Hello, and welcome to WildBrain's fiscal 2022 second quarter earnings call. Today's conference is being recorded. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question, please signal by pressing star one on your telephone keypad. If you're using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. I'd now like to turn the call over to Nancy Chan-Palmateer, Director, Investor Relations at WildBrain. You may begin the conference. Thank you, operator, and thank you everyone for joining us today. Speaking on the call today are Eric Ellenbogen, our CEO, and Aaron Ames, our CFO. Also with us and available during the question-and-answer session are Josh Scherba, our President, and Danielle Neath, our EVP of Finance and Chief Accounting Officer. First, we have some standard cautionary statements. The matters discussed on this call include forward-looking statements under applicable securities laws with respect to WildBrain, including but not limited to statements regarding investments by the company, commercial arrangements of the company, the business strategies and operational activities of the company, the markets and industries in which the company operates, and the future objectives and financial and operating performance of the company and its assets. Such statements are based on factors and assumptions that management believes are reasonable at the time they were made and information currently available. Forward-looking statements are subject to a number of risks and uncertainties. Actual results or events in the future could differ materially and adversely from those described in the forward-looking statements as a result of various important factors, including the risk factors set out in the company's most recent MD&A and annual information form. Please note that all currency numbers are in Canadian dollars unless otherwise stated. For the question-and-answer session that will follow, we ask that each analyst keep to one question with one follow-on so that everyone has an opportunity to ask questions. If you'd like to ask an additional question, please rejoin the queue. I'll now turn the call over to our CEO, Eric Ellenbogen. Thank you, Nancy, and thanks everyone for joining us today. We delivered positive performance in the first half of fiscal 2022 with meaningful growth across our core businesses driven by great IP. As with each of the past five successive quarters, our results today are again an improvement. However, what you're not yet seeing in our numbers are the considerable revenues which we'll be realizing from signed production deals, and that's both live action and animation, and the consumer products upside which many of those shows will produce. As we discussed at our Analyst Day in October, after 2+ years of rebuilding, we're now entering a phase of accelerated growth. I think the team has done a terrific job during this period, and we have a succession of important IP projects rolling forward, though they're at the earliest stages of their life cycles. I'll talk a bit more about product life cycle in a minute, but first I'd like to take a look at our newest project announcements and how the overall pipeline is shaping up. Strong demand for our branded content continues unabated in a highly competitive market among streaming platforms, and we're producing more and more premium shows for these global services who increasingly favor exactly the kind of known IP that we own. The latest and most notable Evergreen brand activation is an all-new Degrassi series, which is gonna launch exclusively in the U.S. on HBO Max. In addition, HBO Max has licensed the entire 14-season, 788-episode library of the franchise's most popular installment, but not the only one, Degrassi: The Next Generation. This partnership is the largest deal in the history of the Degrassi franchise, valued at over 5 x our previous deal for new Degrassi content, which is actually just a few years ago. I should emphasize that this new content is just for the U.S., whereas our previous deal was for worldwide rights, which means that we retain, in the new production, global distribution rights in this new series as well as the library. The global popularity of Degrassi is nothing less than a phenomenon. It is the longest-running teen franchise in television history, having first aired in 1979. It has spawned six previous series, over 500 episodes, four TV movies, and today, Degrassi is more popular than ever, and we have the data to prove it. As a result of the extensive deals we've made with AVOD and other streaming platforms around the world, we know that more than five times as many viewers are watching Degrassi now than ever before. Driven by a devoted and passionate fan base, Degrassi is one of the most enduring and sustainable franchises in the history of youth programming. This deal with HBO Max illustrates perfectly, and I've been talking a lot about this, the rising value of branded IP in today's market, and it underscores the potential of WildBrain's ownership of a deep vault of other such properties. Significant new players have entered the streaming wars in recent years, as we all know, and they're all