Welcome to MustGrow Biologics Q2 2026 earnings call with CEO Corey Giasson and COO Colin Bletsky. The financial statements and management discussion and analysis are available on SEDAR+. Today's remarks may contain forward-looking statements. These statements involve known and unknown risks and uncertainties. Please refer to MustGrow's filings on SEDAR+ for more information. After management's remarks, we will open the call for questions. Participants may submit questions in the question- and- answer window. Welcome, gentlemen, and please begin your presentation. Thank you, Martin. Good afternoon, everyone, and welcome to MustGrow's Q2 2026 earnings call and Q&A session. Before I begin, I'd like to draw your attention to our disclaimer. Forward-looking statements are going to be made in this presentation and in the Q&A session at the end. Again, some of these statements will not come to fruition. This disclaimer can be read on our website at mustgrow.ca. Last week we announced the Q2 2026 results. TerraSante sales revenue for the quarter was CAD 75,000. Gross profit was a gross loss, negative margin of about CAD 17,000. That was due to us shipping product from Asia through air freight into the U.S. and it's quite costly, as you can see. Licensing revenue. We were able to report in Q2 that we had earned licensing revenue of about CAD 1.4 million, and we made the announcement a couple of weeks ago that we'd received that portion of the cash. So in the Q2 financial statements, it reads as in accounts receivable. Our expenses continue to normalize without NexusBioAg, with about CAD 900,000 quarterly of expenses. Net profit, which includes the discontinued operations of NexusBioAg, we had a profit of about CAD 300,000 versus a loss of about CAD 1.1 million in Q2 of 2025. We have a strong cash position now, with the capital raise that we completed in June. We're sitting on cash at the end of the quarter of about CAD 4.4 million and a working capital of CAD 5.2 million. Some comments on the results for 2026. Again, as we indicated in Q1's call in May that we expected the first half of the year's sales to be slower than expected. This is due to manufacturing, specifically manufacturing issues. The new plants that have been brought online, they're having some hiccups and not being able to produce enough product in a timely fashion for us to get into the market. That's why we were focused on some of the product that they were able to produce, to utilize air freight to get it into the market in time. But we are starting to see some improvements in terms of manufacturing, and we did announce in this latest earnings news release sent out on Thursday that as of August 15th of this year-to-date sales are about CAD 900,000, which is up about 46% compared to all of 2025. So we are starting to see some improvements in manufacturing. As we go forward, air freight being as costly as it is, we're looking to move the rest of the product for the remainder of the year and into 2027 with ocean freight, which we should start to see our margins improve back to where we've seen in Q1 of about 24% and potentially better. Going forward, our focus is to drive TerraSante sales. We continue to see an uptick in demand, and Colin will get into some of that in the Q&A session. We need to be able to have our manufacturers produce enough product in a timely manner for us to get the product into the market, and we're starting to see them do that. I'm very confident that they're going to continue to see improvements in manufacturing, and we are also assessing opportunities to supplement production here in Canada and potentially the U.S. We've seen a strong start to the second half of the year, as you've seen over CAD 900,000 or about approximately CAD 900,000 of sales year to date, and we expect the remaining four months of 2026 and going into 2027 to be even stronger. We're excited to receive our first milestone payment from Bayer. This continues to validate the efficacy of our technology and the need for it in the market, and we look forward to working with Bayer going forward, working our way towards doing the work and completing the tasks required for our second milestone payment. On that, I thought I'd go into just a reminder of what the Bayer commercial license is and what is around it and kind of the going forward with it. As you remember, back in 2023, we did sign a commercial exclusive agreement with Bayer for the biopesticide and bioherbicide, and that was all focused around Europe, Africa, and Middle East. We don't need to really go into the why. The why still remains. European Union specifically and the regions around it are moving away from the synthetic chemistries. It's harder for a lot of these large organizations to get the registrations in place and get some of the synthetic chemicals and fertilizers into those markets. The need is growing and continues to grow within that region right across where Bayer's working. When we look at the commitment from Bayer, we always estimate as MustGrow that they'll be investing anywhere from CAD 35 million- CAD 40 million to get that product registered. Right from day one, there was not a chance that we can go into that market without the regulatory expertise, without the investment, without the boots on the ground to really access that marketplace. When we look at what Bayer is