Rockley Photonics Holdings Limited Ordinary Shares

Greetings. Welcome to the Rocklea Photonics Holdings Limited Fourth Quarter 2021 Financial Results Conference 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 your host, Gwynne Lauber. You may begin.

Thank you, operator, and welcome, everyone. This is Gwen Lauber, Vice President of Investor Relations at Rockleaf Photonics. Today, after the U.S. market closed, we released our results for the fourth quarter and full year ended December 31, 2021. A copy of our earnings press release, along with supplemental financial tables, are available on the Investor Relations section of our website at investors.rockleafphotonics.com. With me on today's call, or Dr. Andrew Rickman, OBE, Chairman and Chief Executive Officer, and Mahesh Karanth, Chief Financial Officer. This call is being webcast and will be archived on the investor relations section of Rocklea's website. Before I turn the call over to Andrew, I'd like to note that today's discussion will contain forward-looking statements. These forward-looking statements include, but are not limited to, the anticipated benefits features scope, focus, status, and goals of our platform, technology, products, studies, and partnerships with third parties, our ability to and the timing of bringing our products to market and our product development schedule, our strategies, our research and development plans, our customers, our commercial and market opportunities and trends, our debt obligations, and our costs and expenses, are cash resources and financial performance and outlook and factors affecting the foregoing. These financial statements are subject to risks and uncertainties, which may cause actual results to vary materially from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, those discussed in our earnings press release and in our filings with the SEC. Any forward-looking statements that are made on this call are based on assumptions as of today. We undertake no obligation to update these statements as a result of new information or future events. In addition to U.S. GAAP reporting, Rockley reports certain non-GAAP financial measures that do not conform to generally accepted accounting principles. We believe these non-GAAP measures enhance the understanding of our performance, Reconciliations of these GAAP and non-GAAP financial measures are included in the tables found in the press release. Now, I'll turn the call over to Andrew.

