Good morning, ladies and gentlemen, and welcome to the Baylin Technologies Second Quarter 2025 Financial Results Conference Call. At this time, all lines are in a listen-only mode. If at any time during this call you require immediate assistance, please press star zero for the operator. This call is being recorded on Thursday, August 7th, 2025. I will now turn the call over to Kelly Myles, Director of Marketing and Investor Relations at Baylin Technologies. Please go ahead. Thank you. Hello and welcome, everyone. Thank you for joining the call this morning to review our Second Quarter 2025 Financial Results. On the call today from Baylin are Leighton Carroll, Chief Executive Officer, and Cliff Gary, Chief Financial Officer. We will be available for questions at the end of the presentation. Before we begin, let me make it clear that our comments today may include forward-looking statements and information, as well as answers to questions that could imply future expectations about the prospects and financial performance of the business for 2025 and beyond, and include the use of non-IFRS measures. These statements are subject to risks, uncertainties, and assumptions. Accordingly, actual performance could differ materially from statements made or information provided today, so you should not place undue reliance on them. We also do not intend to update forward-looking statements or information except as required by law. I ask that you read our legal disclaimers and explanation of the use of non-IFRS measures and refer you to the risks and assumptions outlined in our public disclosures. In particular, the sections entitled "Forward-Looking Statement" and "Risk Factors" in our Annual Information Form for the year ended December 31, 2024, and our other filings, which are available on SEDAR +. Our second quarter results were released after market close yesterday. The press release, financial statements, and MD&A are available on SEDAR +, as well as on our website at baylintech.com and otcmarkets.com. I would now like to turn the call over to Leighton. Thank you, Kelly. Good morning, everyone, and thank you for joining us today. I am pleased to report we delivered a very strong quarter with solid performance across all of our business units, with growth across revenue and profitability metrics. The results reflect the strategy we've employed, the strength of our diversified portfolio, disciplined execution, and continued focus on operational excellence. We'll walk you through the highlights of the quarter, provide some insight into what drove the performance across our businesses, and offer you perspective on the opportunities and challenges ahead. There are several points I do want to highlight, though. Net income of $1 million, an increase of $1.1 million over Q2 2024, and $3 million over Q1 of 2025. Gross profits increased $1.2 million over the second quarter of 2024, while revenue was only up $0.5 million. Gross margin of 46.3% compared to the second quarter of 2024 of 41.9%, a 4.4% increase achieved despite the modest increase in revenue. Adjusted EBITDA of $3.4 million, our sixth consecutive quarter and our highest since I started with the company. We also extended our borrowing facility with RBC to the end of 2026. With that, I'll now hand it over to Cliff Gary to walk through the financial information, after which I'll provide more color on the individual business units. Thank you, Leighton, and good morning, everyone. Prior to discussing the Quarter 2025 Results and Financial Position, I would like to address some important disclosures in our statements. The company has extended its credit facility with RBC to the end of January 2026, but consistent with our December 2024 and first quarter 2025 reporting, we have noted a material uncertainty related to growing concern arising from the outstanding court order for the return to the escrow agents of $1.8 million plus interest. We are continuing to work at resolving this issue. Let me walk you through our financial results for the second quarter of 2025 with comparisons to the prior year against ongoing operations as reported. The company's revenue increased $0.5 million or 1.9% to $22.5 million in the second quarter of 2025 compared to the prior year quarter. The increase was attributable to the sales volume increase in the Wireless Infrastructure business line, partially offset by softer revenue in the Embedded Antenna business line. Against a backdrop of the modest $0.5 million increase in revenue, the company's gross profits saw an increase of $1.2 million compared to the second quarter of 2024. The $1.2 million increase meant our gross margin increased 4.4%- to 46.3% in the second quarter of 2025 compared to the second quarter of 2024. A higher gross margin was driven by the increase in the Wireless Infrastructure business line, which had stronger revenue and a favorable product mix compared to the prior year period. Operating expenses increased slightly from $8.4 million in the second quarter of 2024 to $8.6 million in the same period this year. These factors contributed to a very solid adjusted EBITDA of $3.4 million for the second quarter of 2025 compared to $2.3 million for the second quarter of 2024. The company's operating income of $1.8 million for the second quarter of 2025 compares to an operating income of $0.8 million for the second quarter of 2024. Net income at $1 million for the second quarter of 2025 improved from the net loss of $0.1 million for the second quarter of 2024. Cash from operations was $0.2 million for the second quarter of 2025. This included a cash usage of $3.1 million for working capital and compares to the $0.4 million for the prior year's second quarter. Moving to results for the six months ended June 30th, 2025, the company's revenue