potentially spending from R&D, market development, and then into the milestones, it is going to be between that CAD 35 million- CAD 40 million mark, potentially through that period. Once we move to sales, once the product's registered after the registration process, that's when we'll move into more of a royalty and a cost-plus on the active ingredient. Bayer continues to move this forward, and I'll go through that a little bit later, but we're very excited about the first milestone. We're very excited to hit those technical advancements and really start driving this product to that next stage of registration and more market development, and really looking at working with them and excited to work with them in the next three to seven years. If you look at the size of that market, it is a significant opportunity for us, right across Europe, Africa, and Middle East. Just a small amount of market share could generate a significant amount of dollars. Remember, Bayer would not be taking this forward if the product didn't work, if we weren't seeing efficacy, if they weren't able to get around some of these technical challenges and questions, but also they have to be profitable. Taking them and having them take this forward is very exciting for us. In terms of our pipeline, not a lot has changed since our previous call back in May. Again, our focus remains on driving TerraSante sales in the U.S. We think that this is a massive market, a massive opportunity. It's up to us to be able to generate the product, to be able to have the manufacturers manufacture that product and get it into the market in a timely manner so that we can move this company into positive cash flows and continue to grow it from there. The U.S. is really key for us. We are also, as I mentioned before, supplementing or looking to supplement TerraSante sales in other markets potentially. This is going to take on-farm testing, which we're doing here right now, and with positive results and identifying an economic need for this product in the market, we'll be looking to do the initial ramp-up, just as what we've done in California, for instance, starting a few years ago now. In terms of our biocontrol, TerraMG in Canada and the U.S., not much has changed here. We continue to work with the EPA and the PMRA. You will take note in our financial statements, in the income statement, that we are spending less and less on regulatory work. Part of it's a wait-and-see type of period, and part of it is that we want to also make sure that we're driving cash to be able to generate those sales of TerraSante, which again, is going to get us the positive cash flows. I will not comment any more on Bayer. Colin covered that very well in the last slide. In terms of our capital structure, we have 70 million shares outstanding, about 92 million fully diluted. We have seen this count grow over the last few years as we have raised some much-needed capital. We are sitting in a very comfortable cash position right now, and I believe if we are able to execute on manufacturing and selling this product into the market in a timely manner, our goal is still that we will be positive cash flows next year in 2027. So we are well on our way to do that, and we are fortunate to have manufacturers in Asia. It is typical to have hiccups when you bring new equipment online. We understand some of these hiccups. We have been working with them. We are fortunate to have them invest their own capital to go and do this work and be able to produce product for us now and into the future. It allows us not to have to spend tens of millions of dollars to go and develop a plant. We are also excited with some of the discussions we have had with some of these manufacturers is that not only do they want to be able to hit their targets right now in terms of production, but they want to continue to grow with us as we need more and more product in the future. So I think we have got some very good partners that we have in terms of manufacturing, and I am looking forward to us being able to hit those manufacturing numbers so that we can really start driving sales and work this company into positive cash flow and beyond. With that, Martin, that is the presentation, and I would like to open up to Q&A. All right. Thank you, gentlemen. We will now take questions from the audience. We have received numerous by email already. Please submit questions into the question- and- answer window, and they will be addressed. First question, what kind of milestone was achieved for TerraMG with Bayer, and will there be a next milestone? Martin, as I said, those were based on technical achievements and both technical on efficacy in field, but also on application. And one of the key criteria is not only about having a product that actually works, but it is having a product that can go through the typical farm systems that are used in that region. And when you look at what is happening in Italy and Spain, with different types of equipment than in some parts of the U.S., a big part of that milestone was based on those technical achievements. On that, and then we are very hopeful and the potential milestone for 2027, we do believe we are well on our way for that milestone, but we also have to work through a lot of different meetings, a lot of different things with Bayer over the next course of the year. I think you