Hydreight Technologies Inc.

Good afternoon, everyone. Thank you so much for joining us. This is Hydrate Technologies Q2 investor webinar. We're going to go over the earnings today that were just released. So we'll just give it a few moments while we let everyone join as I see people still joining in the weight room. If you do have any questions, please don't hesitate to put them in that Q&A section. And we are going to be keeping this webinar to that 30 minutes. So Yeah, we're going to get through it pretty fast. But if you do have additional questions that we don't get to, please send them to our investor relations email at ir.hydrate.com. I'll also put that in the chat section for you. And just a reminder that we will be going over Just a reminder to take a look at our forward-looking statement as we will like to remind everyone that today's presentation will include forward-looking statements. The statements are based on current expectations and assumptions and are subject to a number of risks and uncertainties. that could cause actual results to differ materially from those projected. So forward-looking statements may include but are not limited to statements about our growth strategies, product development, financial performance, regulatory outlook, and market opportunities. So we do not undertake any objection to update these statements except as required by applicable securities law. So for a full discussion of risk factors and uncertainties, please refer to our filings that are available on CDAR+. under Hydric Technologies there. And I will pass it off to Shane for you, our CEO, Shane Madden.

Thank you, Abby. Hi, everybody. As the great Conor McGregor once said, say what you're going to do and go out and do it. So that's how I would describe 2025 so far, especially Q2. Obviously, we have some new shareholders here from the activity for the last few weeks. So I will go over kind of a high level again. I know some people have heard me talk about this to the point of nausea, but we'll go over it one more time and then we'll circle back to Q2 and some other exciting things. But Q2 essentially for me has been just an organic evolution of the first two verticals that we've talked talked about for a while um we're quite confident in you know um the growth that we communicated at the start of the year on those verticals um we've established them very well um our mode is very high and we've obviously extrapolated that into the third vertical which we'll talk about which is the bell of the ball the girl that everybody wants to date right now uh vsdh1 so High level again for anybody that's new. Hydrate Technologies essentially attempted to capture three key areas of the healthcare industry in the United States. We came at it from a compliance perspective, building tech on top of three key areas that we had identified that the healthcare industry was going to go. Obviously, there's been a couple of accelerators between COVID and the Olympic craze that have shone a light on the need and validated the direction of the company in many ways. Our first was mobile health and wellness, which is known as our Hydrate nursing platform. First business to allow nurses to work as independent contractors, allow them to monetize their credentials in a never before done way. We were first movers, still are. No company has attempted to have a 50 state medical mobile workforce. So that was our first vertical. The second vertical was addressing the non-traditional doctor's office. So health and wellness facilities that are providing true health care, a myriad of services, but it's true health care requiring oversight from a medical director, physician network, access to compliant pharmaceuticals. and obviously there's a tech component to be able to marry all of those but again everything needs to be built off of compliancy the third vertical which again we'll go into shortly is the direct to consumer self-administer again first movers in terms of a model we didn't want to be another runner in that space we wanted to basically be the home for healthcare in that space allowing a wide range of different types of businesses, whether it was a business with a large amount of clients in the greater health and wellness space that just weren't structured to be in the medical side of things, or whether it was people who had structured their business but structurally could only do a few treatments or a few states or had structured themselves actually uncompliantly during relaxed laws and everything in between. The goal with that third vertical is, of course, to be the Shopify for healthcare in a sense. Instead of being another player, we want to have 5,000, 10,000 businesses all operating on our medical network, our tech, our pharmacy through that third vertical. So high level, that's what Hydrate Technologies is. The overall market spend is 5 trillion, as everybody has heard me talk about today in the US. 90% of that is what's called chronic care management, which essentially means it's preventable. And there's only three areas this can go. So individualized health care is where this movement is going. controlling one's own wellness um the awareness has shifted between um what happened during covet but also the um the ozempic monjaro craze as i call it because two years ago nobody knew what a glp-1 was or a self-administered service at home um even to extrapolate away from the glp-1 space into the peptides and the sexual health and the And the hair care, nobody knew that existed. Now half of the US are saying they'd like to try a self administered at home service. So the awareness is there, which is obviously a huge piece of positioning yourself as an offering. So as a company, 50 state medical company that has addressed three different areas of this $5 trillion market. We're positioned very, very uniquely because our mode is compliance. We're not a nice to have in any of the three verticals. We're a must have if you want to be compliant. Obviously, we've married that with tech to make the connection with the customer. Yeah, that's where Hydra technology set out to go, and that's where we're there. Q2, and I'm going to pass it to Vihit to go into some numbers right now, but Q2 for us was, for me, nothing majorly exciting there, but it was just more of a validation of the first two verticals, execution from the team. We've been putting a lot of work into strengthening the departments for growth, for the growth that we know is coming, and I feel that was a an excellent performance in Q2 and validation of what we've built. So I'm just going to pass it over to Vahid to go into some numbers.

