Okay, we just opened up the presentation. We're going to give everyone a couple seconds here to get in from the lobby, then we will get going. Okay, let's get started. My name's Greg Burns. I'm the analyst at Sidoti, moderating the presentation here this morning for Anterix from the company. We have Tim Gray, their CFO. We're going to run this like a fireside chat, so I'm going to direct the conversation for the first part here. Hopefully, if anyone has any questions, they could ask those through Zoom, and we will get to as many of those as possible. So with that, good morning, Tim. Good morning. Thank you. Thanks to Sidoti for having us here. We appreciate being a part of today's conference. Yep. Yeah. Thanks for being here. So I just want to kick it off with, I guess, a high-level question about the company. So maybe you could start off with talking about a quick history of the company and how the business has evolved since the FCC approval in 2020. Sure. So yeah, you mentioned it. We got FCC approval to offer broadband spectrum at 900 megahertz in May of 2020, so just a short four years ago. And in that short time, we've really become a utility industry partner. We believe we're empowering, enhanced visibility, control, and security for a modern grid by providing our spectrum for private wireless broadband networks. And we've seen multiple utilities take us up on it. We've done six deals to date since we got that approval. We've got a pipeline with over 60 utilities in it with what we see as well in excess of $3 billion worth of value. And that spectrum is super important for these utilities as they increasingly need to monitor and control devices on their grid, extending all the way to the electricity consumer. They're super focused on wireless communications. Right now, this is really the most economical and highest performing option to connect all the different devices that they've got to put on their networks. So we feel like we've had a lot of success in driving the industry forward, really building something here that really didn't exist before when we're talking about these private wireless broadband networks. We've got a pipeline that continues to move forward on a daily basis. Okay. Can you just give us, I guess, a sense of your asset base? Is it strictly the spectrum? Do you have ground infrastructure? What does the infrastructure or the asset base of the business look like? Yeah. So we've got 6 megahertz of 900 megahertz spectrum. That's the asset that we've got that we are out there commercializing today. We have been able to use that asset to sign 6 customers with a value of over $270 million, ranging from a $30 million deal to an $80 million deal. And so that is what we have. We don't build out networks for utilities. The utilities themselves want to be able to capitalize costs. So they want to be able to not only capitalize the spectrum lease, but be able to capitalize the cost of an entire broadband network that they put in place. That goes from cell sites to fiber to the NOC that goes into place to put this network up. And so they want to be able to do that. They want to be able to put their own security in place without having to rely on other people to do that for them. They want to be able to put up the cell sites where they want them. They want to be able to harden those cell sites so that they stay up in a storm or an event. And that's very important to these utilities to be able to run their own networks, to be able to do all of those types of things. So then Anterix doesn't have to put up the capital to build out those networks. So we provide the spectrum. Then they take that spectrum and use it to put devices on air. And of the 6 deals that we've done, the vast majority of them already have systems and networks up and running. Okay. So maybe this kind of dovetails into that. But can you, I guess, then talk about the structure of your contracts? Is it paid all upfront and then amortized over a number of years? Can you just talk about, I guess, how the economics of the deals and how they're structured for you? Sure. Yeah. So we've done 3 leases to date—excuse me, 6 transactions to date, 4 leases to sales. The leases are 20- or 30-year leases. The utility, as I mentioned earlier, they want to capitalize costs. One of the ways they're able to do that on the spectrum lease side is by paying us upfront as we deliver spectrum. So we anticipate on deals getting paid within the first 3-5 years of that transaction. So we're going to get all that cash in upfront. But from a GAAP perspective, when we do the accounting, we're going to recognize the revenue over the entire term of that 20- or 30-year lease. So there's a little bit of a disconnect between the actual cash flows and the revenue recognition. But we're very happy to have that cash flow come in early as we then are able to do things like buyback stock, which we've been doing. We have an active $250 million program in place that was approved last September. We've been buying shares against that ever since then. We've also done, as I mentioned, 2 sales transactions where we sold spectrum to what are called utilities that are called Complex Systems. The FCC identified those as entities that had a certain number of sites already up on air at 900 megahertz. They could not be moved mandatorily in the process of clearing spectrum at 900. So with those, we knew we'd be a little bit more creative. So we did a couple of sales transactions. Those don't flow through the revenue line item. Those are going to flow through as gains on our P&L when we actually close those transactions. So even though there's a strong benefit to us, we get that money upfront as well. Again, it's not going to flow through their P&L from the revenue line item. Okay. And maybe we could just talk about the overall market opportunity in the utility space, maybe why you focused on that industry and what the total addressable market looks like for you there. And then maybe on the back end of that, you did this a little bit on the front end of the introduction, but maybe a use case or how utilities are utilizing these private networks. Sure. So utilities have had kind of private communication systems, whether that's on the voice side or whether that's on the data side, for decades. And using a variety of different technologies, a