Good morning, ladies and gentlemen, and welcome to the Think Research Corporation Q2 2022 financial results conference call. At this time, all lines are in listen-only mode. Following the presentation, we'll conduct a question and answer session. If at any time during this call you require immediate assistance, please press star zero for the operator. This call is being recorded on Monday, 29th of August, 2022. I would like to turn the conference over to Sachin Aggarwal, CEO. Please go ahead. Thank you, operator, and good day to everyone who's joining us this morning. Also joining me on the call today is our Interim CFO, John Hayes, who is going to review the financial results in more detail after I discuss some operational achievements during the Q2 and the first half of fiscal 2022, which produced record revenue results despite some temporary program delays in our clinical research division. Before we begin, I just wanna briefly review who we are and what we're trying to accomplish. Think Research is an industry leader in delivering knowledge-based digital health software solutions. Our focused mission is to become, for clinicians, an essential data service that organizes the world's health knowledge so everyone gets the best care. It's evidence-based healthcare. Our evidence-based healthcare technology solutions support the clinical decision-making process, standardized care, in order to facilitate better healthcare outcomes. The company gathers, develops, and delivers knowledge-based solutions globally to customers, which typically include enterprise clients, hospitals, health regions, healthcare professionals, and/or entire governments. The company has gathered a significant amount of data by building its repository of knowledge through its network and group of companies, including our acquired companies. Think's data and software division licenses its solutions to more than 13,000 facilities for over 300,000 primary care, acute care, and long-term care doctors, nurses, and pharmacists that rely on the content and data to support their practices. In addition, the company collects and manages pharmaceutical and clinical trials data in its clinical research division. Millions of patients and residents annually receive better care due to the essential data that Think produces, manages, and delivers. Think also operates a clinical services division, which is a network of digital-first primary care clinics and medical clinics providing elective surgeries. The company's financial performance during the first half of 2022 reflects the impact of the acquisition and integration of four acquisitions from 2021 that continues to transform the business today. Although our performance was a record for the first half, sequentially, revenue in the Q2 was lower than Q1. This was caused by some delays in clinical research programs that were in turn caused by some drug development delays by sponsoring or client companies. Although we're gonna touch more on this in our outlook section, we are pleased that subsequent to quarter end, some of those delays have eased, and we're confident that our revenue for the clinical research division is tracking as expected for the second half of the year. 2022 sales in that division, and consequently, our end-of-year backlog are expected to be at all-time highs for this division. We're also pleased that we're gaining sales synergies through our acquisitions. On May 19, 2022, we announced that MDBriefCase was chosen by a global pharmaceutical company to deliver high-quality content to healthcare practitioners regarding its drug and mRNA vaccine therapies throughout 2022 and 2023. The contract has a value of approximately CAD 4.1 million, with revenues to be earned based on the achievement of various contractual milestones. On June 28th, 2022, we announced a contract with a major U.S.-based pharmacy to deliver business intelligence and support solutions to more than 1,700 pharmacies serving 5,500,000 patients throughout the U.S. This contract is a direct result of the acquisition of Pharmapod Limited in the second half of fiscal 2021. These contract awards and expansions give us enormous confidence that we're building an essential data service for clinicians everywhere that Think has presence. Now, I'd like to invite John Hayes, our interim chief financial officer, to review the financial results in detail for the quarter and year to date. After he reviews the financials, I'm gonna conclude with a bit of an outlook, which offers some thoughts on how we plan to become an essential data service for clinicians. Over to you, John. Thanks, Sachin. The company achieved revenue of CAD 18.4 million and CAD 36.8 million for the three and six months ended June 30th 2022, up by 80% and 108% respectively, compared to the same periods in 2021. This year-over-year growth reflects the impact of the acquisitions and organic growth. Now I'm gonna provide some details regarding Q2 compared to the previous year and to Q1. Revenue from Think's software and data solutions segment