Nanalysis Scientific Corp.

Good afternoon, my name is Sylvie and I will be your conference operator today. At this time, I would like to welcome everyone to the Nenalysis second quarter 2022 conference call. All lines have been placed on mute to prevent background noise. After this speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star then the number one on your telephone keypad. And if you would like to withdraw your question, please press star followed by two. Thank you. And I would like to turn the conference call over to Matthew Selinger, Investor Relations. Please go ahead, sir.

Thank you, operator. And welcome to the Analysis Scientific second quarter 2022 conference call. Before we begin, I would like to remind everyone that our remarks and responses to your questions today will contain forward-looking statements that are based on the current expectations of management. These assumptions ensue of inherent risks and uncertainties that could cause actual results to differ materially from our responses. Certain material factors and assumptions considered and applied in making these forward-looking statements. These risk factors are included in our filings for the year ended December 31st, 2021. Forward-looking statements on this call may include but are not limited to statements and comments with respect to future growth of the company's business, the ability to graduate to a senior exchange, company's acquisition strategy, the ability to develop future products, and the possible associated results. The company's actual performance and financial results in the future could differ materially from any estimates or projections of future performance implied by the forward-looking statements. The forward-looking statements made on this call only as of today, and Analysis Scientific assumes no obligation to update any such forward-looking information as a result of new information, future events, or otherwise, except as expressly required by applicable law. So for additional information, I encourage everyone to review our public filings and press releases which are posted on the CDAR system at www.cdarsedar.com. On the call with me today are Nanalysis founder and CEO, Mr. Sean Krakuski, and Nanalysis interim CFO, Mr. Randall McRae. So with that, I would like to turn the call over to Nanalysis interim CFO, Randall McRae. So Randall, please go ahead.

Thank you, Matthew. It's a pleasure to join and interact with everyone on the call today in my new role as interim CFO of Nanalysis. While I'm new to this position, I'm not actually new to Nanalysis as a company, as I've worked with them in a consulting basis over six months prior to my joining and know the company quite intimately. I've been impressed with the company's current business, growth prospects, and vision to disrupt the NMR and MRI space. I jumped at the chance to join the company in my current role when given the opportunity. My goals since joining the company have been to work with Luc Caplet to ensure a smooth transition, as well as to build out my team and systems to support an analysis's growth trajectory. Some of our business segments, like the CAATSA contract, are going to require advanced ERP systems to ensure proper controls and management, the implementation of which has already commenced. With that said, I would like to turn to the financial performance of the quarter. All amounts referenced are in Canadian dollars. I'm happy to report For the three months ended June 30th, 2022, the company reported consolidated revenue of $5.2 million, an increase of $844,000 or 19% from the comparative period in 2021. The increase in revenue is due to revenue added via acquisition of the K-prime operating segment, offset by slightly lower revenue in analysis and RS2D, gross profit for the three months ended June 30th, 2022, was $3.2 million, a margin of 62%, compared to gross profit of $2.9 million and a margin of 67% for the three months ended June 30, 2021. As discussed on prior calls, we anticipated a bit of margin erosion due to the inflationary pressures on our cost inputs. We continue to evaluate pricing. However, due to a large backlog of sales, the opportunity to increase prices has been temporarily stifled. The company's net loss for the three months ended was $947,000, as compared to the three-month profit in June 30, 2021, of $1.2 million. The increased loss was due to higher costs, specifically sales and marketing expenses, increased general and administration expenses, and increased research and development expenses, both in the analysis segment and from new acquisitions. Analysis has also continued to invest in growing internal processes and structures to support anticipated future growth. As of August 25th, we have 19 100 megahertz units in our production queue worth approximately $2.6 million. We're pleased to announce that as of June 30th, 2022, the company had cash on hand of $12.3 million, an undrawn credit facility of $6.5 million, working capital of $13.5 million, and an undrawn government contribution funding of $5 million as of June 30th, 2022. I'm very confident that we have a strong financial base for an analysis growth. With that, I'd like to turn the call over to our founder and CEO, Sean Krakuski.