Stran & Company, Inc.

Good morning, ladies and gentlemen. Thank you for standing by. Welcome to the Stratton & Company first quarter 2022 earnings call. At this time, all participants are on a listen-only mode. After management's prepared remarks, there will be a question and answer session. I would now like to turn the floor over to the host, David Waldman, Investor Relations. Please go ahead.

Good morning, everyone, and thank you for joining Stratton & Company's 2022 first quarter financial results conference call. On the call with us today are Andy Shape, Chief Executive Officer, and Chris Rollins, Chief Financial Officer. The company issued a press release today, Friday, May 13, 2022, containing first quarter financial results, which is also posted on the company's website. If you have any questions after the call or would like any additional information about the company, please contact Crescendo Communications at 212-671-1020. Companies management will now provide prepared remarks reviewing the financial and operational results for the three month end of March 31st, 2022. Before we get started, we'd like to remind everyone that during this conference call, we may make forward looking statements regarding timing and financial impact of STRON's ability to implement its business plan, expected revenues and future success. These statements involve a number of risks and uncertainties and are based on assumptions involving judgments with respect to future economic competitive and market conditions and future business decisions. all of which are difficult or impossible to predict accurately, and many of which are beyond STRON's control. With that, we'll now turn the call over to Andy Shape, Chief Executive Officer. Please go ahead, Andy.

Thank you, David, and thank you, everyone else, for joining today as we discuss our significant progress made during the first quarter. First, I'd like to highlight that we achieved a record revenue of $12.3 million for the first quarter of 2022, an increase of 62.5% when compared to Q1 2021. Even more important, excluding the gap promotion acquisition, organic revenue increased 50.8% over the same period last year. And we have maintained a solid balance sheet with $30 million in cash reserves and no long-term debt as of March 31st, 2022. Our revenue growth is a direct result of significant contract wins with leading organizations while executing on opportunistic yet aggressive acquisition strategies. 2022 is already proving to be a transformative year for Strawn as we are gaining traction in the market. One example is the recent multi-year contract we secured with a large national healthcare company. This selection was based on our ability to execute as well as our ability to address their complex marketing needs. The initial value of this contract is expected to be over $6 million. However, we believe we can secure additional business from this organization as well. We also look forward to highlighting them as a case study to demonstrate our capabilities in the healthcare sector. While companies such as this already utilize promotional products as a marketing tool to increase brand awareness, They are now realizing the power of promotional products to drive healthy consumer behaviors. As a result, our goal is to add similar customer engagements in the months ahead. We are winning these projects as a result of our compelling value proposition and comprehensive offering. We truly act as an extension of our customer by providing branded products, a flexible and customizable e-commerce platform for order processing, creative and merchandising services, warehousing, fulfillment distribution services, custom sourcing capabilities, print on demand, kitting and assembly services, point of sale displays, loyalty and incentive programs, and as you can see, much, much more. All of these are custom designed to meet the unique needs of each of our clients. Heading into the second quarter, we are seeing very strong bookings with over 18.8 million in orders secured year to date. It is important to note, to reiterate that these numbers aren't reflected as billed revenue until the products are delivered over the next few months. However, this trend bodes well for the balance of the year. In addition to organic growth, we continue to pursue new M&A opportunities that we believe will be highly synergistic with our existing operations. We now have a proven track record identifying and acquiring companies at attractive multiples, as well as quickly integrating these companies into our own operations. Most recently, we acquired Gap Promotions, a leading full-service promotional agency that generated over 7 million of sales in 2020 and 2021. It's also worth noting that GAP has always been profitable since its inception. This acquisition adds an impressive roster of top-tier beverage and consumer packaged goods clients. GAP expands our reach within the beverage and consumer packaged goods sectors, which represent very sizable markets. The combination of GAP's track record and industry relationships with our own end-to-end solutions make this a perfect marriage. To support our continued growth, we have invested heavily in sales and marketing as well as appointed key management team members. As previously discussed, Sheila Johnshoy recently joined our team as Chief Operating Officer. She brings over 20 years of experience with an impressive track record developing and executing growth strategies as well as building effective sales and marketing teams. In the short time since joining, Sheila really has made a considerable impact with the organization. We could not be more excited to have her as part of the executive team as we work aggressively to expand our market share. Additionally, management team members, including myself, have been actively participating in industry and investor conferences to increase the awareness of Strawn and our products and solutions. Overall, we believe we have built a highly scalable business model. This is best illustrated by the decrease in operating expenses as a percentage of revenue. Also bear in mind that our results for the first quarter include the acquisition integration expenses related to GAAP, Public company costs we did not have last year, as well as other fixed expenses to support our planned accelerated growth. Looking ahead as we continue our revenue growth, we expect to not only maintain our track record of profitability, but we believe this company has tremendous earning potentials. We have maintained a solid balance sheet. We ended the quarter with $30 million in cash reserves and no long-term debt. As a result, we are well capitalized to internally fund and execute both organic growth and acquisition strategies. Let me say in no uncertain terms, we have no plans to raise capital at anywhere near our current levels. We share frustration of our investors with the share price given the fact that we're now trading below cash. We're not alone in this market with the numerous companies impacted by the sell-off in the market, which has disproportionately impacted micro-cap and small-cap companies. However, believe our results speak for themselves, and we are in this for the long game. Nonetheless, we have put in a share buyback plan in place as we see this as an opportunity to create additional value for shareholders while the markets are so volatile. We have not started utilizing the buyback for the sole reason we have been in an extended blackout period, given the timing of the 10K and the 10Q. But outside of the blackout, we can and will plan to buy back shares. It is also worth noting that management and the board will also consider opportunity shares in the market. So to wrap up, the promotional products industry is an enormous market, valued over $23 billion, and yet is a highly fragmented market with no clear leader. In addition, we are expanding within the broader $387 billion product packaging loyalty incentive program printing and trade show markets. Based on our strong track record of organic growth and accretive acquisitions, we believe Strong can become a major player within this industry. At this point, I'd like to turn over our call to our Chief Financial Officer, Chris Rollins, to go over the financials. Please go ahead, Chris. Thank you, Andy.