declined by CAD 1.6 million from CAD 8.5 million in Q1 of this year to CAD 6.9 million in Q2. In Q1, there were elevated one-time services revenues associated with the implementation of new programs during that quarter that did not carry over into Q2. Revenue from Think's clinical research operations declined from CAD 8 million in the Q1 of 2022 to CAD 7.3 million in the Q2, due primarily to delays in study timelines resulting from scheduling changes made by study sponsors. Subsequent to the quarter end, the company recognized parts of the delayed revenue and anticipates that clinical research revenue will recover late in the second half of the year. Sachin will provide some further color on our targets in his closing remarks. Revenue from clinical services grew from CAD 3.7 million in Q1 of this year to CAD 4.3 million in Q2 2022 as normal operations resumed following the government-mandated shutdowns associated with COVID-19 that restricted operations in Q1 of this year. Adjusted EBITDA, which is a non-IFRS measure, was a loss of CAD 1.6 million compared to a loss of CAD 1.3 million in Q2 the previous year and a loss of CAD 0.3 million in Q1 2022. The sequential decline in adjusted EBITDA was a direct result of a decrease in revenue associated with delays in clinical research programs and one-time professional services revenue in the software and data segment that was recognized in Q1 and did not recur in Q2. Adjusted EBITDA margin, which again is a non-IFRS measure, was a loss of 9% compared to a loss of 13% in Q2 2021. For the first six months of 2022, adjusted EBITDA margin loss was 5% compared to a loss of 16% for the first six months of 2021. The improvement in adjusted EBITDA margin was due to realized cost synergies and overall revenue increases in comparison to last year. During the Q2 and first half of FY 2022, the company generated gross profit of CAD 9.4 million and CAD 18.5 million compared to CAD 5.7 million and CAD 11 million for the comparable periods in the prior year, representing an increase of 66% and 68% respectively. The increase in gross profit was primarily related to the increase in revenue, which in turn was due to acquisitions supplemented by organic revenue growth. For the six months ended June 30 2022, the company generated gross margin of 48% compared to 59.3% for the same period in the prior year. The main factor in driving gross margin lower in the current year compared to 2021 was the change in revenue mix as a result of the acquisitions in general and BioPharma in particular, offset by realized cost synergies. Total operating expenses other than depreciation and amortization increased by 46% to CAD 12.7 million compared to CAD 8.7 million reported for the same quarter last year, and by 36% to CAD 23.2 million for the first six months compared to CAD 17 million for the same period in the previous year. Think Research continued to focus on reducing its cash operating expenses through realizing cost synergies valued at CAD 5.8 million on an annualized basis in fiscal year 2021 and an additional CAD 3.6 million in the first half of FY 2022, which management believes will enable Think to realize significant expense leverage from larger revenue streams in future quarters. General and administration expenses increased to CAD 8 million and CAD 14.2 million for the Q2 and year-to-date in fiscal 2022, up from CAD 4.8 million for Q2 of FY 2021 and CAD 9.5 million for the year-to-date last year, representing increases of 66% and 49% respectively. These increases were primarily due to higher personnel costs associated with acquisitions, along with higher salaries and wages to support the continued growth of the business, all offset by recognized synergies. Research and development expenses increased by CAD 0.7 million for the Q2 of FY 2022 and CAD 0.8 million for the year-to-date, representing increases of 42% and 24% when compared to the Q2 and first half of 2021 respectively. These increases were due primarily to investment in software related to the company's Digital Front Door software solutions in the Q2, which in turn was driven by new license sales to large organizations in Canada. Sales and marketing expenses increased by approximately 7% and 16% in the Q2 and first half of this year to CAD 2.4 million and CAD 4.7 million respectively. The increases were primarily due to acquisitions completed during the prior periods, branding activities to continue to elevate the Think brand, and higher salaries and wages to support continued business growth, partially offset by cost synergies realized in the year-to-date. Depreciation and amortization increased by 189% and 226%, or CAD 2.4 million and CAD 5 million for the three and six months ended June 30th 2022 over the same periods in FY 2021. These increases are primarily due to the depreciation and amortization non-cash expense associated with acquired businesses. Acquisition, restructuring, and other costs decreased by 6% in Q2 of FY 2022 to CAD 0.7 million compared to CAD 0.8 million in Q2 of FY 2022 and