was $41.3 million for the six months ended June 30th, 2025, compared to $42.1 million for the same period prior year. The decrease of $0.8 million or 1.8% being due to sales volume decreases in the Embedded Antenna and SATCOM business lines in the first half of 2025, partially offset by an increase in the Wireless Infrastructure business line. Despite the $0.8 million decrease in revenue, gross profit increased $1.4 million compared to the prior year's first six months. Gross margin was 44.5% compared to 40.3% in the same six months ended June 30th, 2024. Higher infrastructure volumes and a better product mix drove these improvements, which was consistent with what we witnessed in the second quarter. Operating costs for the first six months of 2025 were $17.8 million, a slight increase compared to the prior year's $17.5 million. Adjusted EBITDA for the first six months of 2025 was $4.1 million, increased from $2.7 million for the same period prior year. The strong second quarter resulted in an operating income of $0.6 million for the first six months of 2025, compared to the operating loss of $0.5 million for the prior year period. The company's first six months' net loss of $1 million compares to the net loss of $2.1 million from the prior year's continuing operations. For the first six months of 2025, the company generated $2.9 million of cash from operations compared to the prior year's $1.5 million use of cash. This cash was partly used to facilitate a reduction in our net debt position from $14.3 million at December 31st, 2024 to $12.9 million at the end of June 2025. With that, I'll now turn the call back to Leighton. Thank you, Cliff. The improvements in our business reflect what we've been working on over the past several years. Clear market-driven strategies, containing costs, prioritizing R&D and product mix, these things have led to both revenue growth and higher gross margins. At the same time, the macroeconomic environment has been, you know, well, bananas with a high level of uncertainty concerning the impact of U.S. tariffs, recalcitrant tariffs, changes in customer purchasing behavior driven by uncertainty over tariffs, as well as the overall level of inflation and interest rates. April was indeed a very challenging month for us given the constant changes in tariff regime. We expect to have a more tempered performance in the second half of the year as the SATCOM business line is seeing a slowdown in order intake, resulting in lower backlog. This is consistent with other satellite technology companies in the broader satellite market. Ironically, the bidding activity for our satellite business is at an all-time high, but delays in U.S. government funding cycles, and an easy way to describe this is think the big beautiful bill, which just recently passed, have had a bit of a cascading effect on buying behavior in that particular market. The Embedded Antenna business line continues to see changes in product mix, which interestingly enough led to slightly lower than planned revenue, but better gross margin and bottom line attainment. Product mix indeed was very good for the Embedded team this past quarter and certainly this year. The Wireless Infrastructure unit, that was really the place where I saw the greatest potential for growth when I joined, if we could get the strategy right and execute. While we have had a great quarter and are continuing to grow, that business always has some seasonality, particularly in the fourth quarter. We expect over the back half of the year it will be a little lower than the first half of the year, but it continues to exceed all of the plans that we have had for it and what we expected would happen this year, which is a great thing. A few other things to share there. We're in the process of commercializing a new derivative of our patented multibeam technology, and it's for a completely different use case that really does something meaningful for wireless carriers. Just through conversations and showing them some of the precursors of what we're doing and the concepts of the technology, we have no less than seven Tier 1 carriers asking for a trial this year. That means U.S., Canada, and Europe. That's a cool place to be. We do see some seasonality in our future and are looking forward to it. There forward to it. There is going to be seasonality. We know that. We are being very proactive in managing our underlying cost structure. I'm going to speak a little bit more about that later in the presentation. That said, I do remain very confident in our long-term strategy and expect the business to continue to grow well into the future. Let me talk about Wireless Infrastructure first. The Wireless Infrastructure business line, fantastic second quarter. In fact, I enjoy talking to the leadership and telling them they sandbag their plans, understanding that's tongue in cheek. We actually set the bar higher even after they grew very well in 2024. They actually grew 40% in 2024. We set the bar higher and they're ahead of that bar. It's kind of a neat place to be. We expect the demand for multibeams, small cells are now back, that they had not been around very much in terms of sales velocity in really late 2022, certainly 2023 and 2024, but we are seeing it come back and actually expect that to come back even stronger in 2026. We're doing very well in the stadium deployment space, and we continue to see good things out of this business. Multibeams are opening up new opportunities. To give you an example, we talk about multibeams, we talk about market expansion. I've made the comment before, you don't go to Europe and say, "Hey, my name's Leighton. I'm a nice guy. I'd like to sell you some antennas." They have people there. I don't know, Ericsson, Nokia, a few others. Good companies who