Biotricity Inc

Greetings, and welcome to the Biotricity conference call. At this time, all participants are in a listen-only mode. The question and answer session will follow the formal presentation. If anyone should require operator assistance, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce founder and CEO, Dr. Waqas Al-Siddiq. Thank you. You may begin.

Thank you, everybody, for joining us today. Second quarter 2025 has been a transformative quarter for Biotricity, marked by significant advancements and strategic initiatives that has led to us achieving positive EBITDA for the first time in September and continue our path to profitability. One of our most significant achievements this quarter has been the improvement in all aspects of the business, from revenue to margins, operational efficiency, and a shift to positive EBITDA. Our commitment to innovation, strategic partnerships, and operational efficiency has allowed us to make remarkable progress across multiple fronts. We are continuing to expand our cardiac AI cloud capabilities, harnessing our data to explore predictive capabilities with our platform. Recently, we published our research in predicting post-operative complications in nature. We expect to expand our research and file for FDA of our AI clinical model by mid next year. Our recent strategic alliances with the top group purchasing organizations otherwise known as GPOs, and specialist organizations in neurology and pulmonology are beginning to gain momentum. These partnerships have helped kick off multiple large opportunities that are currently in pilots along with expanding our reach beyond cardiology, significantly expanding our market reach. This positions us to capitalize on broader market channels and secure larger contracts, strengthening our presence in the healthcare technology sector. As noted in our release, we have also recently procured the support of our funding partners in order to place the largest inventory order Biotricity has ever placed. This is a testament to how excited we are about our growth in the coming quarters. These recent initiatives are part of our broader strategy to develop more complementary partnerships where access to cardiac diagnostics is critical. We will continue to focus on partners that have a broad reach and whose existing customers have a comorbidity or cardiac risk factor. In summary, our strategic initiatives, technological advancements, and operational efficiencies have positioned Biotricity for sustained growth and profitability. We remain focused on delivering innovative, high-quality cardiac care solutions and are confident in our ability to continue driving value for our shareholders and improving patient outcomes globally. With that, I will turn the call over to our CFO, John Iannoglou, to provide more detailed financial insights.

Thank you, Rukos. Let's review the highlights of our second fiscal quarter of fiscal 2025. Our recurring revenue generated from our technologies of service subscription model, as well as our usage-based subscriptions, remains robust, driven by the popularity of our FDA-cleared cardiac monitoring devices, and particularly our state-of-the-art BioCore. We continue to see strong demand and market adoption, particularly in the case of the next generation BioCorp Pro, which features cellular connectivity. Atrial fibrillation is a primary contributor to strokes and remains a significant focus of our ecosystem of technologies and products. We facilitate the diagnosis of atrial fibrillation, providing cardiologists and patients the opportunity for earlier medical intervention. This not only improves patient outcomes, but also underscores significant healthcare cost savings for both individuals and the broader healthcare system. For the second quarter ended September 30, 2025, revenue increased by 13% year over year to $3.3 million. This growth is a testament to the quality of our technology and efficacy of our strategic initiatives. Our BioCore line of products are turning heads at larger clinics and hospitals that have a longer sales cycle. And we have an unprecedented for us pipeline of high quality, high volume accounts that are conducting trials and pilots of our technologies. We've also been successful in our focus to transition our business to a flat fee subscription model, having already transitioned approximately three quarters of our business to establish a higher quality and more predictable revenue stream. Our flat fee revenue grew by about 34% year-over-year from the comparative quarter of the prior year. Technology fees rose by 12.2% year-over-year to a little under $3.1 million, a 73% increase in flat fee revenue. Once again, this reflects our strong customer retention and the quality of our support services. Gross profit for the quarter totaled $2.5 million, up 23% from $2 million in the prior year period. Our gross profit percentage improved 1,468 basis points to 75.3% for the fiscal year, up from 73.8% in the prior year. This increase is attributed to the expansion of our recurring technology fee revenue base. efficiencies gained through the proprietary AI that we use, and improvements in our monitoring cost structure. We've also become more efficient in producing our devices, which are also now enjoying sales at higher margins. Our insourcing business model allows cardiac medical professionals to have direct control over our services, enhancing efficiencies and enabling broader market penetration. Operating expenses for the second quarter of fiscal 2025 were $2.8 million compared to $3.5 million in the same period last year. This is a 34% improvement. Our selling general and admin expenses decreased by 35.5%, and we reduced our R&D expenses by almost 26%. As mentioned earlier, we have strategically transformed our sales force to focus on longer sales cycles and larger accounts. including independent hospitals and GPO networks. As Rakas mentioned, we've now signed three of the largest GPO networks, providing us access to more than 90% of hospitals in the U.S., and certain of these are starting to work closely with us to partner with us in selling our technology. Net loss attributable to common stockholders decreased 57% year-over-year to $1.65 million, or 7.3 cents per share from a net loss of 3.88 million or 44.1 per share in Q2 fiscal year 2024. This was despite the expenses associated with infrastructure growth and higher variable interest rates. We've become more efficient, both in terms of automation and use of AI to streamline operations, but we have also become proactive in cost management to achieve our goal of being EBITDA breakeven, and we're very pleased with our progress. Management considers EBITDA and adjusted EBITDA's measures for the three- and six-month period ended September 30, 24, to be indicators of the company's progress towards breakeven profitability, as well as improvement towards operating cash flow breakeven. EBITDA improved by 80% and 50.4% respectively when compared to the three and six months ended for the corresponding prior year period. Adjusted EBITDA, which management uses as a measure for tracking free cash flow levels, improved to negative $249,000 for the quarter ended September 30, 2024. a reduction of over $1.7 million in negative adjusted EBITDA from the comparative period of the prior fiscal year. This is an 87% improvement. The company was able to achieve a positive adjusted EBITDA for the month of September 2024 for the first time in its history, and we are focused on improving our free cash flow going forward. A reconciliation of our adjusted EBITDA numbers, our EBITDA and adjusted EBITDA numbers, in fact, is available in our 10Q, which we filed last night. Looking ahead, we remain committed to advancing the commercialization of BioCore and BioCare products. Our tech is truly useful globally. Cardiac is the number one chronic care condition in the entire world. We have recently made inroads or received approvals from the regulatory bodies of other countries, including Canada, that will allow us to sell in other jurisdictions. This sets us up for new initiatives we intend to move on in 2026 and beyond. The growing market's interest and demand for a suite of products dedicated to chronic cardiac disease prevention and management reinforce our confidence in our market position. Importantly, our focus on innovation and development continues to yield significant advancements in remote monitoring solutions for both diagnostic and post-diagnostic products. bringing us closer to achieving positive cash flow. We're excited about the future and confident in our ability to deliver sustained growth and profitability for biotricity. And that concludes our prepared remarks. Operator, please open the line for questions.