Hydreight Technologies Inc.

Thank you everyone for joining us today to Hydrate's investor webinar. We're excited to have everyone here today. Just before we start, I want to remind everyone to take a look at the forward-looking statements as management may be discussing such statements that investors are cautioned that forward-looking statements to take a look at them. So please double check the forward-looking statements throughout. And before, if you do have a chance, please do so. And we are joined today with CEO of Hydrate, Shane Madden, and also management team, Vahid Shababi. So I'll pass it along to Vahid, who will take it away.

Thank you, Abby. Thanks, everyone, for attending the webinar. Before I start, if you can hear me and see the screen, can you please type yes in the chat box? Just want to make sure that you hear and see the screen. Perfect. Thank you. So first of all, I appreciate everyone for attending this webinar. I'm just going to have a few housekeeping items before Shane and I go through this. Shane Madden, the CEO of the company, the founder, board member, and the brain behind the whole thing has asked me to start the webinar on a few of the areas and pass it to him. A few housekeeping items. One, first of all, I apologize for having this update earning call with the delay. Both Shane and I have been under roadshows. We had a... I'm basically remote online roadshow two weeks ago. We were at the CEM Bermuda event last week and beginning of this week, been in Toronto meeting many different institutions, banks and people to to share our story. So that's one thing. The second I like to walk through our story and how we started it, not too much in details because we want to get to the updates. But one thing that has been our goal and been doing our best to do in the management team is not to get distracted with the noises that comes our way, if operationally or even on the capital market side. We try to set a goal for the company from the beginning and we continue going that way. We have tried to do our best to get to the goals that we set year over year and continue delivering the results and not get distracted on the capital market share price. Now, with all saying that, we also try to do our best to share the story of our company with more people. We didn't spend money on marketing or promo in this company. We maybe spent about $30,000 a few months ago on a very light program that when we talk to our investors, they provide a very good feedback that they rather story to be shared with the investors that see this company. This is not a company... that overnight the share price get to this point or the result get to this point. This is the company that has been built based on the fundamentals. And it's been creating revenue, real revenue, profit and all that. And this momentum will continue. Now, our goals are set, but it doesn't end there. This is not an event. It's a journey that we're going through it. In the meantime, we try to do our best. to be responsive and communicate with the market, with the facts, with what is happening, update our investors. We've been very grateful that our investors have been great supporters and provided great feedback. By no means we claim that we're perfect. There's always things can be done better. But those are the fundamentals that we want to keep in mind when we're moving the company forward. So with no further ado, I go through our stories and numbers. So as you know, High Grade was created based on The opportunity that we saw in the broken and fragmented healthcare system in the United States. The goal was to create the largest mobile clinical network that we do have nurses, we do have doctors, we do have pharmacies, and more importantly, we do have a structure and a technology that create a very easy and compliance way for the patient to have to access them tomorrow. We started with the very first vertical of the three, which was creating a legal way for nurses to be able to offer their services at patients' locations. In order to do that, we had to create a 50-state medical company. We had to review the legislations for three boards, pharmacy board, medical board, and nursing board of the 50 states, that they're all different, and creating a legal structure under the PC and a technology that defined the flow of the service and connected to any complimentary part that is needed to stay compliance from a doctor network to a medical direction to the pharmacy. Our model was very similar to other successful and fast growing SaaS companies. The SaaS companies that you see they're growing 30, 40% year over year, they usually don't make their money from the subscription because subscription won't go high for your A players. However, Your BNC players, either they cancel or they're going to go out of the business. The SaaS company will make money with the additional service that is tied to your technology. And you see a lot of them making money with the payment processing. We went back and rewrote our future in a way that we want our technology and compliancy lead to the pharmacy orders for us. One way or the other, we want to increase that and increase our margin and eventually have our own. So that's going to be the whole overall picture for us. Nurse Network has been growing really fast in the last four years. We paused the growth. I better say slow down the growth in the last 12 months to just focus on more onboarding them successfully and create more business for them while we're working on the second and third piece. This year, we started it in last 60 days, as was provided an update in our last earning call to make it easy for nurses to come on board with us. And again, the numbers is reflecting that we'll talk about that. Then while we're working on that, we realized that the medical spine industry in the United States has been growing really fast, especially during the COVID. However, during the COVID rules and regulation were relaxed. When the pandemic was over, we realized that many of these break and mortar franchises they have to either close the door or they have find a turnkey solution to make them all compliance. So we started white labeling our solution with the few tweak and mandate them