Sharps Compliance Corp.

Greetings. Welcome to the Sharps Compliance Corporation fourth quarter 2021 earnings conference call. At this time, all participants are in a listen-only mode. A 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. And please note that the conference is being recorded. I will now turn the conference over to your host, Jen Belladeau, IMS of Investor Relations. You may begin.

Thank you. Good morning and welcome to the SHARPS compliance fourth quarter fiscal 2021 earnings call. On the call today, we have David P. Tusa, the company's president and chief executive officer, and Diana P. Diaz, executive vice president and chief financial officer. David will review the company's business performance, operations, and outlook, while Diana will review the financials. Immediately following their formal remarks, we will take questions from our call participants. As you're aware, we may make some forward-looking statements during the formal presentation and in the question and answer portion of this teleconference. These statements apply to future events, which are subject to risks and uncertainties, as well as other factors that could cause actual results to differ materially from where we are today. These factors are outlined in our earnings release, as well as in documents filed by the company with the Securities and Exchange Commission. These can be found at our website or at sec.gov. With that out of the way, let me turn the call over to David Toose to begin the review. Go ahead, David.

Thanks, Shannon. Good morning, everyone. Thank you for participating in our fourth quarter fiscal year 2021 earnings call. I'm going to continue the same practice as I have previously with really just speaking informally about the business and about the quarter and the outlook. So the business, the quarter, and the outlook. We had great success in fiscal year 2021. And I've got to tell you, to me, it's most important is the fact that in addition to revenue growth and profitability, we ended the year as a much stronger company. We have much greater infrastructure, additional plant and route-based capacity, additional geographic coverage for our route-based business, and a very strong balance sheet with $28 million in cash. So, in my opinion, this is just what we need to support a much larger company and continue our leadership positions in the markets we're addressing, regulated medical aids and unused medication. Now, we also accomplished something I think of of equal or maybe even greater importance. The superhuman efforts that we've showed during COVID-19 slash the immunization business during the height of the pandemic to date further strengthen our customer relationships. We had no disruption in our business. We served all of our customers and we delivered solution offerings. And I think there's a lot to be said for that, and our customers recognize that. Now, of course, we can't have a business discussion without covering COVID. So regarding the COVID business, the March and the June quarters, they represent the height to date of our COVID-related mailbag business. Immunization-related orders were about $28 million in customer billings, about $25 million in revenue for both quarters combined. And this is a great start to the season. And while it's very impressive and we're very happy to have the business, as everyone has seen in the news, the immunizations over the last couple of months have slowed. So during the current quarter, there's fewer shots, the September quarter, to date. Fewer shots administered. As a result of mailbag activity, mailbag activity so far in the current September quarter has slowed. So, from a timing perspective and related to immunization orders, I anticipate a slower than expected September 2021 quarter, you know, consistent with fewer shots being administered, at least now, plus the fact that the rate of some of our customers have accumulated inventory. They may have some leftover inventory that can be used to facilitate a portion of the flu season. So, looking past the September 2021 quarter, and into the remaining fiscal year 2022, which includes the December, March, and June quarters, we have the potential, not a guarantee, but the potential for the resumption of larger immunization-related customer billings. And they would be driven by the following, an increase in adult and adolescents receiving their initial vaccines. As a matter of fact, if you just look at the numbers, we're at about 61%. of the adults that are fully vaccinated in this country. Hopefully we can move that higher. The approval this fall of the children's vaccine. There'll be one zero to four, and there'll be one five to 11. A strong flu season. Additional shots for the immunocompromised adults, which the FDA has approved the additional shots last week. And as many of you have seen on the news, today that the rollout of the boosters, which I just saw on the news, that could begin as early as September 20th. And that would be recommended for Americans eight months after they received their second COVID-19 shot. So we're watching this development closely, but the third shot looks to be a reality here next month, which is big news, really big news for us. So moving past the immunization business, as many of you know, we're much more than an immunization mail-back business. We're a comprehensive provider of medical, pharmaceutical, and hazardous waste services. We have the infrastructure footprint to efficiently serve small and medium quantity generators, and our markets are primarily healthcare and retail. We focused over the last seven years on positioning the company as this, not a mail-back company, but as a comprehensive service provider. We added the route-based business and the unused medications. They play a key role in our numbers and our growth, and we think they're going to continue to play a key role in the growth of the business. The route-based business continues to achieve 30-plus percent growth annually. We remain bullish about the business and the opportunities we're seeing to further penetrate the markets. We're in 37 states, 80% of the population with our direct service of our route-based business. Our customer locations are now over 16,000. A year ago, there were about 13,000. Impressive growth, and we believe we have the opportunity to continue to trend. Now, one more thing about the route-based business. We remain focused on our goal of supplementing our organic growth with acquisition growth. We're seeing more activity and possibly some viable acquisition opportunities on this front. We're not offering guarantees, but the strength of our balance sheet, the expanded route-based infrastructure provides us with great flexibility around this initiative to supplement the organic growth. I need medications, just a minute or two on that. The med-safe business was undoubtedly slowed by COVID-19 as retail pharmacies and long-term care were much more focused on COVID versus unused medication. The line of returns continue to be strong, and we have been receiving orders from med-safe units, and we think starting in the September quarter that we'll start to get back on track with some growth rates similar to what we've seen in the past. Unused medications, I think, will continue to play a big part in the future growth of the company, and as many of you know, The opioid epidemic has actually worsened during the pandemic. Our MedSafe is seen as a leading solution, so we like where we are there. So one more time, we ended the year extremely well positioned for further growth, and we built a much larger company with our increased infrastructure, additional plant and route-based capacity, geographic coverage, and again, strong balance sheet with... $28 million in cash. And just a quick word on the employee base. Dedicated. Everyone's been working quite hard. We have to recognize them for what they've done. We want to thank them for what they've done. And it's been busy, and my guess is it's getting ready to get busier. So with that, I'll turn it over to Diana, who will address the financials in a bit more detail.