Netcapital Inc.

Good day and welcome to the NetCapital Fiscal 2023 Third Quarter Earnings Conference Call. At this time, all participants have been placed on a listen-only mode. The floor will be open for questions and comments following the presentation. It is now my pleasure to turn the floor over to your host, Corrine Kreisler. Ma'am, the floor is yours.

Thank you. Good morning and thank you for joining NetCapital's Financial Results Conference Call. for the third quarter of fiscal 2023, ended January 31st, 2023. This is Corrine Kreisler, CFO of NetCapital Inc. I will begin with a review of our financial results, and Jason Frischman, founder, will follow with an update on our platform. Our CEO, Martin Kay, will conclude with some remarks before we open the call for questions. Before we begin, I'd like to call your attention to the customary safe harbor disclosure regarding forward-looking information. Management's discussion may include forward-looking statements. These statements relate to future events or to future financial performance and involve known and unknown risks, uncertainties, and other factors that may cause actual results to be materially different from any future results levels of activity, performance, or achievements expressed or implied by these forward-looking statements. Any forward-looking statements reflect management's current views with respect to operations, results of operations, growth strategy, liquidity, and future events. NetCapital assumes no obligation to publicly update or revise these forward-looking statements for any reason. or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future. I'll begin now with a review of our financial results for the third quarter of fiscal 2023. Total fiscal year-to-date revenues increased 48% year-over-year to $5.4 million. compared to $3.6 million in the year-ago period. For the third quarter, we delivered revenue growth of 25% to $2.3 million. We generated positive operating income for the third quarter of approximately $571,000 compared to an operating loss of $136,000 in the year-ago quarter. For the first nine months of fiscal year 2023, operating income was $912,000 compared to an operating loss of $1.5 million in the year-ago period. Net income per diluted share was 33 cents for the third quarter and 46 cents for the nine-month period. At January 31, 2023, we had cash and cash equivalents of $1.8 million as compared to $474,000 at April 30, 2022. As of January 31, 2023, equity securities at fair value totaled $19.3 million compared to $12.9 million at April 30, 2022. Before I hand the call over to Jason, I would like to make some comments on the Silicon Valley Bank situation. Escrow accounts for net capital issuers are held at Silicon Valley Bank. These funds are fully insured. They are flowing freely, and we have full access to the accounts. NetCapital's main operating accounts are held at Bank of America, which is designated as a systemically important bank, otherwise known as too big to fail. The company has additional accounts at Citizens Bank. We are currently exploring additional potential escrow partners. I'll now turn the call over to Jason Frischman, founder of NetCapital.

Thank you, Corinne. During the third quarter, we announced two strategic collaborations. First, we established a new ATS, or Alternative Trading Systems, partnership with Templum Markets LLC. That brings numerous extended benefits to our funding portal users and issuers. Through the ATS, we can offer investors who purchase stocks through the NetCapital funding portal the ability to unlock liquidity through a structured, regulated alternative trading venue. We believe that our ability to facilitate secondary trading and liquidity represents a strong competitive advantage and key differentiator for net capital within the digital private markets landscape. Next, we formed a revenue sharing referral agreement with JD Merit Securities LLC, a leading boutique investment bank focused on serving middle market technology forward companies. JD Merit's mission to help companies at all stages to build, grow, and fund their businesses and their client-centric approach to strategic advice aligns well with NetCapital's core values. Through our mutually beneficial agreement, their team now has a robust solution for entrepreneurial startups through our SEC-registered funding portal, which empowers private companies to raise capital online. Collaborations like these are a key part of our ongoing efforts to exceed clients' and portal users' expectations and deliver services and solutions that are unmatched in the private capital market space. I will now turn the call over to Martin Kay, CEO of NetCapital Inc.