Applied UV, Inc.

Good day. I would like to welcome everyone to the Q1 2023 Applied UV Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Brett Moss, Investor Relations from Hayden IR. Thank you. You may begin.

Thank you. Once again, welcome to Applied UV's Q1 2023 earnings call. With me on the call today are Max Munn, founder, CEO, president, and director, and Mike Riccio, chief financial officer. As a reminder, all materials for today's live presentation are available on the company's investor relations website at AppliedUVInc.com. Before we begin, please take a moment to read the forward-looking statements in our earnings press release. During today's call, we'll make certain predictive statements that reflect our current views about future performance and financial results. We base these statements and certain assumptions and expectations on future events that are subject to risks and uncertainties. Our most recent form, 10-K, lists some of the most important risk factors that could cause actual results that differ from our predictions. With that, I'll turn the call over to Max Mundt. Max, the floor is yours.

Thanks, Brett. Good morning, everyone. Our Q1 2023 financial results included revenues of $10.7 million, up 217% over the prior year quarter, with our hospitality segment growing 332% and our disinfection and healthy buildings technology segment growing 135%. As a reminder, Applied UV has three portable operating segments, three portable operating segments. The design, manufacture, and distribution of disinfecting pathogen elimination systems for use in food preservation, healthcare, hospitality, education, and public spaces, as well as cannabis, correctional facilities, commercial, municipal, and residential markets. The disinfection, healthy buildings technology segment, and the manufacture of fine mirrors and custom furniture specifically for the hospitality industry, our hospitality segment. And lastly, the corporate segment, which includes expenses related primarily to corporate governance such as board fees, legal expenses, audit fees, executive management, and listing costs. Now I'd like to take a deeper dive and review our hospitality segment. In hospitality, MunnWorks continues its pre-pandemic growth and the industry continues to show strong growth fueled by the post-pandemic travel surge. This market growth continues to heighten the need for hotels to make capital improvements to facilities to maintain their franchise flag. We've had several high-profile hotel operators placing orders with us in the multi-million dollar area. The rising demand for U.S.-based manufacturing, which eliminates the 25% tariff on China-manufactured goods, as well as 6.5% duties, as well as mitigating supply chain disruption, shortening times to delivery of goods is both driving sales and what we anticipate to be margin expansion, much of which we spoke about in our Q4 call. We expect this margin expansion of sales growth into Q2 and to continue to improve the remainder of the year. Our sales backlog for hospitality segment is approximately $10 million at this point. Now, let me discuss the disinfection and healthy buildings technology segment of our business. The UV disinfection market is expected to reach $9 billion in less than four years. The CDC expects that 1 in 25 patients have at least one hospital-acquired infection annually, totaling over 3 million serious infections and 100,000 deaths will occur each year. This amounts to losses from contagious infection pathogens and virus, which will cost the U.S. economy more than $270 billion per year and includes lost productivity due to absenteeism. Our solutions help to keep people safe and healthy, as well as protect and extend the shelf life of high-value agricultural products. Dr. Maximo Cullen, Chief Economist for Food and Agriculture for the UN, recently spoke about the impact that food spoilage has on the world economy in the form of $400 billion a year in lost fruit and vegetables, which equates to approximately 31% of those crops grown and is lost in the supply chain. Because we are leaders In photocatalytic oxidation, PCO, which is a proven technology we co-developed for use by NASA, we plan to leverage our leadership position in post-harvest food security, where our Aeroside product line is already demonstrating the reduction of loss, improving yield, of course, high-value food, fruit, and berries, while we're working with global companies such as Del Monte, Dole, Whole Foods, and others. With the help of Cannon Virginia, we expect to introduce a PCO-based air purification system that would be incorporated into shipping containers, long-haul refrigerated trucks, and distribution centers, and is currently underway. And we expect a major product launch in early Q4 of this year. Our primary focus will be centered on food security and storage, and the company plans to invest heavily in post-harvest facilities, including logistics, transportation, and