NextPlat Corp

Good day, ladies and gentlemen, and welcome to the next Platt Corp. Second Quarter 2025 Earnings Results Conference Call. At this time, all lines are in list anonymous. Following the presentation, we'll start a question and answer session. If at any time during this call you require immediate assistance, please first start here for the program. This call is being recorded on Thursday, August 14, 2025. I will now let you return the conference over to management. Please go ahead.

Good morning and welcome to Nexplat's second quarter 2025 earnings call. Thank you for joining us. Before I begin, I would like to acknowledge Charlie's passing in late May and again offer our condolences to his family. While we will briefly discuss the results of the second quarter, our objective today is to highlight many of the things we're doing now to build on the platform Charlie created. As we said at the end of June, our team has been very busy conducting a top to bottom review of the business. In particular, our healthcare operations that affects the majority of the business and we believe has a large potential to contribute positively to Nexplat's growth and profitability. After I briefly recap the developments in the second quarter, Cecile Monick, our CFO, will review our financial results and discuss activities on a healthcare segment. We will conclude the call with a high-level discussion of our near-term objectives and developments, which we believe will positively drive the business forward. I will then conclude the conference call by responding to questions that were submitted by our shareholders. Trends from the first quarter have continued in regards to both challenges and positive progress in each of the businesses. In terms of e-commerce, here are some highlights. The sale of satellite and connectivity products and services continues to see steady growth in terms of both recurring high margin airtime contracts, which are running at record levels, and a pickup in hardware sales with particular strength in IoT sales. Our sales of Opco products in China continues to show steady product progress, primarily limited by our ability to import increasing levels of inventory as allowed by Tmall. Nonetheless, we're still very excited about the prospects here, especially for pet products, a fast-growing market for which we hope to get regulatory approval in the fourth quarter of the year. Going to Florida sunshine, As you know, the tariff situation remains very volatile, and as such, while we are slowly advancing our efforts in the United States and in Europe, we continue to monitor the situation along with our Chinese partner with a view to resuming launch plans there when conditions improve. In terms of healthcare, we are continuing to make positive progress in the face of several challenges, such as drug pricing and payer reimbursements. We are seeing the early positive impact of cost reductions and operational efficiencies with reductions in salaries and related costs, and other general and administrative costs. We're continuing to implement cost reduction and business process improvements, such as technology upgrades and the recruitment of dedicated sales professionals who are focused on opportunities in the 340B and long-term care segment. I will discuss some of the other things we are doing here after Cecile provides the financial highlights. At this point, I will turn the call over to Cecile to discuss our financial results for the three and six months ended June 30th, 2025. Over to you, Cecile.

Thank you, David. Good morning, everyone. I will now provide a summary of our results of operations for the three and six months ended June 30th, 2025, and our financial and cash position as of June 30th, 2025. Overall revenue for the second quarter of 2025 was approximately $13.2 million compared to approximately $17 million in the same period last year. Our year-to-date overall revenue was approximately $27.8 million compared to approximately $34.5 million for the same period last year. During 2025, the overall decrease in revenue was mainly due to the decline in our healthcare operations segment. which was partially offset by an increase in e-commerce operations revenue. The decrease in healthcare operations revenue for both the second quarter of 2025 and year-to-date period reflects a combination of factors. First, the decrease in pharmacy prescription volume was influenced in part by the continued changes in provider relationships and shifts in patient flow due to the insurance network adjustments or provided decisions to align with different pharmacy partners. And second, we experienced changes in our 340B pharma service agreements where a couple of relationships transitioned to other pharmacy partners, some covered entities opened in-house pharmacies, and another covered entity no longer participates in the 340B program. Our e-commerce operations experienced an increase in revenue for both the second quarter of 2025 and the year-to-date period. which was driven by growth in recurring airtime revenue, hardware sales, and favorable foreign currency impact. Growth profits from our healthcare segment decreased to approximately 20% in the second half of 2025 from 35% in the second half of 2024, and was primarily attributable to the decrease in prescription volume and changes in 340B revenue, as well as the continued industry-wide impact of drug price increases outpacing reimbursement rate adjustments. Gross profits from our e-commerce segment decreased to approximately 26% in the second half of 2025, from 32% when compared to the same period of 2024 due to a service provider airtime contract that expired on December 31st, 2024, which introduced new airtime costs beginning January 1st, 2025, and temporary rate reductions for some customers affected by ongoing service interruptions. As expected, overall operational costs decreased due to the elimination of several non-recurring expenses, such as impairment losses associated with Goodwill and other intangible assets, and legal and consulting fees as it related to the merger of progressive care. We also experienced a reduction in salaries and wages. This was mainly a result of the decrease in stock-based compensation for non-recurring grants fully vested and a reduction in total headcount. During the second quarter, we remained focused on refining our expense structure. We are continuing to work towards achieving cost savings through initiatives such as optimizing our delivery process and renegotiating vendor contracts. Our commitment to driving cost reductions and improving operational efficiency remains steadfast as we move forward. We ended the second quarter with approximately $16.6 million in cash. I encourage you to review our financial statements as contained in our quarter report on Form 10-Q that was filed with the Securities and Exchange Commission. That concludes my remarks on financial results of the business. Back to you, David.