Coda Octopus Group, Inc.

Good morning and welcome to Coda Octopus Group's fiscal year 2025 earnings conference call. My name is Shamali and I will be your operator today. Before this call, Coda Octopus issued its financial results for the fiscal year ended October 31, 2025, including a press release, a copy of which will be furnished in a report filed with the SEC and will be available in the investor relations section of the company's website. Joining us on today's call from Coda Octopus are its chair and CEO, Anne-Marie Gayle, its interim CFO, Gail Jardine, its president of technology and director, Blair Cunningham, and Dylan King from their investor relations team. Following their remarks, we will open the call for questions. Before we begin, Dylan King from the company's internal investor relations team will make a brief introductory statement. Dylan, please proceed.

Thank you, operator. Good morning, everyone, and welcome to Coda Octopus's fiscal year 2025 earnings conference call. Before management begins their formal remarks, we would like to remind everyone that some statements we're making today may be considered forward-looking statements under securities law and involve a number of risks and uncertainties. As a result, we caution you that there are a number of factors, many of which are beyond our control, which could cause actual results and events to differ materially from those described in the forward-looking statements. For more detailed risks, uncertainties and assumptions relating to our forward-looking statements, please see the disclosures in our earnings release and public filings made with the Securities and Exchange Commission. We disclaim any obligation or undertaking to update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made, except as may be required by law. We refer you to our filings with the Securities and Exchange Commission for detailed disclosures and descriptions of our business, as well as uncertainties and other variable circumstances, including the not limited to risks and uncertainties identified in our Form 10-K for year ended October 31st, 2025, and Forms 10-Q for the first, second, and third quarters of our fiscal year 2025. You may get Code Octopus' Securities and Exchange Commission filings free by visiting the SEC website at www.sec.gov. I would also like to remind everyone that this call is being recorded and will be made available for replay via a link in the investor relations section of Coda Octopus's website. Finally, as a reminder, this is our fiscal year 2025 reporting in all comparisons, unless explicitly stated otherwise, are with our fiscal year 2024. Now, I will turn the call over to the company's chair and CEO, Anne-Marie Gale. Anne-Marie?

Thanks Dylan and good morning everyone. Thank you for joining us for our fiscal year 2025 earnings call. Despite the challenging global policy environment, our consolidated net revenue in fiscal year 2025 increased by 30.7% and I believe that we have delivered a solid set of results. For those who are new to the Coda Octopus story, Our business is made up of three discrete business operations, the marine technology business, the defense engineering services businesses, and our recently added acoustics, sensors, and materials business units. Within our group, our core business is the marine technology business. This business generates most of our revenue, and in the fiscal year 2025, it generated 49.8% of our consolidated net revenue. It is around this business that we are building our growth strategy. The marine technology business operates in the subsea market and is home to key disruptive underwater technologies. These technologies are bringing the smartphone revolution underwater by providing a comprehensive real-time information platform which provides vision on the water and allows our customers to make real-time decisions. This technology is a key enabler for the rapidly emerging AI-enabled autonomous capability required by the subsea market as it provides real-time 3D perception on the water. The specific addressable markets which are of relevance are the imaging sonar market and diving market. It is these market segments that our growth strategy is built around. Turning to our flagship imaging sonar, the Ecoscope. The Ecoscope is a real-time three-dimensional volumetric imaging sonar that can generate a real-time three-dimensional image underwater in zero visibility water conditions. This is widely used in the commercial offshore marine market for a range of underwater applications. A significant part of our annual revenue is derived from the commercial offshore marine market. To achieve the growth that shareholders want to see from our company, we have to increase our market share for underwater imaging sensors in the defense space. There are many ongoing defense programs globally where new classes of underwater vehicles are being adopted. Significant budgets are appropriated for this. The Ecoscope's uniqueness of being a single sensor for multiple undersea activities presents a significant advantage over other technologies. It allows the consolidation of multiple sensors into a single power-efficient unit without compromising the various missions to be executed. We recently launched our next generation of ultra-small form factor three-dimensional sonars, the Nanogen series. The three-dimensional sonars within our Nanogen series are a shade bigger than a smartphone and have been specifically designed for the emerging small-class underwater platforms encompassing manned-on-man surface, subsurface, and fully autonomous robotic vehicles. The addition of the Nanogen series allows us to address a larger swathe of the imaging sonar market. Our second key technology is the David, the diver augmented vision display system. The David provides a real-time information platform for diving operations, increasing safety and efficiency. The addressable market for the David technology includes both the defense and commercial diving sector. The untethered David variant addresses the special forces type of divers, and we believe constitutes the largest addressable market for the technology. The David tethered system is already operational and is now the subject of focused business development effort to get broader adoption. The untethered variant of David, which we believe constitutes the largest addressable market for the David technology, has been the subject of a multi-year hardening program which we successfully concluded in fiscal year 2025. Following the successful conclusion of this hardening program, we delivered a small batch of 60 new generation on tethered David systems. This variant is now going through approved Navy use assessment, which we believe will be the catalyst for broader adoption of the technology. We're also pleased with the acquisition of Precision Acoustics Limited, which is a recognized leader of acoustics and measurement sensors widely used in the medical sector. The addition of this company expands our expertise in underwater acoustics, which is critical for maintaining and extending our lead in real-time 3D imaging underwater. It also positions the group to compete for larger defense contracts. Now turning to fiscal year 2025 highlights relating to our core business, the marine technology business. This business sells its products and solutions worldwide. Key highlights in the period include this business increased revenue by 3.2%, In respect of its revenue structure in the 2025 period, 46% of revenue was generated from the defense sector with 54% from the commercial marine sector. 71.9% of revenue generated by this business relates to Ecoscope and 28.1% relates to David. Hardware sales increased by 30.5% and were $9.5 million compared to $7.2 million in the previous fiscal year. Hardware sales to Asia, a strategically important market for this business, increased by approximately 7.7% and were $5.9 million compared to $5.5 million in the previous fiscal year. Rental assets were significantly underutilized in fiscal year 2025, resulting in lower units of rentals and associated services. This also impacted on the gross profit margin of this business. This reflects the change in U.S. policy on funding for offshore renewables, which caused many projects to be shelved, as reported by Shell, Orsted BP and others. Now turning to highlights relating to the defense engineering services business. In the fiscal year 2025, our defense engineering services business revenue increased by 5.6%. This business has longstanding relationships with prime defense contractors and has served the defense market for close to 50 years. It is reliant on receiving funding on the defense programs. During the fourth quarter, it experienced delays in receiving contract awards due to the U.S. government shutdown, followed by the use of continuing resolutions to fund these programs. The success of the defense engineering business is dependent on increasing the number of defense programs that they sell proprietary parts into. Precision Acoustics Limited, in the fiscal year 2025, this business unit contributed 20.4% to our net consolidated revenue. We continue to be very pleased with this acquisition and reiterate that it positions the group to collectively respond to larger defense requirements, particularly in the underwater acoustic space. we continue to make it our priority to focus on executing our growth strategy. Blair Cunningham, our president of technology, will be updating you on our progress and various milestones around our core technologies which underpin our growth strategy. I will now turn the call over to Blair Cunningham.