Genasys Inc.

Good afternoon and welcome to Genesis Incorporated's fiscal first quarter 2020 financial results call. All lines have been placed in a listen-only mode and the floor will be open for questions following the presentation. If you should require assistance throughout the conference, please press star zero on your telephone keypad to reach a live operator. At this time, it is my pleasure to turn the floor over to Satya Chalara, investor relations for Genesis. Sir, the floor is yours.

Thank you, Christy. Good afternoon, everyone, and welcome to Genesys Fiscal First Quarter 2020 Financial Results Conference Call. I'm Satya Chilara, Investor Relations for Genesys. With me on the call today are Richard Danforth, Chief Executive Officer, and Dennis Plan, Chief Financial Officer of Genesys. Before we begin, I would like to take this opportunity to remind you that during the course of this call, management will make forward-looking statements. Other than the statements of historical facts, statements made during this call that are forward-looking statements are based on our current expectations. During this call, we may discuss company plans, expectations, outlook, or forecast for future performance. These forward-looking statements are subject to risks and uncertainties, and the actual results could differ materially from the views expressed today. For more information regarding potential risks and uncertainties, please refer to the risk factors section of the company's Form 10-K for the fiscal year ended September 30, 2019. Genesis disclaims any intent or obligation to update those forward-looking statements except as otherwise specifically stated. We may also discuss non-GAAP operational metrics of bookings and backlog, which we believe provide helpful information to investors with respect to evaluating the company's performance. We consider bookings and backlog leading indicators of future revenues and use these metrics to support production plan. Booking is an internal operational metric that measures the total dollar value of the customer purchase orders executed in a given period regardless of the timing of the related revenue recognition. That log is a measure of purchase orders received that are scheduled to ship in the next 12 months. Finally, a replay of this call will be available in approximately four hours through the Investor Relations page on our website. At this time, it's my pleasure to turn over the floor to Genesis Chief Financial Officer, Dennis Clark. Dennis?

Thank you, Satya, and welcome, everyone. I will open today's call with a recap of the fiscal first quarter 2020 financial results. Richard will then provide an update on the business. Afterwards, we'll open the call for questions. Revenues for the first quarter of fiscal year 2020 were $8.8 million compared with $10.2 million in the first fiscal quarter of 2019. Gross profit was $4.6 million or 52.4% of revenue. The improvement over the 50% gross profit in the prior year quarter was due to more profitable product mix. Operating expenses in the fiscal first quarter of 2020 were $3.9 million, an increase of 3% compared to the same period in the prior year. This primarily reflects the company's increased level of investment in software development to support the previously discussed European Union and other public warning initiatives. We generated net income of $620,000, or two cents per diluted share, in the fiscal first compared with net income of $1 million or 3 cents per diluted share in the same quarter last year. Cash used in operating activities in the quarter was $1.8 million. This represents an improvement of $3.3 million compared with the first quarter last year. The use of cash in the quarter was primarily due to higher accounts receivable and reduced liabilities compared with balances at September 30, 2019. This was somewhat offset by the net income and non-cash charges recorded this quarter. Our balance sheet remains strong. Cash and cash equivalents at December 31, 2019 were $17.1 million compared to $18.8 million at September 30, 2019. The $1.7 million decrease in cash and cash equivalents was mostly due to the cash used in operating activities in the quarter. Working capital increased by $1 million to $25.8 million at December 31, 2019, compared to $24.8 million at September 30, 2019. The increase was primarily the result of net income generated in the quarter. There were no repurchases of company stock in the quarter. Last year, the Board authorized a $5 million repurchase program through December 31, 2020, of which 4.5 million is still available. With that, I would like to turn the call over to Richard.