Gorilla Technology Group Inc.

Thank you for standing by. This is the conference operator. Welcome to the Guerrilla Technology Group, Inc. earnings call for the first quarter of 2025. As a reminder, all participants are in a listen-only mode, and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. To join the question queue, you may press star, then one on your telephone keypad. Should you need assistance during the conference call, you may signal an operator by pressing star and then zero. Before we begin, we will read the forward looking statement. Today's call includes forward looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements reflect management's current expectations and projections about future events and are subject to known and unknown risks and uncertainties that could cause actual results to differ materially. Forward looking statements often include terms such as expects, believes, plans, anticipates, may, should, and similar expressions. For a discussion of important factors that could affect GORILLA's results, please refer to our filings with the SEC, including our most recent Annual Report on Form 20-F. Except as required by law, GORILLA undertakes no obligation to update or revise any forward-looking statements made on this call, whether as a result of new information, future events, or otherwise. I would now like to turn the conference over to Jay Chandon. Chairman and Chief Executive Officer, and Bruce Bauer, Chief Financial Officer. Please go ahead. Bruce Bauer Thank you very much, Nick.

Well, for everyone who's here today, first of all, welcome to our conference call. I'm delighted you all could join. This has been one of the most operationally significant quarters in Gorillaz history. We are expanding across the United States, Latin America, Southeast Asia, and East Asia, converting the real pipeline into delivery and deepening partnerships with some of the world's most respected institutions. Guerrilla is scaling fast and executing harder. The quarter reflects exactly what we have been building towards, strong financial performance, global expansion, and material progress across smart infrastructure, AI security, and national digital systems. What you all are seeing right now is not an early-stage growth. It's a strategic expansion. We're securing projects in ports, airports, data centers, hospitals, education, law enforcement, and all of this is now moving from negotiation to execution. Over the last two years, we have made deliberate decisions to focus inward, fixing the fundamentals, which is very key for our business, restructuring globally, scaling our delivery capabilities, hiring the right people, and proving above all that we can execute. Now, we are not just a hybrid company. While others were chasing headlines and inflated projections, we were securing national infrastructure contracts, deploying mission-critical systems in the public sector, and more importantly, getting our financial house in order. That meant tightening our operations, rebuilding teams, pushing through complexity in multiple markets, quietly, consistently, and without the need for a drumroll. Now, with our revenue up more than 100% year-on-year, And with a positive net income, and more importantly, with a 5 million plus pipeline and real deals being delivered across Southeast Asia, Middle East, North Africa, Latin America, and beyond, the results are loud enough, or I believe the results are loud enough on their own. We're seeing immense acceleration from Q2, Q3, Q4, going into 2026. And I couldn't be more excited to join you all on this call and let you know that, you know, we are positioned for a very strong 25th as well. Bruce, do you want to take them through the numbers on a very high level?

Yes. So I would like to mention a few of the highlights that I'm sure you've seen from the release. So the first is, of course, the revenue of $18.3 million, 109% year-on-year growth. But not only that, we're quite happy with the adjusted EBITDA of $5.16 million, which represents a 48% increase year-on-year, and then the adjusted mid-income of $4.47 million, which is a 46.7% increase. In total, this means that we're executing well on the contracts, the business that we have, and it's flowing through into profitability. The other thing I'd like to point out is that the balance sheet remains strong. So the first thing is total cash reserves, both restricted and unrestricted, closed the quarter at $73.8 million. In addition, we did that while managing to reduce debt. So the debt has dropped from over $20 million at the end of the year to $18.4 million. Subsequent to the close of the quarter, we actually have reduced the debt further to $17 million as of today. We've done that in a cash-neutral fashion where basically we have blocked deposits that are collateralizing the loan, so pay off a dollar of debt that releases a dollar of blocked deposit. So we're very proud of the way that we've managed the balance sheet in this time. A couple of other things I'd like to point out. is, first of all, the cap table. So we ended the first quarter with less than 20 million shares outstanding, slightly less than 20 million, and now it's a hair over 20 million shares outstanding at 20.15. And then the fully diluted share count remained the same because that increase in outstanding shares came due to the exercise of warrants. The other thing I'd like to point out is that during the second quarter, so subsequent to the earnings release, we spent $1.8 million on share buyback. So that means that we've spent a total of $5.4 million on the buyback program in the last 12 months. In addition to that, we have a total of $10 million program authorized. So that gives us $4.6 million of remaining capacity. We've done all this with the business, with the balance sheet, while also investing for the future. So Jay, of course, mentioned some of the pipeline and some of the partnerships that we have. I would like to highlight, first of all, the one Amazon partnership where in the first quarter we made a $1.5 million investment. We followed with $3.5 million in the second quarter. So a total commitment of $5 million to secure that long-term partnership. I'm sure Jay can mention more about what's going on in general with that, but we're very happy to be participating in this partnership in a financial way. At the moment, you can see that that investment is carried at cost on the balance sheet for the quarter. One other thing I'd like to point out is the guidance. So the guidance has remained for 2025 the same. where it's $100 to $110 million is the revenue guidance. This is based on a backlog, which is revenue that we have secured in the sense of where we have contracts signed and is either due to be implemented or it's being implemented already. There's a date attached to the revenue. And we expect an EBITDA of $20 to $25 million based on that revenue number, and then a net profit in the range of $15 to $20 million. Of course, that excludes extraordinary items. So that guidance remains the same. And then 2026, we are not in a position to issue guidance for the full year, but we can say that the backlog continues to shape up. So it's at 70 million for 2026. And then also we have several projects that we have talked about where it's in the proof of concept stage and advancing. So we are confident that that backlog will grow. And then the last thing is Jay mentioned that we have over 5 billion in pipeline and qualified leads. The SHARP observers will note that that is actually decreased from earlier in the year, whereas over 6 billion. The reason for that is actually because our MOU with the PEA, the Provincial Electricity Theory in Thailand, has moved into proof of concept stage, so it's no longer a qualified lead. It's in the proof of concept stage. So that is the reason for the drop. Outside of that, actually, the qualified leads, you know, the amount of sort of contract, potential contract value attached to them grew. And then one other thing, not quantitative, but I'd like to talk about the funding. So as you can tell, we have strong balance sheets, which is like in terms of cash balance, both restricted and unrestricted cash. and also the debt that continues to reduce. The funding that we have on the balance sheet now is enough to tackle the projects that we have signed already, and it's enough to tackle what we envision as the projects that we'll be signing shortly. If we were to sign more projects that need funding, then we would first look for project-level funding. Second would be debt or debt-like insurance, and only then maybe when we look for equity. But I'd just like to emphasize that we're very confident in the balance sheet that we have and our ability to take on new projects without, first of all, hopefully without having to raise outside funding. And if we do have to raise outside funding, Jay and I remain committed to protecting shareholders. Those are the main points from me. Back to you, Jay, or over to the moderator.