Thank you, Shane. Hi, everyone. I appreciate everyone joining the webinar. As promised, we tried and we did file earlier than, you know, before end of the period that we had time to do and sort of, you know, earning call right away to provide updates. Before I go to the Q2, I'd like to walk everyone through the trend, the trend of the business. Because when you were talking about the SaaS company as a software, as a service that has recurring revenue, Trend is a lot more important than having revenue from one point. Because you may do a great Q2 or Q3 or Q4, but then the trend is there. And that's what we're focusing on. The trend on the revenue, the trend on profit, on margins, and what it takes for us to take us where we want to go. In 2020, the business got into action. Obviously, there was few years before that to create such infrastructure and framework to be able to do that. The first two verticals that we had took us from about a million to last year, our top line revenue, about over 22 million. We didn't have the third vertical last year. I'd like to remind everyone, the VSDH1 that right now is in full speed and we're fulfilling the numbers, we're surpassing the numbers, is a brand new business. A business that contains legal compliancy, technology, multiple different dependent factor, doctor network, medical directions, pharmacies, and all that. Not only it went live, but also is generating revenue, real revenue for the business that is helping the revenue of the business goes in higher and higher in the very first year that is in action. So that's why the trend is the key. That's why not only we invested it, not only we created it as such infrastructure and technology, but also is in action and is working. When we started this year for the first two verticals, we're expecting and projecting based on the evidence that we had in hand that we're going to have about 27.5% growth with our first two verticals that would have shown the graph like this. That again, it's based on the historical data that we're going on. In the meantime, we're also focusing on our adjusted EBITDA. in 2020 2021 2022 and 2023 we finance our own growth we paid to create the legal structure to create a technology and update the technology without borrowing any money without uh you know raising any money after going public But at the same time, we're looking at our bottom line to see if it's going to be positive, to be a real business. We could achieve that in 2024. And in 2025, we continue doing that not only in the adjusted perspective, but from the gap perspective as well. Same thing with the cash flow. So the reason I went back is for you to see the trend, the trend of the business. It's not like you go down one quarter, the next quarter you go up. Then when we walked into the 2025, we walked into 2025, we had a very strong Q1. We surpassed our projections from the revenue perspective. We could end up being gap positive. We finished a life offering successfully, $1.55, have enough cash in the bank. And then we walked into the Q2. Our goal at the beginning of the Q2 that was communicated with everyone, you know, when we send the release out, was focusing on the revenue, focusing on the number of the orders coming in, continue focusing on our profitability, trying to add more product, including a genetic test into our offering. And then also looking at some talking acquisitions or investment. The investment that is purposeful is not an investment that just for sake of doing the investment that we're going to do that. An investment that is going to help either with the revenue or with the margin. If it helps with either of those, that's what we're looking for. Now, we didn't want to be a company that keeps sending a release out on the LOIs and not completing that. We send a binding LOI release out around the 503A, but that was after, I would say, a handful of advanced conversation with other players in the market or have some sort of agreement with them, but they failed in the due diligence side of it. We walked into the Q2, the Q2 with that focus, we continued having the same growth. We could have, you know, we achieved, we surpassed the growth percentage that we're looking for. Not only we focused on the VSDH1 to make sure that we can onboard our clients. And again, I'd like to remind you, that's a brand new business. So you can do so much planning based on the evidence in hand. But the nature of the beast is you have to adjust, you have to monitor, adjust and move forward. We learned so many things as we pushed it through, but we try to keep the goal that we have for end of the year consistent. We had to make a lot of adjustments from the onboarding perspective, from going and focus on the businesses that they have the orders and make it easy for them to come through our system by being modular if somebody wants to use the whole thing or one module or two modules at the end of the day bringing them through and and serving their customers um so all that was was was learning but we grew as we and met the expectations that we had as we learn and we as we adjust Q2, we finished strong, our revenue was higher than expected, ended up being cashflow positive again. Now being a cashflow positive and also having money in the bank, everyone would have asked, why do you need to launch a convertible notes if you have that all in hand? And we couldn't talk about these when we launched it because the financial was not out, but we're gonna add more coloring to that and the reason for that. So Q2 from the GAAP perspective, We had about 5 million revenue. Our top line was about 7 million revenue. Cash flow positive now. In Q3, we're investing heavily into the company on some of the areas that is going to expedite the growth of the company and the VSDH1. in Q3 and Q4. We had some major hire that we brought on board, people that they have a very extensive experience in different areas that can help us, including marketing. One of the things that we've been working hard in the last 45 days to create our own marketing agency as a subsidiary in the hydrate to help every single business that goes on the VSDH1 that they need the marketing help. That's the biggest challenge that we see they're dealing with. We invested heavily into the technology and we're constantly adding more. We made it modular, we're adding more features, new versions is coming out. We invested heavily into our product. We invested heavily into the scalability of our company in every single department. So we are investing as