LiqTech International, Inc.

Good morning and welcome to the Luck Tech International Report's First Quarter Fiscal Year 2026 Financial Results Conference Call. After today's presentation, there will be an opportunity to ask questions. To submit a question, you may type it into the Ask a Question box on the webcast screen. Please note that this event is being recorded. I would now like to turn the conference over to Robert Bloom with Lithium Partners. Please go ahead, sir.

All right. Thank you very much, operator, and good morning, everyone. Thank you all for joining us on today's conference call. As the operator indicated, to discuss LickTech International's first quarter 2026 financial results. Joining us on today's call from the company are Fei Chen, Chief Executive Officer, and David Kowalczyk, the company's Chief Financial and Chief Operating Officer. Before I turn the call over to management, let me remind listeners that there will be a Q&A session at the end of the call. Again, to ask a question through the webcast portal, simply type your question through the Ask a Question feature in the webcast player there. Before we begin with prepared marks, we submit for the record the following statement. This conference call may contain forward-looking statements. Although the forward-looking statements reflect the good faith and judgment of management, forward-looking statements are inherently subject to known and unknown risks and uncertainties, that may cause the actual results to be materially different from those discussed during the call. The company therefore urges all listeners to carefully review and consider the various disclosures made in their reports filed with the Securities and Exchange Commission, including risk factors that attempt to advise interested parties of the risks that may affect their business, financial condition, operations, and cash flows. If one or more of these risks or uncertainties materialize, or if the underlying assumptions prove incorrect, The company's actual results may vary materially from those expected or projected. The company therefore encourages all listeners not to place undue reliance on these forward-looking statements, which pertain only as of this date and the date of the release and conference call. The company assumes no obligation to update any forward-looking statements to reflect any events or circumstances that may arise after the date of this release and conference call. Now, I'd like to turn the call over to Fei Chen, CEO, of LickTech International. Fei, please proceed.

