Thunderbird Entertainment Group Inc.

Thank you for joining us. We are here to provide a corporate update and report on Thunderbird Entertainment Group's third quarter 2021 fiscal results, which ended March 31st, 2021. Speaking on today's call are Ms. Jennifer Twyna McCarron, Thunderbird CEO, and Ms. Barb Harwood, Thunderbird CFO. Ms. Twyna McCarn will provide a strategic overview of Thunderbirds Entertainment Group, and Ms. Harwood will review the company's Q3 financials. Following the corporate update and financial review, the call will open up for 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. Alternatively, if you have any questions, you can call plus 1-604-683-3555 or email investors at thunderbird.tv. The company will follow up directly after the call. At this time, all lines have been placed on mute to prevent any background noise. I'd like to remind everyone that certain statements made on today's call will be forward-looking and constitute forward-looking statements. or forward-looking information under applicable securities laws. Forward-looking statements and information discussed on this conference call include, but are not limited to, statements with respect to companies' objectives, goals, future plans, and the business operations of the company. Forward-looking statements are necessarily based on a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include but are not limited to general business, economic and social uncertainties, litigations, legislatives, environmental, and other judicial, regulatory, political, and competitive developments. Those additional risks set out in the company's filing statements and other public documents filed on CDOR at www.cdor.com and other matters discussed in the company's year-end news release. Although the company believes that the assumptions and factors in preparing these forward-looking statements are reasonable, undue reliance should not be placed on these statements, which only apply as of the date of this presentation, and no assurance can be given that such events will occur in the disclosed time frames or at all. If set required by law, the company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. For your convenience, the press release the MD&A and unaudited financial statements for the third quarter of 2021 of Thunderbirds Entertainment Group, which ended March 31, 2021, are filed on CDAR and are available online under the Investor section of our website. We do not expect to update forward-looking statements continually as conditions change. This conference call is being webcast live, and the archive will be available on the company's website at www.thunderbird.tv following today's call. Please note that Thunderbirds reports in Canadian dollars unless otherwise stated. Ms. Twiner McCarran will now provide the corporate update.

Thank you so much. On behalf of everyone at Thunderbird, I'd like to welcome you to this morning's call to discuss our Q3 results for fiscal 2021, which ended March 31st, 2021. My name is Jennifer Twiner McCarran, and I'm the president and CEO of Thunderbird Entertainment Group. I'm here today with our CFO, Barb Harwood, and we are both very thankful to have you here with us. Once Barb and I finish our updates, we will be happy to answer all questions you may have. Thunderbird Entertainment is a high-quality global content company. We create, own, and distribute award-winning factual, animated, and scripted content around the world. We have meaningful and trusted partnerships with all of the major streamers and broadcasters, such as Netflix, HBO Max, Apple, Disney, Discovery, NBCUniversal, PBS, CBC, to list only a few. In addition, we have over 1,000 employees with our head office in Vancouver and other locations in Los Angeles, Ottawa, and Toronto. Q3 was another strong quarter for Thunderbird and a true reflection of the extraordinary work of our talented teams. In addition to the continued demand we are seeing for our company's premium content, Throughout the quarter, we continue to scale up, bringing on new team members across the entire organization. We also secured some exciting new partnerships, a few of which we'll discuss later in this call. In a moment, Bob will walk us through the numbers for Q3, but before that, I want to take a quick moment to highlight two elements which are not only incredibly important at Thunderbird, but also the main drivers of our company's success. The first is our team, the creators and producers behind our content. Our team propels the company forward through phenomenal work that they produce and deliver to our global partners. Thunderbird would not be where it is at today and growing so rapidly if it was not for our people. From our animators to our film crews, to our producers, to IT, to HR and finance, each department is filled with remarkable individuals, all contributing in specific and impactful ways. In fact, in a year when many production companies struggled, Our teams demonstrated incredible resilience by coming together. Despite the need to quickly move everyone off-site to prioritize health and safety, we have not missed one delivery or created one financial overage for any of our partners, only deepening all of our partners' trust in us. As a CEO, I'm always thrilled to celebrate the accomplishments of our people because everything starts with them. We want to make sure that all voices are heard and valued and that no one feels just like a number. We also want to create a culture of excellence where people feel safe to innovate and safe to take risks. When you have a chance to try new things, regardless of the result, innovation will arise. This brings me to my second highlight, which is our content. At Thunderbird, our mission is to create content that makes the world a better place, makes people happy, and provides a much-needed escape, especially during these unprecedented times. By keeping quality as our North Star, we're receiving recognition within our community, the industry, and from our peers. Thunderbird aims to have our content entertain, inspire, and empower. And in many cases, we're also giving a voice to stories that need to be told. During and subsequent to the quarter, I'm proud to report that our productions are recognized with nominations and awards from the following outlets and organizations. The Banff Rookie Awards 2021, Youth Media Alliance, Kids Screen, the Canadian Screen Awards, the Leo Awards, the Deli Awards, and the Nickelodeon Kids Choice Awards. Some of the many productions that continue to turn heads are Molly of Denali, Queen of the Oil Patch, Kim's Convenience, all of which are recognized for how they champion inclusive representation with diverse and authentic lead characters. We are so proud to tell stories like these and believe that everybody in the world deserves the opportunity to see themselves in popular content reflected back in a positive light. Productions like these clearly demonstrate our commitment to diversity and inclusivity, both on screen and behind camera. And we're doubling down on our mission to make a positive difference in the world. For example, we are proud to have won the BC Business of Good Award for diversity and inclusion. And more recently, on behalf of my team, I was also recognized by BC Business as an equity and inclusion champion in the 2021 Women of the Year Awards. This is work that our entire company believes in as part of our core mission and values, and it also reflects our commitment to helping advance issues of gender representation and the inclusion of BIPOC and LGBTQ2S in communities. As a global content creation company, we not only have the unique ability to influence society through the stories we create, but we also have the responsibility to audiences to deliver on that promise. In addition, we know that diverse, inclusive companies where people feel safe and honored also perform better at every level of the organization. Increasing focus on diversity and inclusivity is not just the right thing to do, it's also extremely good for business, the results of which Bob will now discuss. After that, I'll be back to dig in to some more of the company specifics. However, just before Barb gets started, please join me in congratulating Barb for being named by Report on Business as one of the top 50 best executives in Canada. Congrats, Barb. Over to you.