lot of them are sole purpose and would end up being built out into multiple different networks for sole purposes within their organizations. One of our first customers had 20 different communication systems. That part of the reason why they wanted to come onto a private wireless broadband network was to be able to consolidate those down to one or something closer to one. And so that was very important to them and a key part of their business case to be able to do that. From a use case standpoint, what we're seeing today, and let me just talk about power generation, where that has completely changed in the past several decades, where you used to have one coal or gas plant or something like that that would ship or send electricity directly out to the end user, today, now, power is being generated everywhere. It has to be moved constantly. The systems in place to measure that movement, to measure the data of when to send power to a house that has a solar panel or when to receive power back onto the grid from that house with a solar panel, is extensive and growing rapidly on a daily basis. The systems that were in place didn't have the technology to be able to measure all that data, measure the proliferation of devices that are going up to measure that data. They needed new solutions. This is what the private broadband networks are what's come into place to be able to help solve that and solve the need for the data movement now that's taking place where you're seeing—we were starting now to talk about smart meters that are going into homes instead of being pinged once a month, as is currently taking place in a lot of places around the country—it may be monitoring it on a daily, hourly basis and taking information so that the grid operator, the electric company, knows how to deal with that as they deal with different weather events that are going on across the country. We've seen, from a use case perspective, we've seen anything from fire mitigation as a significant use case where people can depower lines before they hit the ground based off of information that they're receiving over their network to one business case which is mainly driven by the fact that one company or one IOU utility was going to be putting up thousands upon thousands of new devices on the network, and they just didn't have the ability or a way to measure them with the old networks that they had in place. Okay. Maybe could you just talk about the total addressable market then within the utility space, what the opportunity is for you there? Sure. So right now, we have over 60 IOUs in our pipeline. And that makes up well in excess of $3.5 or 3+ billion dollars worth of value. This is not an extensive use or extensive number of utilities in the United States. Most of the value is in the investor-owned utilities. And there's not that many of them. What we believe is over 90% of the value of our addressable market already in our pipeline at $3+ billion dollars. So that is the core focus of what we're going after, those big investor-owned utilities, because they're the ones with the capital to be able to build out these networks and the desire to get them, procure them, and put them up in place. And so for us, it's not as much driving more people into the pipeline as it is continuing to work the process of advancing the customers that are within the pipeline on a day-in and day-out basis. What are the, I guess, the major bottlenecks there then? What can you do to shrink the time to deployment? Sure. Yeah. So you got to remember, these are large organizations that are regulated monopolies. So there's a lot of process that they have to go through when they're talking about rather large capital projects. So this is not just a spectrum lease that goes through the process of approval at a utility. It's the entire wireless network. And that's what they're getting moved through their set of processes, whether that's working through all of their different operating companies that they have, working through the regulatory process that they've got to work through just internally to make sure they understand how that's going to work. Some need to go to the regulators in advance. Some don't have to. But they want to understand that and work through that. They've got to go through the business case. They've got to make sure they identify vendors and things like that that are going to build out their networks. So there's just an extensive amount of process that moves things along. We have learned a lot as we've worked through the six customers that we've got and are working through with multiple others in the pipeline around processes within these utilities, knowing that each one is different. But we've done things like put together what we call a playbook to help utilities that are thinking about this as far as how to build things, like how to build out a business case, how to think through the regulatory process, how to think through the capitalization that they're going to have to deal with. And those types of things, we can come, and if someone's got a question, we've said, "We've already dealt with this at multiple different utilities here. Let us try to help you out." Another thing that we've done and put in place is what we call the Anterix Active Ecosystem. And that platform really is 100+ vendors who have put time, money, effort, marketing dollars behind 900 megahertz so that they've got equipment and services that will work to be provided to help these utilities when they're thinking about these networks. So when a utility is thinking about cybersecurity and what they can put in place on their network, we can go to multiple vendors within that active ecosystem to work with the utility. And that's already set up. And so it makes that process just a little bit easier for them to go through. So there are things that we can do to help, and we've done many of them to help the utility work through what they've got to work through. But they control their own process. There's not much that Anterix can do about when a utility is going to work through their capital committee and those types of things. That is what it is with them. But we want to help out, and we do as much as we can throughout that process. I know you mentioned the 6 and then the 60 in the pipeline. Have you put out any guidance or targets