Thank you, Robert, and good day to everyone on the call. The first quarter was in line with our expectations and represented a continued step forward in the transition we have been describing over the past several quarters. Our focus remains on building a more balanced repeatable and ultimately more profitable by placing greater emphasis in the markets where our technology delivers clear value and where customer adoption can scale in a more predictable way. The year-over-year revenue comparison was impacted by a significant water for energy delivery in the first quarter of 2025. That did not repeat in the first quarter of 2026, as well as timing of order conversion. However, the underlining activities across the business were encouraging. Commercial pool, marine, DPF, and the membrane all showed meaningful activity in the quarter. And the new pool and the marine orders are setting the stage for improved results in the second quarter and throughout 2026. Compared to quarter four in 2025, revenue increased by 32%. Our gross margin expanded by roughly 1,290 basis points. The nature of our business. and the sales cycle time means that all the improvements we have made in 2025 will show gradual improvements quarter over quarter in 2026. We are therefore reiterating our full year 2026 outlook for revenue of $23 million to $27 million. David will go through the financial details in a few minutes, so I will focus on operating progress, customer activity, and strategic direction. The main message is that our strategy is advancing. We are building around a portfolio of opportunities where our silicon carbon membrane technology can be deployed in repeatable platforms supported by stronger service capabilities and scaled across geographies. Our commercial pool business continues to be one of the clearest examples of this strategy. During the first quarter, pool deliveries totaled revenue of $0.8 million, compared to $0.3 million in the first quarter, 2025. More importantly, the order activity we have announced since the beginning of the year reinforces our confidence that Clary Flow is getting traction as a differentiated solution for modern commercial aquatic facilities. In fact, based on our order book, we expect a record quarter for commercial swimming pool in quarter two, 2026. A key milestone was our first US pool system order consisting of three systems to be installed at the Weston County School District number one aquatic center in Newcastle, Wyoming. Entering the US market has been an important objective for us because it is a large market with aging infrastructure, high water quality expectations, and a growing need for more automated and space-efficient filtration solutions. We view this first US order as an important proof point that can help open additional opportunities over time. We also received consecutive record-setting pool system orders internationally. One was in partnership with Lotec for a new large-scale commercial pool project in the Netherlands. The next was a follow-on record order in partnership with water code limited for 10 systems for Plumton Aquatic and Leisure Center in Fraser Rice, Victoria, Australia. These ones demonstrate that our solution is being adopted across different geographies, project types, and the partner channels. Flurry flow is well suited to this market because it addresses several customer needs at the same time. Our systems are compact, modular, and designed for stable water quality, automation, and efficient operation. For retrofit projects, the smaller footprint can be a meaningful advantage, where equipment room space is limited. For new build facilities, the modular design gives customers a flexible solution that can be planned into the project from the beginning. From a business model perspective, pools are attractive because the systems are becoming more standardized and repeatable. This is different from a large one-off projects, which often require more customization and can be more difficult to forecast. As a pool adoption grows, we believe this vertical can contribute to better revenue visibility, improved execution, and a stronger margin profile over time. Our marine business also continued to build momentum in the first quarter. We delivered two systems under the quarter for marine dual fuel engine water treatment for LNG vessels. And we expect two more systems to be delivered during the second quarter. Marine revenue totaled 0.8 million in the first quarter, compared to 0.2 million in the first quarter, 2025. The growth in this vertical is being supported by our joint venture in China, which we believe can help drive more sustainable order flow throughout 2026. As we discussed on our last call, we have invested in local capabilities to support the marine market, including development and the localization activities and regional service infrastructure. This is important because the marine market requires reliable execution, responsive service, and a cost-competitive localized supply chain. We believe silicon carbon membrane technology has a strong fit in marine applications, particularly for vessels equipped with dual fuel engines. These vessels require advanced water treatment solutions that can support onboard wastewater purification and reuse. We are meeting demanding operating requirements. Marine is also attractive. because it has the potential to become more repeatable as adoption grows. Each vessel project has its own delivery schedule, but the underlying system platform can be standardized and supported through our regional presence. Turning to water for energy and industry applications, our view remains balanced and disciplined. Oil and gas continue to be an opportunity for leachate, and our pipeline remains active. At the same time, as we have said before, the timing of larger projects can be difficult to predict. During the quarter, we commenced a new pilot program in West Texas for produced water stream treatment with an energy services and solutions company. This type of field activity is important, because it gives customers the opportunity to validate the performance of our technology in demanding operating conditions prior to their investment decision for large-size commercial projects. And it allows us to further demonstrate the value proposition of silicon carbon membranes in produced water treatment. We continue to believe our technology is well-positioned for difficult water streams, where durability, chemical resistance, and stable filtration performance are critical. Produced water and industry wastewater are both areas where customers are looking for solutions that can handle high variability, reduce operational disruptions, and support environmental and water reuse objectives. At the same time, we are being careful in how we allocate resources. We are not basing our operating plan on the timing of any single large-oriented gas project. We will continue to pursue attractive opportunities, but we will do so in a way that supports the broader strategy of building a more balanced business. Beyond systems, our DPF and the membrane business and our plastic business remain important contributor to LeakCheck. In the first quarter, DPF and the membrane revenue increased to $1.3 million from $1 million in the prior year quarter. This was driven by strong order flow from both existing and the new customer following our renewed focus within this market vertical. Plastic revenue increased approximately 5% in the quarter and totaled about $1 million, driven by strong external interest, especially in food processing. Looking ahead, our priorities are clear. We are reiterating our 2026 outlook and remain focused on executing against the revenue growth and adjust EBITDA improvement we have communicated. The path to achieving this outlook is not depending on a single large oil and gas order. It is based on continued progress across commercial pool, marine industry application, and the components market with potential upside from water for energy as opportunities convert. The most important strategic priority is to improve the quality of our growth. where solutions can be standardized, partners can extend our reach, service infrastructure supports customer confidence, and the volumes can support better margins. We believe the first quarter provided encouraging evidence that this transition is working. Poor orders are expanding geographically, marine deliveries are increasing, supported by China J-Way DPF and membrane each benefit from renewed commercial focus. And the water for energy remains actual, but we are approaching it with appropriate discipline. Let me now turn the call over to David to review the financials in more detail. I will then make a few close comments and look to open the call for your questions. David?