Sanara MedTech Inc.

Welcome to the Sonara MedTech, Inc. Third Quarter 2021 Results and Business Update. At this time, all participants have been placed on a listen-only mode, and the floor will be opened for questions and comments after the presentation. If you have a question or comment at any time, you may press star 1 to join the queue. If your question has been answered and you no longer wish to ask it, you may press star 2 to be withdrawn from the queue. It is now my pleasure to turn the floor over to your host, Callum Nichols, Director of Investor Relations. Sir, the floor is yours.

Thank you, and good morning, everyone. I'd like to welcome you to Scenera MidTech's earnings conference call for the quarter ended September 30th, 2021. We issued our earnings release Friday afternoon, and I would also like to highlight that we will post the link to today's deck on our investor relations page. This supplemental deck, as well as a copy of the earnings release, The 10-Q and a transcript of this call will be available on this page. We will reference this information in our remarks today. We expect today's prepared comments from Ron Nixon, Executive Chairman, Mike McNeil, Chief Financial Officer, and Zach Fleming, President Surgical, to last approximately 15 minutes to allow time for Q&A. Certain statements in this conference call, in our press release, and in our supplemental deck include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. For more information about the risk and uncertainties involving forward-looking statements and factors that could cause actual results to vary from those projected or implied by forward-looking statements, please see our most recent Form 10-Q, an annual report on Form 10-K. Now, I'd like to turn the call over to Ron.

Thank you, Callan, and good morning, everyone. I'll begin with an overview of the third quarter, and then we'll provide an in-depth discussion for each of the subsequent slides that were given to you. Scenera generated $5.8 million in revenue and a net loss of $2 million in the second quarter of 2021. Despite an impact from the COVID-19 Delta variant in key large markets, including Texas and the Northeast, this was the second best revenue quarter for the company in history and was driven by surgical product sales. Our net loss was largely driven by an increase in SG&A which was 1.8 million higher than Q3 2020. Approximately 70% or 1.3 million of this increased SG&A was due to increased direct sales and marketing costs related to the expansion of our surgical sales force, as well as higher commissions due to higher product sales. Rochelle asset acquisition, which we completed in Q3, contributed approximately 260,000 of incremental SG&A when compared to Q2 of 2021, adjusted for a one-time reclassification of R&D expense in Q3. These were planned expenses to expand our sales force and research and development capabilities to further advance our six focus areas. The surgical team has continued to focus on adding high-quality experienced regional and territorial sales managers to our team. obtaining hospital approvals, product adoption, and introducing new products. Zach will discuss the specifics in his remarks this morning. We continue to see additional opportunities for our products in surgery and are continuing our pursuit of clinical evidence for outcomes. In the third quarter, we continued introducing our telemedicine and virtual care business, Wounderm. We executed an agreement and launched a pilot in home health care market to prove the efficacy of wound derm solutions and demonstrate the company's overall value proposition related to cost and outcomes of our comprehensive wound and skin strategy. As part of this pilot, the company's EMR was adapted for home health care market, and we concurrently signed a distribution agreement for our proprietary products with that firm. For our virtual consult services, our wound care group, M group, is now licensed to provide wound care virtual consults in 48 states, and we expect to be licensed in all 50 states by the end of the year. We are currently having discussions with a number of value-based and managed care companies and are exploring possibilities across all segments of the post-acute and acute settings. A critical component of our strategy is our partnership with Precision Healing. They are making considerable progress and expect to file a 510K for precision healing imager by the end of the year. As you know, Rochelle Technologies is now part of Senera, and we're working closely with them on our product pipeline with a focus on bringing next-generation Celerate and Hycol to the market, as well as BioSurge, our sterile antimicrobial cleanser for the surgical market. Now I'll turn it over to Zach Fleming to discuss our surgical business.