Thank you for standing by. This is the conference operator. Welcome to the Mimi's Rock Corp. Year-End 2021 and Q1 2022 Results Conference Call. As a reminder, all participants are in listen-only mode, and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. To join the question queue, you may press star then one on your telephone keypad. Should you need assistance during the conference call, you may signal an operator by pressing star and zero. I would now like to turn the conference over to David Kohler, CEO with Mimi's Rock Corp. Please go ahead. Thanks very much, Cherish. Good afternoon, everyone, or morning, depending on your time zone. Thank you for joining us on our combination 2021 year-end and Q1 2022 results call. It's obviously unusual to combine a year-end and a Q1 update. This is occurring today because of delays in filing our year-end, which has created an overlap in our reporting cycles. In fact, as we speak, we've now reached the conclusion of the Q2 period. We'd not only like to update you on our filings and give some indication of how things are currently trending. I think to lead off today, it makes sense for me to take a moment to explain the reasons for the delay and what has specifically happened to cause us to miss our original filing deadlines. Also noteworthy was that as a result of those misses on the filings, we were issued a cease trade order on our required documents, which has been in effect until now through the OSC. As we've explained in the press releases we published, our failure to file on time was a result of additional procedures required to provide assurance on inventory levels at third-party locations. These procedures were not considered necessary in prior period audits. However, as part of a regulatory review by the CPAB, which is the Canadian Public Accountability Board, our auditors were asked to perform additional work in 2021 to verify inventories held at third-party locations. The company holds the majority of its inventory at Amazon warehouses. This was a significant challenge. To be clear, the issue was one of verification. Since the inventory could not be physically observed, rather than anything to do with valuation or accuracy, there were no adjustments to the financial figures as a result of these additional procedures. As you may know, traditional inventory counting at period end has historically been used to confirm the amount and value of inventory at the end of a period. Unlike in the bricks and mortar world of yesteryear, where a crew of people would physically account for the inventory after hours. In the e-commerce ecosystem, inventory moves and transactions are occurring 24/7, 365 days a year, and accordingly, levels ebb and flow and are difficult to nail at a specific moment in time. To be clear, we have a tight handle on our inventory. We know exactly how much we have in production, exactly how much is in transit, and how much has arrived at the warehouses of our e-com partners. We can track and see the number of units we have in the system in real time, and we have sophisticated inventory tracking protocols to ensure we know what's happening with our goods. Despite this, as Amazon does not provide an audit report on their own controls, additional verification steps have to be taken. In order to independently support existence of third-party inventories, we had to reconstruct historical inventory reporting, relying only on purchase orders, shipping manifests, payments, and collection of information, et cetera, such that we could verify our inventory levels without counting on our trading partners' participation. This is now done, but the process took time. Ultimately, both the auditors and the regulators were satisfied with the methodology, which cleared the way for the approval of the audits. This disruption, as mentioned, did not require any restatement of previously released financial information. It did, however, cause Mimi's Rock's year-end filings to slip past the early May deadline. According to the OSC, they halted our stock until the reports could be filed. Q1 was also held back until year-end had been released. These are both now filed. We are up to date. We are in good stead with the OSC, and we're literally waiting for the administrative process from the exchange to see the trading resume, but there's nothing further required from our part, so we expect that to happen at any moment. We'll return the results we filed Monday in just a moment, but first I'd like to take some time to share some color on the ongoings at Mimi's Rock over the months since we last spoke with you. I'd also like to add a bit on what's happening in the broader e-commerce ecosystem as well. As most of you will know, Mimi's Rock owns and operates a number of online brands sold in various jurisdictions around the world, all via e-commerce. We have brands which are in the wellness space and include vitamin and supplements for human consumption, as well as skincare products. We sell these items in Canada, the United States, multiple European countries, as well as Australia, and through also partnerships in South Korea and now recently China. Our most recent market entry is Singapore, where we entered in May. Our strategy since we began the business was to scale through a combination of organic growth and strategic acquisitions as well. Recently, we've been focusing on organic growth