NextPlat Corp

welcome to the next Cloud Core 2024 earnings conference call. Certain statements made during this conference call constitute forward-looking statements. These statements include the capabilities and success of the company's business and any of its products, services, or solutions. The words believe, forecast, project, intend, expect, plan, should, would, and similar expressions in all statements, which are not historical facts, are intended to identify forward-looking statements. These forward-looking statements involve and are subject to known and unknown risks, uncertainties, and other factors, any of which could cause the company to not achieve some or all of its goals or the company's previously reported actual results, performance, finance or operating, including those expressed or implied by such forward-looking statements. More detailed information about the company and the risk factors that may affect the realization of forward-looking statements is set forth in the company's filings with the Securities and Exchange Commission, copies of which may be obtained from the SEC's website at www.sec.gov. The company assumes no and hereby disclaims any obligation To update the forward-looking statements made during this conference call. Joining us on the call today are Charles M. Fernandez, Chief Executive Officer and Executive Chairman of the Board. David Phipps, President and CEO of Global Operations. And Cecil Monick, Chief Financial Officer. I will now turn over the meeting to Charles Fernandez for his opening remarks.

Good morning and welcome to Next Class 2024 Year-End Earnings Conference Call. Thank you for joining us for our call today. I will provide a review of our 2024 operations and accomplishments. The SEAL will then provide a high-level review of our financial results as reported in our annual financial statements contained in Form 10-K that was filed earlier today. David will discuss the results and highlights of our e-commerce business segment. And then I will return to discuss activities and accomplishments in our healthcare segment. We will conclude the conference by responding to questions that were submitted by our shareholders prior to this call. 2024 has been a challenging yet rewarding year for Nexplan and its subsidiaries. We are pleased with the overall performance of the company despite some challenges in our healthcare segment with consolidated revenues exceeding previous estimates. In October, we completed our merger with Progressive Care and its operating subsidiaries after approval by our shareholders. In April, we acquired Outfitter Satellite with offices in Nashville, Tennessee in expanding our sales of satellite-related products in North America through our product sales to customers, commercial, and government. We've experienced a number of positive developments in our e-commerce segment, both for the connectivity products and the slow but steady progress in China and Asia with our Opco e-commerce development program, which was extended and ramped up activities to support the future launch of our Florida Sunshine product line. Overall, we've increased our participation in e-commerce in large domestic and international customer markets and in the U.S. healthcare. We are supporting a growing number of 340B covered entities and long-term care facilities. Our team is working hard to maximize growth, run the business efficiently, reduce our costs across the organization so we can generate positive outcomes, cash flow from our investments. We are pleased that our results for 2024, excluding non-cash expenses and costs related to the merger, reflect progress against our strategic growth initiatives. I'd like to introduce our Chief Financial Officer, Cecile Monick, who will provide you with our overall annual financial reporting.

Thank you, Charlie. I would like to provide you with a summary of our results of operations for the year. and our financial and cash position as of December 31st, 2024. We are pleased with our revenue growth, primarily from the addition of a full year of revenue from our healthcare segment and the acquisition of Outfitter Satellite. Total revenue for the year was approximately $65.5 million, which exceeded our earlier sales guidance predominantly due to our healthcare segment outperforming our projected prescription fulfillment. Gross profits from our healthcare segment decreased from 32% in 2023 to 25% in 2024 as a result of continued pressures from medication price increases along with pay reimbursement rates not keeping pace with those price increases. This is an industry-wide problem for independent pharmacies such as our PharmCo subsidiaries. Gross profits from our e-commerce segment slightly decreased to 25% when compared to prior year and was primarily due to rising inventory costs and price pressures from our competitors. Due to the pricing pressures I have just noted, we continue to implement efficiency and cost-cutting measures, which are in part responsible for decreases in some of our operating expense categories. We have introduced changes in our delivery services designed to reduce driver time and maintenance costs, and change our pharmacy software and equipment that allows for greater flexibility and automation in filling prescriptions. The year-over-year increase in operating expenses was attributable to non-recurring, non-cash expenses, such as impairment losses, which were a result of the remeasurement of the fair value of the intangible assets recognized in the Progressive Care Acquisition. We also incurred significant non-recurring professional fees and other expenses associated with the progressive care merger, as well as litigation that was settled in 2024 of approximately $750,000. We ended the year with approximately $20 million in cash. Much of the decrease in our cash position during 2024 was the result of the non-recurring costs as it relates to the progressive care merger that I have identified previously, as well as cash used in the acquisition of Outfitter Satellite. Excluding non-recurring expenses, total cash used in recurring operating activities was approximately $2 million. We are striving to attain a cash-neutral position for operating activities by 2026. Our balance sheet remains strong. as we have positive working capital and very little debt other than a mortgage on our Hollandale Beach Pharmacy building, the remaining balance on the COVID loan in the UK, and some minor equipment loans. I encourage you to review our financial statements as contained in Form 10-K that were filed with the Securities and Exchange Commission earlier today. I would like to turn over the meeting to David Phipps, our President and CEO of Global Operations, who will provide you with the highlights and accomplishments in our e-commerce business segment.