know what they're doing. By having something that matters and is competitively differentiated and priced well, you can hit a sweet spot for those carriers who are solving use cases for them. We have three trials of our multibeam scheduled with top European carriers coming up this year in countries such as Germany, England, and Portugal. As I mentioned earlier, we have a patent-pending derivative coming. It's coming to market later this year. This is going to, in my opinion, be a nice thing for us in 2026, revenue attainment and growth within this business. I'm looking for further value there. Based on our current assessment, we expect the Wireless Infrastructure revenue in 2025 to exceed 2024, resulting in full-year financial performance comparable. I'm looking to actually hope for slightly better, but to 2024, which was already a great year for that business. The Embedded Antenna line did certainly experience higher revenue in Q2 compared to Q1 of 2025, but this was lower than Q2 of 2024, due largely to changes in customer demand as a result of fluctuations. There was a lot of back and forth with our customers as the tariffs were coming out, back and forth, reciprocal component tariffs. Understand, a lot of our customers, they're not manufacturing in North America. The people who we deal with who do the manufacturing of the end product for a lot of our customers, they are manufacturing overseas, and a lot of them, they're called ODMs. They are operating at reasonably thin margins, so tariffs to them can have a super material impact. You can kind of understand how there's a collateral impact into this business and has changed some of the customer buying behavior. I feel like we've handled it very well. In fact, we've actually been able, because of product mix, to improve our gross margin% on a relative basis and deliver nice results. We expect the second half of 2024 revenue to be lower than the first half and for the full year slightly lower than 2024. The nice part is our backlog remains strong. A lot of this business we believe will have moved to the right, and we do see this business continuing to be very resilient for us. The SATCOM business line had an extremely strong second quarter, which included a shipment of a large solid-state power amplifier program for a U.S. Department of Defense application that was delayed from the first quarter. It is currently experiencing lower intake, and we've kind of seen that throughout Q1, Q2. We're now dealing with a reduced backlog. We do see this as being cyclical and, in other cases, delays in customer programs. As an example, the large U.S. Department of Defense application I mentioned, it's programmatic, meaning we are the standard of that. We do not expect fresh orders for this program, for example, in Q3. My guess is it'll be Q4 or Q1 of 2026. This is a multi-year, multi-million dollar upgrade initiative that we built in Quebec that is going to continue. We're going to have a nice business. In contrast, the number of active bids, while our backlog is down and we're dealing with a cyclical challenge, the number of active bids we have is at an all-time high, which is interesting. The market is there. We expect order flow-through to start to materialize as we get later in the year, setting us up to have this business in a stronger level of performance in 2026, certainly to 2025. I do expect revenue in this business line in 2025 to have lower revenue than in 2024. You have lower revenue and lower revenue really in the back half of the year. This would imply we're looking to streamline the business and reduce costs as we align our production with what we expect in terms of revenue flow. I kind of touched on tariffs, but I did want to take a moment and talk about this because it is, you know, from April forward, it doesn't stop, right? I mean, I even saw this morning, Trump is saying that he wants to talk to and negotiate COSMA all over again with the Canadian government. That's going to be important for us to follow and watch and react to, right? We can't control that, but everybody has to deal with this type of stuff. The changes in volatility, it doesn't go away. We just have to deal with that. We've been very proactive in taking steps to mitigate the tariffs across all of our business line. In fact, I want to thank the teams in Canada, the U.S., and China for their tireless work on mitigating. As one would notice from our gross margin attainment, particularly for Q2, when all of the tariffs were going in, there's all this uncertainty. I am legitimately confident. I've talked to many other CEOs about this. We did a very good job of managing tariffs. We worked with our auditors on some things. We worked with customers. In some cases, for certain product lines, we were actually able to get price increases and rebalance pricing to help us deal with that. I'm very proud of what the entire team has done and how we've handled that. From a macro perspective, we see the business continuing, see the business coming out of what I would call a historically low spending cycle, particularly for Wireless Infrastructure in 2024 and where that market was. We see further improvement as we get to 2026. In addition to organic growth, we have been spending time evaluating several M&A opportunities as a means to drive further growth, but we're only going to do that if it's going to be beneficial to shareholders. Creating shareholder value is a key litmus test for us and for me personally if we're going to do this. By the way, we have walked away from opportunities to do M&A already at Baylin because it wasn't the right value. It wasn't going to be the right fit for our business. We're going to continue to look at it. It's going to be something that we'll talk about in our go-forward strategy, but