that they have to use our technology and they have to use our pharmacy. On the technology piece, we were a little bit easy on them because our plan is coming that how we're going to and monetize that, we'll share about that. The first two verticals from 2020 to 2024 took us from over a million to over 22 million revenue while we were working on the third and the most exciting piece of the puzzle, which is the DSDH One Virtual. The VSD on virtual is a way for any business who's offering any direct to consumer or they cannot offering it because of the compliancy to take advantage of that and start offering that. We'll talk more about that. Our goal when we started this and we looked at the best information that we had in hand was to get to the above 1.3 million by end of this year. And we still don't find any evidence to change that goal. Now, it's it's it's not It's not easy, but it's a very doable based on the evidence that we see. The timeline for onboarding has been changed based on what we have been dealing with. Like any other tech company, when you start implementing, you start learning. As much as you want to do research and develop beforehand, you're going to start dealing with different things. And we also had some improvement on technology that we're going to talk that we made a very modular business that they don't have to go all or nothing. They can come and use us for different purposes as long as we receive the pharmacy order. We'll talk about that shortly. Now, Right now, Hydrate has become the thought leader industry. Again, before we get to the Q1, for those of you who started monitoring us, I want to remind everyone that we are a SaaS company that over four years, year over year, we had at least 30% growth. both on GAAP and top line revenue. We went from a million to 22.2 million last year. And this is only the first two verticals. The numbers that we are projecting for 2025 for the first two vertical is not based on just guesstimation, is based on historical data that we had. We were estimating 27 and a half percent to 30% growth for our first two verticals. And our Q1 was indicating only our first two verticals. And we'll talk about the onboarding and what we're expecting to see the numbers for the VSDH ones coming in. Now, not only that, we were a business that we didn't take any loan or we didn't raise any money until this year because we ran the business very efficiently. We focus how we can grow the business to be a profitable business. Another piece to our formula, when you want to look at a re-evaluation, we're not only a SaaS company that we had year over year 30% growth. This company has also become a just set of positive in 2024. And in Q1, we also ended up being gap positive. We'll talk about that as well. Cashflow from the operation, same thing. We invested in the business heavily, but 2024, as we announced and we talked to our investors, one of our focuses was to be cashflow positive. Cash in hand, same thing. The business went up. Now, let's take a look at the Q1 2025 and what happened. Q1 2025, the goal for the company was to have 27.5% to 30% growth with our first two verticals. Now, we achieved 34% growth in the first two verticals. So from the first two verticals, we're ahead of the curve in the Q1. Now, we did a live offering earlier this year at $1.55, and we received over $5 million in. The purpose of that, to diversify our investor base, bring some institution behind us, getting coverage, and we know the fact a few coverage is happening for us this year. But because we don't want to go after paid coverages, we don't know the timing, but we have received the confirmation that the report are coming out by institutions. In Q1 2025, our gap revenue went to over 4.5 million when a similar figure last year was 3 million. And if you go back only four years ago, it was about $206,000. This is the company that year over year on the timeline and gap revenue, we see that at least 30% growth. Top line revenue, same thing on 2024. We had about 4.8. We finished with 6.5. EBITDA, adjusted EBITDA from the negative 45,000. We ended up being a positive 163,000. Gap. From for the first time, from 308, we went to about 20,000 gap profit and loss in our balance sheet. Cash flow from the business, over 350,000 positive. And cash in hand, it's over 6 million. Now, we have become a company that not only we grew 30 to 35% year over year, now we're profitable with over $6 million in cash in hand. We're going to talk about some of our plans, how we're going to use that to increase the margin of the company. Now, we know the fact Q2 and Q3, we're going to invest into the business that our EBITDA may be impacted. However, that is going to lead to the end results of the year end for the margin and the revenue that we're hoping to get based on our plans. But we're going to continue running the business in a way to stay cashflow positive and profitability is one of our point now. With the first two verticals for the nurse network and franchises, one of the things that we introduced was, and that was the results of the few months. We talked about it in the last earning call that we're trying to finalize that. For the very first time, now our nurses will be financed by a finance company. We'll receive our money right away. However, the nurses can pay in the multiple payments. And we started seeing the results of that in our nurse network because affordability to pay average about $3,000 a year was a little bit hard for some of the nurses. Now, I just want to remind you that market by itself, there are 4.5 million nurses in the United States that they can use our system. And that's the only one. Shane is going to more talk about the necessity versus good to have. If they want to have a side hustle or if they want to have a full-time business that they leverage their skill set and their certifications, this is the only way and this is the only show in town. Now, from January 1st to May 31st, roughly we saw 78% growth in the new signups for the nurses. These are the paid signups. Again, I want to remind you guys that any new sign-up come on board, on average, they can bring up to three nurses to the network as a service provider to be able to serve