we grow to make sure by end of the Q4, we achieve the numbers that we're looking for with the acceptable margin that we go through it. So our cash flow from the ops was over $200,000, cash in the bank about $6 million. That again, we're going to use it only on the growth and investment side. So when you look at the growth trend and the graph that we initially showed at the beginning of the year are the orange line and the blue line. Now, we're not changing our expectation from the company, from the perspective that we're going to change the numbers that we're hitting. But based on the trend that we have in the Q1 and Q2, just with the first two verticals, the trend is going to show the yellow and the gray line that is going to be higher than what we originally started the year with, that we're going to continue focusing on that. And we try to even... surpassed that in Q3 and Q4. Some of the major updates that we had For 2024, we focused a lot on rather than increasing the, while we're increasing the number of the nurses, but the main focus to be helping them to get more services. For them, instead of taking them, you know, three to five months going live, helping them to go live within 30 days. There were so many things from the service perspective that we try to improve that is paying off. In Q2 2025, the number of the new license holders, and again, keep in mind, every license holder in our nurse network that comes on board with us, they usually bring two or three other nurses to deliver the services. The license holders, we went up by 77% in compared to the Q2 2024. And that trend is continue going up. That it helps with the pharmacy orders, that helps with the services orders, that helps with our reach across 50 states because the nurse network is not only from the revenue perspective. We created that as part of our mobile clinical network that creating a white glove service for some of the second and third verticals that we haven't put it in place that is coming in Q4, and it's gonna make it easier for everyone to deliver those services. The pharmacy orders that from our second vertical, which is a white label, has gone up by almost 50%. Now, the nature of the pharmacy, sometimes you see the prices goes down a little bit, but again, for us, it's focused on the numbers. It's going up. Now, These numbers, we'll talk about this more, why now having ownership in the pharmacy is the key, because we focus on getting these orders coming in. We focus on creating the margin on every orders. We focus on creating the revenue from every three verticals. Again, I remind you on the model that we had in mind. Most of the SaaS companies won't make money from subscription because your A players pay only so much. B and C players either cancel or go out of the business. The way that they make money is mostly tying a service to your technology and platform. We see a lot of SaaS companies tying a payment processing. to the services. Now, in our case, we're trying to do that with the pharmaceutical sales and tie it to the compliancy and tie it to the IP that our doctor of the pharmacy, our chief medical officer, they put together these dosages, they put together these IPs that is produced only for our own clients. In the VSDH1, when we started at the VSDH1, we've grouped our customers into three groups. The group that they're brand new customers, that they have marketing budget, they have the customers, that they have members, but they don't have any pharmaceutical sales, and the customers that they come with ready to go orders. Those groups should have satisfied our goal for this year, the third group. However, it's a brand new business. We had to learn as we move forward. We're dealing with bringing over patient data. We made it modular to make it easy for them to come at any stage of the game into our flow. If it's a doctor network, if it's a pharmacy, if it's a medical direction, if it's end-to-end, to make it easy for them to come into everything, go through it. And it slowly bring them over through the migration plan. So that's the group that we came up with our entire year ago. We didn't even count on the first two as those two are growing as well, creating a marketing agencies in the support of the first two to help them to grow on all that. Within the June, July, August, internally, we had, you know, a matrix that we're going to hit to between 70 to 80,000 range within the first three months. The first month, We hit the numbers, we surpassed the numbers. July, we hit the numbers, surpassed the numbers. We went over 42,000 orders. August, same thing. We fulfilled the range that we have and surpassed that. The August, starting late July, because we keep adding more product into the pharmacy, Now we see a wide range of the products coming in from the order perspective. So we see some cheaper products that it wasn't in the original range of the revenue threshold that we have that again, it's a business that is coming in. So we're adjusting that. And one of the reasons that In August, we're surpassing our goals from the product sales perspective, but we're taking time to wait until end of the August to qualify them from the grouping them from the revenue perspective and tie them to our matrix. But at the end of the day, right now, we are focusing on the growth of this third vertical. We are focusing on number of the orders. We're focusing on the revenue secondarily after the number of the orders and thirdly, our margin. Because we get this trend going. This is the very first year of this business that if you get this wheel turning next year and the year after and the year after, this is going to be accumulated. Now, and we're gonna continue doing that in September. Just for you to know the focus of the company, Shane Madden, the CEO of the company, his main focus himself, directly working with the team and the top customers and the pharmacies on the VSDH-1, because the business is there. We already secured enough businesses to help us to get to our numbers and surpass that. But there is so much details into taking them live. It's on us to take these orders on our platform. It's not just the turning on and turning off the switch. It takes time for us to do that. And we want to make sure we don't sacrifice the quality over the time. But in the meantime, we hit our numbers. In the meantime, we bring the revenue. This quarter, as we promised, we launched a personalized genetic test and wellness that ties to our vision later. We're gonna talk about that on the acquisition