Thank you, Gwyn, and thank you all for joining us for our fourth quarter and full year 2021 earnings conference call. Today, I'll start by briefly discussing our results, and then I'll comment on progress that we've made since our last earnings call. We generated revenue of $2.4 million in the fourth quarter and $8.2 million for the full year 2021. Our gap net loss was $14.7 million in the fourth quarter, compared to a loss of $58 million in the third quarter of 2021, which included one-time cost related to our IPO. $81.4 million in cash, cash equivalents and investments. A summary of our financials is available on the investor relations section of our website. Now I'd like to make some comments about our markets. Over the last two years, there's been an increased focus on healthcare from individuals who demand a deeper understanding of the health and from healthcare professionals who want a better, more accurate method of monitoring their patients. This focus was about more than finding ways to cut healthcare costs, but to create a shift from the traditional sick care system to a more personal and proactive healthcare system. I believe that a new system is possible due to technological advances that enable a proactive and remote approach to health and wellness. This change in healthcare is not surprising. Over the last few years, society has realized that we need to improve our baseline health and our ability to monitor it so that we are better able to deal with any future health crisis. One of the best ways to make these necessary improvements is to use technology to allow not only healthcare professionals to improve their ability to care for patients, but also to allow individuals to proactively understand and control their own health. With the right tools, people can not only understand how their lifestyle choices affect their health, but also how the changes that they make can help them to avoid serious diseases. Governments too are acutely aware that we must develop systems that will empower people so that diseases can not only be detected early, but can be prevented. Health and wellness are issues that affect individuals, businesses, governments, And together, we need to look for ways to not only treat diseases, but prevent them. We believe that technology sits at the center of this new healthcare system, and it enables positive changes that only a few years ago we wouldn't have thought were possible. Nearly one year ago to the day, we announced our intention to go public through a merger with SE Health. I am very proud that we successfully completed the merger, but even more proud of all that we have achieved since then. The team has made incredible progress executing on our plan, remaining focused yet flexible, accelerating our achievements by taking advantage of every opportunity that presented itself. It is the team's passion that is driving us and pushing us to do what some believe was impossible. And it's our commitment that has potentially put us firmly in the center of the future of health and wellness monitoring. One of the most significant changes that we see in the market is the convergence of the consumer electronics and medtech industries, with each vying for its place in the health and wellness market. It's not surprising that this large, fast-moving market has captured the attention of both, Rising healthcare costs, consumer demand, and technological advances have created an opportunity for disruption in the industry. Consumers are searching for ways to be active participants in their own health and wellness. Businesses realize that they must not only control healthcare costs, but also develop and maintain a safe and healthy environment for their employees. And governments realize that critical, important changes need to be made to ensure healthy populations. Technology is now seen as the key enabler in the pursuit of healthy lifestyle and in preventative healthcare. According to CB Insights, in 2021, big tech alone invested over $7 billion in healthcare startups. Through the use of technology, we can create solutions that will have a profound impact on the lives of consumers, patients, seniors, first responders, and more, and will help them to make crucial changes that will positively impact their lives. I believe that at the core of this new and growing industry is raw police technology. By taking a holistic view of the human body through insights into multiple biomarkers, both individuals and healthcare professionals could have a more sophisticated tool to monitor and track trends in a person's health. This view has the potential to help physicians identify serious health conditions and possible disease states earlier, allowing for more affordable prevention measures, perhaps long before aggressive treatment is needed. and the desire for remote monitoring solutions had furthered the push for technology that can create these solutions. During the fourth quarter, we announced that we had significantly expanded our footprint in the consumer market for our non-invasive vital spec biomarker sensing platform by signing new agreements with six global consumer electronics manufacturers. With these additional agreements, we now have relationships with 12 consumer electronic customers, including six of the top 10 largest manufacturers of smartwatches and wristbands. These multi-year agreements will focus on evaluating and incorporating the next generation of non-invasive biomarker sensing into a range of consumer devices, including smartwatches, wristbands, and other wearables. We believe that these customer relationships will create new opportunities for our VitaSpec sent-in platform. We recently announced our Bioptics product line, a biomarker-centered platform for professional healthcare. BioOptics features a first of its kind non-invasive continuous biosensing wristband along with a platform that will enable the measurement of an extensive range of biomarkers supported by custom cloud-based analytics and AI. I'm very proud that we were able to launch BioOptics two years earlier than we initially planned to meet increased demand from our customers. The early introduction is intended to accelerate the development of non-invasive remote monitoring solutions for healthcare. In January, we shipped engineering samples to multiple customers, and we expect the first commercial products to be available as early as the second half of 2022. We believe there is an opportunity to generate revenue from additional bioptics solutions, such as our AI Cloud Suite offering in 2023. While our customers have expressed strong interest in non-regulated versions of bioptics, in the future we plan to seek certification from the FDA and other regulators for a medical-grade version of bioptics. I believe our bioptics platform has the potential to profoundly change the healthcare landscape. Another important part of our product development strategy is our relationship with partners. On our last call, I spoke about our partnership with Caltech and the opportunity to bring to the development for future healthcare applications that will use our sensing platform. We intend to collaborate with Caltech on the development of next-generation solutions that combine advanced sensors with artificial intelligence to enhance insight into health and well-being. Since our last earnings call, we added Mount Sinai Health Systems, as a partner, and we are working with the Eichen School of Medicine to collaborate on research studies. We intend to work together on non-invasive sensor capabilities and to accelerate the development of new algorithms for various potential use cases in health and wellness tracking, early disease state identification, and digital health. I believe these collaborations should allow us to bring solutions to market that will provide end users with access to key health insights and provide them with deeper understanding of their health and well-being. Next, I'd like to update you on our ongoing human trials. Recently, we made several announcements regarding our initial studies in core body temperature and blood pressure. The team and I are very pleased with the results, which I believe validate both the potential and the power of the technology we have developed. In early December, we announced the preliminary results of our core body temperature study. In this study, we demonstrated not only the initial efficacy of our photonics-based sensor for measuring core body temperature, but our technology also yielded results more closely aligned with reference sensors than the auxiliary sensors like oral, ear, and infrared thermometers that are today's standard. Core body temperature is recognized as a leading indicator of changes in health, making an accurate reading crucial for early detection of many diseases. Currently, this capability is not possible even with these widely used axillary sensors that provide only surface temperature. Early in 2022, we announced the result of our pilot blood pressure human study. This pilot study assessed our blood pressure measurement capabilities using a cuffless rocky pad wrist-worn device. The results demonstrated both signal quality and measurement techniques capable of potentially providing a non-invasive, convenient method for measuring cardiovascular health. The study also validated that our risk-based sensing platform produced a strong correlation to heart rate and heart rate variability measurements, which are commonly measured using electrocardiogram equipment. These results advance the readiness of our overall sensing platform's capabilities in broad biomarker detection, and sets the stage for a larger blood pressure study. These human studies are important steps in our work to support the full range of biomarker measurements on our platform. The studies help us optimize algorithms and refine our technology performance across a broad range of biomarkers. Throughout 2022, we intend to share the results of further studies of these biomarkers plus additional biomarkers for hydration, alcohol, lactate, and glucose trends. As we learn more about each biomarker through our studies and the work of our customers and partners, I believe that our cloud-based analytics and AI capabilities will help develop a powerful, more holistic assessment of a person's health and well-being. Throughout the quarter, the team has worked hard to make progress not only in our product development, but also expanding our customer base. Looking back over the last year, I can tell you that both have exceeded my expectations. On the consumer electronics front, we increased our customer base from just a handful to 12 customers, including six of the leaders in their space. In MedTech, we now work with five customers, including two of the top 10 MedTech companies. On the product development front, we also are a full two years ahead of schedule due to strong customer demand, and we expect to ship our first commercial products to this market as early as the second half of 2022. The acceleration on both fronts clearly points to the convergence of two very powerful markets with Rockley's biocenting technology well positioned at the center. This has created a significant opportunity for Rockley and for the general population who will benefit from the work of our partners and customers. We remain focused on developing our innovative end-to-end non-invasive silicon photonics-based solutions. We're optimistic that our efforts will have a profound impact on people's lives as we create a platform that will provide valuable insights into their health. Our goal is for the future of health and wellness monitoring to be powered by Rockley. There's a lot of work ahead of us, but I believe that our very talented team has the skills and the passion to reach our goals. With that, I will turn the call over to Mahesh for a review of our financial performance in the quarter. Thank you.