VerifyMe, Inc.

Good day and welcome to Verify Me's first quarter 2025 financial results conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on a touch-tone phone. To withdraw your question, please press star then two. Please note this event is being recorded. So now to turn the conference over to Nancy Meyer, Chief Financial Officer. Please go ahead.

Good morning, everyone, and thank you for joining us today for our earnings call presentation. On the call today, I am joined by Adam Stedham, CEO and President, who will give an operations and strategic update. Following our management presentation, we will have a Q&A session. I would like to bring your attention to the note on forward-looking statements on slide three. Today's presentation and the answer to questions includes forward-looking statements. It should be understood that actual results could differ materially from those projected due to a number of factors, including those described under the forward-looking statements caption and on the risk factors of the company's annual report on Form 10-K and quarterly reports on Form 10-Q. I will now turn the call over to Adam Stedham to discuss the company strategy.

Thank you, Nancy. So during the first quarter of 2025, our revenue decreased approximately 23% versus the first quarter last year. Now, this decline in revenue was due to discontinuing the Trust Coast operation, the customer insourcing in 2024, and then some overall softening of customer shipments. The decline was most pronounced in our premium services, which was down 47% versus the comparable quarter. Now, as a reminder, these services have been down significantly in the last two quarters due to the previously announced insourcing of a large client by our large air freight partner. A negative comparison for this will continue in the Q2 of 2025. However, We have reduced operating expenses by approximately 28% versus Q1 of 2024. We're managing our costs in alignment with these revenues. In addition, we've improved the gross margin of our proactive services within our precision logistics segment. From an organic growth perspective, we believe this service line presents the best opportunity for growth. And we're pleased with the improvements in gross margin percentage. So while we're not immune to the current macroeconomic environment, the positive cash flow from this operating business, coupled with our elevated cash level on the balance sheet, provides a strong backdrop to create shareholder value. At the end of the first quarter, we had a cash balance of $5.7 million. We have no bank debt. And we have a remaining convertible note of 0.8 million, but it's held by insiders and affiliates. So at this point, I'd like to discuss our initiatives for creating value for our shareholders. We continue to pursue efforts to expand our revenues with directly contracted Perryship customers. Our strategy in this area includes three elements. The first element of the effort is optimizing our direct customer marketing and sales approach. We previously announced that we would pilot efforts for increased marketing as well as adding additional outside sales representatives. So the marketing efforts are generating increased inbound lead activity, and we expect to refine our business development approach around leveraging marketing efforts to generate inbound sales leads and then those will be handled by an inside sales team. So the second element of our organic growth strategy is developing relationships with additional freight carriers and third-party logistics companies. Now, as we've engaged with more customers that are contracting directly with Perryship, these customers have expressed a desire to leverage Perryship's value-added services in combination with logistics and freight carriers that are in addition to the single air freight partner that Perryship currently leverages. Therefore, we've begun conversations with additional air freight carriers and third-party logistics companies. We don't know where these conversations may lead, but we will keep you updated as the conversations progress. Now, the third element of our organic growth strategy is integrating with technology platforms that are related to e-commerce shopping carts and shipping management software applications. We have projects underway currently to integrate our technology platform with the e-commerce platforms of Shopify and WooCommerce, and we're evaluating other e-commerce and logistics-related software platforms that are leveraged by potential Perryship customers. So at this point, I'd like to shift the conversation from organic growth efforts to our strategic growth efforts. As I mentioned earlier, the company has 5.7 million of cash as of the end of the first quarter in 2025. We do not anticipate requiring cash to support the annual operating and public company expenses of VerifyMe in 2025. So we continue to have conversations with both transformative and tuck-in potential acquisitions. It's very difficult to predict the timing or probability of these types of activities. With that said, we continue to believe that the strength of our balance sheet, our anticipated annual cash flow from operations, and the executive team's experience with creating value through acquisitions positions the company to provide very meaningful shareholder returns from the current share price. So at this point, I'll turn the call back over to Nancy so she can review the financial details of the first quarter.