Stingray Group Inc.

Good morning, ladies and gentlemen, and welcome to the Stingray Group Inc. Q3 result call conference call. At this time, all lines are in listen-only mode. Following the presentation, we will conduct a question-and-answer session. If at any time during this call you require immediate assistance, please press star zero for the operator. This call is being recorded on Wednesday, February 8, 2023. I would now like to turn the conference over to Mathieu Pelletier. Please go ahead.

Thank you very much. Bon matin. Good morning, everyone, and thank you for joining us for Stingray's third quarter conference call for the period ending December 31, 2022. Today, Eric Boyko, President, CEO, and co-founder, as well as Jean-Pierre Terrain, CFO, will be presenting the Stingray financial and operational highlights. Our press release reporting Stingray's third quarter results for fiscal 2023 was issued yesterday after the market closed. Our press release and DNA and financial statement for the quarter are available on our investor website at stingray.com as well as on CEDR. I will now provide you with the customary caution that today's discussion of the corporation's performance and its future prospects may include forward-looking statements. The corporation's future operation and performance are subject to risk and uncertainties, and actual results may differ materially. These risks and uncertainties include but are not limited to the risk factors identified in Statewide Annual Information Form dated June 7, 2022, which is available on CEDR. The Corporation specifically defines any intention or obligation to update these forward-looking statements, whether as a result of new information, future events, or otherwise, except as may be required by applicable law. Accordingly, you're advised not to place undue reliance on such forward-looking statements. Also, please be reminded that some of the financial measures discussed over the course of this conference call are non-IFRS. Please refer to Stingrays MD&A for a complete definition and reconciliation of such measures to IFRS financial measures. Finally, let me remind you that all amounts on this call are expressed in Canadian dollars unless otherwise indicated. With that, let me turn the call over to Eric.

Okay, merci, Mathieu. Good morning, everyone, and welcome to our third quarter conference call for fiscal 2023. Stingray raised its performance in the third quarter by delivering record adjusted EBITDA of $34.5 billion on unprecedented revenues of $89.2 million. The adjusted EBITDA for the broadcasting and commercial music division was up by 54.8%. We achieved these milestones mainly due to the success of our Stingray advertising offering fueled by the in-store audio network acquisition. We are also seeing the benefits of our renewed focus on our key growth initiative and also our streamline operation. Indeed, in the last five months, we have realigned our resources to high-growth areas like Stingray advertising, which remain mostly immune to the economic downturn based on its large consumer base of grocery stores and pharmacy chains, while trimming down other segments to improve profitability. The end result is that our restructuring efforts, partially offset by strategic investment, have generated a cost saving of approximately $12 million on an annual basis. And I guess we will see these numbers really coming more in Q4. Turning to our reporting segments. Broadcasting commercial music revenue grew 25% to $54.2 million in the third quarter of 2023, primarily driven by in-store audio networks acquisition, revenue increase of our key growth initiative, and a positive foreign exchange on the U.S. dollar. Key achievement in this segment in the quarter includes hiring sales resources to further grow our U.S. retail media business, launching free ad-supported TV channel with Amazon FreeVee, and Samsung TV Plus to increase our presence in the fast channel space. Releasing the Stingray Karaoke app with 100,000 licensed songs on Samsung Smart TVs to elevate our brand exposure worldwide. And finally, introducing our wellness-driven comm live streaming service on Comcast and Cox to expand market share in the subscription-based video-on-demand business. In terms of sBot, our subscriber count rose 16% 16.4% to more than 805,000 subscribers, with B2C revenues increasing by 20%. Total SBOT revenues also increased year-over-year on a net revenue basis as we opted to reduce unprofitable investment in B2C apps to focus on better margins and lower operating expense with B2B partners with large installed customer base. Moving on to radio, revenues improved by 0.4% to $35.1 million in the third quarter on higher digital sales. Although this represents a modest growth, we remain pleased with the overall performance and the cash flow generating business. As the automotive industry gradually resolves its supply chain issues, we anticipate that once again becoming one of our top revenue generation for our radio business. Looking ahead to the fourth quarter, we are optimistic about our multiple growth opportunities despite an uncertain economic environment. Our quarterly focus on debt reduction while maintaining investment in key strategic areas. Strong customer traction at the recent Consumer Electronics Show, CES, in Las Vegas has reinforced our confidence that we have pivoted in the right direction with market-driven focus on retail media, fast channels, in-car entertainment, and B2B-driven subscription video on demand. I will now turn the call to Jean-Pierre for a financial review. And thank you, Jean-Pierre, for a good quarter.