and opening new portals in new geographies as the world has become more e-commerce focused. As you may recall from press releases, in the fall we announced the formation of a special committee of the board of directors. This committee continues to work with the board, management, and Bloom Burton & Co. to seek opportunities to enhance shareholder value. We've been working together to assess restructuring the balance sheet on a non-dilutive basis and looking at merger and acquisition opportunities both north and south of the border. We will update our stakeholders as appropriate as this file evolves. Moving to Q4 and our year-end filings, we reported that Q4 was a lackluster period. This is due in part to a number of issues. Firstly, we experienced the typical seasonal slowdown in product sales velocity, though they were slightly worse than expected due to the overall stalling broadly seen in the economy. Secondly, we also had a couple of products temporarily unavailable to sell via Amazon FBA, which stands for Fulfilled by Amazon. These also hurt our sales velocity. On these relatively rare occasions where products are temporarily unavailable for sale by FBA, we shift to an FBM model. FBM means Fulfilled by Merchant. This is something we do provisionally in those rare cases. As you would expect, FBM is slower than FBA, so it can cause sales to soften. As consumers who are used to ordering via Prime memberships and getting next-day delivery will sometimes decline an FBM option, which can see delivery taking several days. We've taken many steps which help mitigate these rare occasions and disruptions, like multiple pack sizes and product bundles, things of that nature. These are proving to be super effective, though unfortunately, we had some days in Q4 where we did have some important listings diminished for a number of days, which contributed to the slowdown. We also had to absorb a number of one-time non-recurring expenses in Q4, which were associated with the process we undertook via our special committee of the board. The review and contemplation of structural and M&A opportunities added some legal and accounting fees which were charged in the period. As calendar turned, we saw a general recovery and uptick in revenue. This was driven by aggressive new year period promotions and was buoyed by a significant number of price increases we took across our lines. We've seen inflation creeping into our supply chain and decided to get ahead of that. We're super pleased to see the strategy has been working. Strong volumes at new higher price points have begun to have a material impact. Margins are improving, sales are up, and Q1 was a great bounce back. Q2, which as I said, just recently finished, looks even better at this juncture. While we were unhappy with the results in Q4, we've seen a strong improvement since then, with revenues growing in Q1 by over CAD 1 million from the previous quarter to levels similar to Q1 of 2021. We suggest that EBITDA coming in 255% higher than Q1 of 2021. These material improvements in profitability were driven by operational efficiencies and the aforementioned price increases which we took. These price increases didn't negatively impact our sales and in fact, saw us reduce our COGS as a percentage of sales overall, thus producing 2.5x last year's EBITDA on similar volume. We've shifted away from discounting and are selling our products at or close to list price. We have instead been more focused on advertising. We are seeing increases in basket size and gross margin, and as our sales prices continue to climb, we're providing a nice shield from the inflationary pressures which are everywhere. Earlier this year, we conducted a full strategic review. It involved evaluating growth and expansion prospects, retrenching on certain initiatives, a full pricing and product sizing review, and an operational end-to-end critique. I touched on the price increases executed. We also made some adjustments within our marketing group. This informed some changes to our off-Amazon advertising strategies, which in turn has allowed us to make some difficult but appropriate changes. These result in annualized savings of approximately CAD 400,000 per year. These changes have been executed and going forward, we expect to realize these savings. We also have some additional changes planned for the quarters ahead, and we're making those announcements as we implement them. We expect that these shifts are focused on the improvement of the financial performance of the company and optimizing the bottom line. As we enter a period where the macro environment is seeing headwinds in terms of inflationary pressures, interest rate increases, and consumer pullbacks, we're pleased to see we've been able to take price increases and improve our profitability. We also recently announced that we'd entered the Chinese market, and we were excited about the prospects. While our enthusiasm remains unchanged, we have seen our plans stalled by the recent closures of the Port of Shanghai. You've likely read about China's zero-COVID mandate and the measures they've taken to control the spread. The port in Shanghai was unfortunately the entry point for our products, so this situation has delayed the anticipated ramp-up in that market, but we're still confident it will be a material and meaningful channel for us before the end of this year. You may