Good day, and thank you for standing by. Welcome to the Telos Corporation First Quarter 2025 earnings call. At this time, all participants are in a listen-only mode. Please be advised that today's conference is being recorded. After the speaker's presentation, there will be a question-and-answer session. To ask a question, please press star one-one on your telephone and wait for your name to be announced. To withdraw your question, please press star one-one again. I would now like to hand the conference over to your speaker today, Allison Phillipp, Director of Corporate Communications. Good morning. Thank you for joining us to discuss Telos Corporation's First Quarter 2025 financial results. With me today is John Wood, Chairman and CEO of Telos, and Mark Bendza, Executive Vice President and CFO of Telos. Let me quickly review the format of today's presentation. Mark will begin with remarks on our First Quarter 2025 results. Next, John will discuss business highlights from the quarter. Mark will follow- up with second quarter guidance before turning back to John to wrap up. We will then open the line for Q&A, where Mark Griffin, Executive Vice President of Security Solutions, will also join us. The first quarter financial results were issued earlier today and are posted on the Telos Investor Relations website, where this call is being simultaneously webcast. Additionally, we have provided presentation slides on our Investor Relations website. Before we begin, we want to emphasize that some of our statements on this call, including all of those relating to 2025 company performance, plans, and operations, are forward-looking statements and are made under the safe harbor provisions of the federal securities laws. These statements are based on current expectations and assumptions that are subject to risks and uncertainties. Actual results could materially differ for various reasons, including the factors described in today's financial results summary, in the comments made during this conference call, and in our SEC filings. We do not undertake any duty to update any forward-looking statements. In addition, during today's call, we will discuss non-GAAP financial measures, which we believe are useful as supplemental and clarifying measures to help investors understand Telos's financial performance. These non-GAAP financial measures should be considered in addition to, and not as a substitute for, or in isolation from GAAP results. You can find additional disclosures regarding these non-GAAP measures, including reconciliations with comparable GAAP results, in our First Quarter Results Summary and on the Investor Relations portion of our website. Please also note that financial comparisons are year-over-year unless otherwise specified. The webcast replay of this call will be available on our company website under the Investor Relations link. With that, I'll turn the call over to Mark. Thank you, Allison, and good morning, everyone. Let's begin today on slide three. I'm pleased to report that Telos has again over-delivered on key financial metrics in the first quarter, exceeding both revenue and profit guidance. Overall, it was a straightforward quarter with better-than-guided performance across revenue, gross margin, operating expenses, and adjusted EBITDA. Total company revenue grew 16% sequentially to $30.6 million and included growth from both Security Solutions and Secure Networks. Security Solutions grew 18% sequentially to $25.8 million, and Secure Networks grew 8% sequentially to $4.8 million. Security Solutions' revenue exceeded guidance partially due to outperformance on high-growth programs. GAAP gross margin was 39.8%, and cash gross margin was 45.3%, both exceeding guidance due to a more favorable mix. Adjusted operating expenses, excluding depreciation and amortization, were approximately $800,000 better than guidance, primarily due to lower-than-forecasted non-labor costs across multiple cost centers. As a result, adjusted EBITDA also exceeded the top end of our guidance range. Adjusted EBITDA was a $362,000 profit compared to our guidance range of a $1.8 million loss to an $800,000 loss. Lastly, cash flow from operations was a + $6.1 million, and free cash flow was a + $3.8 million. On our last earnings call, we said we were forecasting significant year-over-year improvements in revenue, profit, and cash flow for the full year 2025. Let's turn to slide four for a brief review of our year-over-year performance in the first quarter of the year. Revenue grew 3% year-over-year due to 39% growth in Security Solutions, partially offset by contraction in Secure Networks. Growth in Security Solutions was primarily driven by the successful transition of the Defense Manpower Data Center, or DMDC, program in the fourth quarter of 2024 and the ramp of TSA PreCheck enrollment volume. Secure Networks contracted due to the completion and ramp-down of multiple programs over the past several quarters. GAAP gross margin expanded 278 basis points, and cash gross margin expanded 313 basis points, both primarily due to the favorable mix shift from Secure Networks to Security Solutions. Security