have addressed this already, but is there a realistic chance of achieving additional Bayer-related milestones in 2027? Yeah, and as I said, the potential is there and the opportunity is there. I believe, with the diligence that we are working with Bayer, hopefully within 2027, we will see an additional milestone. Can you quantify the current production capacity for TerraSante? Are the newly commissioned production lines already operating at full capacity? Yeah. Based on the existing lines that have been put in place, I estimate there could be potentially CAD 15 million-CAD 25 million of product being produced at nameplate capacity. No, they are not operating currently at full capacity. We have seen improvements, and I believe that we will get there. Are you now able to fully meet customer demand, or are you still experiencing periods of being sold out? Yeah, we are still experiencing periods of being sold out. We have an existing PO that we need to go and deliver on, so we are waiting on some product. Our objective here is to fully meet customer demand and then be able to build up inventories, specifically for the end of the year so that we can hit the beginning of Q1 hard with sales. You mentioned additional production capacity in Canada. How is total TerraSante production capacity currently distributed between your facilities in Asia and Canada? Are all of them running dedicated for TerraSante? Well, all of our production is currently out of Asia. We have two producers in Asia, one in Thailand, one in India. One of the facilities is 100% dedication to TerraSante. The other facility, I'd say, is about 80%-90% dedication to TerraSante. They do need to produce another product for a month or two over a particular period of time, and I've taken that all into account in terms of the expected nameplate capacity. So for the one facility where we don't have 100% availability, I've taken into account the months that they will be down. Are you scaling production based on actual customer purchase orders in order to avoid building excess inventory? Well, right now, we're just trying to meet demand. Our whole goal is to. We will be carrying inventory in the future. If we can get our manufacturing up to a level, there will be inventory carried in the future, which again, is a good thing because we have seen unexpected demand creep up in that, and we want to be able to not only sell to existing customer base, but any orders that aren't anticipated, we want to be able to supply those as well. Can you provide insight into TerraSante's seasonality and how demand would typically fluctuate throughout the year? Yeah, and right now, Martin, it is sold out or sold throughout the year, depending on the type of application method that is going on. There is pre-plant going on, but also in-season applications. When I look at the, I would say, the two heavy areas would be Q4 and then Q1. Q4 typically would be around the strawberry, specifically strawberry and vegetable production in Southern U.S., specifically California. Then Q1 is also strawberries, other berries, but potatoes, and that is when you would see potatoes come online, specifically in the Pacific Northwest. As the U.S. as a whole right now, it is spread out across the entire year. But the bulk of it would be a Q4/Q1 heavy timeframe, just based on the crop plantings. How has demand for TerraSante developed compared to 2025? Are you seeing stronger order volumes from more repeat customers or expansion into new regions? Yeah, and as Corey mentioned, and part of the, I guess, the release was the increase of over 40% already for TerraSante sales in 2026 versus full year 2025. Now, most of that product has actually gone to repeat customers. We have to satisfy those needs first. As Corey mentioned, we are still in a sold-out position, and as soon as we get product in, it is gone. So most of that is going to existing customers who are expanding acres. As I always said, farmers will use a little bit and then continually expand over time. We have now branched out and are selling into some other new customers, which is great to expand that some more. But for the most part, the bulk of the sales are still coming out of strawberries, still coming out of California, and then also into potatoes. So those are the two main crops for us right now. But we have seen a lot of good growth with existing customers who have used the product now for, in some cases, one year, in some cases, two years. Are you selling directly to those farmers, or is it being sold to distribution companies who then move it on to the farmer customers themselves? Yeah, we go through distribution. You need to work with the right professional agronomists and the right distribution chain to do so. I could say, we've been open about this, but we've had extremely strong support from Nutrien, specifically looking in that California region. They've been tremendous partners for us, driving that demand with their key customers. So everything we do in that sense is through distribution, and that's how we will continue to go forward. I think you've addressed much of this, but with this question. Which regions or crop markets are currently generating the highest TerraSante sales? Yeah, it is strawberries and potatoes, and I would say the one key thing that we're seeing is very good yield response in both those