looking for the best new shows to attract and hold subscribers. In addition to the legacy players like Netflix, Amazon Prime Video, and Hulu, we now have HBO Max, Disney+, Peacock, Apple TV+, and Paramount+. These platforms, all of them, have massive content buckets and are all looking for the highest quality original programming they can secure. This is a very positive environment for us. It's generating strong demand for our shows. During just the past two and a half years, in addition to Degrassi for HBO Max, we partnered with Apple TV+ on multiple new Peanuts series and specials, as well as our entire Peanuts content library. Apple TV+, which we previously announced, is also the home for our new Yo Gabba Gabba! series, as well as the complete Gabba library. Over at Netflix, we're launching reboots of Strawberry Shortcake, Sonic the Hedgehog, Johnny Test, and Go, Dog. Go! It's not really just about these reboots. We're launching new IP as well with major platforms. We've just delivered to Netflix a third season plus three new family specials for our original preschool series, Chip and Potato. On the strength of that show's performance since launching in 2019, we recently appointed JAKKS Pacific as our master toy licensee to translate that audience engagement into a toy line for the brand. Chip and Potato is a great example of how we're creating enduring franchises. It's about leading with content first to build affinity for a brand. Once you have that established fan base, you then follow on with consumer products. We're taking a similar path in China. Jonny Jetboy is yet another new original animated series we're excited about, which we're producing in partnership with Chinese streaming giant iQIYI. We announced this in January. It's a brand-new IP from Keith Chapman, who is incidentally the creator of the global kids phenomenon, PAW Patrol. WildBrain importantly holds full distribution and licensing rights for Jonny Jetboy outside of Greater China, and we think it has great potential as a new global property. I should add that Jonny Jetboy is the first partnership for original IP signed by our dedicated team in Shanghai, who have also been very busy securing local outlets for notable WildBrain IPs such as Peanuts, Strawberry Shortcake, Teletubbies, and more. We're also constantly looking to make great additions of classic IP to our portfolio. Just last week, for example, we partnered with Jay Ward Productions, who are owners of such legendary properties as George of the Jungle, Mr. Peabody & Sherman and the WABAC machine, Dudley Do-Right, Rocky & Bullwinkle, and Super Chicken. WildBrain will add 788 episodes of Jay Ward Productions classic animation to its distribution library, and our two companies will create brand-new content based on the Ward portfolio. I should say it's a property I know very well. Apart from my misspent childhood watching probably all too many of those 788 episodes, I had the pleasure of partnering with Jay Ward's daughter, Tiffany Ward, during my days as a co-founder of Classic Media. There we produced numerous new TV series and a feature film for these brands. The Ward portfolio contains some of the most iconic properties in animation history, and we're thrilled to bring our WildBrain capabilities across production, distribution, and licensing to further perpetuate these wonderful properties. At the risk of redundancy, it all starts with owning great IP, investing in top-notch talent for premium content production. Through WildBrain's unique capabilities across our global infrastructure, we can maximize the value of IP to build franchises from the screen to the toy shelf. As I mentioned at the top of today's call, all of this activity is propelling us into a new phase of growth. We've done a tremendous amount of work, and we now have a wide range of promising projects in our pipeline, many, if not most, with track records of great success. These properties are at the earliest days of their life cycle from development to announcement to delivery, which of course, is when we see those activities in our reported results. To provide a bit more color on this life cycle, development of a new project can take from anywhere, 6-18 months to greenlight announcement, and then production can be an additional 12-24 months before completion of delivery. Looking at where we are just now, 2.5 years after I joined the company, we're really just starting to get the results, and it's where the revenues on initial projects begin to flow through our financials. It's just the tip of the iceberg. We have high visibility on multiple projects with quality partners, giving us great confidence in the stability and growth trajectory of our earnings for many years to come. I'm talking about from 2023 and beyond. What's really nice about the position we're in now is that so much of the very heavy lifting on these projects was really a one-time build. We have many properties to switch on, but once they get going, you're in a steady phase of growth as you're doing second, third, and hopefully more seasons, and then you're leaning into the distribution and consumer products licensing side. To be