it's not something we're going to do unless I think it's going to help us deliver real value to our shareholders. As Baylin moves forward, look, I'm proud of a team. We continue to be disciplined. We're lean, and we really focus on our customers' needs. By focusing on growth and building our business, not for the quarter, but to the long term, I really am excited about the future for our employees, our customers, and our investors. In closing Q2, we managed to do some seemingly ever-changing tariffs, geopolitical shifts, and obviously, in some cases, changes in customer purchasing behavior to deliver such fantastic operating results in what has to be described as a difficult environment. It is a testament to the resiliency of our employees and the structures we put in place. Over the past few years, we've been focusing on getting smarter, leaner, and getting both the culture and strategy right. Both of those matter greatly. This has allowed us to mitigate the impact of tariffs while continuing to grow. While we remain encouraged by our momentum, we are also approaching the second half of the year with appropriate caution and focus. We expect softer conditions for some of the businesses in coming quarters, and we are going to actively manage the business to respond effectively. That said, I remain confident in our long-term positioning and our ability to navigate near-term challenges while continuing to create value for shareholders. Thank you for those of you who are here on the call and your continued support. We look forward to keeping you updated on our progress in the quarters ahead and looking for some more good things out of these businesses. It really has been. I've been, I had my four-year anniversary since joining the company in June. While I reflect on that, how hard it was when I got here, how challenging it was, what we have been through, and to see the results of where we are now, I cannot thank the teams, the customers, our suppliers for their continued confidence in us. I need to thank our investors for having our back and giving us the runway to be able to turn this business. I am super happy with the financial results. We're very open and honest about what comes ahead. I'm really looking forward to the next four years. With that, that ends our formal remarks. Operator, please take questions. Thank you, ladies and gentlemen. We will now begin the question and answer session. To have a question, please press the star followed by the one on a touch-tone phone. If you wish to cancel your request, please press the star followed by the two. If you're using a speakerphone, please lift the handset before pressing any keys. Once again, that is star one should you wish to ask a question. Our first question is from Thomas Hui from Paradigm Capital. Your line is now open. Hi, Leighton. Congratulations on the quarter here. Very strong results on the profitability. I was wondering if you can walk us through some of the moving parts on the adjusted EBITDA, especially given some of the performance in the segments here, and if we can expect a similar level going forward. Yeah, so with respect to Q2, I mean, all three business lines, nice operating EBITDA. Wireless Infrastructure continues to knock the cover off the ball, so to speak. The SATCOM business had a nice quarter, and the Embedded Antenna business had a nice quarter. It was reasonably uniform, but on a relative revenue basis, Wireless Infrastructure, which has been our growth engine, we expect to continue to be, it is generating the highest on a relative basis and see that being good for our future. Now, having said that, you know, we did talk about seasonality. As we go to Q3 to Q4, do expect we're going to see a lower attainment out of the Satcom business in Q3 to Q4. It's just, you know, the Embedded Antenna business and the Wireless Infrastructure business, they are both, you know, typically reasonable Q3s and then absolutely seasonality as you get into Q4 and the holiday season. A lot of people have already bought materials and products to get things out. The embedded team, for certain things, they will have a build through the first half of the year. In Q4, there's holiday selling and promotions from our end customers. You kind of have this seasonality dynamic. I would expect the second half to have lower attainment than the first half, without question. That's relatively normal in our business. That's part, I think, why we also wanted to talk a little bit about how we see things going as we get into 2026, because the order book, the pipeline of opportunities continues to expand. SATCOM, even though I'm absolutely, I am confident in saying we're going to have a lower second half within that business, we've never had the bid pipeline that we have right now. We continue to win at the historical rates that we have. I like the direction of where we're going for the long term. Hopefully, that answered your question. Yeah, that's a good color. Thank you for that. I definitely understood the point on seasonality here, but you know, given the improvements in the revenue mix, the higher margin revenue mix, I was wondering, for especially the second half, is there sort of a, now how does that compare to the second half of last year on the gross profit line and as well as EBITDA? Good question. I'm just trying to go through numbers in the back of my head here. I think our second half of this year, particularly on the operating EBITDA, will be slightly lower than or it will be lower than last year. I say that in particularly infrastructure that continues to grow and exceed expectations. I do think it will be lower. I think from a full year, the results are going to be reasonably comparable on what I would actually expect to be lower revenue in total and then