on expectations for the amount of revenue or deals you expect to close maybe this year or next year or any sort of guidance in that regard? Yeah. So one of the things that we've learned along this process is really hard to pinpoint exact timing. And so one of the things that we've done, taking away trying to predict timing of when we're going to sign deals, is put up a metric about a year ago called Demonstrated Intent. And that's really looking at and scoring activities going on within each of the utilities within the pipeline, some of which are public, some of which are private. It's things like putting out an RFP for spectrum. That's a clear indicator that they're moving forward. And there are roughly 20 factors that we look at and score as a part of that process. We have talked about when entities get above a certain point that we call our highest level of Demonstrated Intent, that they've shown a significant path forward to getting to a deal at 900 megahertz. It's just hard to pinpoint the exact amount of time. So we've got right now 18 utilities of the 60-plus in our pipeline valued at more than $1.1 billion that are above that highest level of Demonstrated Intent. Those are the ones that are closest to finishing the process with us. But again, when exactly they're going to sign is really hard for us. And so we haven't put out guidance on that currently. Okay. I might have missed this at the beginning, but what are the typical terms of these deals? Like 5, 10, 20 years? How long are these contracts that you're signing? Yeah. Good question. So in the utility world, their time horizons are really pretty long. The deals that we've done to date have been a couple of 20-year leases and 130-year leases. And there are renewals built in on the end of the deal. So there is value that we'll see when that timeframe ends with additional payments coming into Anterix at that point in time, as we would expect. Since utilities put infrastructure into the ground for them, probably they're going to renew on the spectrum side. But they're pretty extensive from a length of time standpoint. Okay. So I guess it's kind of like a land grab going on right now. Are there other competing solutions? Are there other people in the market providing spectrum like this like you are? Yeah. I mean, the utilities are going to look at to see what their other options are, like they do with everything else. They've got to make sure that, from a since they are regulated, they've done their due diligence from that perspective. And there's always the carriers. There are certain pockets of other little bands of spectrum that are out there below 1 gigahertz, but not many. We've really created the marketplace here for these utilities and for their private wireless broadband networks being the main spectrum provider and becoming the de facto standard because of the spectrum that we have and the advantages that we have, the platform we've put in place, and the deals that we've signed to date. Because I think you're going to want to see utilities get the benefits of scale from being on the same band of spectrum. So we see some advantages from where we are in the marketplace that we've put together. Okay. Have you seen any changes in pricing in the market from the deals you've signed? And then I guess you talked about a little at the beginning, the lease versus sale. Is there a preference either way? Are you indifferent, or just what's the most economic? How do you view how is that dynamic and the pricing dynamic in the market right now? Yeah. So let me talk about pricing. So when we first started this back four years ago, we said that we thought fair market value for what we could do would be between the 600 megahertz auction and the AWS auction that had taken place within a couple of years of that May 2020 FCC action. And all of the deals that we've done have been in between those goalposts. However, we've seen positive movement from at least our perspective on the pricing side where the value of spectrum continues to grow. We've seen a couple of different transactions at 600 megahertz go for double what the auction price was. And so those are factors that we continue to use when we think about pricing and when we talk to our prospective customers that spectrum on a day-in and day-out basis just gets more and more valuable, particularly under 1 gigahertz. So we bring that to the conversation when we see those new transactions. And I think we'll see that value reflected as we move forward, that growing value. So you talked about lease versus sale. Our business plan is really built around leasing. There are certain and I mentioned this earlier, but let me go into this a little bit again. When the FCC did the report and order in May of 2020, they designated roughly 10 systems in the U.S., mostly utility systems with over 45 sites in place at 900 megahertz as complex systems. So those did not have to be mandatorily retuned out of the broadband section of the 900 megahertz band. So they have a little bit, there's more creativity needed to get transactions done there. And those are the two sales that we've done. We also did a lease with one of the Complex Systems. So I think you'll see some different types of deals with those Complex Systems, maybe some more sales included. But I think by and large, from our business plan, you'll see more leases than sales. All right. So if we look forward a few years and you've converted the pipeline of customers, that $3 billion you talked about, is that the end of the story? Are there other revenue opportunities in this space to provide services, layer anything on top? How do you view the progression of the business going forward? Yeah, absolutely. I mean, there is definitely room for us to be able to work through some additional services, some additional revenue opportunities just based off of the platform we'll have put in place with more and more customers coming on at 900 megahertz. Those potentially could take a variety of forms that we're actively taking a look at and actively pursuing right now. We're not spending a whole lot of money to do that, but we're looking at what those are. I think in the next 12 months or so, you'll hear us talk more about what those opportunities are and what those revenue opportunities could be. We would expect them to be