have seen or read about how there's been a cooling off in general for many e-commerce related stocks as the economy has reopened and consumers are starting to return to bricks-and-mortar retail. Obviously, this was expected, but we believe the retail environment is forever changed. We see good evidence that our brands have salience, and in particular, our core brand, which is the Dr. Tobias. Tobias line in the United States continues to sell well in that most crucial marketplace for us. As Andrew will cover shortly, as we've focused on in-market sales improvement and profitability, we've seen particularly promising results from our core brand in our primary market in the Dr. Tobias line in the U.S. Price increases and prudent management of SG&A have positioned us to continue the trend we've seen moving through Q1, and we expect to report an even stronger Q2 in our next release. Now I'd like to turn it over to Andrew to provide us with a view of the financial results. Thanks, David. As we're covering two financial periods today, I'll start with the results of the fourth quarter and full year 2021. As David discussed earlier, 2021 was a challenging year as COVID continued to put pressure on the supply chain globally and impacted the company's ability to execute. Revenues for the year ended December 31, 2021 were CAD 36.7 million, compared to CAD 40.3 million for the 2020 calendar year. Since the beginning of the pandemic in early 2020, the company's had to continually make adjustments and react to challenges in the supply chain and within the online marketplaces. The company has successfully navigated these issues and become more efficient in the process. In the first and second quarters of 2021, heavy promotions meant the brands generally had higher volumes but at lower margins. A conscious reduction in the amount of discounts in the second half of 2021 resulted in lower volumes but increasingly higher average prices. As a result, during the full year 2021 period, the brands were able to offer less promotional pricing and ultimately maintain and even improve volume in the key SKUs. Revenues for Q4 2021 were CAD 8.6 million compared to CAD 9.1 million for Q4 2020. While the fourth quarter is typically a weaker period for the business, Q4 2021 was additionally impacted by our change in advertising partner and outages for our top two products, as David discussed earlier. Inability to guarantee supply on some products also meant promotions had to be limited or abandoned. The company's skincare businesses, All Natural Advice and Maritime Naturals, were particularly affected by supply chain and market challenges in 2021. A decline in profitability in the company's skincare businesses in 2021 resulted in adjustments to forecasted performance for future years. Key assumptions used in the forecast include revenue growth and profitability levels. While management considers these brands to still have considerable upside, forecasts were based on historical growth expectations. Taking into account these latest developments, the recoverable amount was determined to be lower than the carrying value for the All Natural Advice and Maritime Naturals CGUs or cash generating units. As such, an impairment loss was recognized with respect to goodwill allocated to the All Natural Advice and Maritime Naturals business units, and a non-cash impairment charge of CAD 4.2 million was recognized in 2021. A majority of the issues related to product availability abated entering 2022, with the consistency of supply in Q1, along with uninterrupted listings led to a much stronger sales momentum. Revenues for Q1 2022 were CAD 9.5 million, compared to revenues of CAD 9.8 million for Q1 2021. While revenues in the 2022 period were lower by almost CAD 200,000 overall compared to 2021, gross margin was actually higher in the 2022 period as the company focused on increasing the average revenue per unit by limiting the amount of promotional discounting. Gross margins in Q1 2022 improved to 72.7% from 68.6% in the same period last year. Unit volumes have begun to increase while selling prices have been higher. In addition, a number of price increases on various products in late 2021 and Q1 2022 has allowed for further margin expansion, including from some of the top-selling products, and revenues have continued to show growth. The company's DTI Supplements business performed better in Q1 2022 compared to Q1 2021. However, the company's skincare business continued to have challenges driven by supply chain and market issues, similar to those experienced since the COVID-19 pandemic began. Management is optimistic these issues will subside going forward and expects better performance during the remainder of 2022 compared to 2021. Top-line growth has been encouraging since acquisition of the skincare businesses, with the expectation that the U.S. market will become a more meaningful contributor for both skincare businesses, along with certain European and Asian markets. Looking forward to expectations for Q2, we have seen the momentum generated in Q1 continue so far. In general, prices are higher and margins are better. So far, we have not seen the typical drop in momentum that we see in Q2 and are excited as we enter Q3 with Prime Day just around the corner. Touching briefly on the company's balance sheet and cash flows, we saw cash flows from operations improve