Abaxx Technologies Inc.

Good morning. Good afternoon, everyone. Good evening to all of us joining from Singapore. Thanks for joining us today for the ABEX third quarter investor call. My name is Tara Hayes, Director of Communications at ABEX, and I'll be directing today's call. After years of market infrastructure development, this is our first earnings call since completing our initial ramp up as a revenue generating exchange. We've made a number of format changes as we continue our evolution into the revenue and operating growth phase of the business. With us on the call today are founder and CEO Josh Crum, CFO Steve Frey, ABEX Exchange Chief Commercial Officer Joe Rea, Head of ABEX Technology Products Ian Forrester, and ABEX Digital Title Lead Leah Wald. Everyone should have access to our third quarter reports and Monday's quarterly corporate update press release, which will be the primary disclosures for today's presentations. But we also want to make reference to all filings and risk disclosures found on CDAR+. We have published a short slide presentation to accompany today's call, which is being recorded and will be posted to our investor website, investors.abex.tech, and to YouTube, as we have with prior investor calls and special presentations. We'd like to remind everyone that part of our discussion today will include forward-looking statements which are subject to various assumptions, risks, and uncertainties, and which could cause actual results to differ materially from those expressed or implied on today's call. Please find our full statement and cautions regarding forward-looking statements on the slide attached. Before I hand the call over to Josh to update investors on the vision and strategy of the company, we'd like to specifically draw your attention to the highly regulated nature of our products and operations. Given the early growth stage of our ramp up and deep innovation pipeline for listing new products, it's important to reiterate the cautionary nature of our forward-looking statements with respect to products that are still subject to ongoing regulatory work and review. We'll endeavor to point out these cautions as we go, but as of today, our ABEC Singapore entity's regulatory status is that of a recognized market operator exchange and approved clearinghouse in Singapore. We have revenue-generating futures products currently trading in physical delivery LNG, the only product of its kind listed globally, Singapore gold kilobars, two voluntary carbon market carbon futures products, of which our Corsia contract became the first VCM contract to ever go to delivery through FCMs and a regulated clearinghouse this year, our battery materials products in lithium carbonate and nickel sulfate, and new since our last update in August, our first weather derivative contract in German onshore wind, which had its first block trade take place this week and has catalyzed a significant amount of new onboarding from global institutions since our last call. Any other potential products discussed today, including new markets planned for additional precious metals, base metals, additional weather derivatives, smart commodities, or even some of our innovative technology-enabled products in the pipeline, would be subject to meeting all regulatory requirements and disclosures before listing. As we speak about our gold products today, we want to point out that our ABX spot entity was newly incorporated in Singapore this year, but operating under a different branch of the ABX corporate family tree. Not part of the entities regulated by the MAS under ABX Singapore and the Monetary Authority of Singapore does not regulate spot commodity markets. Following Josh's presentation, we will open the call up for Q&A to answer investor questions, which you can submit anytime using the Q&A feature on the controls toolbar on your Zoom screen. With that, I'd like to hand the call over to Josh for some opening remarks and a walkthrough of our third quarter update and KPIs.

