SurgePays, Inc.

Your participation in this conference has been terminated by the host. Goodbye. Thank you. welcome to the surge pays first quarter 2023 earnings call at this time all participants will be in a listen-only mode later we will conduct a question and answer session i will now turn the call over to brian pranovo please go ahead sir thank you operator and good afternoon everyone welcome to the surge pays first quarter 2023 earnings webcast and conference call today's date is may 11 2023

On the call today from Surge Pays are Brian Cox, President and Chief Executive Officer, and Tony Evers, Chief Financial Officer. Before we begin, I'd like to remind everyone that this call may contain forward-looking statements as they are defined under the Private Securities Litigation Reform Act of 1995. These statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements. For a discussion of such risks and uncertainties, please see SurgePay's most recent filings with the SEC. All forward-looking statements made today reflect our current expectations only, and we undertake no obligation to update any statement to reflect the events that occur after this call. Also during the course of today's call, the company will be discussing one or more non-GAAP financial measures, Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP measures are included in the press release we issued this afternoon. Copies of today's press release are accessible on SurgePay's Investor Relations website, ir.surgepays.com. In addition, SurgePay's Form 10-Q for the quarter ended March 31, 2023, will also be available on the SurgePay's Investor Relations website. And now I'd like to turn the call over to President and Chief Executive Officer Brian Cox.

Thanks, Brian. First of all, I'd like to thank our shareholders and those interested in SurgePace for joining the call. As we have expanded and are continuing to expand our audience, I'd like to give a brief overview of who we are, what we do, and our target market. Surge Pays brings financial and telecom products to the underbanked and underserved populations of the United States, where they live and where they shop. Our goal is to build the largest direct distribution network of underbanked products and services in the country. The underbanked do the majority of their financial transactions at their trusted local convenience store that's closest to their home. Surge Pays utilizes these stores as the points of distribution into these communities. As we onboard stores to our FinTech software platform, we enable the clerk at that store to perform transactions such as prepaid wireless activation and payments, along with reloading debit cards and other financially enabling services to improve the daily lives of those without traditional access to banks, credit, and checking accounts. One of the really great things is that our revenue is directly tied to how many essential services we provide to those who need it most. The Affordable Connectivity Program, or ACP, has been the revenue driver for SurgePay's growth over the last two years, taking us from a company with $50 million in revenue in 2021 to $121 million in 2022 with roughly break-even profitability. In 2023, we are guiding to $190 million of sales with positive cash flow. The ACP offers a federal subsidy for a tablet device and a monthly cellular broadband internet service to the recipients of any other income-based government benefit, such as Medicaid, Veterans Pension, Section 8, and most notably, the program historically called Food Stamps, or EBT, but now goes by the name SNAP. There are several wireless companies out there with licenses to offer the ACP program to the public. However, we are uniquely positioned as the only ACP company that owns its own customer relationship management software platform that's integrated with the FCC's database and also AT&T and T-Mobile. Further, we're the only ACP company that owns one of the few prepaid transaction platforms that has a nationwide network of convenience stores. This trifecta competitive advantage paves the way for us to be the only ACP company able to do brick and mortar signups inside convenience stores, which means store owners can earn revenue by helping those in their underserved community get connected. We are utilizing this great ACP program as the enticing catalyst to build what is now over 25,000 stores to be onboarded with a staging target of less than 12 months. In some areas, more than 30% of the transactions at convenience stores and supermarkets are using a SNAP card, which is the government benefit. Every customer who pulls out that card in the store is eligible for ACP. What's even more exciting is that ACP is limited to one per household. And through our surveys, we know that each household has three to four smartphones on another prepaid wireless company. With our presence in these stores where these customers shop and the ability for these customers to pay their monthly prepaid wireless bills at the same store, it's a fantastic launching pad for our non-ACP prepaid wireless subscriber push later this year. Another exciting facet of our business is now the store owner is making money directly in partnership with helping his community, and we're the company enabling this. Directly because of this, I've never seen a warmer reception to upselling and distributing other products to a store. Not only does our software platform have a navigation interface similar to a website for doing these transactions, It also has a wholesale marketplace back office where store owners can order high margin products that are in demand directly from the manufacturer. These products are the impulse consumables by the register that many store owners in rural areas especially have difficulty obtaining or the minimum orders from their local distributors are just too high. Using ACP to add stores to our network by the tens of thousands grows our ACP subscriber base, our prepaid top-up and payment revenue, and gives us points of distribution for selling other third-party products into these communities nationwide. This is the mindset or the driving force for parlaying the success of the ACP program into exponential revenue growth in our other verticals. We are piggybacking this hot reception by store owners to have access to this offering. Even with the majority of our team's energy focused on this longer-term growth model, I'm pleased to announce that the first quarter of 2023 continues the profitability trend we began to see at the end of 2022, delivering net income of $4.5 million and EBITDA over $5 million. With our funding in place, we've secured a consistent supply of tablets at a significantly lower cost, and in the meantime, We've built out the infrastructure to distribute them in the most efficient means possible. We should no longer see periods of throttling growth due to running out of devices. We expect revenue to ramp higher in future quarters. As I mentioned in the last quarter's call, the key metric is new stores on our platform going forward. More stores on our platform means more ACP signups, more prepaid wireless subscribers, more products on the shelf, more transactions over our FinTech platform, and more sales per individual store. As always, we're focused on managing our cash and our cash flow while deploying that cash to maximize growth. We expected first quarter revenues to align with fourth quarter 2022 revenues, and that's precisely what happened, but with strong positive cash flows. We anticipate the full benefit of our lending facility to be realized toward the end of the second quarter, with growth accelerating quickly and continuing into the second half of the year. We still expect 13,000 stores to operate on the SurgePay network by the end of the year and see positive operating cash flow during the year and only looking to raise capital for a defined opportunistic purpose. I don't normally enjoy preparing for these calls, but stopping for a minute to see the fruits of your labor has changed my mind a bit, considering how the fruit looks now. I think our next couple of calls will continue elevating my smile as we're able to continue shifting gears upward. Until then, thanks go out to the Surge Pace team for pushing forward and delivering on a daily basis. I'll turn the call over to Tony to review our financial results briefly before summarizing today's call. Tony?