side. We'll talk about that. We received some unpaid analyst coverage. We know more is coming. Our focus is quality. We've been super grateful with the analysts, with the banks, with the investors that we have behind us. We're not spending money on the typical promo marketing to just give it a hype. We take our time to spend time with the investors, Shafin, Shane, everyone in the team, try to meet new investors, share our story. Now from every three investors, maybe one of them will be interested in our story, but at least they're investors that we fall within their thesis. We're going to continue doing that. As you remember, for those of you who were with us for the past two years, last year, we didn't spend much time on that. We're focusing on building a business. We promised we're going to do it this year. We've already done that. We're sharing our plan for the rest of the quarter on different events that we're going to do, different investor conversations that we're going to go. So that's where we are. Now, we launched a 10 million convertible. Business is profitable. You have 6 million in the bank. Why do you need this convertible? It's a very good question. But again, sometimes because we're a publicly traded company has a lot of advantages, but trust me, they have some disadvantages. We cannot share everything going on in our head and in the company, and we have to follow the rules and regulations of the exchange and regulators. So at a time that we launched this, we saw our numbers, but we couldn't discuss that in details. We had to wait the financial to go out. Business from the operation perspective, we're good. We don't need money. Business is paying it for itself. However, this is the time that we look at the value of every dollar that is coming to the business. If a dollar into the business can lead to $10 in the business in the 12 months, 24 months, or 36 months, it's bad. based on the evidence, it's a good decision that we can take. So right now, based on the number of the orders that we're getting on BSDH1 across three verticals, and based on different pieces that we can see how quickly it can help with the revenue increase and margin increase, there are many investment and acquisition and growth drivers available in the market. It's every day counts with the level of the growth and the orders that we're seeing. So we wanted to make sure that we can take advantage of that, that if we have enough around us that we can use it for those purposes to support our growth, to see where we're going with that. As you've seen the numbers that have been filed, the business from operational perspective is not bleeding. We actually have enough cash in the bank and we keep adding to it. But we're looking at this in a long term and we're looking at this as a bigger picture, how we can, again, based on the best evidence, based on the best knowledge that we have, what can be done to add the maximum value for our investors and for our company. So we launched that with Canaccord, you know, other companies. banks and other firms is helping us with that through the whole process. And again, I think the closing is next week that we're going to do that. I think it's September 3rd, but please go back to the press release for more details. We focused on potential M&A and investments since late last year. But again, we don't wanna just spend money, even our shares on something that is not gonna add value. There are five or six areas that we're looking into for investment and acquisition. Pharmacy 503A, Pharmacy 503B. Shane will add more color into that. But it has two parts. It's not only about the margin. Margin is one thing. The second reason for that is the full control over the offering. We're not dependent to other players. And thirdly, we have this volume coming in. Right now, it adds value from the revenue and profit perspective in our balance sheet. Why not using the same, the very same orders and creating the assets in our balance sheet, creating an asset for our company? This is our orders that is going through. Yes, we make money off them. But why not also that to be part of an asset that is creating value for our business? We'll talk about this shortly. So 503A after... like again, I was at least eight or 10 serious conversation and handful of advanced conversation within those, we found the right group. We signed the binding LOI and we extended it outside it by five days because we've done a very extensive due diligence on the whole thing and we're closing it and we pushed it by five days, which is I think early next week. to to to to uh uh finalize that and then start on the 503 b side of it with them and the technology side we wanted to have a prescription software which we achieved that with the number one uh acquisition that we announced through the perfect script that is that ties to our point of sales and also cornering the break and motor will shane will add more more detail into that Point of sales, we've been talking about this. We have all these break-in motors coming on board that they're using us. If we can tie them to our technology in a way that they don't need any third player, not only we have full control, but also it's going to add a new revenue stream for us, which is the payment processing that we already secured the agent licenses to be able to do the payment processing. We just need to tie it to the point of sales. Also, we've been talking about AI and treatment plan on the technology side. AI is a cliche word nowadays. AI means nothing if you don't have the data and if you don't know how to monetize those. We have the data. One of the reasons that we wanted it to launch the genetic test was tying it to this one. And also treatment plan, again, Shane will add more colors into that. And also we want to have medications that we're going to put on our pharmacy and we own the IP. So these are the areas that we're focusing that the 10 million convertible and also supporting this from the operation perspective and supporting the existing growth is going to be used. From the technology perspective, we have started working on all these three internally. But if we find an opportunity that is going to fast track this one, that is going to go live and start generating revenue for the company, it makes sense for us to go that path and start getting it in action right away. So before I go any further into our capital market events, I'd like to pass it to Shane to add more colors into this one or the previous slide, which was about the updates.