Thanks, Jen. I'm very fortunate to work with an incredible finance team at Thunderbird who support me every day and certainly make me look better than I would otherwise be. um and now to the q3 results q3 was our strongest quarter ever with revenue of 37.7 million and 85.4 million for the three and nine months ending march 31st 2021 as compared to 29.6 million and 60.2 million for the comparative periods of fiscal 2020 increases of 27 and 42 percent respectively The majority of these increases over the comparative periods in 2020 is related to growth in production services attributed to the kids and family division. The company has two principal revenue streams, production services and licensing and distribution. Production services revenue is earned for service work performed on projects where the company does not own the IP. Licensing and distribution revenue is earned when the company owns the copyright to a project and subsequently enters into a broadcast or distribution agreement to license the project for a specific term. Production services revenue was $19.4 million and $53.2 million, increases over Q3 2020 of $6.6 million and $18.4 million, or 52% and 53% respectively. which was due to an increase in the number and size of contract. Licensing and distribution revenue was $18.3 million and $32.1 million for the three and nine months ended March 31st, 2021, increases of 9%, $1.5 million, and 27%, $6.8 million, over the comparative period, due mainly to the delivery of another three episodes of the animated series The Last Kids on Earth in the current period, In the current quarter, the company also recognized revenue from 13 episodes of Kim's Convenience Season 5 and 40 episodes of three factual series, Heavy Rescue 401, Mud Mountain Haulers, and Save My Reno. In the comparative quarter, revenue was recognized from 13 episodes of Kim's Convenience Season 4 and 35 episodes of three factual series, Heavy Rescue, High Arctic Haulers, and Save My Reno. Gross margins decrease from 38% to 33% in the nine months ending March 31st, 2021 over the comparative nine months. Gross margins for own content are typically higher than production services due to the fact that content stays in our library and is able to earn recurring revenue. There is also variety in the gross margins of our own content because each series is its own business model. growth margin for production services, alternatively, is typically lower than that of own content. When production service revenue increases as an overall percentage of our revenue, our margins may decrease. Production services revenue as a percentage of overall revenue increased from 58% to 62% year to date. In addition, Due to the incredible strength of our quarter, we took the time to conservatively look at older titles in our library. With Richard Goldsmith joining in January as President of Consumer Products and Distribution, he was able to use his expertise to advise on titles and their ultimate worth. As a result, we decided to record an additional amortization of investment and content of $1.5 million this quarter, further strengthening our balance sheet while continuing to put up great numbers and excellent growth trajectory. Year-to-date, the company's production backlog was $102.2 million compared to $86.1 million as of March 31, 2020. This backlog is defined as the undiscounted value of signed agreements for production services and licensing and distribution agreements for which the title expects to recognize revenue in future periods. Adjusted EBITDA was $7.4 million and $17.3 million for the three and nine months ended March 31st, 2021, increases of 8%, 0.5 million and 39%, 4.8 million respectively. These increases were primarily due to growth in production services revenue over the comparable period, as mentioned before. I want to point out an input error in the EBITDA table in the press release only. Deferred income tax is showing as 1.405 and 980 for the three and nine months ending March 31st, 2021. The correct numbers for deferred income tax expense, which can be found in the MD&A on page 8, are 1.014 and 589. All other numbers in the EBITDA table in the press release are correct. Free cash flow was $1.8 million and $7.5 million for the three and nine months ended March 31, 2021. a decrease of $2.7 million and an increase of $2.8 million, respectively. These fluctuations are mainly due to changes in working capital and production loan repayment. And finally, the consolidated cash position at March 31st was $18.8 million, with $11.5 million being required for production and $7.3 million available for general use. In addition, the company continues to operate with no corporate debt. And now back to you, Jen.