certain, the build is real, and to do it takes time, but the payoff is well worth the wait as we're building franchises with multiple high-margin profit streams for many years to come. We'll continue to add to this portfolio of production as we move through 2022 and beyond. We'll also start to reap earnings benefit as we deliver more new content and add more profit streams to our season shows via licensing partnerships. Peanuts is probably a perfect analog of what we're building. Over the past couple of years, we virtually relaunched Peanuts with a range of exciting new content, the first in decades, I should add, and we're only just getting going with our prolific slate of content to come. The returns on that work are just beginning to appear on our earnings, both as production revenue and also in consumer products growth. Speaking of consumer products, that sector was up 35%, excuse me, quarter-over-quarter, and a big contributor to this are the synergies and strengths of our wholly owned licensing agency, WildBrain CPLG, and particularly for the Peanuts business. Other brands, including Chip and Potato, Strawberry Shortcake, and Sonic Prime are coming up behind Peanuts. Of course, there's so much more IP in our pipeline to switch on. With our recent expansion of CPLG's business into the North American market, building on our robust presence throughout Europe, the Middle East, and India, coupled with active licensing in China, we have a truly global representation business in driving consumer products for our own and partner brands. CPLG is, as you know, integral to our infrastructure and plays a key role in our 360- approach from development right through the toy shelf as we build franchises and monetize IP. The IP projects we're working on now, even including the rejuvenation of Peanuts, are just getting started. The future potential is sizable and for the first time visible for both our own and partner brands. With that, I'll hand the call over to Aaron Ames. Thank you, Eric. We delivered [uncertain] 2022, especially given the high [uncertain] of Q2 2021. This is highlighted by double-digit revenue growth in consumer products and at WildBrain Spark. We are building on our "earning space" on which we expect increasing momentum next year and beyond as new IP activations are brought to market and start to contribute to our results. Looking at the key numbers for the quarter, revenue grew 8% to CAD 153 million compare to CAD 142.3 million in the prior year, reflecting growth at Spark and strong performance in consumer products. Net income in the quarter was 4.6 million compared to 11.3 million in Q2 2021. This is primarily due to high gross margins, lowered distributions to not controlling interest, offset by higher SG&A related to growth initiatives and a lower foreign exchange [uncertain] in the current quarter. Free cash flow for Q2 2022 was -CAD 0.8 million compared to free cashflow of CAD 23.5 million in Q2 2021. This was primarily due to significant growth in accounts receiveable assiociated with the larger deals we are doing, and increased consumer products business, and to timing of working capital settlements. This is a favorable development, reflecting the increasing revenue and deal flow coming through the company, which are driving returns across our business as you're already seeing in our financial results. Adjusted EBITDA was CAD 27.3 million in Q2 2022 compared to CAD 29.1 million in Q2 2021, primarily driven by higher gross margins and lower distributions [uncertain] interests offset by higher SG&A including growth initiatives. Excluding other income of CAD of 4.4 million from litigation settlements and CAD 1.2 million of government wage subsidies both in Q2 2021. Adjusted EBITDA increased 16% in Q2 2022 versus the same prior year quarter. Now, I'll turn the call back to Eric. Hey, thank you, Aaron. Yet another strong quarter and it's a great start to the year, calendar year. As promised, we're layering on more premium content deals, launching and relaunching IP to grow [uncertain] long-term earning space, and strategy is already beginning to show results. It's still early days, as we continue to leverage our 360 capabilities to switch on IP, and we're lining up a creative pipeline with meaningful consumer products upside and building a very large book of business for years to come. It's a sizeable opportunity ahead, so as I've said before, please stay tuned. Over to questions now. Thank you. If you'd like to ask a question, please signal by pressing star one on your telephone keypad. If you are using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. Again, press star one to ask a question. We'll pause for just a moment to allow everyone the opportunity to signal. We'll take our first question from the line of Aravinda Galappatthige. Yo ur line is now open. Please go ahead. Thanks. Good morning, and congrats on the strong quarter, gentlemen. I wanted to start with because, you know, obviously, you know, you're developing a lot of these deals, and I wanna make sure we keep track of all of them. Can you just help us with the timing, you know, in particular, Eric, the brands that you