No, that's great. Thank you, Vahid. No, very eloquently put, as always. Just kind of go back to where we're at now and where we're going. I guess that's kind of Vahid covered a lot of ground there. So We've talked since Q4 of last year of the release of our third vertical. We hope to have put it across very well in previous meetings as to the migration plan, the challenges from moving people from one medical company over to another and Q3 and Q4. The reason I said there was nothing overly exciting about the first two verticals is because we essentially knew where those verticals were and what the company was going to do. We've been talking about the third vertical for quite a while and the party has officially started in Q3 and it's going to continue to grow and we're very, very excited about the execution that the team has done. But the first two verticals also have accelerators coming that are all feeding the same. Because remember, the ecosystem is the entire healthcare industry. I talk about three different areas, but there's a lot of synergy below it in terms of everything ends up in the pharmaceutical. So we have two distinct accelerators in our first two verticals. The nursing, we already released, obviously, some notes about financing and things like that that has helped boost. But we have a version two coming of that, which is quite dramatic. Again, it kind of showcases our position in the industry with some of these very, very large banks and the history of the company and the support. So there's a lot of good news coming shortly on the nurses, which is going to remove essentially a barrier to entry. And we see a huge expedition of the amount of nurses coming on there. The second vertical, we are actually releasing. We've been reinvesting in tech, as everybody knows, for the last year very aggressively. uh across all three verticals to help with scale to help with automation to help with the you know the the volume that we know um is coming in we're in the middle of migration and a lot of it um but we have a hardware addition to our fully digital uh offering for our for our for our second vertical that's going to be released in q4 our goal behind that is to essentially capture a very large portion of the 100,000 plus med spa industry. A very aggressive strategy. We've hired a new head of sales to basically spearhead that. And we are going to essentially try to capture a very large portion of that market, which again, is just an addition to our existing bricks and mortar offering, but it offers a lot more in terms of control of the pharmaceutical, of the telemedicine, et cetera. So that's an exciting one that we're really excited about. Obviously, the third vertical then is what we're currently migrating businesses, giving updates on the volume. We all know our projections for the end of the year and everything is going great there. Now, if we zoom out for one second, knowing what's coming, obviously the communications we've been giving since Q4 of last year wasn't projections. Essentially, it was goals for the company based off of the businesses that we knew were coming on the third vertical and what they were currently doing. So again, we know and we're excited about the execution of that. And we're always very happy to share the numbers because again, it validates everything that we have been saying. But if we want to scale and we want to control the scalability of that vertical we need to start really thinking about controlling the pharmaceutical itself that's why for a number and this isn't a thought that popped into our head the last couple of weeks this has been since last year so A is obviously a 50-state dispensing pharmacy, so the A can dispense across the various states. The B, however, is kind of the bulk creation and obviously the $10 billion industry that you see there by 2033 that Forbes predicted. That is controlling all of the three verticals so we want a strategic talking strategic partnership that basically is going to protect all verticals it's going to increase our control from a pharmaceutical perspective which all three verticals end up in um increase profit margin increase control of the product itself from a compliance perspective from a product expansion perspective if you had touched earlier that we have some clients migrating now that have asked for other things and wonderful Uh, so the future, uh, on that side is, is, is all about vertical integration and we're ahead of the game on that. Um, and we've announced obviously there's certain things we can't go into, but, um, The company's in a very strong position. We obviously know what Q3 and Q4 from a numbers perspective has looked like. So that's why the, that's why this transaction from a, from a convertible made, made a lot more sense. Um, so the other side of it then is just, if I zoom back out and this is the last thing I'll say, I know we're kind of gone over time here is. The full end-to-end flow here and the way all of this is going is individualized healthcare and accessible healthcare. What do I mean by that? Individual. Get a test at your house, at your home, at your office, wherever. Get results back in a timely fashion to some type of technology that tells you exactly that. There's an AI component. If you're not looking at AI, you're looking in the wrong direction at the moment as a company, unfortunately. There's an AI component that needs to be plugged in there to basically expedite the level of care, the predictions, the accuracy, what can be given and then tucked into your other technology. So that's something we're also looking at at the moment with a number of companies. That flow from individualized healthcare to almost immediate, accurate projections, recommendations to the telehealth, to the pharmaceutical itself. That's the flow. That's the flow, whether it's a nurse in the mobile setting, whether it's self-administered at home, or whether it's in a bricks and mortar. That is the full end to end of where all of this is going. We've positioned ourselves pretty well, I would say, to now, and we are doing some vertical integrations at the moment that are basically just going to add on to what we already know is coming. So, again, I know we went over, so I just want to talk high level on where we're going.