crops compared to synthetic fertilizers and actually the synthetic systems that those growers are using. So we're seeing that growth head-to-head versus our targets. The strawberry market, is that primarily California, or is that in the Southeast as well, or other southern states? Yeah, California is the biggest driver of it right now. We are looking and driving some new field trials and testing in Florida. The two key markets for strawberries would be California and into Florida. Once we look at potatoes, like I said, that's more Northwest. If you go into fruit and veg or other vegetables, that's still a very dominant California market. How much improvement in gross margins do you expect now that you are transitioning from air freight to more economical ocean freight? What are delivery times with ocean? Yeah. In terms of gross margin improvements, in Q1, we had about 24% gross margin. I expect to see us going back to that 25%-30%, 40% range. It all depends on some of the costs, such as ocean freight at the time. We have seen ocean freight rates spike up during the Iran war. In terms of delivery times, we're looking at about six weeks on ocean freight. So that 25% would be at full production capacity? No, it is not at full production capacity, no. Can you estimate what gross margins would be when you are running at full production? Well, we have got agreements with our partners in terms of the costs and purchase orders that we put in for the product. The more efficient that they get in terms of their production, and we have seen their efficiency starting to increase, it means that their costs are going to go down and that. And that is a good thing for them because, with the low rates that they have been producing at, it could be quite costly for them in terms of their margins. What are the next steps in the regulatory process for TerraMG and your other biocontrol technologies? Well, in terms of the PMRA, I will let Colin comment on that. But in terms of the EPA in the U.S., we are in a wait-and-see period here right now. Again, we have not been spending very much money there because we have not had to. When we get an idea and a sense of where the EPA is at and what our next steps would be, we will have to assess. If it is going to cost more capital for us to do that, we will have to assess, do we want to be driving capital there versus TerraSante sales? If not, well, hopefully if not, we do not have to spend any more money in this area. We look forward to receiving our registration. In terms of a timeline with the EPA, it is hard to say. Yeah. Martin, in Canada, we are addressing one data need that we are putting forward this fall. We hope to have that soon. With the European Union, in Bayer's area, Bayer continually works towards that registration process across the EU27 and their other regions. Looking at other parts of the world, we continually assess other markets and seeing what would be the best route to market and with who in other areas such as Asia, Latin America, et c. When do you expect TerraSante to be available in Europe? Yeah. As of right now, we are doing testing in Europe, specifically looking in flowers in the Netherlands. We have to wait for that process and that data to come through before we can then make the next step of working with the right partner and the other partners. Flowers is not part of the Bayer agreement, so we do have freedom to work in that area, and Netherlands being a very large opportunity. It is going to depend on the country, depending on the data, depending on the crop as well. But we are hopeful that we will be getting a lot of those answers here at the end of 2026 and then really figuring out a plan as to when for TerraSante and where else we will go with it. For TerraSante, you are gaining or you have gotten a lot of action from the potato and the strawberry markets. Are you working on research to validate the efficacy and value in other crops? Yeah, we are, Martin. With TerraSante, with TerraMG, both of those products are crop agnostic. We can work in many different crops. It all comes down to the dose, the timing, and the application. The one difference between something like vegetables versus strawberries is the value at a farm gate level. So we have to then work through different dose. But we continually look, leafy greens, tomatoes. We are looking in other berries, even down to the point of looking into specific row crops as well, just to continue that expansion. But it all comes down to you need to get the right value at the right time for that farmer, and that is where we have to work through some of those key different metrics. With over 100 patents in hand, could some of those be sold for cash? Yeah. I guess, we have about 110 patents here right now. We think there is better value for us keeping these patents right now and moving our technologies into commercialization and scale up, because there will be a lot more value for those patents down the road as we execute on commercialization. What level of exposure to U.S. tariffs do your customers in the U.S. have, and what, if any, impact do you expect them to have on go forward sales? Yeah. Well, in terms of tariffs, so far, our product, as it sits here right now, our product being a biofertility product coming out of Asia, we are not seeing any tariffs. But again, that could change at any