accretive. But we're going to take full advantage of the platform that we're putting in place as 900 megahertz becomes more and more the de facto standard. Okay. This question in regards to your capitalization and cash burn. At what revenue level do you expect to get to GAAP BPS positive? So that's a couple of things. From a capitalization standpoint, look, I mean, we have a good balance sheet. We don't have any debt. We have been able to take kind of excess cash and use that to buy back shares. We've been very active in buying back shares each quarter. We had a previous buyback program that we bought back shares under. We've got a new one that we announced in September again at $250 million that we've continued to buy back shares using. And we'll talk more about this last quarter when we announce our earnings here in the next month or so. So again, we have been out there using that excess capital, that extra cash flow. And I've mentioned this before. We're cash flow positive this last fiscal year. And that continues to be a strong benefit to be able to fund that buyback program. That's driven mainly from receiving well over $100 million in cash from our customers because of those prepayments that we get to come in our fiscal year 2024. So that's driving a lot of that from a returning capital shareholders perspective. When I think about what does GAAP revenue need to be to get us to EPS positive, that's got to be in the $40 million-$50 million range. Okay. Per quarter, right? No, I mean, on an annualized basis. Annualized? Okay. Okay. All right. And maybe this is kind of part of the last answer, but is the utility market enough for you to focus on? Is there opportunities for you outside of the utility market? How do you view that, or are you just committed to staying focused in the utility space? Well, I mean, I think the value for us is in the investor-owned utilities. That's where the main spectrum value is. That's where the well-capitalized utilities that can build out their own networks. They're the ones that are driving the activity for the most part in our pipeline. However, we've already done a deal with the Lower Colorado River Authority, LCRA in Texas. That's a quasi-governmental utility that does more than just from a power standpoint, they also manage the Lower Colorado River. Several of their use cases are going to be built around water and the services that they provide in managing the river. So it's not just the IOUs that we've already done. We're going to continue to see other opportunities outside of IOUs, whether that's gas, oil, and additional water opportunities as well. So we believe that they're out there, but we also believe that most of the value in our overall opportunity, looking at our market, looking at our pipeline, is in those Investor-Owned Utilities. Okay. I guess with that in mind, and maybe this goes back to converting the pipeline, but do you have the resources in terms of sales? How do you go to market within the utility space? Do you have technical consulting resources? How do you move the utilities through the pipeline? Yeah. So we've got a sales force that they're all assigned different utilities that they work with each day. Again, it's not a huge universe, so we don't have a large sales force, but we've got enough people to manage the day-to-day relationships to help continue to move these processes along. But what we do, in addition to that salesperson, is we have additional resources that they can bring to bear for any conversation that needs to take place, any questions that utilities need, whether that's in-house sales engineers who can get really deep in the weeds on the technical questions, or outside resources that we have on retainer for things like in-depth regulatory questions. We have different regulatory advisors who specialize in different areas of the country that we can bring to bear on questions that someone may have about a specific state that they're dealing with and what issues may come up in a regulatory process. And so those are, and that's across a variety of different areas that utilities have questions on that we have all kinds of additional resources that our sales guys can call on at any time to come in and have those conversations to help move things along. We also have a lot of executive involvement from our team in our own C-suite to help drive conversations within the utility at the C-suite and other levels to move things along. We also heavily participate in industry functions and conferences and things like that so that we're out there talking to both the utilities, the vendors, the whole ecosystem here and keep them up to date on what's going on and knowing who all the players are so that we're very actively involved and the sales force really can answer questions in depth about use cases as well. Okay. And we've probably touched on some of what this answer might be over the course of the conversation, Tim. So maybe we could just use this as a final statement, maybe give your pitch to investors on why they should invest in this stock. But what's your vision for Anterix? Where do you see the company in 5-10 years from now? Yeah. I mean, the vision is really to continue to be a partner. As we develop a de facto standard where more and more utilities are going to come onto this 900 platform, not only are we the spectrum answer, but we're also a partner who is able to answer and provide all kinds of additional services to utilities, whether we're looking for them as revenue opportunities or not, and for the long term, for the benefit of those utilities and their end users. So I did want to say thank you for having us today. I mean, I think this is for Anterix, we are and continue to be a good cash flow story. We feel good about where we are and continue to be able to return capital to shareholders. That process is going to continue because we are going to continue to advance our pipeline. We are going to continue to sign additional customers and continue to grow as the standard and platform for utilities in their wireless broadband networks. All right. Great. Well, if no one else from the audience has a question, I think that's a good place to wrap it up. So thanks, Tim, for speaking with us here this morning. Everyone else for listening in. And with that, we will wrap it up. Thank you very much.