BIO-key International, Inc.

Good morning, ladies and gentlemen, and thank you for standing by and welcome to BioKeys International's second quarter 2021 conference call. During management's prepared remarks, all participants will be in a listen-only mode. Afterwards, listeners will be invited to participate in a question-and-answer session. As a reminder, this conference is being recorded today, Tuesday, August 17, 2021. If you require operator assistance, please press star, then zero. I would now like to turn the call over to Ms. Kimberly Johnson, BioKeys Vice President of Product. Please go ahead, ma'am.

Thank you, and thank you for joining our call this morning. With me on today's call are BioKeys Chairman and CEO Mike DePasquale, Chief Revenue Officer Fred Corcentino, and our CFO, CeCe Welch. I'd like to remind everyone that today's conference call and webcast may contain forward-looking statements that are subject to certain risks and uncertainties that may cause actual results to differ materially from those projected on the basis of these statements. Words such as estimate, project, expect, anticipate, believe, think, plan, may, or will, or similar words, typically identify and express forward-looking statements. Such forward-looking statements are made based on management's beliefs and assumptions made using information currently available pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. For a complete description of these and other risk factors that may affect the future performance of FIO-key, please see risk factors in the company's annual report filed on Form 10-K and in other filings with the Securities and Exchange Commission. Listeners are cautioned not to place undue reliance on forward-looking statements which speak only as of today's date. The company undertakes no obligation to revise or disclose revisions to such forward-looking statements to reflect events or circumstances that occur after today. With that, I will turn the call over to Mike DePasquale. Mike?

Thank you, Kim, and good morning, and thanks to everyone for joining our call today. After my prepared remarks, I'll turn the call over to Fred to review some of our key initiatives, followed by Kim, and then CeCe will briefly review our financial results and Solid Balance Sheet position. In past calls, we've discussed the favorable work and study from anywhere trends that have rapidly increased demand for the identity and access management solutions that we provide. We've also reviewed core capabilities that differentiate our solutions, including our industry-leading biometric capabilities and our support for a broad array of other identification factors that allow our solutions to easily integrate with most customers' existing infrastructure. These factors continue to support our optimistic growth outlook. Through the first half of 2021, our performance is showing growth and progress we envisioned following last year's recapitalization and the strengthening of our team and our product offerings, including the acquisition of PortalGuard's parent company. In particular, We are seeing strength in demand for our PortalGuard iDAS cloud offering, including migrating existing customers from our on-premise solutions to our cloud-based software as a service, or what we call ID as a service, or iDAS. We are also seeing strong interest in our channel alliance partner program, which Fred will touch on. In Q2, We expanded our reach to over 55 higher ed customers in the California college system, and we continue to migrate other colleges and enterprises to our PortalGuard iDesk offering. For example, Rio Hondo College selected our iDesk platform to improve the security and user experience for its over 19,000 students, enabling them to securely and seamlessly access More than 20 of the school's enterprise-wide applications. Regarding BioKey Africa, after starting initial hardware shipments in Q1 to support our large-scale ID projects in Nigeria, the re-emergence of COVID-19 challenges caused a suspension of activity, impacting Q2 shipments. Though we continue to expect a re-acceleration of activity in these efforts, It's very difficult to predict the exact timing with certainty, though we do expect to recommence at some point in Q3 and through the remainder of 2021. As I've mentioned on each of our recent earnings call, the challenge is balancing the equipment and services required with the availability of cash that is flowing through to our partners. The good news is that we are now in process of receiving bank guarantees so that BioKey will be paid directly by the bank for what we deliver through to the partners and other service providers that are undertaking the mass enrollment and verification activities in Nigeria. The World Bank is now pushing the funds down to the national Nigerian banks to accelerate the deployment process, much of which has been held up because of funding. This is a seminal event because it now means we have surety of payment as the contracts evolve, reducing or eliminating any risk on our part. Our managing director in Nigeria has been heavily engaged in this process over the last 30 days. As for our financial performance in the quarter and year to date, we were able to increase revenue, Q2 revenue, by 223%, and revenue for the first six months of 2021 is up 247% versus the year-ago periods. The performance keeps us on track to achieve our full-year revenue guidance of $8 to $12 million, the midpoint of which would represent growth of 250% over 2020. We continue to position BioKey to achieve profitability within this revenue guidance range. However, that would depend on the mix of hardware and higher margin software revenues. Given our strong balance sheet, expanding portfolio of solutions, Building Demand for our iDesk Cloud Offering and the Substantial Growth Potential Presented by our Africa Initiatives, we remain very excited regarding our prospects for the balance of this year. Let me now pass the call to Fred to highlight a few key business development highlights.