Good morning, ladies and gentlemen, and welcome to the Ocean Power Technologies Fiscal 2014 First Quarter Conference Call. [Operator Instructions] As a reminder, this conference is being recorded and webcast. I would now like to turn the conference over to your moderator, Mr. Chris Witty of Darrow Associates, Investor Relations Adviser. Please go ahead, sir.

Thank you. Welcome to Ocean Power Technologies Earnings Conference Call for the first quarter ended July 31, 2013. OPT issued its earnings press release earlier today, and the company will soon file its quarterly report on Form 10-Q with the Securities and Exchange Commission. All public filings can be viewed on the SEC website at www.sec.gov, or you may go to the OPT website at www.oceanpowertechnologies.com. With me on today's call from the company is Chuck Dunleavy, OPT's Chief Executive Officer. Please advance to Slide 2 of our presentation on the website. During the course of this conference call, management may make projections or other forward-looking statements regarding future events or financial performance of the company within the meaning of the Safe Harbor provision of the Private Securities Litigation Reform Act of 1995. As indicated in the slide, these forward-looking statements are subject to numerous assumptions made by management regarding future circumstances over which the company may have little or no control and involve risks and uncertainties and other factors that may cause actual results to be materially different from any future results expressed or implied by such forward-looking statements. We refer you to the company's Form 10-K and other recent filings with the Securities and Exchange Commission for a description of these and other risk factors. Now let me turn the call over to Chuck Dunleavy, OPT's CEO. Chuck?

Thanks, Chris, and good morning, everyone. I'll begin by providing an update on key activities, after which we'll briefly go over our financial results for the first quarter. I'll then be available to answer any questions. Turning to Slide 3. Let me first review OPT's recent developments since our last earnings call just 2 months ago. In August, we launched one of our enhanced Autonomous PowerBuoys off the coast of New Jersey as part of a previously announced contract with the Department of Homeland Security. We're pleased with the deployment and test results of this buoy as I'll detail more in a moment. We were also recently awarded a Phase 1 Small Business Innovation Research grant of approximately $150,000 by the U.S. Department of Energy, or DOE. Under this grant, we will be evaluating certain advanced control systems for our power take-off mechanisms, which are essential to increasing the wave energy captured and hence, the total system electrical power output. The scope of work also includes assessing various control models by carrying out simulations using OPT's proprietary tools. This analysis will be corroborated using data collected from previous full-scale PowerBuoy deployments and wave tank testing. The work is aimed at enhancing the ability of OPT's wave energy convergence to increase their power output. This is a critical parameter in the reduction of the levelized cost of energy and in making PowerBuoy systems more commercially competitive with conventional power generation. When this Phase 1 is complete and if invited by the DOE, the company can apply for a Phase 2 SBIR funding for further analytical work, including wave tank testing. We're very pleased to have been chosen for this grant, particularly given that in the current budget environment, less than 12% of the DOE's SBIR and related small business technology transfer…

[Operator Instructions] Our first question comes from the line of Robert Littlehale with JPMorgan.

Your comment about the Australian government being in transition, I guess Tony Abbott now assumes control of the government from Kevin Rudd. Any sort of inkling in terms of their view, Tony Abbott's view of renewable energy, or do you think the policy will remain the same? Any thoughts along those lines?

Sure, Bob. I think there will be some changes based on what certainly I've read and also what our people in Australia have listened to, heard and passed on to us. I've also had some discussions with about 2 or 3 months ago with a person who was, at the time, the treatative [ph] Minister for Energy, who's the so-called shadow minister. So that also has provided some input to us. I think the likely -- one of the likely initiatives of the Abbott government is to reduce or eliminate the carbon tax. And other than that, we are not aware at this time of any specific articulated changes of any note. We feel confident about the continuation of the grant, which has been awarded, so -- to which I referred to a few moments earlier. But until the government really gets its feet on the ground, gets all its ministers placed with their portfolios well established, we're making, by the way, an outreach effort to a number of ministers who have been selected at this point and to make sure that they're aware of this great project. It does mean jobs for the state of Victoria, as well as potentially other areas of Australia, and that's a strong powerful message that they're listening to.

[Operator Instructions] Our next question comes from the line of George Santana with Ascendiant.