Solutions' revenue increased from 63% of total company revenue in the first quarter of 2024 to 84% of revenue in the first quarter of 2025. As a result of revenue growth and gross margin expansion, GAAP gross profit increased by $1.2 million and cash gross profit increased by $1.4 million. Turning to operating expenses, during the third quarter of 2024, we implemented a restructuring and cost reduction plan in order to maximize our operating leverage as we return to growth in 2025. In part as a result of that plan, adjusted operating expenses, excluding depreciation and amortization, declined by $1.3 million year-over-year. Higher cash gross profit combined with lower adjusted operating expenses drove adjusted EBITDA higher by $2.7 million. Lastly, cash flow from operations increased by $6.5 million and free cash flow increased by $7.4 million due to higher adjusted EBITDA, lower capitalized software development costs, and favorable working capital dynamics. Overall, we expect the trend of year-over-year growth in revenue, adjusted EBITDA, and cash flow to accelerate in the second half of 2025. I will now turn it over to John for an overview of recent business highlights. John. Thanks, Mark. Good morning, everyone. Let's turn to slide five. First, I'll provide an update on our TSA PreCheck program. We continue to make progress expanding our national network of enrollment centers, providing a convenient solution for travelers and gaining enrollment market share on this important national security program. The pace of our rollout has increased since our last earnings call in March, and 73 new locations have been added over the past nine weeks. We currently have 291 locations in key markets across the United States. As we said in the past, we do not expect a linear monthly pacing of opening new enrollment centers. We will have phases when we open a larger number of locations, followed by quarters when we open fewer locations, and during which we, together with the TSA, will assess the operations of our enrollment centers before resuming a higher pace of rollouts. However, we continue to target achieving 500 enrollment locations sometime around the end of 2025. Next, I will provide a quick update on the program with DMDC. The program is ramping on schedule, and we continue to expect it to be a major source of revenue growth for the company over the next several quarters. Finally, I will summarize the latest news on other business outcomes since our last earnings call. Our executive business has achieved new orders with several customers, including Infor and a U.S. federal government customer, as well as renewals from the U.S. 16th Air Force, the Office of Naval Intelligence, a New Zealand government agency, a leading cloud provider, and several other federal government customers. We also received a new order for cyber services from a Fortune 100 company in the technology sector. The Automated Message Handling System, or AMHS business, has achieved key renewals from the U.S. Marine Corps, the Defense Information Systems Agency, and the U.S. Special Operations Command. I'll now turn the call back to Mark, who will discuss second quarter guidance. Mark. Thanks, John. Let's turn to slide six. For the second quarter, we expect revenue to grow 14%-21% year-over-year to a range of $32.5 million-$34.5 million. We forecast Security Solutions revenue to grow low 60% to low 70% year-over-year, primarily due to growth in DMDC and TSA PreCheck enrollments. We forecast Secure Networks revenue to contract low 70% to mid-60% year-over-year due to the completion of programs over the past several quarters. GAAP gross margin is expected to be approximately 32%-33.5%, and cash gross margin is expected to be approximately 38%-39.5%, down from last year due to rapid growth of lower margin programs in Security Solutions and the completion of higher margin programs in Secure Networks. Cash operating expenses, which adjust for capitalized software development costs, stock-based compensation, restructuring costs, and DNA, are forecast to be approximately $1 million-$1.3 million lower year-over-year, primarily due to cost reduction initiatives in 2024. We forecast an adjusted EBITDA loss of $2.1 million-$600,000. Lastly, our full-year outlook is unchanged. Revenue for the full year will be comprised of several key components. First, we expect our existing business, excluding TSA PreCheck and the DMDC and DHS programs that we won in the first quarter of 2024, to generate approximately $70 million of revenue in 2025. Second, we estimate the DMDC and DHS programs could recognize approximately $50 million-$75 million of revenue. Third, we expect TSA PreCheck enrollment revenue to ramp along with our enrollment centers during the year. Lastly, any new business wins during 2025 will have the potential to contribute additional revenue during the year. With that, I'll turn it back to John. Thanks, Mark. Let's turn to slide six. In summary, we're pleased to have over-delivered on key financial metrics in the first quarter, with 16% sequential revenue growth, positive adjusted EBITDA, and positive cash