distribution, which will improve the yield of high-value food and vegetables, cannabis, wine storage, all of which will be the largest area of growth for our company. Also, with the urgency for improvements to improving indoor air quality within HVA systems post-pandemic is rapidly expanding. Our acquisition of Puro Lighting, which announced a partnership with Johnson Controls and Ushio and a leading research institution to test the effectiveness and efficacy of our patented 4UV222 nanometer technology, which upon conclusion in late Q3, early Q4, will drive adoption of our unique systems. Our disinfection and healthy buildings technology segment reported $4.6 million for the quarter, largely attributed to the acquisition of Puro Lighting and LED Supply Co. We're already enjoying the cross-market selling of our case goods, part of our hospitality business, into projects bid by LED Supply. In fact, there's approximately $2 million worth of mirrors that we have confirmation on. We'll continue to work toward pathogen elimination as an option in both freestanding and to be engineered into hotel guest room furniture. There's a great cross-selling opportunity. Our sales backlog for LED supplies is approximately $7 million. As we stated, we are forecasting total revenues for this calendar year of between 45 and 50 million. And the results we accomplished in Q1 have further strengthened our view in this guidance. This further positions Applied UV as a fully integrated company providing a broad pathogen elimination platform with leading technology that can be used by consumers, businesses, and governments. As we also stated for Q4, for 2022 the company plans to continue its return to national international trade shows representing and presenting our entire suite of products at leading industry conferences all around the world these efforts combined with our plan 2023 marketing initiatives will help pave the way for an increased pipeline of orders with new and existing client wins throughout the year to support those efforts our scientific advisory board which includes Mark Behringer from the wine industry, Dr. Mason, who's an expert on PCO, and Dr. Bernard Kamen from leading infection prevention, renowned expert from Mount Sauna Hospital, which each in their respective fields will be representing the company speaking at leading industry conferences and trade shows regarding the efficacy and effectiveness of our pathogen elimination products in those proven verticals. With our global distribution, which now includes 89 dealers and distributors in 52 countries, including Southeast Asia, with manufacturing reps and 19 U.S.-based sales reps, along with numerous strategic partnerships. Firmly in place, we have a leading competitive advantage over our public market peer group with relationships with Canon, Acuity Brands, Johnson Controls, Ushio, Siemens, and Grainger, to name just a few. With both existing and new product offerings under development, we plan to leverage the potential cross-market selling opportunities across all of our brands. offering our global end users a complete suite of recharge-backed and clinically proven best-in-class products that utilizes photocatalytic oxidation, advanced UVC-activated carbon, far UV, also known as 222 nanometer devices, indoor air quality monitoring software, and LED lighting for smart building products. Our transfer of manufacturing from Offshore to Cannon, Virginia, a wholly-onset city of Cannon, USA, is progressing on schedule with the first production run complete. We believe this will yield a significant reduction in our fixed G&A expense into a variable G&A expense, and believe this partnership will translate into production and logistics cost savings by removing manufacturing execution risk and allowing the company more effectively to scale and focus solely on marketing and sales. Cannon Financial Services has recently completed the first of many anticipated leases with one of our customers. In terms of R&D, the PureOnNet proprietary software which we've developed will finally allow us to cross the bridge and accelerate our transition to adding Internet of Things integration throughout our entire product portfolio with proven software that continuously will monitor indoor air quality throughout an entire facility. One of the reasons that we've got Johnson Controls interested in our proposed joint venture. Additionally, we plan to invest and incorporate machine learning and AI capabilities into our indoor air monitoring software across our product line. which will allow us to competitively compete in one of the fastest growing air pathogen elimination markets, offering complete systems within systems, with air monitoring software a growing trend. We expect to heavily invest in AI in the next two quarters to drive our product to the front of the entire competitive field. Let me turn it now over to Mike Riccio, our CFO, for a further review of our financial results. Mike.