Q2 2026 Burcon NutraScience Corp Earnings Call

November 12, 2025

And thank you to all on the phone for your time.

Interest in to many of you for your investment in <unk>.

Marissa: Good afternoon, everyone, and thank you for participating in today's conference call to discuss Burcon NutraScience Corporation's fiscal 2026 Q2 results ended 30 September 2025. Joining us today are Kip Underwood, Burcon's Chief Executive Officer, and Alex Varty, the company's Interim Chief Financial Officer. After the presentation, there will be an opportunity to ask questions. To join the question queue, you may press Star, then one on your telephone keypad. Should you need assistance during the conference call, you may signal an operator by pressing Star, then zero. Before we conclude today's call, I'll provide the company's safe harbor statement with important cautions regarding the forward-looking statements made during this call. Now, I would like to turn the call over to the CEO of Burcon, Mr. Kip Underwood. Please go ahead.

Operator: Good afternoon, everyone, and thank you for participating in today's conference call to discuss Burcon NutraScience Corporation's fiscal 2026 Q2 results ended 30 September 2025. Joining us today are Kip Underwood, Burcon's Chief Executive Officer, and Alex Varty, the company's Interim Chief Financial Officer. After the presentation, there will be an opportunity to ask questions. To join the question queue, you may press Star, then one on your telephone keypad. Should you need assistance during the conference call, you may signal an operator by pressing Star, then zero. Before we conclude today's call, I'll provide the company's safe harbor statement with important cautions regarding the forward-looking statements made during this call. Now, I would like to turn the call over to the CEO of Burcon, Mr. Kip Underwood. Please go ahead.

If you have one takeaway from our discussion today is that we at <unk> have tremendous business momentum today, you'll hear about the successful commercialization of technology.

You will hear us discuss record production.

You will hear us talk about subsequent to the quarter significant recurring sales.

And I think again as we announced earlier today the desire to.

Complete an additional funding round to accelerate our growth because we can see the customer demand.

So again exciting times for <unk>, great business momentum.

Our safe Harbor statement.

To walk through the business momentum I just discussed will go through our Q2 highlights.

Kip Underwood: Thank you, Marissa. Good morning, good afternoon, and good evening. Thank you to all on the phone for your time, your interest, and to many of you for your investment in Burcon. If you have one takeaway from our discussion today is that we at Burcon have tremendous business momentum. Today, you'll hear about the successful commercialization of technology. You will hear us discuss record production. You will hear us talk about subsequent to the quarter, significant recurring sales. At the end, as we announced earlier today, the desire to complete an additional funding round to accelerate our growth because we can see the customer demand coming. Again, exciting times for Burcon. Great business momentum. Our safe harbor statement. To walk through the business momentum I just discussed, we'll go through Q2 highlights. We'll ground ourselves in our technology platform.

Ground ourselves in our technology platform will go back and we'll talk about the plant protein market dynamic growing.

We will review our sales and production.

Talk about how we're investing for growth our cash position, while we believe it's a great time to invest in <unk> and then look forward what does 2026 looked like.

And obviously, we will open it up for <unk>.

For Q2 on the operational side I think there was one word I would say is execution.

So from an execution perspective again initial commercial sales.

Our pea protein and marketing approaches.

Successful scale up of <unk>.

Protein solid protein and canola protein.

It is very difficult because we are both starting up a new facility with our partner and commercializing technology, both our hard independently they are extremely difficult to do together.

Great customer engagement as evidenced by our customer pipeline 200 plus projects.

Kip Underwood: We'll go back and we'll talk about the plant protein market dynamic growing. We'll review our sales and production, talk about how we're investing for growth, our cash position, why we believe it's a great time to invest in Burcon, and look forward to what does 2026 look like. In the end, obviously, we will open it up for Q&A. For Q2, on the operational side, I think if there was one word I would say is execution. From an executional perspective, again, initial commercial sales, our pea protein and our canola protein. Successful scale-up of pea protein, faba protein, and canola protein. That is very difficult because we are both starting up a new facility with our partner and commercializing technology, both are hard independently. They're extremely difficult to do together.

And inside of those project customers are progressing they continue to vote with their time and the more time they vote with their more validation that our products are proteins are meeting if not exceeding expectations and.

And lastly, a great market outreach at IFC first one of the largest trade shows in the world great opportunity to showcase.

<unk> technology and interact with the entire industry.

That's the execution side with that I'll turn it over to Alex for the financial highlights Alex Morris.

Thank you, Kevin and respective financial highlights what we're really seeing is the translation of the operational achievements made throughout calendar 2025 into our financial performance in.

In Q2, specifically, we generated revenues of over 350000, representing a nearly eightfold increase over the comparable year ago quarter.

