Monogram Technologies Inc.

Good afternoon, everyone. I'm Larry Holub, Director at MZ Group North America. I would like to welcome you to the Monogram Technologies fourth quarter and full year 2024 financial results and business update conference call. A question and answer session will follow the formal presentation. Webcast viewers can submit written questions for the Q&A portion of this presentation. As a reminder, this conference call is being recorded. Before we begin the formal presentation, I would like to remind everyone that statements made on the call and webcast may include predictions, estimates, or other information that might be considered forward-looking. While these forward-looking statements represent our current judgment on what the future holds, they are subject to risks and uncertainties that could cause actual results to differ materially. You are cautioned not to place undue reliance on these forward-looking statements which reflect our opinions only as of the date of this presentation. Please keep in mind that we are not obligating ourselves to revise or publicly release the results of any revision to these forward-looking statements in light of new information or future events. Throughout today's discussion, we will attempt to present some important factors relating to our business that may affect our predictions. You should also review our most recent Form 10-K and Form 10-Q for a more complete discussion of these factors and other risks, particularly under the heading Risk Factors. A press release detailing these results was issued today, March 12, 2025, and is available in the investor relations section of the company's website, monogramtechnologies.com. Your host today, Ben Sexton, Chief Executive Officer, and Noel Canopy, Chief Financial Officer, will present results of operations for the fourth quarter and full year ended December 31, 2024. At this time, I will turn the call over to Monogram Chief Financial Officer, Noel Canopy.

Good afternoon, everyone. Glad to be with you today. Thank you for joining us. I'm just going to dive right in and give you a review of where we are for the year from a financial perspective, and then I'll hand it over to Ben to share some exciting upcoming events that are coming up in the near future. As you know, as a startup, cash is extremely important, and we've done a good job of shepherding our cash this year. ending with a cash balance of $15.7 million, which was higher than the cash balance at the end of the previous year. This is due to one, being very frugal in our spend and maintaining our monthly cash burn to around $1.2 million as it's been for some time. And also due to a successful preferred D raise where we had an oversubscribed $13 million successful raise. combined with some significant investment by senior management. And this is indicative of the faith they have in the technology and the business and management going forward. So we're very happy to see that. And then we were also able to access with some institutional investors, access to our ATM facility to raise a little bit more there. So we have a strong balance sheet going into the year and to meet our upcoming milestones. We are still very highly variable in our cost structure. We have 27 full-time employees, and we leverage outsourced engineering talent when needed. We were able to scale back on that some in Q4 as the V&V portion of the project wound down. And we're focused on getting the AIR submitted and onto our next objectives. Again, we have no traditional debt and very limited short-term warrant obligations right now. And we expect to have a solid cash through the year. So all things looking positive, all things going forward, and we're prepared to enter the next stage of our journey. So with that, I'll hand it over to Ben Sexton, the CEO, who will walk you through the exciting things that are on the agenda and coming up shortly. Thank you.

Thanks, Nolan. Thank you, everybody, for joining us today for our fourth quarter call. Appreciate everybody's time. So I'm just going to start by really recapping what the monogram investment thesis is. And it's really pretty simple. We think that robotic penetration today is not what it will be in the future. We think it's going to be significantly higher in the future, driven by a lot of clinical factors that we can get into. And we think that we can get into the reasons for why this is, that there's one dominant player that really has demonstrated significant robotic utilization They have the strongest market position. They're consistently growing year over year. And we think that they really have demonstrated what's valuable in orthopedic robotics, specifically in the knee replacement area, which we think will grow significantly in terms of robotic adoption. And so our thesis is that any company that really does not get its act together with a robotic knee strategy, let's say, and then moving into other applications as well, will really have A lot of an uphill climb, let's say. So Monogram really has always, from the beginning, been developing a robot that we hope will address this market pain that we think is going to become more and more obvious over time, in our opinion. So just kind of starting out, we think that the market is currently digesting robotics as a growth driver. but not a kill shot. And what do I mean? I mean, if you look at the market today, in total knees, robot utilization is still low, as you can see here. It's not like the majority of knee replacements are not robotic. Maybe the key question is, where is this going to be as we move forward? When you think about it from a clinical perspective, especially Mako, which utilizes a personalized CT scan, robotics enable more personalized surgery. They enable different types of alignment. They help with press fitting of implants. So instead of putting an implant in and cementing it down, they can help with, let's call it a more precise bone prep surface, which can accommodate press fit implants. Systems like Mako have safety boundaries that we think are really imperative for helping to minimize the risk of cutting soft tissues or adverse outcomes. Then if you just look at the demographic trends, 70% of fellowship programs have access today to a MAKO, and 60% of orthopedic surgeons will be over the age of 65 by the year 2031. And we've seen forecasts that suggest that one out of two knee replacements will be robotic within the next five years. So if that's kind of just setting the table for where the market's going, it's important to kind of look at where we are now. And there's a lot of factors, obviously Stryker is a, what you see here is a, stock prices for various players in our space. Stryker is the one in black and some of the other publicly traded companies. And we don't think it's any coincidence that around the time that Mako was cleared for total knee, that Stryker's outperformance has gone parabolic. And obviously they've made a lot of really smart moves and they're a well-diversified business and probably the most well-diversified of any of the orthopedic total joint reconstruction players. But That aside, it's clear that they have done something right. And I don't think that the market has fully understood what exactly it is that they've done right. And understanding that is really fundamental to the monogram investment thesis. And this is just to stress the point even more. When you look at robotic knee replacements, 88% of robotic knee replacements use a Mako system. And 73% of press fit knee implants, this is per the orthopedic news network, are press fit and that market's owned by Stryker. So in our opinion, the market has spoken. If you talk to surgeons and we talk to a lot of them, you're going to hear a whole bunch of different reasons why that is. I think the most common reason you'll hear is because Stryker had a significant first mover advantage with Mako. And I think that that certainly may be true and maybe a contributing factor. But when you dig into the details, there are things about the Mako system that are unique to the Mako system that nobody else really can do. And we've in terms of taking a complex problem and trying to distill it down into what actually makes it different. I think it really boils down to the fact that with Mako, a surgeon can efficiently do the surgery. by themselves. We know a lot of surgeons that don't even use retractors. You have safety boundaries and you can efficiently cut bone with safety constraints. And there's just no other system on the market today that has been able to efficiently cut bone with safety constraints in the way Mako has. And the primary reason for that is their IP portfolio and the complexity of executing this problem without infringing on that IP portfolio. And so that is the monogram investment thesis in a nutshell, is that we think that we have a system that can efficiently cut bone very accurately with safety constraints. And it really is going to be that simple. And we announced not too long ago, had a press release and in that press release, we had a video that I don't think has been fully digested by the market. So, so Mako, the Mako system does not utilize external fixation, meaning the surgeon doesn't have to bolt the bone down. It's not like a CNC. It's a, it's a real time system and the bone is free to move. And they utilize something called haptics where the surgeon is actually, it's surgeon initiated cutting. The surgeon is the one moving the robot around. what Monogram is doing is fully autonomous cutting. The challenge of this, which it's never been done before, is nobody's ever done it with two things. One, nobody's ever done it with a saw as we're doing it, and nobody's ever done it unconstrained with a saw. So what we put out in that video not too long ago, and I'll just upload that, is we can now very, very efficiently cut with a saw, and this is our next gen end effector that we will be deploying in our clinical trial, which we hope to talk more about. But we can now, this is a fairly, one of our larger size femurs, but you can see that with this new upgraded end effector, I don't know if it's frozen on your side, it's not playing on my side. Can you see it? No. Um, is it playing for you or is it frozen?