increased by 13% to CAD 1.8 million in the first half of FY 2022 as compared to the same period a year ago. The increase in the year to date is due primarily to the implementation costs of staff reductions associated with Think's plan to realize synergies from the operations of acquired companies. Net loss was CAD 7.5 million and CAD 13.7 million for the three and six months ended June 30 2022, compared to losses of CAD 5.6 million and CAD 10.6 million for the comparable periods in the prior year. The increase in net losses when compared to 2021 is primarily due to an increase in expenses related to companies acquired during FY 2021. During the Q2 of this year, the company borrowed CAD 10 million under a new credit agreement with Beedie Investments Ltd. Beedie may elect to convert all or any portion of the loan into common shares at a conversion price of CAD 1.443 per common share. The company's cash balance at June 30th 2022 was CAD 6.1 million, down from CAD 6.3 million on December 31st 2021. The company borrowed CAD 10 million from the new credit facility and repaid CAD 2.4 million of the operating line in the first half of the year, resulting in a net increase of cash from loans and borrowings of CAD 6.6 million. We made payments of CAD 1.6 million on our lease liabilities and CAD 1.6 million for finance costs in the first half of 2022. Think also invested CAD 1.9 million in intangible assets, CAD 0.3 million in property and equipment, and paid CAD 0.4 million of cash consideration towards an acquisition made in the prior year. We believe we're on track towards positive cash flow soon. Although Q2 had some revenue delays that impacted performance for the quarter, we are encouraged by the outlook in the second half of the year, particularly in the Q4, and for that to continue into the first half of next year. Sachin, over to you for your final comments. Thank you, John. Our objective is to grow revenue with improving margins by becoming an increasingly essential data solutions provider for healthcare clinicians everywhere so that they can deliver the best outcomes for patients. We have effectively optimized most of our operations to deliver on this objective, although there is a little more to accomplish here. There is increasing evidence in our, in our pipeline and contracted revenue that is encouraging to us that this approach to organic growth is working. We're very excited about the visibility we have into second half performance and our prospects for the coming full fiscal year. With that evidence, we are reiterating our full year revenue guidance above CAD 80 million. Further, we are refining our guidance, as we indicated on our press release earlier today. Q4 revenue run rate will range between CAD 84 million-CAD 90 million annualized, and pro forma adjusted EBITDA will range between CAD 6 million-CAD 9 million annualized. We think that the quarter should come in at somewhere between CAD 21 million and CAD 22.5 million. That being said, we are measuring three operational growth KPIs that we continue to allocate resources and attention towards. First, we're adding more users to current licenses by promoting adoption and usage. There is a lot of room for us to increase users and usage of already deployed solutions. As we add more users, our solutions become more essential to licensees, which gives us pricing power and switching barriers. A great example of this is our eReferrals or digital referrals business, which grew to more than 125,000 transactions in Q2 alone from 108,000 the previous quarter. Substantial in quarter organic usage growth. For the first time, surpassing a run rate of 500,000 referrals per year and thereby introducing thousands of practitioners to Think Research and some of our data services. As well, increasingly, our content is becoming part of standard workflows for hospitals, which makes our solution stickier with more practitioners using our software regularly. Second, we aim to increase revenue per user by increasing the number of services and solutions that a licensed user adopts and uses regularly. We have a better line of sight now in product development and sales requirements in all of our major segments now that we've begun to focus our offerings. The deal announced in Q2 with the global drug and the mRNA vaccine developer is a great example of our ability to cross-sell between segments and mature our solutions. Our relationships, our relationships at our clinical research division helped us land our content solution with our data and software division. We're seeing more of these cross-sell opportunities coming up in our pipeline. Finally, with the user base now exceeding 300,000 clinicians, we have an ability to sell new solutions and content developed internally with strategic partners that monetize licensed users directly over the top of facility licenses. We believe that direct user licensing could generate entirely new revenue streams. For example, we are now cross-promoting and cross-selling pharmacist education solutions directly to