Q2 2023 LogicMark Inc Earnings Call

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Good day, and thank you for standing by and welcome to logic, Mark second quarter 2020 financial results and corporate update conference call. At this time, all participants are in a listen only mode.

The speaker's presentation there'll be a question and answer session to ask a question during the session you'll need to press star one on your telephone you will then hear an automated message advising Johannes race to withdraw your question. Please press star one again, please be advised that today's conference is being recorded.

And now like to hand, the conference over to your speaker today peer Dubois with Investor Relations. Please go ahead.

Well, thank you norm and good afternoon to everyone.

And thank you all for participating in today's conference call joining me from logic, Mark today, Our Charlotte Simmons, Chief Executive Officer, and Mark Archer Chief Financial Officer.

During this call management will be making forward looking statements.

Statements that address logic marks expectations for future performance or operational results and anticipated product launches.

Forward looking statements involve risks and other factors that may cause actual results to differ materially from those statements.

For more information about these risks please refer to the risk factors described in logic marks most recently filed annual report on Form 10-K, and subsequent periodic reports filed with the SEC as.

As well as logic marks press release that accompanies this call.

Particularly for the cautionary statements in it.

The content of this call contains time sensitive information that is accurate only as of today August 10 2023.

Except as required by law logic, Mark disclaims any obligation to publicly update.

Or revise any information to reflect events or circumstances that occur after this call.

With that it's my pleasure to now turn the call over to Charlotte.

Thank you Pierre and welcome to everyone joining us today.

We'd like to start by thanking our employees for their tireless efforts as we continue to build <unk> into a leading solutions provider with a carrier economy.

Our team is relatively new but we have much to be part of.

You'll see from our second quarter results.

Okay.

60% plus gross margin level for another consecutive quarter.

In fact, our second quarter gross margin of 69% is the highest level of reported in the last 10 quarters.

This is partly due to improvements in our supply chain logistics and we're also looking for other operating efficiencies to keep in mind. We are still very focused on building testing and releasing new products, which will grow our top line.

Speaking to product releases.

Very excited to announce that we are expecting to launch a new product called freedom on that plus the.

The first since most of the new team was higher last year.

For the legacy company, the first new product in eight years.

The new freedom aware plus is a wearable device that introduces fault detection.

Is that connection to caregivers.

Screen design, which is unique to the person industry.

By incorporating a more sophisticated device.

<unk> software platform.

Can offer valuable additional features helping to transform us from a mere reactor technology ensure predictive technology and a more comprehensive health communications product.

With this new generation of Arctic My products, we can now captured in needed data to monitor our customers' evolving in real time, using artificial intelligence and machine learning to optimize the best care.

These systems utilize various sensors algorithms machine and machine learning techniques to analyze them and some patterns usage and other relevant data to accurately predict the likelihood of a fall occurring.

Our current assessment of fault detection has been lacking in the Perth market for some time and our team is tackling head on with our R&D efforts and innovative solutions throughout the Pie chart and careful current platform as a service.

C pass ecosystem.

She passed utilizes the logic more care of the software platform, our new suite of connected services.

<unk> includes a proprietary device operating system called.

Cloud based services.

Third launch App, which can be accessed on both iOS and Android devices.

The new logic devices will offer automatic updates.

This permits us to continuously optimize our fault detection for our customers.

It also allows us to add new features ensuring sustainability are providing customers with innovative features at all times.

For example, we'll be incorporating a medicine reminder, and one of our upcoming product releases.

The user can program alerts for the various prescription medicines they are taking.

Our aim is to make this feature assessable on Albania logic mask copper products after features become available.

Our previously announced partnership with diverse monitoring also supports our ability to respond to our customers' needs.

And without working with them to support a life century subscription based product.

Freedom alert will be available through our government business to business and direct to consumer channels.

This includes a logic Mark Amazon store, which we bought in late March to help increase our direct to consumer distribution.

We're continuously working on making out direct to consumer channels operate more efficiently. So that we can capture additional market share.

Yeah.

We're excited about our role in providing additional products in the marketplace to serve the aging population.

A recent article by U S News report summarizes their survey.

Indicate a strong desire for the 55 and older population tilted in their homes as long.