Thanks, Tara. And good morning, everyone. Thanks for joining us. It's very exciting to be presenting this new format today. A lot of hard work over a half decade in the making for our first exchange revenue generating quarter with strong initial volumes in our gold and LNG contracts in particular during Q3. But I want to start off today by acknowledging the tireless entrepreneurial endeavors of Sean May Lim, our Chief of Market Operations and the Singaporean founder of Abex, President Dan McAlduff, who led the build-out of Abex Clearing as a lead designer of all of our futures products, and of course, the always steady hand leadership of CEO Nancy Sia, as well as Joe Rea, Tak Siong, CTO Richard Fong, Xinhui, Celine, Natalie, Alistair, Taff, and the entire Abex Singapore executive team and board of directors. Avex is quite possibly the first ever global market of this potential and scale built completely from scratch. A suite of brand new greenfield physical futures products on a brand new exchange, a proprietary next generation tech stack, and one of the only commodity clearing houses regulated and launched in decades. This is an accomplishment that none of our largest global commodity market infrastructure tiers in their current form can claim, having bought or evolved most of their markets from existing platforms. I can confidently say that our people are unmatched in their grit and determination, combined with an innovator trailblazing mindset that forms the DNA of this company and will serve us well as we make our next moves in this volume and revenue growth stage as we grow market share in the commodity futures business. In this first exchange revenue quarter, volumes in our flagship LNG futures totaled 9,486 contracts in Q3, the equivalent of 27 physical cargoes. This LNG volume ramp-up shows strong momentum with an 83% increase in September over August. And while volume and open interest growth should probably be compared on a half-over-half basis for a while, given the timelines of new institutional onboarding, it has nonetheless been good to see the early momentum growth as the second half of 2025 has progressed. In particular, as our North Asia LNG contract recently joined our U.S. Gulf contract in daily trading volume. Our gold Singapore futures also saw accelerating adoption, reaching 54,128 contracts traded since its launch. It was our first contract to start trading regularly through our club across calendar months, which was key to stress testing our market plumbing, improving and optimizing our new systems. We also have a strong balance sheet designed to support our strategy and growth. After our recent strategic financing, growing reserves and runway, as of November 14th, we had over 50 million in cash, as well as the strong market to market positions of our strategic stakes in base carbon and mine hub. These are assets owned in order to drive long-term operating income in our core markets and software business operations. But our balance sheet affords the company financial flexibility to increase operating budgets into our revenue ramp-up phase over the next 12 months, while remaining focused on minimizing share dilution, as always. We've also realized a significantly improved cost of capital over the course of the quarter, with the ABEX stock price rewriting strongly in response to the Q3 de-risking events and daily volume growth of the exchange and the announcements of our ID++ digital title pilots, a greater than 150% increase in the stock price in Q3. But while acknowledging these significant financial milestones and successfully starting our first transition from a company that builds hard things to a company that sells things, I want to step back briefly to the long-term strategy and roadmap to put this quarterly update in perspective. As I've outlined on previous calls this year, the core long-term asset we're developing with every onboarding and every IT connection for moving data into and out of our systems is that of the ABEX network, the asset which remains the nexus of our markets and software development strategy. The daily trading activity over Q3 was supported by significant network growth. Our connected participant base grew 88% quarter over quarter to over 150 firms, including new onboarding of trading firms, indirect clearing firms, and inter-dealer brokers all achieved during the quarter. Our market maker and liquidity provider base specifically grew 93% to 29 firms, strengthening liquidity across our product verticals. It's through this early network development that we've achieved the first step of our log-scale growth ambitions. During Q3, we achieved our first 1,000 average daily volume, or I'll continue to call ADV through this call, on our targeted log-scale path to 1 million ADV by 2030. We also saw our first trading revenue on a path to significantly higher sales over that time. The combination of 1 million ADV contracts with 50% EBITDA margins is a powerful profit generator. This is the target, and continued execution over the next year will determine the slope and timing of that AVEX path. This kind of growth requires new nodes on the ABEX network, which requires more products to drive more onboarding urgency, particularly among clearing members, opening up more regions to become a true global commodities venue and more data distribution so the market sees our prices and bids and offers, and a general equivalency of traders being able to execute in our markets as easily as taking liquidity in today's existing commodity benchmarks. So we continue to frame our milestone updates in this context for developing the singular asset, the ABEX network, de-risking the blockers to market access and allowing us to grow to 1 million ADV and beyond. And this network isn't just about the exchange. It's the foundation of our full stack strategy. We use the regulated revenue generating exchange as the flywheel to build, prove, and deploy our next generation technology from the inside out. This is where the two pillars of our business strategy converge. And I want to be very specific about the strategic value of