flow. Additionally, we're thrilled with the progress on the DMDC program. The program continues to ramp successfully and remains a key source of revenue growth in 2025. We are excited to be able to deliver mission-critical offerings to this important U.S. government customer. We continue to make progress on the expansion of our TSA PreCheck enrollment network and have added a significant number of new locations since our last earnings call. For the second quarter, we're forecasting 14%-21% year-over-year revenue growth, primarily driven by substantial growth in Security Solutions, partially offset by contraction in Secure Networks. Finally, we expect year-over-year growth in revenue, adjusted EBITDA, and cash flow to accelerate in the second half of 2025. With that, we're happy to take questions. Operator, please open the line for Q&A. Thank you. Thank you. As a reminder, to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Our first question comes from Zach Cummins with B. Riley Securities. You may proceed. Hi, good morning, Mark and John. I appreciate giving me the opportunity to ask questions and congrats on a solid start to the year. Mark, I appreciate the reaffirmed outlook, essentially. Just curious if there's been any changes on the new business front, first part of the question there. The second part is, can you give us a better sense of what the margin profile for DMDC looks like as that continues to go through the early stages of the ramp right now? Yeah, hey, Zach, good morning. It's Mark Bendza here. I will start on the DMDC margin profile, and then I'll turn it over to Mark Griffin regarding new business. DMDC is a large program. It's going to generate substantial revenue and revenue growth for us this year and then into 2026. It's also a complex program, and there are multiple revenue streams within that program, and they have very different margin profiles. On balance, on a blended basis, that program will be dilutive to overall margins. I'm not going to get into program-specific margin details, but it will be dilutive to overall margins. As that program ramps sequentially over the course of this year, it's going to primarily be the lower margin revenue streams that will ramp. You will see margin contraction sequentially over the course of the year. Revenues will ramp significantly from the first quarter to the second quarter. Margins will contract, and then operating expenses will be relatively flattish, maybe a little higher in the second half. Year-over-year, you're going to see overall revenue, adjusted EBITDA, and cash flow, that year-over-year variance to improve from the first half to the second half. Let me pause there and see if that answers that part of the question. Yeah, yeah, very helpful on that front. Just curious about any kind of incremental new business this year that maybe is flowing into the model. Sure. I'll turn it over to Mark Griffin. Hello, Zach. The business pipeline still remains over $4 billion with several hundred opportunities that we're working on. The award dates for those opportunities still are scattered between this quarter and next quarter and end of the year. Any incremental growth that we see from awards this year will be single-digit kind of opportunities, but the pipeline is still very robust, and we're still very pleased with how it's filling out. It's equivalent to what it was last earnings call, just a different mix on some of the opportunities that we see both on the IA front, the ID front, and Secure Network. Got it. Just in terms of my last question, it is around TSA PreCheck. Obviously, the pace of the rollout has been a little bit slower to start this year. Just curious on the performance of your existing footprint and the visibility that you have in terms of rolling out to that 500 target with the TSA here towards the end of the year. Yeah. PreCheck is going to be a really important driver of our financials this year. We feel good about it, especially in terms of cash generation. I think you saw in the first quarter a very significant turnaround in cash flow. Overall, for the full year, I think you'll see cash flow step up significantly year-over-year. In part, that's due to performance on TSA PreCheck. We're feeling good about its contribution to the economics for the year. Do I say something about the rollout? Great. Thanks for taking my questions. Really appreciate it. Best of luck with the rest of the quarter. Thank you, Zach. Thanks, John. Thank you. Our next question comes from Rudy Kessinger with D.A. Davidson. You may proceed. Hey, guys. Thanks for taking my question. Really following on Zach's question, Mark, I know you don't want to get into maybe specifics on the margin profile, but put it a little bit more bluntly to Zach. If I look at your Q2 midpoint of your guidance versus Q1 results, it's - 31% incremental cash gross margins, - 59% incremental EBITDA margins. I guess could you tell us sequentially the climbs throughout the year in cash gross margins? Where could they be by year-end? Could they be low 30s, mid-30s? Where should we kind of plug those? Specifically on the DMDC revenues at $50 million-$75 