appreciably in Q1 2022 compared to the prior quarter and the same period a year ago. We have continued to make scheduled principal repayments on our senior term debt, which currently stands at CAD 8.3 million, exactly half the amount of the debt at the time we acquired the skincare businesses just two and a half years ago. With our current level of operations and cash flows, we have reduced the long-term debt to a very manageable level and are confident we will continue to meet all obligations as they come due. I shall now turn the call back to David. Thanks, Andrew. Obviously, we're speaking to you after Q1 is filed and Q2 is completed. While Q4 and the year-end weren't exactly the results we wished for, I'd be remiss if I didn't give you the insight that things are much, much better now. We've seen EBITDA grow, and we're seeing better performance in terms of revenue, unit prices, following significant price increases and profitability. We continue working to execute our strategic plan, which is the long-term range of CAD 100 million in revenue and CAD 20 million in EBITDA in 2024. This plan is expected to be achieved through a combination of organic growth, which includes new product launches, as well as new channels and portals, along with strategic M&A. Please do look for some exciting announcements in the weeks ahead on these fronts. Shifting gears, we know that it is important to our organic growth plans that we have the ability to launch in new markets. Canada is an excellent example of a new geography where we're succeeding. Our Dr. Tobias brand was launched in Canada in late 2019. Sales grew rapidly in the first year and have continued to on a fairly meteoric trajectory. This model and success gives us a solid roadmap to follow as we continue to pursue new markets. I mentioned that most recently we've added Singapore to our list of markets. This is an Amazon Marketplace. Despite the fact that Singapore only has approximately 5 million residents, Amazon is using it as a market from which to fill Malaysian orders, so it has the potential to become interesting and meaningful very quickly. Following the Canadian roadmap that we've established, we believe we can enter this market and be very successful in the short and medium terms. We've also seen continued growth in our skincare brands in the U.S. While we haven't seen growth in the Canadian skincare business of late, the uptick in the U.S. market is extremely encouraging. Currently averaging over 100% growth year-over-year on the All Natural Advice business in the United States. In 2021, for context, we were selling a little over $2,200 per week. That is now over $5,000 per week and continuing to grow. On this trajectory, the revenue should be material in the near term. Just before we open for questions, I want to expand on my earlier comment regarding our strategic plan for growing the business to CAD 100 million in 2024 with CAD 20 million in EBITDA. Firstly, we continue to diversify the platforms on which we sell. As I noted, we've added products on multiple new portals in the last year. We continue to do so in the periods ahead. Secondly, we'll continue to tune our portfolio and ensure we optimize and leverage the use of our hero products, as well as act in a nimble and expeditious way as consumer demand continues to evolve. This includes taking price increases where practical and cutting costs where possible. We invite you to stay tuned in the months ahead and expect to hear significant announcement on all of these fronts. With that, I'd like to now open the line for questions. Please, operator. Thank you. We will now begin the question and answer session. To join the question queue, you may press star then one on your telephone keypad. You will hear a tone acknowledging your request. If you are using a speakerphone, please pick up your handset before pressing any keys. To withdraw your question, please press star then two. We will pause for a moment as callers join the queue. The first question comes from Antonia Borovina with Bloom Burton. Please go ahead. Hi, guys. Thanks for taking my question. Maybe just first to clarify, regarding the inventory auditing, it sounds like, you know, the processes are now in place and everyone's satisfied. I just wanna get your take if you don't anticipate this issue arising again and delaying any other filings? Yeah, that's correct. Hi, Antonia, it's Andrew. As sort of the, I guess, the lead on dealing with the audit, I can say it's been quite a challenge. It was difficult because the issues presented were ones that, you know, we're sure other companies experience that have inventories at e-commerce providers, Amazon in particular, where they, you know, with the FBA model, they manage all your inventory. You effectively drop ship to two locations. They, you know, manage the distribution throughout, you know, on a national level and a bunch of different places. Really, it's impossible to physically observe that inventory at inventory count time, which is sort of a required step. In a lot of cases where you have a third-party service provider, that provider will give a controls report on their own processes, which you can rely on for audit purposes. Amazon does not provide that controls report, which meant that we could not rely on any Amazon reports for purposes of the audit. Effectively, we had to, you know, work around that system