pharmacists that are on our Pharmapod Incident Management Network. In support of these strategies, our product teams and business development teams are focused on strengthening the utility of our data and data solutions, such as, for example, as mentioned earlier, digital referrals, through ongoing product development, platform integration and content development. We plan to add new third-party solutions to data services and our solutions via supplier partnerships and integrations. We're expanding our solutions footprint via new facility licenses and over-the-top direct user licenses in the eight countries where Think has a market presence. In the immediate time frame, in order to effectively execute on these strategies, the company is undertaking the following now. First, the integration of our acquisitions from last year are concluding. Although the company has gained another CAD 3.8 million of cost synergies so far this year. Even at full integration, we're always looking for ways to digitize processes and be more efficient over future quarters. In addition, Think is improving operations and sales potential at both in order to maximize adoption, scale, and earnings potential as we add more licenses and users. Over the coming quarters, expect us to gain more synergies in our G&A expense category. We're continuing to evolve from a product-focused conglomeration into a cohesive data solutions company with a focus on clinician data and knowledge needs. Our product and R&D teams are constantly reviewing our users' needs, our solution sets, and sales and marketing strategies with an effort to become more essential to users and licensees alike. As we optimize operations, we're realigning resources to increase sales capacity and revenue-generating support functions in key areas. Now that we've gained significant synergies in sales and marketing through our integration, expect us to begin reinvesting in profitable, high-revenue growth parts of our business. As we transform into a solutions-based organization focused on essential clinician data, we're comfortable with our annual growth rates and our path to profitability. Due to the nature of some of our lines of business, there may be quarterly variances to be expected in performance due to project work or delays or accelerations in programs. However, we're extremely excited about the prospects for Think over the coming quarters to be a profitable, high-growth company. With that, this concludes our prepared remarks, and I ask the operator to open the line for questions. Thank you. Ladies and gentlemen, we'll now begin the question and answer session. Should you have a question, please press star followed by one on your touch-tone phone. You will hear a three tone prompt acknowledging your request, and your question will be put in the order they are received. Should you wish to withdraw from the conference process, please press star followed by two. If you are using a speakerphone, please pick up the handset before pressing any keys. One moment, please, for your first question. First question comes from Jérome Dubreuil from Desjardins. Please go ahead. Hey, good morning, everyone, and thanks for taking my question. First one is on the software and data solution segment. Was wondering a bit which quarter between first quarter and the Q2 that was a bit closer to normal, what you would consider normal operations or normal results, and also if there was any other one-timers in the Q2? Thanks, Jérome, for the question. In general, the software and data solutions is at a pretty good overall organic growth clip, right? But of course, there are some services revenue that comes along, particularly with very large government programs. When the Ontario government asks, you are adding features and functionality as appropriate and, often, particularly in the examples of things like digital referrals or our Digital Front Door, you are always onboarding new users, right? There's some portion of services related to those kinds of activities every quarter, right? In terms of run rate, probably we had a big amount of revenue recognition related to one-time implementation of our Digital Front Door in the province of Ontario. That declined significantly in Q2. I think we expect to see that come back up a bit. John, I don't know if you have particular comments on that. Sachin, Jérome. I think Sachin's comments are right on. You know, what would you expect going forward, probably, you know, somewhere between the two, would be our, an appropriate estimate, I would think. Okay, great. Also wanted to thank you for the additional precisions on the guidance you have provided this morning. This is appreciated. Signals good visibility, and you mentioned that in your prepared remarks as well. I was wondering especially on your visibility in terms of the BioPharma or clinical research operations. How confident are you that the clinical trials will go smoothly in the next few quarters? I think there could be maybe potentially some supply chain issues that might be