I appreciate it, Shane. On the same note, so we talk about these acquisitions that is going to help with two things. One, our investments with our margin and also with our revenue and volume. Now, one thing that I mentioned earlier is how our existing business can create big value and asset for our business by having ownership in those. Forbes came up with how the compound pharmacy is gonna be valued nowadays, especially if you have a turnkey to send the orders and manage the orders in full compliancy, which is our technology and our corporate structure. That's something that no other players in the market have something similar to this. Now, just to give you an idea, and again, for numbers, I want you guys to do your own research. This is based on the very high level, but like, for example, a 503B pharmacy or a 503A pharmacy, if you get in at the right time that the business don't have, they have the structure, they have the compliance, they have 50 state license, it's ready to go, You get in at the valuation of anywhere between like 50 to 60 or 70 or 80 million valuation to come in to get a piece of that because it's kind of a goldmine. When you see in the market, usually those businesses, it will be a value that 10 times of the revenue. Again, I recommend you to do your own research. This is high level based on our researches, but we do more details. But I just want to talk about the idea. Fadi Bardawil, Ph.D.: : us putting our own revenue and our own pharmacy orders through that pharmacy and going at the 50 60 70 80 million valuation and. get the 10 times multiple of that from the value perspective as an asset under the company, you're looking at, and again, we won't be the only clients of that, but if you look at that, adding 50 million revenue from the pharmacy going through that, that is a 500 million business within six to 12 months. So again, the numbers can change. And again, I recommend you to do your own research, but that's the top process. We're trying to create an ecosystem. We're trying to create a company that has assets, has technology, has customers, has compliancy, has legal structure, and it's an end-to-end solution to serve this market. Um, uh, to, to wrap up the, uh, the call, um, as, as promised, we're going to do, we're going to continue, uh, going around and talking to the right investors to share our story with them rather than, um, spending money on one-time promo marketing that again, There's nothing wrong with that, but we don't believe in that. We'd rather to focus on quality conversations. There are three events from now until end of October that we're going to go. Besides that, there are multiple events that we're going to, from the medical perspective, that we always talk with different similar-minded people within the industry, and we actually talk to them. Now, Again, we pass the time, but there are a bunch of questions. We try to go to answer as many questions as we want in the next few minutes. But if anything's left, please feel free to send an email to the IR and we'll be more than happy to answer. We're always very open and very grateful for all the feedback and all the discussion points and support that we're getting from investors. As we said before, by no means we're perfect. We're trying to do our best to bring the best value for the company, for our team, for our investors, for our clients. And this is again, this is a brand new and the third industry is a brand new business that we learn as as we move forward. We've done enough researches. We created enough. It's already showing it's already showing. is already showing results. So I'm just going to go on a bunch of the questions and between Shane and I will answer that. How do you see 503A and potential 503B acquisition impact the targeted 20 to 30% margin figures you probably previously shared? So we already talked about the margin. We talked about the assets and all that. When are you going to NASDAQ? Has that process started? No, that process hasn't started it. We always say we want to graduate high school before we go to the master program. We have so much to do. We don't want to get diluted for no reason. we want to make sure from the we're ready to go to the nasdaq that's the goal that's what we're hoping to do that's what we're planning to do but right now just just the cost for the capital market side going to nasdaq we're added to spend on the growth side when we hit the real numbers that we have in mind within the next 12 months that's the time to start looking at it that's definitely part of our our our goal to go to do that but we want to focus to master this what we do right now and go there. So yes, it's part of the plan. The process hasn't started it. Can you provide a high level of speech revenue between the TRT, GLP, IV right now that in trending in the future? Shane, do you have those stats handy or you want us to send a release out on that?