and try to prove all our inventories that were there without using Amazon reports, which was quite difficult. This was the first time we've encountered this. This is sort of a new area that's developing as a result of having, you know, material amounts of third-party warehouses when that provider doesn't provide a controls report and it's impossible to physically observe. We were able to resolve that through a whole bunch of other procedures, as sort of Dave discussed, through his commentary. Ultimately, we do feel this is a one-time issue. We have now effectively created all kinds of new internal processes to be able to prove inventory without using Amazon reports, which obviously is not ideal, but we have obviously strengthened our procedures as a result. Don't expect this to be an issue going forward. This was sort of a one-time thing as a result of sort of changes in the marketplace and auditing standards. Okay, great. That's helpful. Maybe I can. Yeah. I'd like to maybe tag on just one quick comment, just from more of a, I guess, a layperson's perspective, because when you start hearing things about inventory verification, it gets a little unsettling. I can assure you that we have really ironclad inventory counting and inventory control systems. The challenge was, as Andrew was just illuminating, is trying to prove the value at a point in time without the use of any of Amazon's reports. As you can imagine, in a 24/7, 365 e-commerce world, you're trying to chalk a line at a moment in time so you know how much you've sent in, you know how much you've sold, you know how much has been recovered, you know if you have returns. It's all very clear. Given that we have controls on both ends, we always knew. The issue is, you know, when did that unit sell or ship? When are you recognizing the revenues and whatnot? To Andrew's point, we've built new systems and controls that are now in place that we can use to monitor going forward or to reaffirm what we already knew. I think importantly, there was no material change to anything. There was no financial restatements as a result. I believe that, as he also noted, that there's no prospect for this recurring in the future because now these systems exist. Although it seems like it's one of those evolutionary things in the accounting practices around e-commerce, we are far from the only ones who have this sort of issue. I think this is just a new wave of controls that will exist and we're comfortable that we're now, you know, have them all well in hand. Okay, thanks. My next question is regarding your revenue. They've fluctuated, you know, quarter-over-quarter. There's been a few different factors, the discounting, supply chain. You did mention that the supplements, the Dr. Tobias business is better in first quarter 2022. The skincare continues to struggle due to supply chain. I'm wondering if you can just maybe quantify it and let us know, like what is the growth trajectory on a revenue and volume basis for those two major business lines? Yeah, I mean, that's sort of a step, we don't typically do that. I can give you sort of an indication, I guess directionally. You are correct that, and I think as we tried to articulate, you know, we have sort of two main businesses, supplements and skincare. The skincare has two brands. They're quite similar but have different sort of aspects as well. Both of the skincare businesses were not as resilient to some of the challenges as the supplements business, mainly because I think it's, you know, more of a luxury spend as opposed to sort of a day-to-day sort of need with the supplements business. I think it's gonna take a little bit longer. We are seeing some good signs there. Maritime particularly, 'cause it was a smaller brand, is a bit more difficult. We are seeing some great things happening in the U.S. market, which we're very excited about, particularly on All Natural Advice. Overall, as we also talked about, we did take an impairment loss in the skincare businesses as a result of, you know, the change in outlook to those businesses. While we still feel that they will recover, they're going through some challenges right now. We can't, you know, prove beyond a reasonable doubt that we can recover. We sort of have to take an impairment charge right now. That's as a result of both what happened in 2021. You know, when we're doing the audit, you are looking at results for 2022 as well. They just have not. You know, they've recovered, but not to the level we expected them to. Q1 2022 for the skincare businesses were their best ever quarter. It's a high bar that we're never going to reach that level. They were down Q1 over Q1, skincare business were both down quite significantly to the level of about 25%. That was pretty significant because, you know, obviously it's a large piece of our business, but more importantly, you know, we were driving that with promotions and discounting last year, so we were getting the high revenue sort of, I don't wanna say fictitiously, because we were sort of supercharging it with a lot of promotions. We weren't making a lot of money, so it took a while to sort of retrain our customer base. I think we are there. We've gotten, you know, we've got the average unit price up. The volumes are not quite back yet, but they are improving. It's gonna take a while to sort of turn that around and turn it into more of a higher margin business. We are on our way there. That was down quite significantly year-over-year. We expect that delta as we go forward in quarters to lessen. You know, the difference from last year to get less, and hopefully at some point later this year, it will be, you know, having better results than it did same period last year. In terms of the supplements business, that was up in U.S. dollars. As you know, most of that, the supplements business is U.S.