AgEagle Aerial Systems, Inc.

Good day, everyone, and thank you for participating in today's conference call. Joining us today from AgEagle is Chief Executive Officer and Chairman of the Board, Barrett Mooney and Nicole Fernandez-McGovern, AgEagle's Chief Financial Officer and Executive Vice President of Operations. Following Barrett and Nicole's prepared remarks, both company officers will respond to questions that were previously submitted via email by analysts and investors. Before I turn it over to Barrett, I would like to remind you that during today's call, including the question and answer session, statements that are not historical facts, including any projections, statements regarding future events or future financial performance, or statements of intent or belief are forward-looking statements and are covered by the safe harbor, sorry, disclaimers contained in the company's public filings with the SEC. Actual outcomes and results may differ materially from what is expressed in or implied by these forward-looking statements. With that said, I'll turn the call over to AgEagle's CEO, Barrett. Please go ahead.

Thank you, Kat, and good afternoon, everyone. We greatly appreciate your taking the time to join us on our webcast today. I'd like to start off by inviting Nicole to review AgEagle's key financial highlights relating to our 2022 year-end performance, after which I'll cover some operational highlights from the past year and provide you with some detail and perspective on our growth strategies and outlook for 2023 and beyond. With that, I'll turn it over to Nicole to review our financials. Nicole, over to you.

Thanks, Barrett, and thank you all for joining us today. Shortly before the start of this call, AgEagle released an announcement relating to our financial and operational highlights for the year ended December 31st, 2023. Our corresponding annual report on Form 10-K will also be filed today with the SEC and be accessible on the SEC's website and on the investor relations section of AgEagle's website. We encourage you to read over our 10-K to better understand and appreciate our business, growth objectives, risk factors, and greater details relating to our financial results, among other important information made available to you. I'll begin my prepared remarks by highlighting some key metrics relating to our results for the full year ended December 31, 2022, as compared to the prior year. Total revenues in 2022 climbed to a new company record of $19.1 million, up 96% from $9.8 million when compared to the prior year end. The increase in sales is a direct reflection of our acquisition activities in 2021, coupled with robust global market demand for our new panchromatic sensors commercially released in early 2022. Drilling down, total sensor sales for the 12 months ended December 31, 2022 increased 27% to 8.7 million compared to 6.8 million in the prior year. As noted, The increase was primarily due to growing demand for our proprietary sensor product portfolio and, more specifically, broad adoption of our new Altum PT and RedHP multispectral sensors, primarily used for sophisticated applications across agriculture, forest management, land management, and plant research. Now, looking at drone sales. We recorded revenue from sales of our line of EB fixed wing drones of $9.8 million in 2022, which compared to $2.4 million generated from EB sales in 2021. As a reminder, we acquired SenseFly in October 2021, so the prior year only has recorded sales of our EB line from October 21 to the end of 2021. Revenues from software subscriptions increased 11% to nearly $600,000 compared to approximately $538,000 in the prior year. Moving down the income statement, notwithstanding non-cash charges for goodwill impairment of $41.7 million booked in 2022, our loss from operations totaled $22.8 million, which compared to a loss from operations of $17.9 million before factoring a non-cash Goodwill impairment of $12.4 million for the 12 months ended December 31, 2021. Inclusive of the aforementioned non-cash charges, net loss totaled $58.3 million compared to $30.1 million for the years ended December 31, 2022, and 2021, respectively. In addition, The 2022 net loss was impacted by greater operating and transactional costs as a result of the acquisitions completed during the 2021 fiscal year. This was partially offset by a $6.5 million non-cash gain on debt extinguishment associated with the reductions of holdback liabilities realized in the third quarter of 2022 in connection with the company's acquisitions of SenseFly and Micasense in the prior year. Our cash position as of December 31, 2022 was $4.3 million compared to $14.6 million at the end of 2021. During 2022, we raised total net proceeds of approximately $17.9 million in our financing activities, including $4.6 million through our ATMs. $9.9 million through a registered direct offering with an existing institutional investor, and $3.3 million in promissory notes issued to a current institutional investor. More recently, in February of this year, we raised an additional $3 million through the private placement of Series F convertible preferred shares with the same institutional investor. It is important to note that the Board of Directors has been granted authority by our shareholders to issue up to $25 million of preferred stock a preferred stock in one or more series to raise capital when and if necessary to support our future operations and growth strategy. As we proceed through 2023, we intend to continue exercising strict financial discipline and cash management and capital formation, while we also work to achieve sustainable cost reductions through ongoing integration and consolidation of our business units. Now I'll pass it back to Barrett to go over some operational highlights and a review of our strategy moving forward. Barrett?