NXT Energy Solutions Inc.

Good day, ladies and gentlemen. My name is Patrick, and I will be your conference operator today. At this time, I would like to welcome everyone to the NXT Energy Solutions 2021 Third Quarter Operating and Financial Results Conference Call. All participants will be in listen-only mode for the first part of the conference call with the ability to ask questions after the presentation by the company. For the question and answer session, if you would like to ask a question, please press star 1 on your device's keypad. If you wish to cancel your question, please press star 2. I would now like to turn the meeting over to Mr. George Lississas, President and CEO of NXT Energy Solutions. Please go ahead, Mr. Lississas.

Thank you, Patrick. And welcome and thank you, everyone, for joining us today for NXT Energy Solutions Third Quarter 221 Financial and Operating Results Conference call. This is George Licitas, and joining me on today's conference call is Eugene Wojcicin, Vice President of Finance and Chief Financial Officer, Dr. Xiang Gui, Director of Research and Development, Rashid Tipu, Director of Geosciences for Africa, Asia, and Middle East, Enrique Hung, Director of Geosciences for the Americas, and Mohamed Saqib, Head of Interpretation and Project Engine. The purpose of today's call is to briefly discuss the highlights of the release of NXT's third quarter 2021 financial and operating results. Following our update, we will open the line up for questions. Please note, all statements made by the company and management during this call are subject to the reader's advisory regarding forward-looking information and non-GAAP measures set forth in our Q3 2021 press release and MD&A issued November 15th. All dollar amounts discussed in today's conference call are in Canadian dollars unless otherwise stated. The complete financial and operating results and consolidated financial statements for the third quarter of 2021 were published on November 15th and are available on NXT's website, CEDAR's website, and soon will be available on Edgard's website. Now over to Eugene for the financial review.

Thank you, George. As George mentioned, our third quarter 2021 financial statements and management discussion analysis were filed on CEDAR's website yesterday and will shortly be available on Edgard. From a financial perspective, the focus remained on supporting the execution of the business development effort, continuing to control and optimize costs. For the third quarter, our financial results were as follows. Cash and short-term investments were $2.8 million at September 30, 2021, and net working capital was $4.03 million. The company received $750,000 of payments on outstanding accounts receivable in October 2021. Operating activities used $1.07 million of cash during the quarter and $1.23 million year-to-date. There was no revenue in Q3, but year-to-date revenue was $3.14 million. For the quarter, NXT recorded a net loss of approximately $1.43 million, or two cents per share, based on 64.7 million weighted average common shares outstanding. This compares to a net loss of $1.49 million in the third quarter of 2020, or two cents per share. For year-to-date, NXT recorded a net loss of approximately $1.55 million, or two cents per share, based on 64.6 million weighted average common shares outstanding. This compares to a net loss of $4.37 million during year-to-date 2020, or 7 cents per share. Total operating expenses for the third quarter were $1.51 million, including survey costs. This included non-cash expenses of $0.57 million related to amortization and stock-based compensation expenses. Total operating expenses for year-to-date were $4.63 million, including survey costs, This included non-cash expenses of $1.54 million related to amortization and stock-based compensation expense. G&A expenses increased $22,000 or 3% in the third quarter of 2021 compared to 2020 for the following reasons. Salaries, benefits and consulting charges increased $75,000 due to the decreasing Canada emergency wage subsidy rates offset by lower vacation expense in the third quarter. Awarded professional fees and public company costs decreased $91,000 or 35% due to decreased legal fees. Premises and administrative and overhead costs decreased $52,000 or 26% due to the receipt of the Canada Emergency Rent Subsidy in 2021. Business development costs were minimal in both periods as travel restrictions continued due to the COVID-19 pandemic. And stock-based compensation expenses were higher in 2021 versus 2020 by $91,000 through the implementation of the RSU plan and the employee share purchase plan. G&A expenses decreased $200,000 or 8% year-to-date in 2021 compared to 2020 for the following reasons. Salaries, benefits, consulting charges increased $73,000 due to the decreasing Canada Emergency Wage Subsidy rate Again, offset by lower vacation expense. Award and professional fees and public company costs decreased $156,000 due to lower legal fees. Premises, administrative overhead decreased $132,000 due to receipt of the Canada Emergency Rent Subsidy in 2021. Business development costs decreased $127,000 as travel restrictions continued due to the COVID-19 pandemic. And stock-based compensation expenses were higher in year-to-date 2021 versus 2020 by $141,000, again, due to the implementation of the RSU plan and the employee share purchase plan. To summarize some of the key financial points, we ended the quarter with $2.8 million of cash and short-term investments on hand, a net working capital balance of $4.03 million, and we received $750,000 U.S. dollars in October for outstanding accounts receivable in respect to a pre-existing SFD data sale earlier in the year, with remaining US$650,000 expected to be received later in the fourth quarter. Our main focus continues to be on the execution of NXT's commercial opportunities. I would now like to hand the call back over to George to further discuss our business update and forward plans.