their area. Now, from January 1st, May 31st to in 2024, in compared to 2025, in compared to 2024, we roughly have 70% growth. Our pharmacy orders, number of the orders from January 1st to May 31st from 2024 and 2025, we saw roughly about 45% growth. And again, our third vertical is kicking in in Q2. And we're seeing in June the numbers that are coming in for the businesses that we signed up, even though it's still we're in slowly migration, live migration process to slowly bring their customers over when All the basics are done. The religious script is done. Their record is over. Slowly we're rerouting their pharmacy orders, which is the last piece of the puzzle for us to bring it through our system. So we start seeing that and realizing that day in, day out in June. And we're hoping to in July and August is going to go up and achieve the numbers that we're looking for. Now, one of the things that I mentioned earlier is with all these break-in motors that we signed up, one of the reasons that we had the enforcement of using technology whenever we trigger that was because we wanted to have a secondary revenue stream attached to our technology to be payment processing. This is a very high risk payment processing. Not too many people can do that. We already received the confirmation of the agent of that from our gateways. So we can do that. Now we're bringing the POS, the point of sales to our technology. So right now, if they're only using it for booking and scheduling, online booking, doctor network, seeing the doctors and pharmacy orders, Now, the goal is to either acquire a POS company or build that piece because we started that piece last year, but due to the VSDH1 development, and again, running the company very efficiently, we had to delay that. When that piece comes over, every dollar that goes through any of these breakout motors, we're going to make a piece of that because the payment processing will be with us and we'll make money through that. So, in a nutshell, the Q1, that was a reflection of the first two verticals we had roughly about 34% growth, which is higher than 27.5% to 30% that we were hoping to do. Now, With no further ado, I want to pass it to Shane to talk about the BSDH1, the platform, the structure, why this is only not a 2025 play for us. This is just the beginning of a journey. And as this business has shown that we have year-over-year growth and where we're going to go with that, and then we'll continue with that. Shane, please go.

Thank you, Vihit. Hi, everybody. Vihit, beautiful as always. Thank you for framing the company in such a great way. So we've had a lot of volume over the last few weeks on the market side. So I'm going to kind of go back over some old ground for some of the shareholders here. But please, please allow me to do so. What we have created here with Hydra Technologies is a holistic solution for the direction that the US healthcare system was going. So the US healthcare system is $5.9 trillion spent every single year. 90% of that is based off of chronic conditions, diabetes, obesity, and many conditions, you know, lifestyle related that are technically preventable. What we identified back in 2018 was the direction that the solution of this U.S. healthcare issues were going to go was in three areas. Mobile health and wellness, i.e. a healthcare professional physically giving a service in a remote setting. the non-traditional doctors, health and wellness facilities, but your non-traditional doctor's office, that was the second direction or vertical that was going to go, your medical spas, your IV therapy lounges, anything that is providing health and wellness, but not a traditional doctor's office. uh still needs all of the compliance etc um it's just a different direction for healthcare and the third uh direction was obviously the direct-to-consumer model um where that is self-administered by the patient but under the governance of of compliance via telemedicine So those are the three areas. That market has only expanded with obviously COVID shone a light on accessibility to health care without it being a physical hospital or a doctor's office. The glamorization of the Ozempic and Mungero and GLP-1s has again shone a light on the direct-to-consumer model. But the awareness has now started. 50% of United States citizens in a poll recently said they would like to try GLP-1. So that awareness, whereas two years ago they didn't even know what that thing was. Being the CEO of your own body, controlling your own wellness, that movement has happened. Now, where we've positioned ourselves to the hit point of this is not a quick sprint or this is not a chart that is doing well for right now but might taper off is we've created a mode of compliance. Our model is different. Our strategy was different. Our direction was different. Just like the nurses, where we get called the Uber for nurses, we were the first movers and are still the first movers to allow nurses to be independent contractors across 50 states and be able to monetize their credentials outside of a bricks and mortar setting. We were the first to do that. But our entire platform is first mover. Our third vertical, which is obviously the most exciting from a revenue generation perspective and an accelerating of the company. That also is a first mover. We are essentially a platform to do business. We get referred to as the Shopify for healthcare in that regard. But again, that's a little bit of a slight on the company because we're not the marketplace, we're the market essentially. And we've created this mode of compliance that doesn't go away. That's the reason our graph looks The way it does is as people join us and as people partner with us, as we solve the problems to allow their companies to grow, they stay with us. So what actually is VSDH1 and what have we created there that is so powerful? Well, I'll go into it a little bit more deeply now. So during COVID laws, there was a lot of stuff relaxed. People were popping up with health and wellness businesses, putting a website on. or adding additional services to their existing business that wasn't technically healthcare, supplement related, etc. So we've leveraged our 50-state medical company, our vertically