MIND Technology, Inc.

Greetings and welcome to Mind Technology third quarter 2021 conference call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal 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 Mr. Ken Dennard. Thank you. You may begin.

Thank you, operator, and good morning, everyone, and welcome to the Mine Technology Fiscal 2021 Third Quarter Conference Call. We appreciate all of you joining us today. Your hosts are Rob Capps, TOE Chief Executive Officer and Chief Financial Officer, and Guy Mauldin, TOE Chief Executive Officer and Executive Vice President of Marine Systems. Before I turn the call over to management, I have the normal housekeeping details to run through. If you'd like to listen to a replay of today's call, it'll be available for 90 days via webcast by going to the investor relations section of the company's website at mine-technology.com or a recorded instant replay will be available until December 11th. Information on how to access the replay features was provided in yesterday's earnings release. Information reported on this call speaks only as of today, Friday, December 4th, 2020 and And therefore, you're advised that time-sensitive information may no longer be accurate as of the time of any replay listening or transcript reading. Before we begin, let me remind you that certain statements made by management during this call may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management's current expectations and include known and unknown risks uncertainties, and other factors, many of which the company is unable to predict or control, that may cause the company's actual future results or performance to materially differ from any future results or performance expressed or implied by those statements. These risks and uncertainties include the risk factors disclosed by the company from time to time in its filings with the SEC, including its annual report on Form 10-K for the year ended January 31, 2020. Furthermore, As we start this call, please also refer to the statement regarding forward-looking statements incorporated in our press release issued yesterday, and please note that the contents of our conference call this morning are covered by these statements. With that behind me now, I'd like to turn the call over to Guy Malden. Guy.

Thanks, Ken, and good morning, everyone. We would like to thank you for joining us today for our fiscal 2021 third quarter conference call. Conditions in the global marine industry remain challenging due to the lingering impacts of COVID-19 and the growing number of restrictions and regulations that have emerged as a result. However, we continue to make progress and build momentum in both our day-to-day operations as well as our longer-term strategic growth initiatives. With that in mind, let me begin by making some general comments about the third quarter. I'll then take the opportunity to outline what we consider to be important market trends emerging in the marine industry, how they fit into our future growth plans, and what we are doing to capitalize on them. Turning now to the third quarter. While COVID-19 negatively impacted our operations due to lingering uncertainty and travel restrictions, the quarter progressed a bit better than we had anticipated. As we mentioned during our second quarter call, our expectation had been that third quarter revenues would be roughly flat in the second quarter. However, we managed to achieve nearly a 29% sequential improvement in revenues despite the restrictive macroeconomic environment. As I stated in our previous call, we believe the pandemic and its consequences have weighed heavily on our customers and hampered their willingness to commit to expenditures. Despite that, There still is a healthy level of inquiry and bid activity in the marketplace. We feel that now is an ideal time to highlight and review our approach to the global marine market since we've recently completed our comprehensive reincorporation and rebranding and are also in the midst of exiting our legacy seismic land leasing business. With these actions either completed or in progress, it's helpful to review our vision and outline our longer-term initiatives for the company. and how we plan to build on the momentum we've established to pursue our identified growth opportunities. So let me start by outlining our target markets before I review the trends that we see developing in those markets and how we plan on leveraging our capabilities to take advantage of the opportunities these trends provide. Looking at the marine industry, based on our target markets, we provide our technology to three major segments. First, the exploration market, which includes marine seismic exploration and survey activities conducted to support decision-making on engineering and renewable energy projects, as well as oil and gas and other mineral exploration. We estimate its serviceable market size, which is the portion of the market that we can serve with our current and planned products, to be roughly $440 million per year. Second, the survey market, which is made up of search and recovery activities as well as hydrographic and construction surveys, is estimated to have an annual serviceable market size of about $150 million. And third, the defense market, which is made up of applications such as mine countermeasures and anti-submarine warfare and maritime security, is estimated to have a serviceable market size of about $750 million per year. So all told, These three market segments yield a combined estimated serviceable market size of about $1.3 billion a year. Given the size of the opportunities available to us, our goal over the next five years is to grow our annual revenue to $140 million, with EBITDA margins in excess of 20%. We anticipate that most of the growth will be driven organically with the help of our strategic initiatives, which I will address shortly. The remaining balance will be driven by strategic partnerships and acquisitions. Now within those three market segments, there are certain developing market trends that represent significant growth opportunities for MIND. As we now see it, those trends include the following. First, the proliferation of unmanned or uncrewed marine vehicles, be they surface or underwater vehicles, for the commercial and military markets. These are often referred to as unmanned surface vehicles, or USVs, and autonomous underwater vehicles, or AUVs. Second, growing customer demand for higher resolution sonar images. And third, the need for alternative technology solutions for anti-submarine warfare and maritime security to counter the growing maritime security concerns, such as the rapid acquisition of conventional submarines in regions such as Southeast Asia. In order to address these trends and better exploit the opportunities, we have established certain strategic initiatives. For instance, to address the growing market need for uncrewed or unmanned vehicles, we have focused on providing sensor packages tailored specifically to these vehicles, enabling customers to obtain a more complete solution and easier integration into their platforms. Similarly, To address the growing customer need for greater resolution sonar imaging, we've recently partnered with a major European defense contractor in a mutually beneficial arrangement to produce synthetic aperture sonar, a type of side scan sonar that can yield much higher resolution images. And finally, in the area of maritime security, we are applying existing, commercially developed technology, such as our Solid Streamer product, to provide more cost-effective practical solutions to this developing market. Furthermore, our substantial existing production capacity enables us to eliminate a significant barrier to entry and produce these items quickly and economically versus more traditional solutions. Now, initiatives like these play a critical part in the development of our company as we look to expand and add new technology and applications to the marine market. We feel that they are in very natural progression from our existing sonar and seismic capabilities. It's my hope that this discussion has enhanced your understanding of how we plan to leverage our core competencies and utilize existing technologies in new, unique, and innovative solutions to expand into new markets. Let me now turn the call over to Rob, who will discuss our financial results in more detail and add some closing comments before turning the call over for Q&A.