coming positive again in terms of overall growth as we get into 2026. I think that's a fair way to put it. Okay, that's great. I guess my next question would be on sort of the M&A that you mentioned. Will it be sort of strategic? Are you looking at competitors? Any color on that would be great. Yeah, so one of the things that I think about is I want to expand the resiliency of our business, right? If you go back to 2024, we needed to divest the mobile business. It was low intellectual property, low pricing, or low commercial power. All the power was with the customer. At that point, Samsung was the largest customer of said business. You were competing on price and then trying to get volume. That's not going to be, particularly for what we're trying to build, a high-quality business. We will look at things that are going to be, if you think about what our core DNA is, our business is basically predicated around RF engineering capabilities and RF products that matter, right? Getting the commercial strategy right. When I talk about resiliency, do I want to buy an apple to bring it in and pair it with another apple when it may be better to have an apple and a pear? Things that are adjacent have additional durable revenue streams. By the way, as you build a business and you think about building resiliency, I think about building a foundation. Boring makes money. Boring makes money. That's a great place to be. If we pick up things that are adjacent but rhyme with what we do, where there are clear opportunities for synergy, cross-selling, customer, and market expansion at a reasonable value, that's a type of thing that will be interesting for us. Add additional capabilities, additional customers, additional revenue streams with the opportunity to cross-sell and uplift the entire business. Strategically, that's how I would generally think about approaching an acquisition. I've done this a few times. When you go through and you look at acquisitions, it's a bit like dating. You go out once, it's like, no, that's not for me. You go out a few times and you figure, okay, that's not really going to be a great strategic fit. You do the no, no, it's not you, it's me. I still think you're a pretty thing. We still want to be friends. Then you finally find the one that makes sense. That's when you execute. It's kind of funny. I've always thought of this kind of cycle as you're going through and evaluating and doing M&A. It's a bit like dating and finding the one that really makes sense for you and then finally getting married. We are going to effectively take that same approach and we are only looking for things that are going to add capabilities for our company and drive shareholder value. That's a great color as well. I guess one last one for me. As we look forward to 2026, hopefully some of this tariff noise would be a little bit more cleared out and the macro clears out as well. You also mentioned some strong demand in wireless especially. Maybe you can just walk through the levels that we're hoping to see in 2026 and how that compares to maybe this year and 2024 as well. Thanks. Yeah, I mean, it's still early. We have done some preliminary looks at where we think the businesses will be. Wireless Infrastructure is a bit of the wild card because without any new product, you know, I mentioned we have something that we're ready to commercialize that's a derivative of technology. That is true. If we just stayed within that kind of the portfolio of what we're doing now and the product development within that without a new thread, Wireless Infrastructure will continue to grow. We've got good demand. We're getting into new customer markets, getting into this many trials in the EU. It's a cool thing, right? The newer technology coming out, that's the wild card. If we get that right, we have to get the commercials right. That has the potential to be a higher volume and product. If I have to sacrifice some margin to get a ton of volume and the final number is, you know, an order of magnitude bigger, I don't have to be a rocket scientist to know that that's probably the right decision. We are expecting Infrastructure to grow again next year. We're actually expecting the company to grow. It should, in my opinion, outperform 2024 and 2025. I can't give you a sense of magnitude because we have some things cooking that are interesting. Okay, great. As we look in the aggregate in 2026, if the volumes come, can we expect maybe similar levels in the first half of this year? I know it's early days, but any color would be great. I'll pass the wand. Yeah, if I could control the U.S. administration, I would say yes, absolutely. We're going to, I mean, the problem is there's a ton of uncertainty in this market. Right now, with how things are playing out, I expect the first half of 2026 to rhyme with the first half of 2025 or be stronger. I would say the back half of 2026 should absolutely be stronger than the back half of 2025 that we anticipate, yielding an overall better year for us. There's a lot of moving parts and we have a lot of work to do to attain that. Thank you. Thank you. There are no further questions at this time. Please proceed. Okay. I appreciate it. I know there was a second analyst who was going to join us and unfortunately had a hard conflict. We're actually, I think we're speaking to him at 11:00 A.M. today. Very happy for Baylin. I'm very happy for our team to have this sense of accomplishment. I just wrap it up by saying thank you for being here and thank you for our employees for working so hard with me over these past four years to make this a reality. With that, I think we can wrap the call. Thank you, guys. Thank you, ladies and gentlemen. The conference has now ended. Thank you all for joining. You may all disconnect your lines.