GURU Organic Energy Corp.

Welcome to the Guru Organic Energy First Quarter 2024 Results Conference Call and Webcast, being recorded today, March 14, 2024, at 8.30 a.m. Eastern Time. At this time, all participants are in a listen-only mode. Following management's presentation, there will be a question and answer session with financial analysts, Instructions will be provided at that time for you to queue up for questions. If anyone has any difficulties hearing the conference, please press star followed by zero for operator assistance at any time. Guru's press release, MD&A, and financial statements are available in the investor section of its website and on CDAR+. During the call, The company may refer to certain non-GAAP measures. Reconciliations are available in its MD&A. Also note that all financial figures are expressed in Canadian dollars unless otherwise indicated. I would also like to remind you that today's presentation may contain forward-looking statements about Guru's current and future plans, expectations and intentions, results, level of activity, performance, goals or achievements, or other future events or developments. As such, please take a moment to read the disclaimer on forward-looking statements on slide two of the presentation. I will now turn the call over to Carl Goyette, GURU's Chief Executive Officer.

Thank you, operator. Bonjour à tous. Good morning, everyone, and welcome to our earnings call. Joining me this morning is our CFO, NG Seraph. For those who are following the webcast, you can turn the presentation to slide five. GRU has now achieved a fourth consecutive quarter of top line growth with solid retail channel sales in Q1, lifted by strong momentum online and in club wholesale. For comparison, Online and wholesale club markets in the U.S. are each the same size as the Canadian energy drink market. They are a growing proportion of Guru's net revenue with a strong potential for future growth. Across all three of our channels and where available, our latest innovations continue to bear fruit. This is led by our expanding punchline, which is very popular with consumers and will be reinforced by our updated brand positionings. As the year progresses, we will keep focusing on three sales channels and leverage our innovation pipeline. We will ensure our sales and marketing investments generate the best return on investment with the right tactics deployed through the right channels. Our 2024 priorities to grow sales and accelerate our return to profitability remain firmly on track. Net revenue has grown 43% this quarter. Net loss continued to decrease for the fifth quarter in a row over the same period a year ago. This is significant progress. Turning to slide six. Last week we upgraded our online presence with a new and improved transactional Guru Energy website. This site now offers better user functionality with more interactivity and simplicity. These enhancements are expected to increase consumer conversion. The site also showcases our sleek new can design and emphasizes energy-focused brand features, such as improved focus for our punch line and metabolism boost for our new Guru Zero line. We're happy to provide these additional functionalities to our Guru consumers. Turning to slide seven, In the coming weeks, there will be a lot of activity in Canada. First, in retail, we're introducing Peach Mango Punch across Canada, supported by in-store activation initiatives and a punchy marketing campaign. Second, we will be launching the innovation we hinted last quarter. This innovation is our Zero Sugar Organic Energy Drink, the first of our new Zero Sugar Metabolism Boost product line-up. This drink combines metabolism boosts from green tea extracts with a delicious wild berry flavor. We firmly believe that our long-awaited zero-sugar energy drinks will be welcomed by existing and potential consumers alike. The initial launch plan in the coming weeks will be in Quebec at retail locations and online across Canada. Looking at the wholesale club channel in Canada, we're extremely proud to have achieved permanent status at Costco in Quebec after successful rotational programs. Now, our products will be available on a regular basis. This is a meaningful foot in the door at Costco in Canada that hopefully will enable us to potentially break through outside of Quebec. Still on the topic of wholesale and now turning to the U.S. on slide eight. Q2 started on a strong note with two rotational programs at Costco in Los Angeles and in the Midwest. The first is carrying our 12-can variety pack comprised of tropical punch and fruit punch. And the other, our 15-can variety pack and complete punch lineup, including our peach mango punch. At retail, we began rolling out peach mango punch in natural food stores and other retailers in February. Whole Foods Market will lift Tropical Punch nationally in over 500 stores starting in April. This channel has shown consistent growth over the last 52 weeks. We believe that these new launches will boost the momentum and contribute to that growth. Traction on Amazon.com was particularly impressive last quarter, with an 89% increase in sales. This was mainly fueled by Black Friday, our fruit punch launch, and peach mango punch launch, including the variety pack. These launches drove repeat customers and helped us reach record levels of new-to-brand customer acquisition in January, surpassing Black Friday month, and we expect this trend to persist going forward. I will now turn the call to Ingi to discuss our financial results in more details. Ingi, over to you.

Thank you, Carl, and good morning, everyone. Turning to slide 10. Net revenue in Q1 increased by 43% year-over-year to $7.1 million. That marks the fourth consecutive quarter of net revenue growth versus a year ago. Sales in Canada grew 35% to $5.7 million, driven by increased sales velocity. In the U.S., sales grew 87% to $1.4 million, driven by ongoing online sales optimization and retail growth. Gross profit increased to $3.8 million from $2.7 million in Q1 2023. Gross margin was 52.9% compared to 53.7% for the same quarter last year, mainly due to increased promotional activity in Canada offset by less promotional activity in the U.S. SG&E was $6.1 million compared to $5.7 million in Q1 2023. As a percentage of net revenue decreased to 85% from 113% in Q1 2023. Selling and marketing expenses increased to $3.3 million from $2.9 million in Q1 2023. As we were more active on social media to promote our brand. Net loss for the first quarter decreased to $1.9 million compared to $2.6 million for the first quarter last year. Adjusted EBITDA amounted to a loss of $2 million compared to a loss of $2.6 million for the same period last year. As of January 31, 2024, Guru had cash, cash equivalents, and short-term investments of $31.2 million and unused credit facilities of another $10 million as we continue to exercise prudent financial management. Cara, back to you for concluding remarks.