ToughBuilt Industries, Inc.

Greetings. Welcome to the Tufts-Built Second Quarter 2022 Earnings 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. Please note this conference is being recorded. I will now turn the conference over to Martin Gossian, Chief Financial Officer. Thank you. You may begin.

Good morning and thank you all for joining us today to discuss Tuftsville's second quarter 2022 financial and operating results. Again, my name is Martin Gostian and I am the Chief Financial Officer of Tuftsville. Joining me on today's call is Michael Panossian, President and Chief Executive Officer of Tuftsville. Michael will begin today's discussion by providing operational and financial highlights from the second quarter. I will then review our financial performance for the same period. Michael will conclude the discussion with our plans for 2022 and beyond. Before turning the call over to Michael, I would like to remind you that any forward-looking statements made by management are covered under the U.S. Private Security Litigation Reform Act of 1995 and are subject to the changes, risks, uncertainties described in the press release and in our U.S. security filings. In addition, during the course of the call, we may refer to non-GAAP financial measures that are not prepared in accordance with accounting principles generally accepted in the United States, and that may be different from non-GAAP financial measures used by other companies. Investors are encouraged to review Tufffield's current report on Form 8-K, furnished with the SEC for Tufffield's reasons for including those non-GAAP financial measures in the earnings release and presentation. The reconciliation of non-GAAP financial measures to the most directly comparable GAAP financial measures are contained in our earnings press release issued earlier today, unless otherwise noted therein. I will now turn the call to Michael.

Thank you, Martin, and thank you all for joining us on today's call. The second quarter of 2022 was strong for Tufffield, culminating in revenue $17.9 million and approximate 13% year-over-year increase compared to Q2 2021. During the second quarter, Amazon.com gross sales increased by 41% to approximately $3.5 million, compared to approximately $2.4 million for the second quarter of 2021. highlighting the strength of this sales channel. During the quarter, we also announced the launch of 93 products on Amazon Italy and Amazon Germany. As a result of these strong revenue numbers and our expansion efforts, we expect to see online revenues continue to grow into the future. In U.S., we increased our brick-and-mortar presence by launching 35 products in ACE hardware warehouses. that services 5,500 members across the country. We continue to offer new products, such as our one-of-a-kind magazine-fed auto-reloading utility knife. We sell this and many other of our innovative products at the leading U.S. home improvement retailer and across our global strategic network of partners that currently services over 15,500 stores in the U.S. and across the globe. We further increased our brick and mortar sales channels internationally, which will increase our reach to numerous stores and thousands of end users. This significant progress in executing our sales strategy gives us reason to believe that we will continue our revenue growth moving forward. Tough Build continues to be a leader known for innovation and for developing some of the most unique products for the construction and home improvement industry. We believe that much of our success is due to our ability to attract the best talent. Our unique platform has proven to be a tremendous draw for professionals eager to join our organization known for its creativity and ability to quickly and efficiently bring ideas for concept to shelves in record time. An example of this is the new auto-reloading utility knife I just mentioned. While our staff has grown considerably, we now believe that we are at a place where we can stabilize our hiring and as such, we anticipate a flattening of our SG&A costs in the second half of the year. As we mentioned on our last call, we are taking steps to reduce other costs as well. To help combat logistic-related costs in 2022, we have negotiated improved shipping rates as well as working with our large retail partners to implement direct import ordering where possible. Direct import ordering would result our retail partners taking possible products directly from ports and shipping to their own warehouses. In the months to come, we anticipate that this will decrease our shipping costs by shifting several supply chain steps from top build to our partners. We are looking closely at other costs through the company and through discipline management of the business, we believe can achieve profitability in 2023 while accelerating our top line growth as we target the launch of five to 10 new product lines this year and into next year and further expand our sales channels. I will now turn the call back to Martin to cover our financial results in greater detail. Martin?