Voxtur Analytics Corp.

Good morning, ladies and gentlemen, and welcome to the Voxer Q3 2024 earnings call. At this time, all participant lines are in a listen-only mode. Following the presentation, we will conduct a question and answer session. And if at any time during this call you require immediate assistance, please press star zero for the operator. Also note that this call is being recorded on Monday, December 2nd, 2024. I would now like to turn the conference over to Mr. Jordan Ross. Please go ahead, sir.

Good morning, everyone. Thank you for joining us for the Voxter 2024 third quarter earnings call, where we will discuss our financial results and business highlights. Please note that our results for the three and nine months ended September 30, 2024 were released November 28, 2024, and can be accessed on CDAR Plus and on our website at voxter.com. Joining me today are Executive Chairman Gary Yeoman, CEO Ryan Marshall. And unfortunately, Robin Dyson, our CFO, had an urgent and unexpected matter arise and will be unable to join the call, but will make herself available for any and all questions after today's call. We will begin with prepared remarks and then move into Q&A. If we are unable to get to your question, you are always welcome to contact me directly at jordan.boxter.com. I will begin by going over our financial results. After that, Ryan Marshall will provide updates as to how we are progressing towards our objectives. Before we get started, please be advised that some of the information that we will share on this call today may contain forward-looking statements. We caution you not to place undue reliance on forward-looking statements and undertake no duty or obligation to update any forward-looking statements as a result of new information, future events, or changes in our expectations. Further, on today's call, we will report using both IFRS and non-GAAP financial measures. We use these non-GAAP financial measures internally for financial and operational decision-making purposes. as we believe that they provide a meaningful measurement of financial performance and valuation. These non-GAAP financial measures are presented in addition to and not as a substitute for financial measures calculated in accordance with IFRS. To see the reconciliation of these non-GAAP measures, please refer to our management discussion and analysis, which is available on CDAR+. A replay of today's call will also be posted on our website. Finally, please note that all references to amounts or currency during today's call are to Canadian dollars unless otherwise stated. I will now provide an overview of the financial highlights for the three and nine months ended September 30th, 2024 in place of Robin Dyson. But I again remind you all that she will make herself available as necessary for any follow-up questions that we may not be able to answer during today's call. As noted on the second quarter earnings call in July 2024, the company entered into a definitive agreement to divest 50.5% of the interest of Bluewater Financial Technologies Holding Company LLC, a subsidiary of the company. This transaction is subject to various closing conditions which have not yet been met and further updates on the transaction will be provided when available. However, we are functioning and operating as if the business is still 100% owned by the company and therefore, Ryan Marshall will also be including this in some of his updates during his portion of the call. As at September 30th, 2024, management was committed to a plan to sell the controlling interest in Blue Water. Therefore, in accordance with IFRS standards, as at September 30th, 2024, this business has been classified as a discontinued operation. As such, all P&L activity related to this business for the current and prior periods have been carved out of the individual revenue and expense line items in the financial statements and have been reflected as a single line item in the presentation of each of net income loss and comprehensive loss. The Q3 MD&A presents key financial metrics for both continuing and discontinued operations. The metrics to be discussed on today's call, for the most part, will be based on continued operations only, unless otherwise noted specifically. Revenue for continued operations decreased to $8.5 million from $10.1 million for the three months ended September 30, 2024 and 2023, respectively. This decline was primarily attributable to settlement services and software and data licensing. For the nine months ended September 30, revenue decreased to $25.7 million for 2024 as compared to $30.7 million for 2023. While there were declines in the software and data licensing and technology managed service revenue streams, the decline was primarily attributable to the settlement services related revenue. The company is actively pursuing and rebuilding these revenue streams through expansion of our client base, a new product offering, and reshaping of the business model for settlement services, and will be discussed in more detail by Ryan Marshall later on this call. Gross profit decreased to $4.9 million from $6.5 million for the three months ended September 30, 2024 and 2023, respectively. and decreased to 14.6 million from 18 million for the nine months ended September 30, 2024 and 2023 respectively. Again, these decreases are attributable to the decrease in revenues previously noted. Gross profit as a percentage of revenue decreased to 58% from 64% for the three months ended September 30, 2024 and 2023, respectively, and decreased to 57% from 59% for the nine months ended September 30, 2024 and 2023, respectively. Adjusted EBITDA from continuing operation was negative 2.1 million for the three months ended September 30, 2024, as compared to negative 846,000 for the same period of the prior year. The decline of approximately 1.2 million is primarily attributable to the decline in revenue of approximately 1.6 million, offset to some extent by a reduction in operating expenses. Adjusted EBITDA from continuing operations was negative 6.4 million for the nine months ended September 30, 2024, as compared to negative 8.7 million for the same period of the prior year. While revenue for this period declined, this was more than offset by operational savings. I will now turn the call over to our CEO, Ryan Marshall, to provide the business updates. Brian.

