Scientific Industries Inc

Good afternoon and welcome to the Scientific Industries Report's second quarter of fiscal year 2022 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 your touchtone phone. To answer your question, please press star then two. Please note this event is being recorded. I'd now like to turn the conference over to Joe Dorme, Managing Partner. Please go ahead.

Thank you, Grant. Good afternoon, and thank you all for joining us today to review the financial results of Scientific Industries, Inc. for the second quarter of fiscal year 2022, ended December 31, 2021. With us today on the call are John Moore, Chairman, and Helena Santos, Chief Executive Officer. After the conclusion of today's prepared remarks, we will open the call for questions. If anyone participating on today's call does not have a copy of the press release, you can retrieve it from the company's website at scientificindustries.com or numerous other financial websites. Before we begin with prepared remarks, I'd like to remind everyone, certain statements made by the management team of Scientific Industries during this conference call constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Except for the statements of historical fact, This conference call may contain forward-looking statements that involve risks and uncertainties, some of which are detailed under risk factors and documents filed by the company with the Securities and Exchange Commission, including the annual report on Form 10-K for the year ended June 30, 2021. Forward-looking statements speak only as of the date the statements were made. The company can give no assurance that such forward-looking statements will prove to be correct. Scientific Industries does not undertake and specifically disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events, or otherwise. Now I'd like to turn the call over to Helena Santos, CEO of Scientific Industries. Helena?

Thank you, Joe. Good afternoon, and thank you for attending our company's fiscal 2022 second quarter earnings call. The second quarter of fiscal 2022 reflected a 7% increase in the company's total net revenues, which was due mostly to sales generated by our bioprocessing operations of approximately $403,000, which is double the prior year's same quarter. And this is attributable to sales of Aquila Biolabs products. The product sales of the company's core business, the benchtop laboratory equipment operations, during the second quarter were at approximately the same level as the prior year, reflecting increased sales of the Torbell Division's Vivid Pill Counter and decreased sales of Genie Brand products due to raw material shortages, which caused production delays and inefficiencies. In other words, we simply couldn't ship. We are facing challenges in the supply of component parts for our products, with substantially increased lead times due to underlying raw material shortages, particularly for digital components. So while the order input is still at a healthy post-pandemic level, our ability to deliver is hindered by these challenges. This has been true primarily for the Genie brand products. The good news is that thus far, our Torvald brand products have not experienced significant supply chain disruptions. So combined with the first quarter, our company's total revenues for the first half of this fiscal year increased 22% due to high sales of the core benchtop lab equipment in the first quarter and sales generated from the Aquila Biolabs products, which we acquired in April of 2021. And John Moore will discuss in further detail. We expect that the order levels for Torvald products will continue to increase and the Genie brand products to remain steady. However, our ability to deliver and therefore recognize the sale is dependent on the supply chain situation. The gross profit amount generated during the second quarter was approximately the same as the prior year, which was $1.4 million, with the gross profit percentage of 48.5%. and that compares to 50.9% in the prior year, same quarter, due primarily to increased material and labor costs for the benchtop lab equipment and decreased percentage for the bioprocessing operations compared to last year. And that's since last year was mainly royalty revenues, which gave it a higher gross profit percentage. The six-month periods percentages were substantially the same as the quarter that I just discussed. Our operating expenses increased significantly for both the second quarter as well as the year-to-date period due to the expenses of the bioprocessing operations, in particular, the German operation, which did not exist last year. Increased product development costs, sales and marketing expenses, non-cash equity expense, investor relation costs, and other professional fees. Other income that we recorded this quarter was significantly higher, and that's principally due to taking into income the forgiveness of the company's second PPP loan, which occurred in December of 2021. Looking at our balance sheet, our cash position at December 31st was approximately $11.2 million in cash and investments, and that's compared to $13.4 million at the end of our fiscal year, end of June 30th, 2021. For the last half of our fiscal year, we will continue to focus on building the bioprocessing business, as John Moore will discuss in detail, and we will continue to foster our core business so that it can continue to generate immediate positive cash flow for the growth of our company. And with that, I turn it over to John.