Snipp Interactive Inc.

Good morning and welcome to the Smith Interactive First Quarter 2025 Earnings Conference Call. At this time, all participants are in listen-only mode. Following the company's prepared remarks, we will open the call for questions. Please note that today's call is being recorded. Before we begin, I'd like to remind everyone that today's calls contain forward-looking statements within the meaning of accessible security laws. These statements are based on our current expectations and involve risks and uncertainties that could cause actual results to differ materially. For a discussion of these risks and uncertainties, please refer to our public filings available on Stata and our Investor Relations website. We do not undertake any obligation to update any forward-looking statements made during this call, except as required by law. Good morning, everyone, and thank you for joining us. We entered 2025 with positive momentum, and I'm pleased to report that our first quarter results reflect a strong and steady continuation of that trend. Revenue grew 37% year over year to $6.4 million. Gross margins expanded to 60% and we delivered a fourth consecutive quarter of positive EBITDA, a 0.9 million improvement over the same period last year. Perhaps most notably, we generated 2.3 million in operating cash flow, the highest quarterly total in our company's history. These results speak directly to the strength of our model as we focus on high-margin, platform-driven solutions, which can improve financial performance, not in isolation, but as the natural result of growing customer demand and disciplined execution. C1 revenue growth was among the strongest we've seen in several years and we are very pleased with how the year has started. That said, I want to be prudent in managing expectations. While C1 is a positive data point, we know that C1 in year-over-year growth will be valid across every quarter. As we move through the year, growth may normalize somewhat as we lapse certain client implementations. That said, we are confident that 2025 will show healthy top-line growth relative to the prior year. As it relates to bookings, I want to be upfront that the current environment does create a bit more unpredictability at the quarter-to-quarter level. Some client decision-making is taking a bit longer and we've seen some shifting of campaign timings which makes it difficult to fully forecast bookings with precision for any single quarter. That said, when I step back and look at the full year, our pipeline remains very strong, price retention remains excellent and the underlying drivers of the business are intact. While we may see some quarter to quarter variability, I remain confident in our ability to deliver healthy growth on a full year basis. The reason being that the key driving force behind our business today is our value proposition which continues to resonate in the market. Our platform continues to gain traction across promotions, loyalty rebates, and our new offers score up. Additionally, we're gaining critical momentum with SlipMedia, where we are building a differentiated channel that combines media delivery with closed-loop attribution. While feedback has been positive, SlipMedia remains in its early stage, and as previously guided, we do not expect it to contribute meaningfully to revenue until the back half of the year. We are working on a major deal for this product that should have materialized will allow us to break into a large number of manufacturers and retailers simultaneously. More on that as that deal cycle materializes. In the meantime, our core business is capturing market share and growing as reflected in our booking backlog, which increased 17.9 million this quarter, a 16% year-over-year increase. This backlog provides strong visibility in the future annualized revenue and underscores the strength of the current relationships we are continuing to build. We are not just winning individual deals, we are establishing recurring multi-program engagements aligned with our long-term strategy. We also continue to maintain a strong knowledge of the closing quarter with 5.8 million in cash and your debt. With consistent EBITDA, strong and positive cash flow and a great backlog, we have the financial With that, I'd now like to turn the call over to our new Influencer for Malcolm Davidson. I am proud that Malcolm is joining us at this very moment. His experience will allow us to bring him to our finance team for a more detailed look at financial jurors, Malcolm.

Thank you, Michelle, and good morning, everyone. I'm excited to join this interactive team with the intern CFO. This is a pivotal time for the company, and I'm personally thankful for this opportunity. I'm looking forward to leveraging my experience in financial reporting and regulatory compliance to lead this continued growth and to help drive long-term value for its shareholders. I'd like to first address a topic that I think understandably has been top of mind for many shareholders, the prior audit delays and the periods where our stock was temporarily halted. These were clearly unfortunate events, and we recognize the frustration they created for our investors. As we discussed, the core issues were primarily around legacy internal processes and rigorous constraints with our finance function, challenges that became more evident as we've grown. I've taken concrete steps to address these challenges as evidenced by a quick turnaround on our timely Q1 financials. The mandate for our financial team is very clear. We must be timely, accurate, fully buttoned up in our reporting processes with appropriate control, well ahead of our filing deadlines. I'm committed to building a more robust finance infrastructure going forward that reduces the risk of these re-experiences and these types of disruptions. The added delays did not result in any material changes to the financials. However, it has exposed the need for a more rigorous approach to documenting and scaling our financial processes, which I will focus all my energies on to begin with, to ensure we don't have these types of delays in the future. My first goal for SNF is to ensure our finance team continues to scale up with the growth of the business and can absorb the speed of innovation into its financial accounting systems and related processes. As Atul mentioned, we're very pleased with the financial results we delivered in the first quarter, and I'd like to take a few moments to walk through the numbers in greater detail. Revenue for the three months ended March 31, 2025, with $6.4 million, up from $4.7 million in the same quarter last year, an increase of 37%. This growth reflects higher contributions from our core platform clients, as well as early revenue recognition tied to new program launches. Growth profit for the quarter was $3.8 million, resulting in a gross margin of approximately 60%. compared to 54% in Q1 of last year. The increase in margin is a result of continued improvements in our revenue mix and cost efficiencies across the business. Turning to EBITDA, we reported positive EBITDA of 0.3 million for Q1 compared to a loss of 0.6 million in the prior period. This March, a $0.9 million improvement year-over-year and represents our fourth straight quarter of positive ETH. Moving to the balance sheet, we ended the quarter with $5.8 million in cash, up from $2.7 million at the end of Q4. Importantly, operating cash flows for the quarter was $2.3 million, our strongest quarterly performance to date. We also saw continued reduction in accounts receivable, from $3.4 million at the end to $1.4 million as of March 31, improving our overall working capital efficiency. Combined cash and AR stood at $7.2 million, essentially flat compared to year-end, but with a much cleaner AR profile. and bookings backlog, which represents contracted programs that have not yet been recognized as revenue of each $17.9 million compared to $17.3 million at the end of December. This provides clear visibility into future revenue and demonstrates strong customer engagement across our product suite. Overall, we remain focused on maintaining financial discipline while continuing to invest in areas that are driving long-term growth. With that, I'll turn the call back over to Atul for closing remarks.

Thanks, Asim. So, guys, in summary, we're off to a strong start in 2025, delivering profitable growth, expanding the reach of our platform, and deepening engagement with major brands across few verticals. We look forward to the redemption of trading on the exchange and have submitted all requested documentation as of last week. We're now literally just waiting for the exchange to respond. So, I would tell you my guess is I'd give the viewers a surrendered allow for training. Nothing's holding up, you know, holding them up per se. I guess it's just their process. So, you know, we should hear from them pretty soon. Malcolm's first job today after this call is to call them again just to, you know, push them to approve the title. So with that, let's move to Q&A. You know, again, as with Q&A on these calls, you can either chat on the chat and, you know, ask the question or put your hand up and I will try and unmute you to do that. So we have the first question on chat comes from AP. Hi AP, can you explain why there's no fairing in Canada yet? Well, I just said what I have to say, which is, you know, we're waiting for the exchange. As soon as we hear from them, as soon as they turn us on, we'll be back on. It should be very soon. I'm pretty sure. Okay, the next question is from Daniel Rosenberg. Hey, Dan. I owe you an email. I'm sorry. I will call you right after this call, maybe. But go ahead. Let me unmute you. Yeah, there you go.