talked about, the Yo Gabba! deal, the Degrassi, Strawberry Shortcake, Johnny Test. Like, can you sort of help us with the timing of these deliveries so we have sort of an accurate sense of, you know, when the financial benefit would accrue? Secondly, with respect to I see really strong consumer products numbers yet again, particularly so in Q2, actually. Can you help us with how, you know, that flows to profitability, especially when it's driven by Peanuts? I know the 41% holding, that's known, but the other pieces, the other sort of claims against, sort of that top line, can you sort of just help us work that out, as we try to assess sort of the impact on EBITDA and profitability in general? Thank you. Hey, thank you, Aravinda. I'll take part of this, and I'll certainly welcome Josh to join in regarding the studio and specific delivery of content. First of all, you're seeing nothing from Yo Gabba Gabba! or Degrassi in our numbers yet. The only exception I would say to that is on the distribution side, where there's money that I alluded to, as well as views flowing through our AVOD distribution and Spark distribution of that content. The nice part about the live action piece is it happens pretty quickly. You know, we're in pre-production or production on all of those announced shows. Jonny Jetboy is animation, however, so we'll talk about the timing of that in a minute. That stuff that comes in basically in a 12-month period, depending obviously on how many episodes are in an order, whereas lead time on animation can be as long as 24 months as the production numbers go. That doesn't even begin to touch, though, what happens in consumer products. Because as I've said before, and you know it is a past practice which, you know, I have, like, not followed, is we wait until the market is ready on consumer products. We don't lead with it, we chase with it after there's a fan base and audience engagement, and that's when it starts turning up in the numbers, and that, you know, can be something like, you know, as we're looking at Chip and Potato, it's going into its third season. We just struck a toy deal there. There are these multiple streams that are layering, some in live action and some in animation. It really depends. As well as things that you alluded to Peanuts in the second part of your question. That has always been, you know, that's a character property that's always had character demand, just, you know, without any filmed entertainment content. I think what you're seeing right now in the strong CP numbers, particularly as it relates to Peanuts, is the effect of, you know, absolutely fantastic new content that's rolling out on a global basis. That is creating, you know, significant new demand for Peanuts. I've talked before, and I think I did so at Investor Day, what an amazing marketing partner Apple is and how dedicated they are to this franchise. That's led to a great deal of growth. Let me see if Josh has anything to add to that and then, you know, can certainly come back to you to make sure I answered everything. Thanks, Eric. Just a couple more details. Specifically on Degrassi, nothing is reflected in our numbers to date. Next quarter, we will. You'll see some distribution revenue hit as a result of this deal. Next year will be when the revenue from the new production will be reflected in our numbers. Likewise, with Gabba, we've seen some distribution numbers reflected, but really the production is very early days and won't really take full effect until next fiscal year. Also on Strawberry, nothing reflected in our numbers related to the current production right now. That will start to build in subsequent quarters. Aaron? On the CP question, Aravinda, as you know, and Eric mentioned it in his remarks, CPLG is a critical component of our CP strategy because we have our own in-house agency. You know, the more that we do on that business, we get our 30% margin, which improves our margin significantly on not only Peanuts, but also on other brands, especially our own brands. As we continue to build on our own brands, we have a massive built-in synergy that will start to really kick in next year, on top of Peanuts. Thanks. I just want to follow up on what Josh said. When you talk about distribution for Degrassi and Yo Gabba! hitting this year, if you take Degrassi, for example, that 385 episode library, that licensing, that hits 2022. Is that fiscal 2022? I'm sorry, fiscal 2023, is that correct? Yes. That's correct. Okay. Is it fiscal 2022 or fiscal 2023? Sorry. It's fiscal 2022, to be clear. The production revenue will hit next year, next fiscal year. Okay. Got it. Thank you. Just a quick follow-up on Spark. You know, obviously it continues to grow nicely, but you know, we're still some ways from sort of the pre-pandemic or let's call it pre-made for kids time period. How do you see that the shape of growth there? Maybe just touch on some of the drivers there, please. Yeah, what you're seeing in Spark and, you know, I make this characterization in general, Aravinda, which is like, let's not get, you know, overly obsessed about quarter-to-quarter. You know, you're seeing a layering in of all