-based. It's primarily a U.S. market, although we have expanded into Canada and into Europe as well, and to some other markets. Most of it is U.S. Exchange rate was relatively similar. I think it was within a half a percent Q-over-Q. In real dollars, in actual dollars and in Canadian dollars, the DTI business was better. I believe it was around 6% better in Q1. However. 6%, sorry, on a revenue or volume? Yeah, on a revenue level. Yeah. However, it's sort of a tale of, you know, the individual months within the quarter. 'Cause typically what happens with the supplements business is January is your best month. It's a new year, new you. January 1 starts buying vitamins. You know, February's a short month, it softens, and then March it could go either way. We've actually seen a little bit of a different trend within the months, such that sort of volumes and revenues were improving throughout the quarter. There's, you know, February was shorter, but March was considerably better than January, which is unusual. That momentum has continued into Q2, which is, you know, why we are excited. You know, we've got Prime Day coming up in a couple of weeks. Really we were concerned with taking some price increases, that we were gonna see some reduction in volume. We haven't seen that. We've seen actually the opposite. We've seen strengthening in volume as well as the increase in margin. That's very positive for us. If I may, just with the skincare business, you did mention also some supply chain issues. I'm just wondering, have those been resolved or is that? The supply chain issues aren't typically massive, but because of the fact that, you know, the skincare is in a bunch of different markets and sort of, it's more reliant on a smaller set of products. What happens is, when you can't be confident that you can get enough supply, then you can't plan your promotions very well at all. Meaning that if you wanna run a sale or a discount or do some kind of a lightning deal or something like that, you're not sure if you have the inventory, you can't do those deals. It really limited our ability to sort of promote the brand. Again, we were doing overall less discounting, but promotions and sales periods are still an important part of the overall process, to keep the momentum going. When you can't plan it properly, it really hinders your ability to keep that momentum going. That was the challenge. It was a bunch of smaller disruptions. It just allowed us to have almost no momentum at all in Q4. That has helped or improved, I should say, quite substantially in Q1 and Q2. It's still happening on the skincare, not as much. We feel it as it lessens. Really it's twofold. One is the supply chain, but the other one is just on Amazon. Amazon goes through these periods of sort of for whatever reason, doing sort of, you know, sweeps and, you know, checks of, you know, listing requirements and things like that. They'll sometimes delist your product for a period of time. There's little things like that that continually ding the momentum, and we've had those, and they are getting better. We feel overall skincare is improving just not as fast as supplements is. Supplements is a very positive story for us. Okay. If I can just finally, regarding your sales and marketing spend. It jumped in first quarter 2022 to the mid-50s% and previously it's been in the mid- to high 40s%. Just wondering, you know, is that being driven by a more competitive environment on Amazon or due to your transition to the new marketing partner, or maybe both? Then if you could just provide maybe commentary on the new marketing partner and what they're able to do that your old one wasn't doing. Again, let me try to answer the first part of that, then I'll pass it to Dave to discuss more about the marketing partner itself. In terms of the spend, you're right, it was higher, quite a bit higher in Q1 2022 percentage wise. Part of that is, you know, as your revenues are lower, which they were, I mean, DTI as again, we were higher, but overall we were lower. As your revenues are lower, you can't maintain that percentage. You sort of have to have a base level of promotion and marketing. Again, I just wanna reiterate what goes into selling and marketing expenses is a combination of our discretionary spend, i.e. What we decide to, you know, spend on banner ads and, you know, click-throughs and keyword searches and things like that, versus the transaction fees that Amazon actually charges you to effectively deliver and, you know, fulfill your product. All those charges go into that selling and marketing expense. Approximately 2/3 of the selling and marketing expense, a little, just right around 2/3, about 33% of that of the revenue is Amazon's fees. Those have ticked up slightly. Amazon is, you know, just a public company like every, you know, like we all are here. We're just, they gotta make revenue, they gotta keep charging more in order to keep