Listening to you talk about this, the sonar package, I mean, it sounds like a fairly significant development. Is that -- does that launch you into kind of a new vertical? You have to perhaps staff up in that area. Does it build on former efforts? And also, I mean, is that just the -- what we should expect as we look at your company going forward that you could kind of continue to tailor the product to different uses, and this would really be kind of the first one in that direction?

Sure. Well, certainly, the sonar and the radar very important from the viewpoint of what I'll call homeland security. That includes not only defense, pure defense, but also relates to such issues as trafficking and drugs, which increasingly uses very sophisticated seaborne vessels and illegal immigration. So there are some parts, a couple of areas in the world where illegal immigration is a very big, major concern. And so interestingly, for this system, the existing platform that we have, we've initiated some discussions with at least one government about that, that is to say the illegal immigration. And for us, a homerun with our product would be effectively for some customers to establish what we refer to as a picket line, that is to say, a series or sequence of our systems that would be out in deep ocean and which would be capable of detecting both subsurface and surface vessels. That obviates a lot of very, very expensive monitoring equipment, particularly ships and aircraft, which the government otherwise might be required to deploy. So we think it's a very compelling story that we tell in terms of the capability of our systems. So as to your question about things to look forward, I think that, that is certainly an aspect of one of the applications of the existing platform. And George, it's really important to convey that while there are other forms or versions, let's say, of the Autonomous PowerBuoy, which we are -- have some initial design work already accomplished, we're focusing very much on the product we have now, which is to say the APB-350. So we're aggressively marketing that. And in -- I think one other application which looks very promising is with respect to subsea operations in the oil and gas industry. So we've got a heck of a boost at that Offshore Europe show. I think it was about 10 days ago in Aberdeen. Just some great, great reception as a result of that. And at any show, you get a lot of people come in your booth and they all say, "Well, let's keep in touch." But you really have to focus hard on, out of that group of contacts, how many are really quality contacts of people who have a strong strategic interest and need for your product. And that was what we found at the show, that there were a number of such very enthusiastic and strategically interested parties that said, "Look, let's get together. Let's set some meetings after this show." So I think again, as we look forward, we believe that not only in the field of homeland security, but also oil and gas and in particular, subsea ops, that there's a great opportunity for our system.

[indiscernible] follow-up. It's just -- it's kind of difficult to see kind of in this and follow the development of the tidal [indiscernible] in Scotland. But has there any been strategic and [indiscernible] sector even ocean [ph] power or tidal? And what do you kind of see developing there?

George, I'm sorry. Your call cut out a little bit and I didn't catch all of the questions. So would you mind just trying one more time with the question?

Yes, no problem. In terms of any strategic investments, anything along those lines in either tidal power or ocean power, anywhere around. I know there's a lot of activity in Scotland, they're still testing a lot of that center, perhaps the Japanese. Just if anything has happened there over the last 3 to 6 months?

Well, you're right to point out some activity in Europe. I'd say, in the very short term, I'm not aware of any recently announced new strategic investments in Europe. I know that there are a few companies out there that are starting to report some results, which I think are good for some of their systems. We've always said that we don't want to be the only game in town with respect to marine energy. So I take it very encouraging that there's some other companies out there that are deploying systems, getting data, reporting that and establishing a presence within the, what I'll generally refer to as the marine hydrokinetic industry. But back to your question and the specifics of your question, I don't see any particular -- I'm not aware of any particular investments in the short term. I have to say that from our perspective, however, and some of our business development activity, we're very encouraged by some discussions that we're having with some major companies. And that's not intended to be a teaser, but simply to communicate that we have had some good dialogue with large companies interested in this field, interested in what specifically we're doing. I think an important aspect, as people considered the industry, one thing that has been said to us that they like very much about OPT is that we have not only the utility markets which we serve, but also the autonomous ones, which I've obviously spent some time talking about it during this call. But that aspect not only is an issue that mitigates risk. I think in the eyes of potential investors and customers, as well as partners, but also just simply why didn't the opportunity to make money with the PowerBuoy product. And that's, I think, hopefully provides you with a little more color about the kind of dialogue that we're having and we're seeing ourselves.

There are no further questions in the queue. I'll now turn the call back over to Mr. Dunleavy for any closing remarks.

Thank you all once again for attending today's call. If you have any further questions, please don't hesitate to contact us. Otherwise, we certainly look forward to speaking with you next quarter.

Ladies and gentlemen, thank you for your participation in today's conference. This concludes the presentation. You may now disconnect. Have a great day.