Byrna Technologies, Inc.

Good morning. Welcome to Berna's Fiscal First Quarter 2026 Earnings Conference Call. My name is Sherry, and I will be your operator for today's call. Joining us for today's presentation are the company's CEO, Con Davis, and CFO, Larry Kearns. Following their remarks, we will open the call to questions. Earlier today, Berna released results for the Fiscal First Quarter ended February 28, 2026. A copy of the press release is available on the company's website. Before turning the call over to Con Davis, Berna Technologies' Chief Executive Officer, I will read the Safe Harbor Statement. Some discussions held today include forward-looking statements. Actual results could differ materially from statements made today. Please refer to Berna's most recent 10-K and 10-Q filings for a more complete description. of risk factors that could affect these projections and assumptions. The company assumes no obligation to update forward-looking statements as a result of new information, future events, or otherwise. As this call will include references to non-GAAP results, please see the press release in the Investor section of our website, ir.berna.com, for further information regarding forward-looking statements and reconciliations of non-GAAP results to GAAP results. Now I would like to turn the call over to Berna's CEO, Con Davis. Please go ahead, sir.

Thank you, Sherry, and thank you everyone for joining us today. I want to start by saying how excited I am to be here. This is my first earnings call as CEO of Berna, and I could not be more energized about the opportunity in front of us. Over my first several weeks in the role, I have spent a great deal of time listening, assessing the business, and aligning with the team on where I see the greatest opportunities ahead and where we need to sharpen execution. Before I go further, though, I want to take a moment to acknowledge Brian Gans. What Brian built here over the past several years is remarkable. He took this company from its NASDAQ listing to one that generated $118 million in revenue last year and built the category leader in less lethal personal defense. I am grateful for his leadership and the role he played in building Verna into what it is today. Now, as I've spent time with the business, it has become even clearer to me why this opportunity is so compelling and why this is the right time for me to step into the role. Verna is entering a phase where marketing, e-commerce, and operating execution matter enormously, and those are the areas where I believe my experience and skill set can help the business sharpen its focus and improve performance. When I was evaluating this opportunity, four things in particular stood out to me. First, the company's mission spoke to me. At Berna, we empower people to protect themselves and live safely without the need for lethal force. The opportunity to both empower individuals and save lives was truly meaningful to me. Second, The market is enormous relative to where our sales are today. At the core of this opportunity is our launcher platform, which addresses a real and growing need for less lethal personal defense. We have built a strong product and early brand awareness, but the reality is we have only scratched the surface of what this brand can become. There are entire consumer segments we have yet to meaningfully engage, and that represents a significant growth opportunity. Third, This company has important strengths already in place. The balance sheet is in great shape. We have a truly differentiated product offering that addresses a real consumer need and stands apart in the market. We have a talented and dedicated team in place. We have a strong manufacturing footprint right here in the United States, and we have a growing retail and dealer footprint that gives us multiple avenues to reach customers. These are the hallmarks of a business that is poised to accelerate. Fourth, and perhaps most importantly, I believe Berna is at a phase where stronger execution can translate the strengths already in place into more consistent growth. The dealer channel is growing, the retail channel is growing, and we have the product innovation pipeline and operational infrastructure to support the next phase of expansion. Taken together, this is a business with meaningful opportunity ahead. but realizing that opportunity will require sharper execution than the company has demonstrated recently. With that context, let me walk you through how I'm thinking about the business's priorities. First, I am focused on driving deeper penetration to our retail and dealer channels. I believe this represents our single biggest growth opportunity over the next 12 to 18 months. We are continuing to expand our brick and mortar presence and we are focused on improving productivity within that footprint. We are investing in store shooting experiences that bring the product to life for new customers, and working closely with our retail partners to ensure they have the inventory, education, and tools they need to sell effectively. The data we are gathering from our own retail locations is already informing how we approach merchandising, marketing, and sell-through, and we intend to use those proprietary insights to sharpen our approach across every channel. Second, we are working to broaden our brand message to reach new audiences and customer segments. Historically, Burna has spoken most effectively to a narrower slice of the market, and there is a much wider audience that this product and mission can and will resonate with. We see evidence that Burna can resonate more broadly when customers engage with the product in a more intuitive and effective way. whether that is in our own stores, in stronger retail presentations, or through guided tools like our new Find the Right Launcher quiz on burnit.com. I will come back to that new tool in a moment, but it is one example of how we can do a better job helping a broader audience understand what product is right for them and why. Whether it's an early morning runner, a college student walking to their car, or a family on a camp out, we believe Burna can become a more relevant and accessible solution for a wider set of customers. That means evolving our message to be more emotionally resonant and more relevant to people's everyday lives. We want our customers to understand and feel that Burna launchers are there to keep them safe and provide confidence in their ability to protect themselves in real-world situations. As one part of this change, We plan to evolve our influencer strategy to be more inclusive, reaching a broader and more diverse set of customers through a new and more impactful media channels. The less lethal personal defense category should speak to far more people than it currently does, and we intend to lead that conversation. Third, we are establishing a clear financial algorithm that will help ensure our growth flows through to the bottom line. We will be disciplined in how we deploy capital, focused on improving inventory turns, and committed to leveraging our cost structure so that every incremental dollar of revenue drives meaningful improvement in EBITDA and cash generation. Growth is important, but profitable growth is the goal. With that in mind, we are working to ensure our expanding retail footprint grows the top line and meaningfully improves our cash conversion. Additionally, with our $33 million in inventory, we have a significant opportunity to optimize our working capital and use that cash to invest in our brand strategy. I also want to be clear about our capital allocation philosophy. The highest and best use of our investment dollars right now is in the core of the Burn It business. We are long on the launcher market, and we will continue to invest accordingly. That said, we will remain thoughtful about selective opportunities that can enhance our product portfolio and expand how we address the needs of the marketplace. We have an incredible opportunity ahead of us, and I am excited to be here to help capitalize it. With that, I will turn the call over to our CFO, Lori Kearns, to walk you through the financial results for the quarter. Lori?