Long as possible.

Sure.

A few of the highlights include.

For the first time ever there will be more older adults in the United States and children and the upcoming battle.

By 2034.

The U S census Bureau.

But there will be.

At least half a million people, aged 65 and over reported a 67 5 million under the age of 18.

But the decisions are thoughtful medical system can be difficult.

<unk> yeah.

Yeah, we all 96%.

Well it brings some comfort according to bed once safety net and affordable.

The surface Mount reform, but 97% of these are certain medical devices Bookmark utilized provides reassurance appeared to have in Europe was device.

We're using a system of health related technology people 55 and older.

Among the most.

But it's easy to use.

These metrics at all.

As possible using a mobile app.

Wireless.

I probably in a recent report published by CP.

Sure.

So delivery and navigation tax as well as health data analytics.

By category.

Acting private reimbursements were flat in 2023.

Uh huh.

Do you have more proof points.

Right path with our target markets.

During.

Hum.

Development is on target.

At this point I'd like to hand over the call to Mark for some comments on the financials.

Yeah. Thank you Shai win.

Our second quarter results include a gross margin of 68, 7%.

On revenues of $2 3 million.

This compares to a gross margin of 59, 5%.

On revenues of $3 4 million for the same period last year.

We're always looking for ways to improve margins through productivity.

Better supply chain management.

Efficiency improvements and cost reduction programs.

As an example, we've been able to return to Trans Pacific shipping.

As opposed to using airfreight.

From our Asia based contract manufacturers.

And the airfreight can be four to five times as expensive as shipping over the ocean.

So the savings are substantial.

The decrease in year over year revenues was due to onetime sales.

911, plus 14 units last year.

That replaced.

Yes.

The national cellular networks announced in 2022, they would no longer support.

In the case of our three junior and it's less than two years old.

We did place those units at our cost.

Whats the veterans administration healthcare system greatly appreciate it.

As Youre aware.

<unk> has been our most significant and enduring customer.

As Sharon mentioned.

We're still focused on building out the new product pipeline and ramping up our sales.

During the quarter operating expenses rose.

748000.

24% compared to the same period last year.

Specifically.

The increased operating expenses relate to the started of online advertising to support our direct to consumer sales effort.

Additional personnel in the sales department.

And one time expenses relating to the special shareholders meeting held in April .

And the reincorporation into Nevada that was done in June .

Net loss attributable to common shareholders for the second quarter.

Was $2 3 million compared with a net loss.

Of $1 2 million in the same period last year.

On a fully diluted basis.

Our net loss per share was $1 83.

Compared to a net loss of $2.50 a share last.

Last year.

The net loss per share improved over prior year because of the weighted number of shares outstanding.

On April 21, we successfully completed a one for 20 reverse stock split on both our common and preferred shares.

Which was required to maintain compliance.

With our continued listing on the NASDAQ stock exchange.

On May eight we were notified by NASDAQ that we were in full compliance with their listing requirements.

From a liquidity standpoint, we ended.

The second quarter with a cash balance of $7 6 million.

Compared to $7 million at the end.

Calendar 2022.

I also would just like to mention that we finished bringing our accounting function in house this quarter.

Well, we have been out.

Outsourcing with a third party.

We believe this move will strengthen our internal controls.

Improve our financial reporting process.

And help us manage our expected future growth.

Well I think Norma we can go ahead and kick off.

Q&A Mark did you have any comments before you want to hand, the call over to her.

Oh, yes, I'm, sorry, I did.

Did we not hear any of that.

Oh sure Yeah, we heard it all.

I think you had a closing statement before you wanted to hand, it over such as nobody wanted to.

I, just I guess I just.

I'm pleased with the progress so far and with the product pipeline.

Filling up I think we'll see.

Lifting our revenues beginning later this year.

Okay.

Thank you again to ask a question Thats Star one one.

And at this time I'd like to hand, the conference back to silent chairman for closing remarks.

Okay.

Thanks to all of you for taking the time to listen today.

We appreciate your support and we look forward to keeping you updated on our progress.

This concludes today's conference call. Thank you for your participation you may now disconnect everyone have a wonderful day.

Okay.

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Hum.

Yeah.

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