this network. We aren't just building a list of trading counterparties. We are effectively building a preloaded distribution network for our future technology products. But by onboarding these 150 plus firms to the exchange, we are establishing the commercial rails to sell them our digital title solutions tomorrow. These clients have a critical need beyond just hedging. They need to solve for the velocity of collateral and in particular to unlock the trap value of their physical commodities. We will discuss this technology again in more detail later in the call, but it is important to understand that every new exchange client is a future user of our full tech stack, positioning us to capture revenue beyond simple trading fees. On the path to realizing that vision, over the quarter, we also made significant progress on the ABX ID++ private digital title and console suite. This technology segment is now moving from R&D to the operational reality. In Q3, we also officially launched Adaptive Infrastructure, our new wholly-owned subsidiary. Adaptive provides the institutional-grade custodial and settlement services that form the foundation of our new markets. It has already been approved as a custodian for our carbon futures contracts and will serve as the custodial foundation for the upcoming tokenized money market fund pilot. This brings me to the private digital title pilot program. I'm pleased to report that in Q3, we completed the core platform development to enable the creation and transfer of legally enforceable digital titles through the ABEX private network. This is the technology engineered to solve that identity privacy ledger trilemma that I talked about in previous calls, which is the key failing most of the blockchain real world asset projects today. We also announced a third pilot with Mindhub to extend this digital title infrastructure to in-transit shipments of non-ferrous metals like copper and aluminum, as well as copper and aluminum. And as a key milestone subsequent to quarter end, Mindhub successfully completed its integration testing our Verifier Plus kit in October. And finally, I want to flag a major macro development that validates this entire technology roadmap. Since our last call in August, with the momentum behind the US Genius Act and the global stablecoin volumes now exceeding $1 trillion a month, the market has decisively woken up to the need for something like on-chain finance. But in our view, they are all hitting the identity wall that we spent the last five years solving and that I walked through in detail in the last call. Our timing here has been impeccable. We are now positioned as one of the only platforms with the regulated rails to be at the forefront of this transition. And I will explain later in the call how we plan to capture this massive shift, but we can get into more of those details as we walk through a few slides detailing our KPIs and path ahead. Tara, can you please pull up the first quarterly update slide? As I mentioned, we recorded our first revenue at ABEX Exchange, which analyzed to just over 1 million in volume-based revenue in Q3. This is a critical milestone, but it's important to understand that it's just the first of multiple long-term revenue streams we were built to capture. Our business model is a full-stack layer cake of revenues when fully executed. We are now live on exchange and clearing fees. We've also been live on royalties, but the model is designed to ramp up over time as we launch market data subscriptions, SaaS license fees for our console suite, and network transaction fees based on the assets in our digital title ecosystem. For the exchange and clearing fees layer, the key drivers for this and our future growth are average daily volume ADV and revenue per contract. The Q3 ADV was built on accelerating momentum in our flagship products. Again, LNG volumes totaled 9,436 contracts in Q3, 27 physical cargoes. But what's critical here is the early momentum, as we saw the 83% increase in September trading over August. This is the first sign of a true physically backed forward curve forming on our screens. Our gold Singapore futures saw even faster acceleration. The contract reached 54,128 contracts traded since its launch through September 30th. To give you more color on that ramp, volumes rove 242% month over month in July to 8,829 contracts, and then a further 167% in September to 23,563 contracts And this isn't just on the future side. Our entire gold ecosystem is being built out. ABEX Spot, our physical in-vault spot platform, has seen strong commercial engagement with 27 companies, including refiners, trading firms, and financial institutions, now either fully connected or in the process of onboarding. Total ADV across all contracts for September showed steady growth over prior months, which continued in October. We're still a long, long way from our 1 million ADV goal, but we're making steady progress. We believe rate limiting items like the CFT's FBOT approval will unlock significantly more growth opportunities in ADV in the near future. And again, I'd like to point out that while initial month over month and quarter over quarter volume has been very encouraging, the true slope of the exponential curve towards 100,000, 1 million and beyond should really be measured on a half over half basis over the next 12 to 18 months. As the key clearing member nodes that open up access to more firms and more taker liquidity and open interest can take more than a quarter to onboard. We can talk a little bit about that onboarding pipeline in the Q&A with Joe. And speaking of onboarding, ADV and RPC are lagging indicators in our view. The leading indicator for future growth are the network KPIs, and these were arguably our most successful metrics of the quarter. Our connected participant base, which includes clearing firms, trading firms, and inter-dealer brokers, grew 88% quarter over quarter to over 150 firms that are now fully connected or in the onboarding process. Even more importantly, our market maker and liquidity provider base grew 93% quarter-over-quarter to 29 firms. This