difficult to control. If you can speak to what kind of visibility you have specifically for clinical research. Yeah. Thanks, Jérome. I mean, if you look at it starting from a very high level, the year 2022 already year to date, but if we look at the full year, 2022 is expected to be the best sales year that the organization has had. You can see from the first half of the year, the revenue recognition will lag the overall bookings in the year. We're gonna have a very material backlog as we head into the back half of the year. The way that the research cycle works, just from a timing perspective is fiscal year and budgets in fiscal year really matter to our client sponsors, right? While we saw delays in H1, we are seeing a lot of pressure to get studies done in H2. In particular, our clinics has been very busy through the months of the back half of August and looks packed through September and beyond. We're starting to see some real activity. Let me see if I have anything in particular to add to that. I think that gives us a great deal of confidence into where we expect to see that business going in H2. Yeah. No, that's great color. Very helpful. Thanks. Thanks for taking my question. I'll pass the line. Pleasure. Thank you. Ladies and gentlemen, as a reminder, should you have a question, please press star followed by the number one. One moment for your next question. Your next question comes from Mike Stevens from Echelon Wealth Partners. Please go ahead. Hi. Good morning, guys, and thanks for taking my questions. On the software and data solutions segment, you mentioned obviously the professional services may have led to that uptick in Q1. From a margin standpoint, you obviously had an exceptional gross margin quarter. Do you attribute some of that to, you know, less professional services, kind of looking toward the sustainability of, you know, what to expect gross margin-wise going forward? I'm gonna let John lead on that question. Yeah. Mike, we worked with our auditors in Q2 and decided to actually reclassify a few indirect year-to-date costs from cost of goods sold to operating expenses to better reflect direct costs of revenue delivery in our cost of goods sold. That's why that's one of the reasons, obviously, your question about professional services versus, you know, license revenue is also accurate. One of the other reasons that boosted our gross margin in the quarter was that we're going to be reclassifying certain indirect sort of administrative costs that had historically been captured, sometimes in cost of goods sold, into operating expense to just align the way that all of our recently acquired companies report and make it all consistent so we have a better baseline for reporting going forward. That change means that what you saw in Q2 is probably more representative of what you're gonna see going forward. Okay. Great. Thanks. Does that mean that G&A line, that obviously it sounds like some of the COGS got funneled into, is that a good sort of base to look toward? Or do you to achieve that Q4 EBITDA guidance, do you see some of these, you know, declining throughout Q3 and Q4? Yeah. Sachin, I'll take that, the start of this one as well. There's a little bit of Q1 catch-up in that. You know, that was part of the reason why SG&A jumped as much as it did. Also, the stock-based compensation in Q2 was about CAD 700,000 more than in Q1. We definitely saw in Q2 that we had to increase our non-cash stock-based compensation expense to attract and retain employees in a really highly competitive talent market. When you combine that with the cost synergies programs that we have going forward, yeah, if you kind of put that all together, I mean, I'm expecting and forecasting the overall OpEx line. You know, it's certainly not going to increase. In fact, you know, we're expecting, based on those things that I just mentioned to you know, a modest decline over time. Sachin, anything to add? Okay. Great. No, nothing to add. That was perfect. Thanks. Yeah. That's pretty helpful. Thanks for that, John. One last one if I can, probably for Sachin on BioPharma. Yeah, that's like obviously a great problem to have that your sales backlog is so strong. I'm just wondering, is there any insights to kind of compare it to maybe normalized levels, that backlog? From a capacity standpoint, are there any things that you guys are looking forward to chew through that backlog faster? Or, you know, how should we look at that run rate, exiting the year at BioPharma? Just lastly, will that kind of constrain the growth in 2023, your ability to kind of generate new wins with what your capacity is at? A great question. Just to give you a sense of historically, year bookings in a year don't dramatically exceed revenue recognition in the year. A lot of that has to do with the fact that historically, you may recall when we acquired BioPharma, their business was mostly bioequivalence. Going backwards, it was mostly bioequivalence. Those types of studies, they're you know, you book them, and you typically complete