these production deals, a switching on of the IP. Spark, in some sense, this is no different. It's a content-driven platform, as it sees ebbs and flows. You know, YouTube, Google turns the dials in various ways around the business. Optimization continues. What I can say is this, double-digit growth this quarter, double-digit growth next quarter and on a full year basis. Our revenue is up year-to-year. It's healthy. Advertising rates are continuing to recover. We're increasing monetization of the large audience. We're benefiting as a provider of very curated quality content and optimizing that content, and it's a bet on quality and network scale. We're always refining there. We're seeing, you know, meaningful increases in eCPM. You're also seeing YouTube favor quality networks, favoring networks exactly like ours, because they're TV now. I mean, they are. You know, they're every bit on your smart TV startup screen as television. You know, we can think of them not just as mobile content or, you know, as they originally started as cat videos. It's a real network, and we look at it as part of the mosaic of distribution platforms. But it's really about this kind of 360 engagement, for example, about emojitown, that's a YouTube native operation and the way we manage it. It's about audience engagement. That's what we're going for. It's about those quality views. You know, it's just, again, part of the puzzle of content management that we have. You know, I can say unequivocally double-digit growth next quarter and full year. Thank you. I'll pause the line. Again, if you'd like to ask a question, press star one. We'll take our next question from Dan Kurnos with the Benchmark. Your line is now open. Great, thank you. Obviously strong results, guys. I guess the question for me at this point, Eric, is, you know, I know we're only halfway through the year here, but you have some pretty big momentum building. You're telling us that, you know, a lot of these new deals aren't in your numbers. I know that a lot of this will fall into 2023, so we'll get kind of a stepwise function. But you almost comp against your Apple deal last year. You almost met the numbers in you know, calendar Q4. I guess what I'm trying to get at, Eric, is just, you know, is there any way to kind of size how we think about the stepwise function, like, where we go from here? I know you're probably reluctant to give any, you know, granular forward guidance, but I'm just trying to get a sense of how big you have currently in the pipeline of what this is going to add. Frankly, in the back half of the year, if you have this momentum, you know, it feels like your current guidance is somewhat conservative. Thank you, Dan. We like to be conservative. Look, we're super comfortable with where we're at. We reaffirm that guidance, and there's really no reason to change. I would just remind we're still investing and, you know, putting money back into projects and opportunities where we see layering in for future growth. I think I can reiterate, though, just as far as what's gonna fall in fiscal 2022. You know, you and your colleagues are well familiar with our requirement to accrue, you know, large library licensing deals in the order in which the content is delivered. T hat will be showing up. Then obviously the pipeline, which I'm feeling really good about, that will take us into fiscal 2023. Much of that work has been done without even putting anything new on the books that we have a very, very solid platform. I think that the trajectory is just in the right direction. You know, we do get a little bit of noise in the system, as you understand, when we have to accrue these very, very large deals like Peanuts, which happened last year, when these large library deals are concluded. That's basically, you know, what I can say. Super confident about our long-term targets. Even though we're looking at improvements in this quarter and, you know, most of our deals in consumer products upside, they just aren't in our numbers. That includes Peanuts, which I know this is funny to say about a property that's as old as Peanuts, but it's just getting going. If you saw what happened just in terms of you know our Swatch deal and Lacoste and you know huge media spends against those properties, we're really seeing terrific momentum, and we're just layering on one at a time you know long-term high return deals first-class partners. Not rushing anything, though. That's. You know, again, I know you're looking for more granularity. I don't have it for you, but we're sticking to our guns. Right. Fair enough. The Jay Ward portfolio, you wanna talk about tugging at the old heartstrings, Eric. Super quality. Obviously, you guys have a chance to do some good stuff. This is the second quarter in a row you've announced a pretty meaningful, you know, partnership, plus you've got, you know, the China deal for Jonny Jetboy. I'm just curious, you know, from your vantage point and given sort of the macro backdrop on what's going on here and your growing momentum, you know, is this. I don't wanna, you know, sort of front run your further announcements, but is this kind of the cadence