Energy Focus, Inc.

Greetings and welcome to the Energy Focus first quarter 2022 earnings conference call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the following 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, Brett Moss of Hayden IR.

Thank you, Brett. You may begin. Thank you, Operator, and good morning, everyone. Joining me on the call today is Steven Sokoloff, Chairman, Interim Chief Executive Officer, and Todd Nestor, Chief Operating Officer and Chief Financial Officer. Before we begin today's call, I'd like to remind everyone that we're making certain forward-looking statements. These statements are based upon information the company represents, the company's current expectations or beliefs. These results The results realized may differ materially from those stated. For discussion of these risks that could affect our results, please refer to the section under the headings, risk factors, as well as forward-looking statements in our most recent 10Q, followed by SEC. The company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law. Also, please note that during this call and in the accompanying press release, certain financial metrics are presented on both GAAP and non-GAAP-adjusted basis. Reconciliations of adjusted results to the GAAP results are available in the tables attached to the earnings release, which is posted on our corporate website at energyfocus.com in the investor relations section of the site. I'll now turn the call over to Steve. Steve, the floor is yours. Thank you, Brett.

Good morning, everyone. Just a few weeks ago, I introduced myself and spoke to you about our initiatives to improve the energy-focused business through bringing more value-added, differentiated products to the marketplace. aligning our team around near-term opportunities with an emphasis on execution and streamlining our expenses to reduce our cash burn. We have made progress in each of these areas since we last spoke, positioning the company for improved financial results in the second half of this year. As discussed on the last call, we reorganized the company to drive focus and accountability on our lines of business, as well as on the engineering, operations, and sales functions. We are building on areas where energy focus has an established reputation in the market, such as with our REDCap products. We are on track with our plans for new product introductions of solutions that leverage our core expertise in innovative military, industrial, and commercial lighting and controls, and where we believe we can see near-term results without significant additional sales and marketing investments. I am encouraged with the effort and resolve our team has displayed and believe all our resources are fully aligned toward the same strategic goal. A key rationale for our reorganization was to focus on improved execution. We have put initiatives in place to improve engineering and supply chain management with the goal of improving inventory management, reducing costs, and improving quality. We are simultaneously focused on improving sales execution in both our military and commercial markets. To this end, we are making a few strategic investments, including investing in our government direct sales team to help us better target decision makers in the military market. We are also implementing some upgrades to our approach in the commercial market to drive improved sales execution. Please don't misunderstand. We're not satisfied with the results we're reporting today. Current revenue and gross profit levels are simply not acceptable. This is why the board stepped in and made the changes we made. Current revenue levels represent a trough from which we believe we will recover. It is critical that energy focus improve its execution. We need to do a much better job of bringing new products to market successfully. We need our innovative products with great product quality and good supply chain support to drive higher margins. We also are building our sales and support teams to better serve our customers. extending our current differentiation we are developing the next generation of our red cap integrated battery backup emergency lighting products leveraging our long-standing reputation with this innovative product line the next generation will include additional features that we expect will continue to differentiate it in the marketplace this has traditionally been one of our highest demand products where we also have intellectual property and competitive advantages and we expect this to enhance our position in the retrofit market. We are also refreshing our traditional line of tube products to simplify and reduce cost. We expect this refresh to improve customer satisfaction, enable better inventory management and availability, and improve margins. Our major area of innovation involves our patented and focused power line control technology. This offering enables hardwired digital dimming and color tuning control to any lighting circuit without additional control wiring. We believe this is a disruptive solution for our market, bringing reliable network lighting control into commercial applications where concerns about security, reliability, or cost preclude the use of wireless solutions. In addition, this product line offers cost-effective and user-friendly human wellness lighting to hospitality spaces and homes, especially new home construction. We expect to launch a broader portfolio of products built around this technology late second quarter and early third quarter of this year. Our new line of UVC disinfection solutions for mobile, residential, and commercial use were introduced at the end of fourth quarter last year. First quarter this year, we have seen initial sales traction and are building both a new brand and new category of UVC air disinfectors from the ground up. We have demonstrated the effectiveness of these products, neutralizing pathogens to help create healthier spaces for living and working. We've seen positive interest following our recent promotion on the Dr. Phil show with additional media opportunities in the works. We have focused our brand building efforts on Nuvo Traveler, which offers the lowest entry costs and a lower overall cost of ownership compared to its air purifier competitors. With that, I will turn the call to Todd to review our financial performance for the quarter. Todd?