We can send, can you read the question again?

They want to split revenue between TRT, GLP, and IV. But it's a lot more than that. We have like, right now we have like over 55 products. And that was one of the things that I said about August. The orders is above the numbers that we're expecting. It's just, it's so, because we added so many products, some a lot cheaper, some a lot more expensive. That's kind of the variance. But Shane, please feel free to add any comments on that one.

I'll just give two minutes. The IV is obviously administered by a healthcare professional. So that's on the first vertical with the nurses. And that's obviously one of the major services that are being done by those. The other third vertical, which is the self-administered, there's over 45 treatments there. TRT is obviously one of the big ones, GLP-1, of course, and obviously the peptides and sexual health and things like that. So the IVs wouldn't fall into that category whatsoever. But I would say pretty evenly spread between TRT and GLP-1 at the moment. TRT is huge. Okay.

You've been outlining a fairly aggressive growth trajectory on the monthly orders last four months, 100K, 200K, 300K, 400K. Where do you see this trajectory peaking? You have not shared any 2026 projection order. So all great points. As I said, we haven't seen any evidence for us to change our numbers that we set as a goal. The 100K for September is, again, with the numbers that we saw in July and August and June, we're not too worried about the next few months based on the numbers, but we continue updating the market on that. At end of September, we're going to work on our 2026 numbers. As I said, it's a brand new business that got from zero to about 100,000 orders within the first three months. So it's very aggressive. But again, I want to emphasize on the fact that the businesses that we secure with the existing orders is supporting our 2025. It's just a matter of us doing a good job and successfully bringing them over to our platform at one of the stages coming over.

If I could just add in a little bit there to hit it, I hate to sound like a broken record because I know a lot of people have heard me say this before, but we need to really always kind of go back to where we've positioned this company. The growth is in front of us. When we talk about our first vertical, there's 4.5 million RNs. We're talking about thousands that are on it right now. Our second vertical, there's 150,000 that would fall into the MedSpa non-traditional doctor office. We're talking about hundreds on there. The third vertical is untapped, as we know, and we've obviously given some projections as to the current clients that we have. But when people talk about what are your projections, the projections are very hard actually at the moment because we have positioned the company with a compliance mode that the future is looking fantastic. So we will give communication towards Q4 for 2026. I know I'm always saying this, but the growth's in front of us because of where we've positioned the company and we will give as accurate information as we can for our goals.

Great progress over the year. Congrats to the team. How confident are you that the guided 1.3 million orders will be reached by end of the year? That will mean that in second half, in every month, there must be 150,000 orders. Thanks for the updates. Appreciate the kind words. The goal that we set for 1.3 orders, again, we haven't seen any evidence for us to change that. But again, we're focusing on the trend. We're focusing on the trend more than just having one month for 500,000 orders and going down to 2,000 orders, right? The trend, we're sharing the trend. You can see the trend. We'll continue updating the market as much as we can based on the rules and regulation on the progress. uh you mentioned glp one churches in the last webinar but you didn't elaborate can you provide the color to this uh shane i don't know how much we can do because that's through one of our clients but if you want to just add high level uh what was the first part of the question i heard you mentioned glp12 churches in last webinar but didn't elaborate can you provide more colors this time

Yeah, well, I can give a high level because again, it's a client on the third vertical that has a unique relationship with with a ministry across the United States that has a tremendous following. So they're a perfect example of a client that is not structured for medical, but has a large following. They're in various stages of launch. And yeah, we can provide more color, I think, in the coming weeks, actually.

OK. Shane and the team, three questions. how are large partners onboarding going on like Dr. Frank? Just to let you know, our large partners, Dr. Frank is not one of them. The large partners that we're talking about are the one who already have orders. They already processing 40, 30, 25, 100,000 orders a month. Dr. Frank is a big brand. It took us a lot to bring them on board, but they're starting from scratch in the United States. So we don't look at them as a large partner. Dr. Franks, Shane, do you want to provide? There are three questions. That's one of them.

They'll eventually be a huge partner with their experience in this space. And obviously, they're a large company, so they have a large marketing budget. But again, the US is new to them. That's obviously one of the reasons they wanted to join forces with us. So yeah, they're on board. They're ready to go. They're basically just fleshing out their marketing strategy. Do they want to go with a certain number of services and then branch out or do they want to go across multiple categories right away? So that's where they're at. But again, coming weeks, I believe they've already started kind of their first phase and then obviously ramp up from there. But we will be the first to update everybody on success. As we communicated through Q1 and Q2, we said, guys, once migration starts and once Q3 and Q4 hits, we'll be the first to update everybody. And I think we've started doing that.

