Profound Medical Corp.

Welcome to the Profound Medical Second Quarter 2022 Financial Results Conference Call. My name is Darrell and I'll be your operator for today's call. At this time, all participants are in a listen-only mode. Later, we will conduct a question and answer session. During the question and answer session, if you have a question, please press 01 on your touchtone phone. I will now turn the call over to Stephen Kilmer, Investor Relations. Stephen, you may begin.

Thank you, Darrell. Good afternoon, everyone. Let me start by pointing out that this conference call will include forward-looking statements within the meaning of applicable securities laws in the United States and Canada. All forward-looking statements are based on Profound's current beliefs, assumptions, and expectations and relate to, among other things, expectations regarding the efficacy of the company's treatment technologies, results of future clinical trials, the ability to obtain coding and or reimbursement from third-party payers, anticipated financial performance, business prospects, strategies, regulatory developments, market acceptance, and future commitments. Such statements involve known and unknown risks, uncertainties, and other factors that may cause actual results, performance, or achievements to be materially different from those implied by such statements. No forward-looking statement can be guaranteed. Listeners are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this conference call. Profound undertakes no obligation to publicly update or revise any forward-looking statement whether as a result of new information, future events, or otherwise, other than as required by law. For the benefit of those who are new to the Profound story, I would also like to take a moment to summarize our business. Profound developed and markets customizable incision-free therapies for the appellation of disease tissue. We are currently commercializing Tulsa Pro, a technology that combines real-time MRI, robotically driven transurethral ultrasound, and closed-loop temperature feedback control. The technology is designed to provide customizable and predictable radiation-free ablation of a surgeon-defined prostate volume while actively protecting the urethra and rectum to help preserve the patient's natural functional abilities. Tulsa Pro is CE marked, Health Canada approved, and 510 cleared by the FDA. In the U.S., we employ a pure recurring revenue model for Tulsa Pro, whereby we charge customers on a per-procedure basis for Tulsa Pro consumables, lease of medical devices, and services associated with extended warranties. Outside of the United States, we primarily deploy a capital and consumable sales and service model separately as the situation warrants that. We are also commercialized in Sonoleaf, an innovative therapeutic platform that is the mark for the treatment of uterine fibroids and palliative pain treatment of bone metastases. Sonoleaf is also being approved by the China National Medical Projects Administration for the non-invasive treatment of uterine fibroids and has recently obtained FDA approval under a humanitarian device exemption for the treatment of osteoid osteoma. The business model for Sunweave Systems is currently a one-time sale of capital equipment. On the call today representing the company are Dr. Arun Menawad, Profound's Chief Executive Officer, and Rashed Suwan, the company's Chief Financial Officer. With that said, I'll now turn the call over to Rashed.

Good afternoon, everyone, and welcome to our second quarter 2022 conference call. On behalf of the management team and everyone at Profound, I would like to thank you for your ongoing interest in our company. For those of you who are shareholders, we appreciate your continued interest and support. I will turn the call over to Arun in a moment for an update on our commercial activities. However, before I do, I would like to provide a brief update on our second quarter 2022 financial results. to streamline things. All of the numbers we will refer to have been rounded, so they are approximate. For the three-month period ended June 30, 2022, the company recorded revenue of $2 million, with $1.16 million coming from recurring revenue and $864,000 from the one-time sale of capital equipment. This represented revenue growth of 48% sequentially over the previous quarter, driven by a 14% increase in recurring revenue and the first-time North American sale of sauna leaf systems. Q2 2022 revenues decreased 600,000 from the same period in 2021, due primarily to lower one-time sales of the capital equipment in international markets. Total operating expenses in the 2022 second quarter, which consists of R&D, G&A, and selling and distribution expenses were $8.7 million, an increase of 15% compared with $7.6 million in the second quarter of 2021. Breaking that down further, expenditures for R&D increased 8%, on a year-over-year basis to $3.7 million, GNA increased by 7% to $2.6 million, and selling and distribution expenses increased by 39% to $2.4 million. Primarily due to a higher foreign exchange gain, net finance income for the 2022 second quarter was $1.9 million. This compared to a net finance cost of $602,000 in the same three-month period of 2021. Overall, the company recorded a second quarter 2022 net loss of $5.9 million, or 28 cents per common share, compared with a net loss of $7 million, or 35 cents per common share, for the same three-month period in 2021. As of June 30, 2022, Profound had cash of $53.2 million. With that, I will now turn the call over to Arun.