we should expect to hear from you guys in terms of new partnerships? How does the pipeline look, you know, from that perspective? Dan, as to the pipeline, you know, when it comes to the kind of the M&A and partnership-related deals, you know, they kind of have their own timetable. It's nothing that, you know, we try and sync up to a quarterly announcement. There's a really good pipeline there, and we continue to work on deals that, you know, not only about the monetization, activation of the IP library, but also acquiring other stuff. I mean, I just saw yesterday Fox picked up Gumby. You know, it's the way of the world. That consolidation continues unabated. You know, I have to say it's so personally gratifying for me, when, you know, Tiffany Ward was- I was the first phone call she made after the NBCUniversal deal expired. We're getting back together again, and I know that's gonna be an incredibly fruitful and fun relationship. I should also mention, apropos of nothing, that I think the George of the Jungle series, Peabody and Sherman, and the Rocky and Bullwinkle series, which we made together. One was for Netflix, the other was for Cartoon Network. Another one of the shows was for Amazon. All were done coincidentally because of creative excellence at our predecessor studio in Vancouver, which is now WildBrain Studios, but it was a Studio B. You know, the animators fought for the opportunity to work on it. That's really... I know, you know, you're looking for numbers, but that, you know, creative snowball effect of, like, great content, great development, you know, creative excellence, that's the stuff that delivers. It takes time. That's the build. Yes, the trajectory is exactly as you described, but we're not kind of deal timing to quarters. You know, Degrassi was in the incubator for quite some time, and we had opportunities to move with it earlier with different creative teams, but we waited to get the exact right team on that. We've done that with each of the properties, and we're just gonna take our time on it. What it does is just delivers this sort of steady state and a real shot at the consumer products upside, and that's what we're going for. No change in plans. Got it. If I could just sneak one last one in. Obviously, there's upward pressure or tailwind from you on CPMs. I'm just curious, in this environment, in an inflationary environment, and given the amount of crazy spend on media, especially in the kids category, if A, you're seeing any benefit on, you know, either episode pricing or licensing deals. Then excuse my ignorance, but on the CP side, knowing that you don't take inventory, do you get any flow-through if toy prices continue to rise due to supply chain issues? Let me start with your last question first. You know, I'm hardly an economist, so I can't really gauge, you know, the inflationary effects of these things, but just tell you kinda what we're seeing. As wholesale prices go up, we get higher royalties, absolutely, because our, you know, licensing deals are generally pegged to the wholesale received by our licensees. Yes to that question for sure. You know, it's also the case that as you sell more expensive stuff, you know, and that would be like some of our big Halo licenses, you know, those are much chunkier fees that we get out of those licenses. Fewer articles sold than mass. We love mass deals, but they help define the franchise, and that's often part of the strategy that we go into licensing with is you know you start upstairs, and then you kinda work your way down. It's just part of that product life cycle. As to whether we're seeing inflation hit the you know content licensing market, I don't really. I haven't seen any of that going on yet. I mean, because each IP is its own thing. I think it's more, Dan, about the competitive pressures you know where we have multiple buyers for properties, and they just have to bid for it. It's just like the good old days. I don't think that has changed at all, in terms of, you know, having to bid up a price for either library content or the rights to new production. I think if anything where, you know, there's pressure on wages, I think that the streamers and licensees understand that. There's pretty good transparency in the industry around what things cost to make, and, you know, they're gonna have to come up with the difference. You know, speaking of which, I just got my notice from Netflix that my price went up to $20, so, that just equals more acquisition budget to me. Amazon's charging me more now too, so I hear you. Yes, that sounds like pricing power to me, Eric. That's kind of what I was getting at. I appreciate it. Thanks for all the color. Thanks for indulging me and, you know, keep up the momentum. Not at all. Thanks for your questions, Dan. There are no further questions at this time. Ms. Nancy Chan-Palmateer, I'd like to turn the conference back to you for any additional closing remarks. Thanks, operator, and thanks everyone for joining us today. We look forward to updating you again further on our next call in May. Thanks, everyone, and have a super day. That concludes today's conference. You may now disconnect.