I think they're going to send a release out soon on that and update the market. What are the next products VSDH1 will be rolling out? Would VSDH1 be fulfilling Palsable's orders? What is the new products that BSDH1 will be rolling out?

So across the categories, obviously, we all know about GLP-1s. The peptide space is just going to grow continually. So there'll be a continuation of that category. The sexual health, the hair loss, the sensitive stuff. The at-home testing will also broaden because, of course, that's the first piece of the individualized health care. So again, it'll be more of an expansion of the categories rather than a specific product. You know, obviously the TRTs, the HRTs, there's different administration types of those coming now, same way that the GLP-1 has numerous types of administration from sublingual to a patch to all that stuff. So it'll be versions of those categories.

Perfect. I'm going through with the question. There's a bunch of questions about the M&A strategy. Talk about M&A or how you're going to use the cash for convertible. These are, I believe, they were posted before we go to that slide. So I'm just passing. I'm not ignoring the question. New products that respond to add to the platform. We just talked about that. You recently referenced the potential partnership. Exit sales in 2026 and the retail conference calls. Do you feel an exit might be premature at this point, given the trajectory? Again, that might be the end goal, but right now our focus is growth, number of the orders, profit. And in order to do that, we're going to do it organically, acquisition, investment, supporting the growth in different ways, including initiatives that we have internally doing that. Could you provide some coloring additional operational costs that are expected to be incurred as the VA Stage 1 continues to grow? So we need to focus, like we are building this business as a process oriented business that is around the automation more than anything. We don't want to be cornered, uh, by, uh, by people, uh, or mistakes or errors because human, uh, human being will, uh, create errors no matter how precise we are. So, um, it's going to be, we're going to invest more and heavily around the technology that we have. around the offerings that we have, around the operation that we have. But again, we are monitoring that. We have our numbers. We look at those, and we continue planning for our next 90, 120, 180 days, and we adjust it as we move forward. Can you provide insight into the current, I believe your current measure and the potential reach to $200 million? We never mentioned any specific revenue for 20, for 2026. We haven't provided any specific number on 2026. But as Shane said, we're looking at the numbers, we're focusing on the orders. By end of September, we're hoping and we believe we're going to have a clear projection for next year. And also we have a better idea from the dollar per order side that we can work on that. how do you feel about the August numbers related to your previous cited? So yeah, we, the August originally we had it about like, you know, in the original matrix before we get into the July, we had about 35,000 to 75, 70,000 average 55,000 orders. As I said, we fulfill and surpass that. It's just that we're not, because some of the orders is coming is a new product that is cheaper than the, the, the numbers that we had so we need to wait for the month to be over and start organizing those so we can tie the number of the orders coming in with the revenue generated and dollar per order but from the order perspective product order perspective uh we're very excited and happy for month of august as well um Can we discuss dilution in the future? There are many times where the topic was addressing the cause and the answers that Hydrate has enough capital to meet their growth. So the problem is not dilution itself, but communication in front, how sure we are that we'll not enter dilution in three months. There is no dilution. You are looking at this business. The question is, do you wanna have a big piece of a small pie or you wanna have a bigger piece, a bigger, a small piece of a bigger pie, right? We didn't raise any money since we went public at 63 cents until earlier this year at $1.55. We make sure the revenue goes from a million to 22 and a half before we do the rates. We made the company to be profitable. We have done our researches to do our best to make sure the money that is coming in is going to be used properly. We got diluted by issuing RSUs to the teams being with us over the years and made this growth possible. We got diluted by bringing more investors, $1.55 to diversify that and also getting coverage. We got diluted by getting a piece of a 503A pharmacy that is a goldmine. And it's in their benefits now that they do well because they are shareholders of the hydrate. We got a convertible, not the straight raise because we believe the value of the shares. So when you look at the dilution, we're still saying what we said before, but we have to see what's going to bring the most benefit for the shareholders, the management, the board, the CEO, everyone working day in, day out to see what's going to bring the most value for the shareholders. I'm going over the question. Most of the question we addressed and a lot of it is very similar. I know we already passed about 25 minutes over the webinar. Apologize for taking your time longer. Appreciate your time. Appreciate your support. Any other question, feel free to send us an email, IR emails. And our team will get on the phone with you, respond back to your email. Again, we're overwhelmed with the support that we have and we appreciate it. We're doing our best based on the best of the knowledge, best of the effort that we can put in to deliver the results. I appreciate it. Thank you so much. Thanks, everybody.