them in a relatively short time frame, right? Bios, they tend to be a little bit lower margin studies and less differentiated, so more difficult to carve out a niche. One of the things that we've really spent a lot of time doing since the acquisition was shifting the organization towards more phase I studies and starting to reduce the amount of BE studies that we do. The consequence of that is they tend to be a little bit higher margin. They also tend to be slightly longer studies where you're recognizing revenue a bit more smoothly quarter over quarter over quarter. They also require less physical infrastructure at any given time. You tend not to be putting through a large volume of subjects all at once. You tend to be doing a small volume on a regular basis, right? It actually puts less pressure on your physical infrastructure, so it increases your overall clinic capacity when you do that kind of shift over to phase one, right? The other comment that I'll make, from a capacity perspective is that, as between our Canadian and U.S. facility, we still have a lot of capacity in the U.S. facility, which is newer, and will take, you know, probably a couple of more years, frankly, to really ramp up to its full potential, right? Lots of capacity there. Now, all of that being said, if we actually tried to push through the full backlog that we have this year into the second half of the year, we would not be able to do it, right? We do expect very good results, but we also expect a lot of that is gonna carry over into Q1, Q2 and beyond. John, did you have anything to add there? No, Sachin. I think you really captured it. I mean, from a finance and, you know, forecasting perspective, the longer duration of the phase I studies, you know, gives us greater visibility into what's coming in future quarters, which is, you know, what gives us the confidence to be able to, you know, provide our guidance in the later part of the year. That's all I would add. Okay, great. Thank you both for your insight. Have a good one. Thanks, Mike. Thank you. Ladies and gentlemen, as a reminder again, should you have a question, please press star followed by the number one. Please one moment for your next question. Your next question comes from Kris Thompson from PI Financial. Please go ahead. Good morning, guys. Just to follow on that line of questioning on BioPharma. If you plug the Q4 revenue guidance, it looks like CAD 26 million-CAD 27 million. Would that imply the CRO revenue in the CAD 13 million range? Again, like, you guys have capacity to execute that type of revenue in one quarter? I'm gonna pass that one over to John, but I think overall our answer is we're pretty buoyant about it. Yeah. I didn't quite follow how you got CAD 26 million-CAD 27 million. Maybe you could just unpack that for me. Well, you guys guided Q3 and full year, so I just backed it out. Am I off? Okay. Yeah, our Q4 number that Sachin guided was, I believe, CAD 21 million-CAD 22.5 million for the quarter. That's right. You know, that does imply though that you know we have really strong revenue in BioPharma in Q4. You know, you've identified that there is a risk of capacity constraints. I think Sachin spoke to that, you know, why we believe that is all achievable. You know, there's certainly some risk there, but we don't believe it's due to a lack of orders. There's just some execution risk, but we have plans in place, which is why we believe that we'll be able to achieve that. Got it. Sorry. I hope that's helpful. That's the Q4, that's the Q4 revenue. What are you guys thinking about Q3 then? I mean, I guess the plug works the same way. How are you getting so little revenue in Q4? How are we getting so little revenue in Q4? Well, Q4 will be a big boost over, of course, Q2. We expect Q3 to be somewhere in the middle of those. That represents some recovery from Q2, particularly in BioPharma in the second half of Q3. Overall, right now we're giving sort of guidance on Q4, not on Q3 at this time. We do expect Q3 to be an okay quarter, but you know, it's got some hangover effects from Q2 and earlier. Okay. What about headcount? Where were you at the beginning of the year? Where are you today? Good question. I don't have the numbers right in front of me. I can tell you that it was over 500, and now it's materially below 500 as of today. I can follow up on that particular question. Okay. Let me have another look at my financial model, and I'll follow up with you guys later. Thanks. Yeah. You bet. Thank you. Ladies and gentlemen, as a reminder, should you have a question, please press star followed by the number one. Mr. Aggarwal, there are no further questions. Please go ahead. All right, everyone. Thank you. We appreciate it. We wish you all a good balance of the short summer that remains, and we look forward to speaking to you again in the fall. Thanks for your time. Thanks, all. Thank you. Ladies and gentlemen, this concludes your conference call for today. We thank you for participating and ask that you please disconnect your lines.