Legend Power Systems Inc.

Greetings, everybody. We're going to begin in just a minute. We're going to allow everyone to transition from the waiting room into the live meeting, and then we'll get rolling in just a minute. Okay. Randy, it looks like everybody has transitioned successfully, so you may... Recording in progress.

Welcome to Legend Power Systems Fiscal Q2 2026 investor call. I'm Randy Buckmer, Vision CEO. We're pleased to have you join us today to discuss our corporate progress and answer the results for Q2, which were the three months ending March 31st, 2026. Please note that certain statements in this call may be forward-looking in nature. These include statements involving known and unknown risks, uncertainties, and other factors that could cause actual results to differ materially from those expressed or implied in our forward-looking statements. For more information about Legends forward-looking statements and risk factors, please see our management discussion analysis, which is filed on CDAR under our company profile at cdarplus.ca. I'm joined by Paul Moffitt, our COO and CFO, and Mike Ciossi, VP Sales and Marketing. Paul will provide an update on the various operational units under his leadership, and Mike will talk, obviously, about our sales progress. During our last IR call, Mike discussed the extraordinary challenges that were affecting sales last year and into fiscal 2026. He'll update you on the progress and results addressing challenges over the last 60 days. And during our last IR call, we stated we were experiencing product skepticism and deal delay as prospects were reluctant to place orders solely on energy savings alone. We've made very strong progress addressing this challenge. We've always evolved and refined our value proposition positioning based on our prospects and customers' feedback and sales funnel pushback. Our positioning modifications were needed to directly address the skepticism we encountered from prospects, specifically relating to quantifying and defending the non-energy value of Smartgate. To solve these challenges, we have been executing a focused three-prong approach. Firstly, We've been tightening the linkage to non-energy financial benefits, being maintenance, repair, asset life, and capital replacement. Secondly, we've been using and establishing credible third-party validation, including industry partner data, partner-derived data sets, and an Oak Ridge Labs report to support our methodologies. We've also been leveraging actual customer operating and financial data to demonstrate real world impact, which has been very, very positive. With the updated positioning and validation framework largely in place and early customer prospect discussions resulting in orders, we see a path to deal progression resulting in weeks and not quarters for qualified prospects. The proof that our enhanced messaging is working is the 12 systems ordered in May coming from our pipeline and reseller channels. We expect a continued value proposition refinement and execution leading to shortened sales cycles, higher buyer conviction, and more consistent deal conversion. Mike will provide better detail on the new approach and the very positive immediate order results. And also discussed during our last IR call, We discussed that we're having an environment of tight cash for the last couple of years, and fiscal 2026 Q2 was also a tight past quarter. We continue to make the necessary expense and operational cost reductions to keep our momentum going, including having several leadership members accepting reduced salaries, production layoffs, and reducing our monthly operating costs on a cash basis to less than $150,000 per month, a significant cost saving from a year ago. Paul will talk about that. We also continue to lower our component costs, increase our system margins, and after substantial reviews and inductive to source new vendors or improve our pricing to reduce our COGS, we expect to achieve 50% margins during the year, and after the last quarter, we'll go on our way to that. We obviously see and share with you that we have a bright legend future, and the legend team is absolutely committed to making legend power possible. a success story. Paul, please provide the operational update.

Great. Thanks, Randy. I'll start off with some of the financial updates and we'll get into operations. We saw our revenue fairly flat quarter over quarter at $545,000 compared to $523,000 from the prior. basically from additional smart gate sales in the quarter, but also from growth in our service and recurring maintenance revenues, which is a great add-on for our strategies and our future growth. Our gross margins, as Randy implied, have improved dramatically, and we're on our way to 50% realization coming up in the future. We hit in Q1 and Q2, so for the last six months, 41%. And that's compared to 21% in the same six months of fiscal 2025. Compared to prior, it's primarily due to reduced material costs, as some of our cost of goods sold improvements have actually come into play. And we continue to work on those improvements. So I expect to see another significant change over the next three or four months, and then the commensurate improvements in our gross margins. Our operating expenses for the second quarter of fiscal 2026 were $658,000 compared to over a million in the same quarter of fiscal 25. And again, as Randy mentioned, we're currently seeing monthly operating costs as low as $145,000. And that's due to lower headcount salaries and consulting costs that have reduced along with other internal cost cutting measures. In operations, we have two systems remaining in backlog from prior orders, and we are now currently preparing our MRP, our material requirements for the new orders that we've just received. Cash management continues to be a top priority. Accounts receivable from backlog, our new deposits, which is 50% of all new wins, will support our ongoing operational costs. Inventory has dropped approximately $200,000 over the last quarter as our backlog is processed and shipped. And the operating expenses, as I mentioned, have reduced from prior quarter at $210,000 per month down to the under $150,000 per month that we're now seeing. We continue to monitor cash and cost-cutting opportunities closely and are preparing for the material and production ramp ahead. Thank you. I'll pass it over to Mike.