Omniq Corp

Good morning and thank you for joining us for the Omnicue Financial Results and Corporate Update Call for the fourth quarter and full year ending December 31st, 2021. Joining us today are Shai Lesgarten, CEO of Omnicue, who will provide an operational overview, and Niamh Niesensen, Chief Financial Officer, who will discuss financial results. At this time, all participants are placed on a listen-only mode. After management's prepared remarks, there will be a question and answer session. I will now take a brief moment to read the Safe Harbor Statement. During the course of this conference call, we will make certain forward-looking statements. All statements that address expectations, opinions, or predictions about the future are forward-looking statements. Although they reflect our current expectations and are based on our best view of the industry and our current expectations and our business as we see them today, they are not guarantees of future performance. These statements involve a number of risks and uncertainties, And since these elements can change and in certain cases are not within our control, we ask that you would consider and interpret them in that light. We urge you to review the company's Form 10-K and other SEC filings for a discussion of the principal risks and uncertainties that affect the company's business and performance and the factors that could cause actual results to differ materially. OmniQ undertakes no obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events, or otherwise, unless required by law. I will now turn the call over to Shai Lesgarden. Please go ahead.

Thank you, Operator, and thanks to everyone joining us on the call today. We're very pleased to share with you our 2021 financial results combined with some recent achievements. We define it as the Omnicue Momentum. We mark a milestone of annual revenue run rate of $100 million, and we hope to exceed that exponentially soon. As projected and desired, we uplifted to NASDAQ in September 2021. Our Q4 revenue grew by 93% to nearly $25 million. Our annual revenue grew by 42% to $78.3 million. We exceeded Lake Street and ThinkEquity's analyst's revenue projections and equal taggage for Q4 and full year 2021. In Q4, we had a gross margin of 24% compared to 19% in 2020, mainly due to the growth in service agreements in our product mix. We achieved 21% sequential increase in Q4 sales over Q3 of 2021. Our year-over-year gross profit increased by 53%. Our balance sheet is stronger, and our cash position grew by 39% since December 31, 2020, to approximately $7.1 million. Another important event is the acquisition of 77% of Dangot Computers, a leader in providing sophisticated solutions of automation for hospitals, restaurants, supermarkets, government institutions, and others. Synergy with Dangot generated immediate joint projects with Omnicuse AI solutions. Acquisition started only several months ago. Integration of both activities is healthy and fruitful. Soon, we shall see more projects resulting from the combination of the two companies' product offering. A good example is the inclusion of Dangot Smart Kiosks with our AI-based sensors providing a comprehensive solution for automation of parking and access control systems. We believe that many joint projects will follow. Now, We're fully focused on 2022 as we're experiencing a robust start with a record backlog of orders and a strong pipeline of orders coming in from all our divisions. In particular, the demand of our AI machine vision for safe city, smart city, and automation of parking is experiencing growth in demand in the U.S., Israel, and South America. As well as our smart kiosk solution, which saves time and money by eliminating long lines and reducing interactions with cashiers and service staff, lowering the chances of spreading COVID-19. Another very important 2022 focus is our initiative to develop and install QShield, our turnkey AI pay system in many locations in cities in the US. Five cities are already under contract with us, with many more projected to sign soon. I would like to explain the system to you and the recurring revenue sharing model. QShield is our police force multiplier, an unbiased AI approach to law enforcement that offers 24-7 visibility and identification of possible risks, which increases safety, revenue, and enforcement efficiency. Our dynamic revenue share model empowers cities with the option to deploy QShield with little upfront cost and repayment through a percentage of citation collection. Today, QShield is already affecting the everyday lives of residents by making our streets safer and creating more resources that are invested back into the community, responding to needs that prior QShield were harder or not possible to respond to. And I'd like to reiterate that Q4 and full year 2021 was a huge leap forward for Omnicube. As we move ahead in 2022, we're well positioned to show significant top and bottom line momentum. Our confidence stems in part from tremendous backlog of greenfield revenue opportunities with AI and smart city applications for our technology, targeting both new clientele as well as our existing Fortune 500 customers that buy our supply chain automation solutions. We expect our financial profile to transform as our AI revenue streams grows and we unleash the earnings leverage potential in our business model. Before I go further, let me now turn this over to Niamh to take a deeper look at our financial results. Niamh? Yes.

Hello, everyone. As Shai highlighted, we reported revenue of $24.9 million at the end of fourth quarter 2021. This is an increase of 93% from $12.9 million in the fourth quarter of 2020. Through our consolidation with Dengar, as well as continuing increase of presence in the marketplace, we are doing extraordinarily well and trending for continued growth. Total operating expenses for the quarter were $7.6 million compared to $5.1 million in the fourth quarter of 2020. and the increase reflects the consolidation of Dango as well as certain non-recurring expenses related to the acquisition. Net loss for the quarter was $2.2 million, or a loss of $0.36 per share, compared to a loss of $2.9 million for a loss of $0.66 per share for the fourth quarter last year. Adjusted EBITDA, meaning adjusted earnings before interest, taxes, depreciation, and amortization, for the fourth quarter of 2021 amounted to a loss of $548,000 compared to adjusted EBITDA loss of $771,000 for the fourth quarter of 2020. Cash balance was $7.1 million as the period ended December 31st, 2021. Turning to four-year results, OmniQ reported revenue of $78.3 million for the year that ended December 31, 2021, an increase of 42% from $55 million in the same period of 2020. Our gross profit grew to $16.7 million in the year that ended December 31, 2021, compared to $10.9 million in the same period in 2020. Total operating expenses for the year ended December 31, 2021 were $7.6 million compared with $5.1 million in the same period in 2020. However, there were significant non-interior expenses related to the acquisition in Q4 this year. Net loss for the year ended December 31st, 2021 was 13.1 million or a loss of $2.20 per basic share compared with the loss of 11.7 million or a loss of $2.49 per basic share for the same period of last year. Adjusted EBITDA for the year ended December 31st, 2021 amounted to a loss of 4.1 million compared with an adjusted EBITDA loss of 3.1 million for the same period of 2020. I do wish to point out that we executed a new $8.5 million lending facility with Bridge Bank, a division of Western Alliance Bank, which replaced our old high interest $6 million limit facility we had with a different financial group. As part of the new facility, our interest rates have been cut significantly. Let me now turn the call over back to Shai to talk more about operational achievements and outcomes. Shai?