Thank you, Con, and good morning, everyone. Let's review our financial results for Fiscal Q1, ended February 28, 2026. Net revenue for Q1 2026 was $29 million, an 11% increase from the $26.2 million reported in the fiscal first quarter of 2025. The increase was driven primarily by continued sales expansion across dealer and chain store channels, partially offset by typical post-holiday seasonal moderation in the quarter and lower conversion rates on our websites. Growth profit for Q1, 2026 was 17.4 million or 60% of net revenue compared to 15.9 million or 61% of net revenue for Q1, 2025. The increase in growth profit was driven by the increase in overall sales. The modest change in growth margin was primarily due to the greater contribution of dealer and chain store sales. We do expect to see growth margin expansion in the back half of the year given continued changes in the product mix, modest price increases that we implemented late in the first quarter, and continued efficiency improvement in manufacturing. Operating expenses for Q1 2026 were $16.5 million, compared to $14.2 million for Q1 2025. The 16% increase reflects higher advertising expenses and marketing costs to support revenue growth through the expansion of retail distribution and initiatives aimed at increasing brand awareness and conversion. We also incurred higher costs for legal and other professional fees during the quarter. Net income for Q1 2026 was 0.8 million compared to 1.7 million for Q1 2025. Adjusted EBITDA and non-GAAP metric for Q1 2026 totaled 2.2 million compared to $3 million for Q1 2025. Cash, cash equivalents and marketable securities at February 28, 2026, totaled $9.6 million, compared to $15.5 million at November 30, 2025. The decrease in cash was primarily driven by payment of year-end bonuses and other accrued payables. Inventory on February 28, 2026 totaled $33.1 million compared to $32.7 million on November 30, 2025. As Con mentioned, we are focused on decreasing the inventory levels to improve our working capital. I will now pass the call back to Con for additional insights into our performance and future. Con?