pushing the top line. They keep taking, you know, CAD 0.25 here, increasing listing fees. They're not significant, but they do have an impact of a, you know, point or two here and there. On top of that, you know, we have a budgeted spend, so you can't continually go, "Oh, we're not selling enough. Reduce the spend." You have to sort of stick to your strategy and your goals. Ultimately, sometimes the sales just take a little longer to percolate up. Some of those investments that you're making in ad spend don't generate in the same quarter. We sort of alluded to a bunch of times here, the strategy that we've taken with the ad spend, particularly with the new partner. We are very happy with their performance so far since they started back in October. They really didn't get going until November. A tough period to get going, but they've almost done better performance-wise on the metrics that we measure. Things like, you know, your return on ad spend, your ACoS, your overall cost of spend and things like that are doing much better. We have seen the momentum continue, and that's really the kind of proof in the pudding that, you know, these things are not just built for today's sales, it's built to keep the momentum going. We've certainly seen a real improvement in the overall momentum. Yes, we're spending a little bit higher. I think as the revenue line starts to improve, that percentage will come back down into the forties again. It just, you can't get it in the forties at certain levels of revenue. Once it gets to a certain level, you kind of have to, you know, have a base level of ad spend. That's where we were for this particular quarter. Dave, do you wanna just maybe talk a little bit more about key performance metrics then? Yeah. As a brief recap that some of you who've been on calls previously might know that we have been, since our inception, using third parties, for AI support for certain activities that we do on Amazon. Just to maybe give you just a very 30,000-foot view of that. Keywords, for example. When a consumer goes on Amazon and types in something they're looking for across the top of the banner, like fish oil, for example, those are what are called keywords. Keyword searching will lead you to certain, postings. There's actually a kind of a bidding process for the placement of your products, and these are all managed through AI. The reason we do that is because A, it's constantly evolving. It's a real-time dynamic marketplace for these biddings. It happens across multiple time zones, and it's happening in real time at massive quantities. There are a number of third-party providers for these AI services to help you optimize and tune your advertising on Amazon. We've been using those since our inception, as I said. You may recall a few years back, we changed suppliers of that service because we were unhappy with our then provider. We had a good period where we felt good about it and things had been progressing nicely. Then back in 2021, the partner that we had engaged was actually sold. Whether that led to perhaps a slight lack of focus or some change in staff and what have you, I'm not really in a position to comment on, but I can tell you we noticed a distinguishable drop in attention to our account and to the performance of the account in particular. We took on in the summer of 2021 an RFP process whereby we engaged six different companies in the space that provide this sort of thing. Went through a protracted selection process and ultimately landed on a new partner, which came on board in the fall. They have subsequently done a terrific job. We monitor it literally daily. We meet with them weekly. We go through these things in agonizing detail to make sure, because of the importance of it, that they're fully on top of our account and the things that are being done. Unfortunately, as we transitioned away from our prior partner, that lack of focus I mentioned seemed to become even more magnified, as I guess they knew they were losing the account. We did see a bit of a slowdown during that transitional process which started in the early fall. Our new partner is fully up and running in middle of Q4. As noted, you know, we're seeing really terrific results, so we're very pleased about that. We now feel that we've got that right partner. As a sidebar to that, this particular provider is also well-positioned in terms of their software in the Walmart ecosystem. We've seen of late an interesting uptick on our Walmart business as well. We're excited about the prospects for growth there as in concert with what's happening on Amazon. Great. Thanks for the added commentary. Once again, if you have a question, please press star then one. As there are no more questions from the phone lines, this concludes the question and answer session, and I would like to turn the conference back over to David Kohler for any closing remarks. Thank you, and thank you all for joining us on the call. We'll be putting a transcript of this call on our website, so you may contact us through that website today at www.mimisrock.com. Or certainly feel free to reach out to me personally with any other questions or follow-ups you may have. We look forward to communicating again with you soon. Thank you all and have a terrific day. This concludes today's conference call. You may disconnect your lines. Thank you for participating and have a pleasant day.