is the fuel for deeper liquidity and tighter markets. It's through this early network development that we've achieved the first step of our long-scale growth ambitions. Again, to maintain this kind of growth requires new nodes on the ABEX network, which requires more regions, more products, and more market data distributions. We are actively building this network in the key strategic regions that matter. First, in China, this is a major strategic focus. In Q3, we facilitated a high-level delegation from the China City Gas Association, which represents over 680 firms, to promote and educate the market on our LNG benchmarks. We are also progressing partnership discussions with Chonggong Natural Gas and the Qingdao Exchange to strengthen the link between Chinese buyers and international suppliers using our platform. Second, in India, our network is also expanding into other key Asian markets. We've begun onboarding our first trading firms from Gujarat province's gift city, which is home to over 1,000 proprietary trading firms. Third, in the United States, we continue active engagement with the CFTC regarding our foreign board of trade application. As I mentioned earlier, this is a critical milestone for our commercial ramp up. While we have already onboarded major global FCMs, including our first bank FCM, many of these partners have significant client bases and trading desks in the US that are currently restricted from accessing our markets directly. Securing FBOT status will allow these existing partners to fully turn on the pipes for their US clients. We view this as a major dormant liquidity pool that we are working to unlock, further deepening the order books for all participants. And finally, in Europe and in new asset classes, over the medium term, we will look to expand the ABEX network into the $2.5 trillion global fine art market. We have just announced a strategic investment in Artex AG, a regulated multilateral trading facility in Liechtenstein. Crucially, this partnership opens the door for an entirely new asset class of hard asset futures products on ADEX exchange, fine art index futures. Right now, banks and insurers sit on billions of dollars of art collateral that they cannot effectively hedge. By listing a futures contract based on ARDEX's transparent trading data, we can offer these institutions the first real hedging instrument for the art market, effectively a beta index for the movement of art prices. But on a side note, talking about the tech again for a second, this is also potentially a major technology development. ARDEX is also positioned to use our ID++ and digital title infrastructure to power these regulated transactions. This drives a unique viral network effect where ARDEX launches an IPO for a famous painting. It creates a distribution event to drive mass adoption of our ID++ wallet nodes, acting as a Trojan horse that puts our identity technology in the hands of countless new users. And finally, in operational talent, to drive this commercial push, we've hired key talent like Russell Robertson as our new Chief Business Development Officer. Russell brings decades of experience in clearing experience from the Gulf Merck, CME Group, and IceClear Europe, and has already been representing AVEX at key industry forums in India, Japan, Singapore, and beyond. This global network growth is also fueled by our product strategy. As I've discussed on past calls, we think about new products in three categories. Greenfield, these are the brand new markets we are building from scratch, like our physical LNG and battery metals contracts. Second, step out. These are improved market structures or regional hubs for existing commodities, like our gold kilopar contract. And third, spreads and lookalikes. These are products designed to plug into existing liquidity pools like the cash settled LNG and energy related contracts we have in development. In Q3, we successfully finalized and subsequently launched a strategically vital new contract in our German onshore wind futures, which, as Tara mentioned, went live and had its first trades this week. This is our first weather derivative and our first contract to be settled in euros and a major step into the environmental products vertical. This is just the start. Our active pipeline includes stage three, which is our final development stage, work on silver market solutions and those complimentary cash settled energy contracts. And we are in stage two development for platinum group metals and even an out-of-the-box thinking uranium product. But before we transition to our technology update, I want to add a brief note on our operating leverage and costs. In previous calls, I mentioned that we had reached peak cash OPEX for our initial launch phase as we were maintaining an incredibly tight balance sheet and dilution until daily volume started to ramp up. However, with our strengthened balance sheet and an improved cost of capital from our recent strategic investor, we are making the strategic decision to ramp up investment again. We had been running a net cash outflow of about US 25 million annualized, which has picked up another roughly 10% over recent months. And we are reviewing additional hiring to come on in 2026 to accelerate the growth curve. Which brings me to an update on how we view our evaluation, some of the parts. With the exchange now live, revenue generating, and on an initial trajectory to our medium-term target, we believe the market infrastructure side of our business is increasingly de-risked and just requires more hands and more patient and steady execution of our plan. However, because our software business is just entering its commercial pilot phase, we feel the market is currently assigning little value other than maybe a blue sky call option. We still see significant arbitrage here. In conversation with many investors, they see ABEX as buying a de-risk by growing a volume exchange and getting a free option on the technology stack. But unlike a typical venture bet, this technology option is also de-risked because it has a pre-built base. We don't have to go find users