million, what would that revenue be if it was being recognized on a net basis instead of on a gross basis? Thank you. Yeah, sure, Rudy. So first half to second half, if we talk cash gross margins, I'd say you're going to see approximately, now this is going to depend on mix. There are various things that can move this answer depending on mix. I would say from first half to second half, you'll probably see cash gross margins step down, call it roughly 600 basis points. We have some other higher margin revenue streams elsewhere in the portfolio that could come into the second half that will offset some of that dilution. As a base case, think of it as around 600 basis points of sequential cash gross margin dilution from the first half to the second half. That'll be driven by two things. It's the lower margin revenue streams in DMDC and then an accounting nuance that we've talked about in the past, which is how we're recognizing some of our costs on TSA PreCheck. We have some costs that from a GAAP basis is ramping through cost of sales in TSA PreCheck, but there's not a corresponding increase in cash expense, actually cash outflow expense. That's one of the reasons why you'll see cash flow meaningfully outperform what you would expect relative to adjusted EBITDA. That's helpful. Thank you. Yep. Thank you. As a reminder, to ask a question, please press star one one on your telephone. Our next question comes from Nehal Chokshi with Northland Capital Markets. You may proceed. Yeah, thank you. Nice results. I think positive guidance from my perspective here. You had positive free cash flow this quarter. That's great. Sounds like that's largely being driven by TSA PreCheck. Trying to bridge to your commentary that you expect year-over-year growth in cash flow in the second half of 2025, does that mean that Q2 2025 free cash flow will be negative? Yeah, Nehal. I'm not guiding Q2 free cash flow simply because it's very much going to be driven by working capital at the end of Q2. I could tell you the first two months of the quarter, I expect to be positive, slightly positive. The third month of the quarter, it's really going to come down to the mundane details of working capital collections versus payments in the last kind of one to two weeks of June versus the one to two weeks of July. That delta could really push working capital positive or negative. It'll just reverse in July. That being said, second quarter of last year, we burned $11 million of free cash flow, right? I think relative to last year, we're going to be in a very different place this year, just like we saw in the first quarter. Given that. Nehal, that's true throughout the year. Yeah. Okay. You mean the first two months versus the third month of the quarter in terms of free cash flow generating characteristics? Is that what you're saying is true? No. What we're saying is that we expect to be, from a year-over-year point of view, we expect to be way better than last year. Yep, on free cash. Got it. On a free cash flow basis. Understood. Let's see. Free cash flow for calendar 2024 was - $40 million. Given where you were for 1Q 2025 and where things seem to be trajecting, what are your expectations for the full year? Will it actually be positive? Yeah. Nehal, I'm not guiding full-year cash flow, but one of the things that I walked through on the last call is that we expect free cash flow to outperform adjusted EBITDA, in part due to some favorable working capital dynamics, as well as the pretty significant chunk of expense recognition running through cost of sales on PreCheck that will not have a corresponding cash outflow. Okay. All right. Great. Then just on the quarter here, you note that outperformance comes from both security solutions and secure networks. From a dollar basis, which one was the bigger outperformer? Solutions. Security solutions. Would that primarily have been driven by TSA PreCheck then? I'd say both of the growth programs. So DMDC and PreCheck. Okay. Are you seeing any rollover and renewal activity given that we're coming to the, that we are past the five-year COVID anniversary here? Yeah. The renewal market will contract. Overall market will contract pretty meaningfully this year. We did see that in the first quarter as expected. Okay. Great. Fantastic results given that dynamic. Thank you. Thank you. Thank you. This will conclude today's question and answer session. I will now turn the call back to John Wood for any closing remarks. First of all, I just want to thank our shareholders for your ongoing support. We continue to make progress in the first quarter. We executed our plan, demonstrated year-over-year growth in key financial metrics. We look forward to continuing the trend of year-over-year growth throughout 2025. We have very robust and recession-resistant markets and well-funded customers and a decades-long track record of serving the world's most security-conscious organizations. From our perspective, Telos has a very strong foundation for the future. Thank you very much for participating. Thank you. This concludes the conference. Thank you for your participation. You may now disconnect.