Thank you, Jordan. Good morning, everyone. Thank you for joining us today. It's an honor to address you for the very first time as the CEO of Boxster. My journey here began just 90 days ago. And while it's been a brief period, I'm proud of the progress that we've made and fully aware of the significant challenges that we face. Over the past four to five years, Boxster's journey has been turbulent. Yet I still remain and I believe that the story is growth, ambition, and the unique synergies that sets us apart from anyone else in the industry. Our top priority has been to bring focus and clarity to Voxter's operations. The one Voxter initiative goes beyond being a mere message. It's about fostering alignment within our internal teams and reinforcing our reputation as a reputable, reliable, and trusted partner for our clients and employees. Equally important has been my commitment to providing greater clarity and transparency to shareholders and key stakeholders. I recognize the importance of gathering all of the facts, understanding the context and outlining a clear and strategic path forward. Second, we made a commitment to all of our employees and clients. to provide them with a safe and stable workplace. This is vital to building a company that can sustain itself while delivering maximum value to our stakeholders. These goals required tough decisions, but what has truly inspired me is the unwavering dedication of our team. Individuals who have sacrificed personal time, taken on additional workloads, and embraced discipline to create cost-effective solutions It's both an honor and a privilege to lead this remarkable group. I want to note, for IRFS purposes, we are required to report that Blue Water is a discontinued operation. However, we continue to maintain 100% control, and it remains entirely under our management, and until that time, 100% under Boxter. All of the numbers and forecasts that I'll be sharing today include Blue Waters revenue, expenses, dedication, and associated management initiatives as our path forward. In the last 90 days, some of our key accomplishments. Let me outline some of the critical steps that we've taken to realign Boxster to its true potential. Number one, we focused on profitability. we shut down all projects and initiatives that did not generate revenue or had less than an 80% probability of doing so in the next 12 months. This initiative included over six business lines under previous management and control. Furthermore, we separated our products from individual business units to remove any and all conflicts of interest to ensure that our solutions remain impartial and client-focused. Number two, We streamlined operations. We continued consolidating corporate resources and conducting regular reviews of critical vendors to optimize our performance and our costs. By fostering synergies across business lines, we started breaking down the internal silos. Our business units no longer compete with one another or our clients. Instead, we leverage a collaborative and collective experience, talent, and contacts to empower growth and drive results. Mitigated liabilities, number three. To date, we have successfully resolved, settled, and mitigated serious threats to the business without compromising our integrity. Our legal team has worked diligently to find alignment with even our fiercest adversaries, ensuring our vision of unity and stability remains intact. Number four, cost optimization. We've identified and began reducing our third quarter monthly operating expenses by approximately 800,000 a month once all changes have been realized. Now I'm going to go over some internal projections that I've been using to track results within the company. I want to make note, all of my numbers include Bluewater. They are all in CAD. This also goes against my DNA, which is reporting or somehow suggesting forecasted numbers that have not occurred yet. All of the numbers that I am about to present to you are numbers that I personally have line of sight on and include Bluewater as a continued operation in 2025. In 2024, I'm forecasting a total gross profit of approximately 25 to 28.3 million. In 2025, if we maintain a gross profit of approximately 25 to 28, and we achieve a 11 to 15% growth rate from current signed SOWs and first quarter 2025 targeted initiatives, our gross profit will reach approximately 30.3 to 33 million. With our expenses under $26.6 million, once all changes are in place, Voxer would be on track to achieve EBITDA positivity, ensuring sufficient working capital for debt service. Now, this upside potential, this shift in our title business strategy from our service-focused model to technology-driven approach has created challenges. Exciting opportunities for growth and profitability in 2025. This includes the launch of Voxter Rate Advisor, an innovative and first-of-its-kind platform for the industry. Again, these projections are based only on our core products and do not account for any upside revenue from our new offerings, such as Voxter Rate Advisor, Voxter Verify, Voxter Direct, which now includes a management of AMCs, lean monitoring and or bundling products that we are anticipating on doing in 2025. These products show tremendous promise but require much more data for me to provide you with a reliable forecast. Additionally, as competitors contract, we anticipate material increases in our volume from our organic and per click products, further strengthening our position in the marketplace for 2025. In closing, I want to emphasize that while identifying problems is straightforward, executing solution requires trust, discipline, and timing. The progress we've made in the last 90 days is a foundation for a stronger, leaner, and more focused Boxster, one that is positioned for sustained profitability and growth. I am deeply grateful for all of our employees for their tireless efforts and to our clients and shareholders for their patience and their trust. Together, we are building a Voxter that is aligned, resilient, and ready to meet the challenges of tomorrow. Thank you, and I'll open the floor for questions.