!

You can download the research here: http://www.more-ir.de/d/31623.pdf

Contact for questions:
GBC AG
Halderstraße 27
86150 Augsburg
0821 / 241133 0
research@gbc-ag.de
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Offenlegung möglicher Interessenskonflikte nach § 85 WpHG und Art. 20 MAR Beim oben analysierten Unternehmen ist folgender möglicher Interessenkonflikt gegeben: (11); Einen Katalog möglicher Interessenkonflikte finden Sie unter: http://www.gbc-ag.de/de/Offenlegung
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Date of Completion: 14.01.2025 (12:30 pm)
Date of First Distribution: 15.01.2025 (06:00 am)