of our digital title software. We simply have to cross-sell it into clients already trading on our exchange as it provides utility and capital efficiency. We believe the structure offered is one of the more asymmetric risk reward profiles in the market, which is, again, all due to the structure of our business model inside a growing market network. So our cash outlay is all about building the network. We add new nodes by investing in new regions and new products, all of which feed back into our core flywheel and why we see adding budget now a no-brainer as a high return activity and just needs more human capital for more products and more connectivity for liquidity to accelerate. So back to the tech and digital collateral opportunity. It's quite understandable that analysts have yet to sign tangible forecasts as we have yet to release pricing on our rollout guidance. But we have invested roughly 20% of ongoing operational costs over half a decade now with full confidence in what we've built and with good timing on our rollout in 2026 as the world accelerates on a path to financial market tokenization. But to achieve the top layer of business revenue and commercial products, like SaaS license fees and the network transaction fees you see in our revenue model slide, and new exchange products like real-time digital collateral, we had to build an entire full stack from the protocol layers up. This has been a long-term endeavor, and in Q3, this technology segment moved decisively from R&D to an operational reality. Atara, can you please pull up the technology slide? As you can see, our stack is built in layers. At the foundation, we have our open identity protocol, ID++, and decentralized storage. In our current Smarter Markets podcast series, Re-engineering Tokenization, which I would encourage anyone to check out, we refer to this as building a human blockchain of trust. Instead of relying on anonymous algorithms or a central database that can be hacked, we anchor digital identity to real-world accountable parties, like our regulated exchange members, who have reputational skin in the game. This allows us to have a decentralized trust without sacrificing the privacy that institutions demand. On top of that sits our policy engine and our identity applications. In Q3, we delivered key upgrades here. ABX Verifier Plus was upgraded to support in-app approval flows for digital title transactions. Next is the application layer, our console suite. In Q3, we released ABX Sign to a technical preview with new interoperability between Sign and Drive, improving our workflow efficiency and document management for digital title applications. Messenger, Sign, and Drive are the compliance-ready thin applications that let institutions manage assets across this AVEX private network. And all of this enable the top commercial layer, truly digital collateral, which we call our private digital title. This entire stack is now being deployed for our private digital title pilot program. In Q3, we officially completed the core platform development to enable the creation and transfer of legally enforceable digital titles. This technology is engineered to solve that identity privacy ledger trilemma I've talked about. It provides legal finality and built-in privacy, which is what separates our approach from standard blockchain tokenization. And this is where the velocity of collateral business case becomes real. By using this technology, a trader can take a physical gold bar sitting in our Singapore vault and instantly pledge it as HQLA collateral for an LNG trade without waiting days for bank transfers. This efficiency releases trap capital on the balance sheet of our clients. We aren't just offering them a better trade or risk management through our exchange and clearinghouse, but soon we'll be offering them a better capital efficiency. We also announced a third pilot with MineHub to extend this digital title framework to in-transit shipments of non-ferrous metals and copper and aluminum. And as a key milestone subsequent to quarter end, MineHub successfully completed its integration testing in October. We are now in the final phase of the zero to one rollout. We are currently finalizing the legal partner and regulatory work needed to make sure these business layer pilots are not just demos, but real transactions. These pilots will run with our completed tech all the way through the stack starting this December. To provide the institutional foundation for these new markets, in Q3, we officially launched Adaptive Infrastructure, our new wholly-owned subsidiary. Adaptive provides the institutional-grade custodial and settlement services that form the foundation of our new markets. It has already been approved as a custodian for our carbon futures contracts and will serve as the custodial foundational of our upcoming securities pilots. And again, I realize we're covering a lot of ground on the convergence of these technologies and business models today. For investors who want to understand exactly why our architecture wins here and the specific architecture beyond the identity-first approach, I again encourage you to listen to our re-engineering tokenization podcast series found on Apple or Spotify, YouTube, particularly episodes one and two. We also laid out the detailed technical roadmap for this architecture during our August investor presentation. So to conclude, it really has been a transformational quarter. As many years of hard work have come together, significantly de-risking our long-term business model with this early market validation seen over the course of Q3. I want to thank you for your continued support as we execute on this vision. And with that, I'll turn it back to Tara to start the Q&A.

Thanks, Josh. Before I hand the call to our Chief Strategy Officer, Dave Greeley, for the Q&A session, we'd like to remind everyone that questions submitted to the APEX IRN box ahead of today's call will be answered with priority. For additional questions, feel free to submit them using the Q&A feature on the Zoom controls toolbar on your screen. And Dave, over to you.