time. Even if we- Yeah. ...were producing products here in Canada, and exporting to the U.S., I believe being a biofertility product, it would be not under the new 50% tariffs that are expected here. Has the EU changed their biopesticides approval times to be more of a fast-track process? They talk about it, Martin, but they have not clarified or changed the registration or regulations in that sense yet. There are still, like I said, discussions about utilizing natural products like ours to drive that and go faster. But every regulatory body, I think, on this globe says that they want to be fast, but they never are. It just takes time. It's government, and that's something we just have to deal with. What will your pricing policy be once production is meeting demand? In the marketplace right now for TerraSante, we are in a good sweet spot to drive that growth. It is a profitable product for us in that sense and in those areas. My mindset would be that we maintain our pricing, we maintain driving the value, showing the value at a farm gate level, and showing that value to the producers. Getting more product on the ground, getting more users, getting more turnover is going to benefit us over the long time. Looking at a lot of the market sentiment right now, specifically in the U.S., fruit and vegetable growers are having a tough time. To do a long-term price increase or pricing strategy with TerraSante right now just wouldn't be feasible. My goal would be to continue to look, continue to adjust and look at the marketplace, see what's possible. The first priority is to increase sales and get more product on the ground and get more users utilizing TerraSante so we can continue that growth curve. Have you started the registration in more states? As of right now, we have a number of different states and new ones that we just announced. There are a few key other states that I would like to get into just based on demand. I would say first priority is to get the product placed and put into the marketplace as quickly as we can, number one. But number two is continue the growth curve, in the key regions, and I would say those key regions would be Pacific Northwest, California, and Florida. In my mind, there's no use getting more states when we don't have enough boots on the ground. I'd rather focus and get these other areas right first. Then we could look at additional states based on demand and based on priority. You said flowers are not part of the Bayer agreement. Is TerraSante also covered in the Bayer agreement? It is. Our technologies are covered in that Bayer agreement. We will continue to work with Bayer to see how and where we would take TerraSante into the marketplace in those regions. But the first goal would be to get it into something like flowers where we have freedom to operate, show the demand, get the growth, get the data, and drive that. Flowers are a tremendous value crop, and if you look at the Netherlands alone, there is roughly 28,000 hectares of flowers in the Netherlands. So it is a very large opportunity. First is to focus on there. Second would be then to look at where else can we go with TerraSante and TerraMG with Bayer within their region, and pick out those key countries. Can you make a comment to the current share price? Yeah. We have seen our share price down over the last year or so. We are shareholders in this company, and it is not that we do not notice it, but we know how we can see an appreciating share price, and that is going to be generating sales of TerraSante, and moving the company into positive cash flows, showing the growth. That is our focus and that is where we are headed. Does Bayer also support work on TerraSante already and is working towards registration, or has all the work been on the TerraMG? Yeah. All the work with Bayer right now is on TerraMG. TerraSante is, I would say, a potential upside for both organizations. I will be meeting with them, coming up in October, to go through potential next steps. But when you look at a large agricultural chemical company like Bayer, having TerraMG in the marketplace first is something that they want to do first and foremost. They do see TerraSante, though, as a potential upside, but we have to work through a number of different things with it to see the right place, the right time, and where it has a good fit. Given they are both with the same core technology from the mustard seed, getting approval for the TerraMG, would that facilitate or potentially accelerate an approval process for TerraSante in Europe? No. They are two separate products, with separate claims, with separate formulations, separate targets. The answer would be no. It is two different systems. The biocontrol system versus biofertility and biostimulant is different, but it does come down to a country-level discussion than with biofertility products. Biocontrol, you work through the whole EU27, where with biofertility, it is more a country-level basis discussion. So it is just really about understanding where those opportunities are and where the fit is, and where growers are having a desperate need right now. But like I said, we will be working through that to get a better understanding and really see where we can drive that growth with Bayer. Thank you. There are no further questions. This concludes today's call. Thank you for joining us, everyone.