integrated pharmacy network, our doctor-physician network, and our overall compliance with corporate practice of medicine. um to allow these businesses to stay compliant uh or to expand now um we're not a nice to have we're a must-have so the same way it's illegal for a nurse to um to basically monetize a medical service it's the same for businesses so corporate practice of medicine is exactly how it sounds it's the prohibition of corporation getting into medicine, unless you have a structure like we have created. It's incredibly difficult. It's incredibly complex. And to tie all of this together through the medium of technology for those three verticals is the reason we're kind of a one stop shop. We'll move on to kind of talk about the different types of customers here and how that relates to our goals. We've been very clear about our goals for 2025, the nexus point or the inflection point this company has reached. Our first two verticals have still a lot of growth, as Vihit touched on, 4.5 million RNs. There's only more and more traction happening on that vertical, adding treatments, getting busier from the patient perspective. And we're very excited about these first two verticals that in itself is a very successful company for these last five years and has tremendous growth potential. But the third vertical is a little different because it's a B2B2C play, essentially. And these are recurring treatments. And so across the 53 treatments across five or six different categories, whether it's at home testing, which we have, I'll get into in a little bit, we have very creatively worked with a lab that not only has the genetic piece, but it has the technology piece. That's what most most laboratories are missing is the business side of it. So being able to get your results back to your technology and then be able to see the next steps of ordering a treatment that's specific to your results. Now you're getting into the individualized healthcare and now you're closing the loop on the individualized healthcare cycle. So essentially we have obviously created a beautiful mode, a turnkey solution for businesses that are looking to do a particular thing. So there's a few different types of businesses that we're attracted to. So you have the businesses that already have clients, but are not technically in healthcare. So they would have to obviously join, use our tech, use basically everything. The slowdown for them would be obviously LegitScript certification. which were enterprise levels. So that takes between 12 and 16 weeks, depending on the client. And they basically would be the easiest, I would say, to onboard. But obviously, they have to gain traction in the market from a marketing perspective. So the easiest to onboard, but possibly the slowest to big results. Those are the ones that we've been focusing on. Well, we focus on everything, but those ones are the ones that we'll possibly see in the Q2 results, you'll see traction from that type of customer. Our other businesses are obviously the larger volume businesses. So these are businesses that are actually doing large numbers. And we've communicated obviously in previous webinars that we have some businesses that are doing 150,000 orders a month. Nothing that we have done This year has taken away from our goals of basically 1.3 million orders. We're going to see a lot of that in Q3 and Q4 for a number of reasons. We're technically solving one of maybe five or six problems for these bigger businesses that are doing a lot of volume. uh created on maybe structurally uh unsound uh premises um want to expand into other states want to expand into other products perhaps to increase the ltd but just from a practical perspective so everybody that's not deeply into the healthcare side of things in the us can understand is you're literally taking a medical company who's doing large numbers and you're taking everything across to our medical platform for it from md uh which would be medical directors to um the physicians, they're now our physicians, to the patient data, to the product itself. In some scenarios, it's customized medications. So that involves the pharmacy. They have to be on our pharmacy network because some of these pharmacies that have popped up to take advantage of the GLP-1 craze and the peptide craze are not all that credible, from the product itself to their state licenses, et cetera. We have to move the entire thing across and you only get one chance to do something the first time. So we've been very, very hands-on, very goal and execution orientated on those larger businesses, but everything is working smoothly. And again, we are very excited about seeing that nexus point from of those businesses in Q3 and Q4. However, in Q2, we're gonna see the other category of business owner, which is the ones that are branching into this model with their existing customers or branching into gaining new customers. That's kind of an oversight of the mode that we've created, where we are as a company from our third vertical, what we're expecting this year and why we're going to be around for quite a while. This is not 2025 as kind of our sprint to the finishing line. This is essentially the the kind of evolution of the overall platform. And now it's just coming to fruition from a revenue generation perspective. So I'm going to pass it back to Vihid maybe to talk about some accelerators. Actually, I'll just stay on this slide for one second because it's a good way to kind of visualize The various onboarding times for the different clients that I just described. So again, depending on which type of category of customer we're talking about, whether it's low volume and needs the tech, needs full migration of their customer data. needs full migration of their existing high volume, possibly needs a customization of their actual pharmaceutical, which of course will take time with our partner pharmacies, that can range. So again, I hope I did a good job of explaining kind of in more detail, because I know we have some great shareholders out there that are very excited about 2025. And I just wanted to add a little bit more flavor to how this is going to pan out and how this is actually going to be reflected in Q3, Q4.