ADDvantage Technologies Group, Inc.

Greetings, and welcome to the Advantage Technologies Group Report Fiscal 2022 Fourth Quarter and Year-End Financial Results. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Mr. Brett Moss with Hayden IR. Thank you, Mr. Moss. You may begin.

Thank you, Operator. We're joined today by Joe Hart, President and CEO, as well as Michael Rutledge, the company's Chief Financial Officer, and J.D. Jones, the new President of Fulton Technologies. Before we begin today's call, I'd like to remind you that this conference call may contain forward-looking statements which are subject to the safe harbor provisions of the Private Securities Allegation Reform Act of 1995. These forward-looking statements include, among other things, statements regarding future events, such as the ability of Advantage Technologies and its subsidiaries, to maintain strategic relationships and agreements with certain original equipment manufacturers and multiple system operators, as well as the future financial performance of Advantage Technologies. These statements involve a number of risks and uncertainties. Participants are cautioned that these forward-looking statements are only predictions and may materially differ from the actual future results or results due to a variety of factors, such as those contained in Advantage Technologies' most recent report on Form 10-K on file with the Securities and Exchange Commission. Financial information presented on this conference call should be considered in conjunction with the consolidated financial statements and notes included in the company's press release issued earlier today and included in Advantage Technologies' most recent report on Form 10-K. The guidance regarding anticipated future results on this call is based on limited information currently available on Advantage Technologies, which is subject to change. Although any such guidance and factors influencing it may change, Advantage Technologies will not necessarily update this information, but the company will only provide guidance at certain points during the year. Such information speaks only as of the date of this call. During this call, we may also present certain non-GAAP financial measures, such as non-GAAP net income and certain ratios that are used with these measures. In our press release and in the financial tables issued earlier today, which are located on our website at advantagetechnologies.com, you will find a reconciliation of these non-GAAP financial measures with the closest GAAP financials and a discussion about why we believe these non-GAAP financial measures are irrelevant. These financial measures are included for the benefit of investors and should be considered in addition to and not instead of GAAP measures. Finally, I'd like to note the company has adjusted its fiscal year end date from September 30th to December 31st. Accordingly, we are comparing the 12-month period ending December 31st, 2022 to the 12-month period ending September 30th, 2021. We are comparing the three-month period ending December 31st, 2022, which is our fourth quarter of 2022, to the three-month period ending December 31st, 2021, which was our first quarter in the 12-month period ending September 30th, 2021. I would now like to turn the call over to Joe Hart, President and Chief Executive Officer of Advantage Technologies. Joe, please go ahead.

Thank you, Brett, and thank you to everyone joining us on the call today. 2022 is a very good year for Advantage Technologies. and I think we have positioned the company for continued success in 2023. Both of our segments grew and both demonstrated resilience in the face of economic conditions and the ongoing global supply chain challenges. Our team responded nimbly and professionally, taking excellent care of our network, enterprise, and work-from-home customers on the telco side, and our carrier and OEM customers on the wireless side. While our telco business performed exceptionally well, we think we've only scratched the surface of the wireless opportunity, meaning we have growth and cash generation still to come, in our opinion. The December quarter and the March quarter are often impacted by weather conditions up north on the wireless side, as well as the holidays and the end-to-end start of annual budget cycles on the telco side. The fourth quarter of 2022 was no different in this regard. Our telco division grew 1% over what was a strong December quarter last year, but revenue growth tailed off at the end of the quarter compared to the previous three quarters. However, our wireless division actually delivered an 11% increase quarter over quarter and a 49% increase in revenue year over year. Simultaneously, we benefited from the cost reduction initiatives we put in place throughout the second half of the year for wireless, followed by a revenue quarter with improved margins to end the year. During the year, our improved profitability and cash generation enabled us to pay down our line of credit and strengthen our balance sheet and also provided added liquidity through a factoring arrangement. Advantage Technologies finished the full year at positive net income for the first time in six years and is poised for continued wireless growth in 2023. This was a $7 million turnaround on the bottom line YEAR OVER YEAR. CONSOLIDATED REVENUES INCREASED 5% FROM THE SAME QUARTER A YEAR AGO AND 56% FOR THE YEAR. WE ALSO SAW MARGIN IMPROVEMENTS AS GROSS MARGINS INCREASED 254 BASIS POINTS FOR THE YEAR. IMPORTANTLY, OUR OPERATING EXPENSES INCREASED ONLY 6% FOR THE FULL YEAR even as we grew revenue 56%. This positions us for significant improvements in net income and cash generation in 2023 as we continue to grow revenue. Our 4G and 5G tower work for our wireless division continues to grow, as do opportunities for expansion in 2023. Our telco segment delivered strong double-digit growth rates for three of the four quarters in 2022, reflecting continued demand for our optical transport and enterprise network offerings. The result is total company revenue of $19.6 million for the quarter and over $97 million for the year. While there is definitely some uncertainty created by economic headwinds and geopolitical tensions, we see another strong growth period for our wireless division in 2023. There is some upheaval on the wireless services provider side of the food chain that is creating opportunity for us the next several years. We have made some recent strategic hires on our wireless team and that we hope will help us exploit these impending opportunities. We see opportunities to expand our geographic footprint and to enhance our business with the wireless carriers this year. The 5G opportunity represents a multi-year growth opportunity for tower work across all four of the major wireless carriers. Each of the carriers are investing billions of dollars in the expansion, and the CapEx plans of the carriers are public and widely discussed. While some carriers may slow CapEx temporarily, the consumer demand for increased bandwidth and coverage continues to increase, thereby leading to the need to add cell sites and improve capacity. Our TOCO segment had another positive quarter, and an outstanding year in 2022. This was their seventh consecutive quarter of revenue over $11 million. Our telco segment continues to generate solid and positive contribution margin to our company. With that, I'll now turn the call over to Michael Rutledge, our CFO, to provide a more detailed review of our financial results. Michael, please go ahead.