Kip Underwood: Great customer engagement as evidenced by our customer pipeline, 200 plus projects. Inside of those projects, customers are progressing. They continue to vote with their time. The more time they vote with, the more validation that our products, our proteins are meeting if not exceeding their expectations. Lastly, a great market outreach at IFT FIRST, one of the largest food trade shows in the world. Great opportunity to showcase Burcon's technology and interact with the entire industry. That's the executional side. With that, I'll turn it over to Alex for the financial highlights. Alex, please.

Subsequent to year end, we've also seen strong sales momentum with orders received from October 1st to date in excess of $500000, including multiple repaid commercial sales.

As we concentrate our efforts and our resources on production and sales we have reduced our spending in research and development and in general and administrative expenses by 61% and 27% respectively over the second quarter and fiscal 2025.

Lastly, we announced today the offering of convertible debentures, which will allow us to strengthen our balance sheet and support accelerated growth will discuss this more in detail later on in the presentation I'll turn it back to you.

Marissa: Thank you, Kip. In respect of financial highlights, what we're really seeing is the translation of the operational achievements made throughout calendar 2025 into our financial performance. In Q2 specifically, we generated revenues of over $350,000, representing a nearly 8-fold increase over the comparable year ago quarter. Further, subsequent to year-end, we've also seen strong sales momentum with orders received from 1 October to date in excess of $500,000, including multiple repeat commercial sales. As we concentrate our efforts and our resources on production and sales, we have reduced our spending in research and development and in general and administrative expenses by 61% and 27%, respectively, over the Q2 in fiscal 2025. Lastly, we announced today the offering of convertible debentures, which will allow us to strengthen our balance sheet and support accelerated growth.

Alex Varty: Thank you, Kip. In respect of financial highlights, what we're really seeing is the translation of the operational achievements made throughout calendar 2025 into our financial performance. In Q2 specifically, we generated revenues of over $350,000, representing a nearly 8-fold increase over the comparable year ago quarter. Further, subsequent to year-end, we've also seen strong sales momentum with orders received from 1 October to date in excess of $500,000, including multiple repeat commercial sales.

Thank you Alex and it really reiterate those last few points so.

All the work we have done since March finally, translating transitioning into significant commercial sales and then in discussions with our board our insiders seeing those sales come in recognizing we needed to accelerate growth be ready for growth.

The fund raise we announced today and that we will discuss later on the presentation.

Alex Varty: As we concentrate our efforts and our resources on production and sales, we have reduced our spending in research and development and in general and administrative expenses by 61% and 27%, respectively, over the Q2 in fiscal 2025. Lastly, we announced today the offering of convertible debentures, which will allow us to strengthen our balance sheet and support accelerated growth. We'll discuss this more in detail later on in the presentation. I'll turn it back to you, Kip.

Our foundation what enables all of this at our heart is our technology. The innovation network <unk> has invested in over the years and what that truly delivers is purity.

Unmatched purity in the marketplace and that's important because that purity is what delivers superior performance excellent taste excellent texture excellent color.

To our customers, we like to say, we gave the food companies a protein blank canvas. So they can go create the great foods that we all want to buy and the joy.

Marissa: We'll discuss this more in detail later on in the presentation. I'll turn it back to you, Kip.

Kip Underwood: Thank you, Alex. Really reiterating those last two points. All the work we have done since March, finally translating, transitioning into significant commercial sales. Then in discussions with our board, our insiders, seeing those sales come and recognizing we needed to accelerate growth, be ready for growth, hence the fundraise we announced today and that we will discuss later on in the presentation. Our foundation. What enables all of this at our heart is our technology, the innovation that Burcon has invested in over the years. What that truly delivers is purity. Unmatched purity in the marketplace. That's important because that purity is what delivers superior performance, excellent taste, excellent texture, excellent color. To our customers.

The technology also highly relevant in today's market because protein is if.

If you have walked a grocery store you have notice protein only front of pack protein positioning 10 grams approaching 20 grams of protein and beverages and coffee and cereals across all types of foods.

Yes.

Our potential customers look to position protein to consumers.

That is a great place for us that is a great place for our technology to play a role and in the end. This is a dynamic market that is truly good for broker.

And we see this in our in our robust funnel was mentioned this funnel has delivered $500000 of orders.

Since October <unk> subs in the quarter, but is any of the dynamics of 200 active projects, we talk about our customers.

Kip Underwood: We like to say we give the food companies a protein blank canvas, so they can go create the great foods that we all want to buy and enjoy. The technology is also highly relevant in today's market because protein is hot. If you have walked a grocery store, you have noticed protein on the front of pack protein positioning. 10 grams of protein, 20 grams of protein in beverages, coffee, and cereals across all types of foods. As our potential customers look to position protein to consumers, that is a great place for us. That is a great place for our technology to play a role. In the end, this is a dynamic market that is truly good for Burcon. We see this in our robust funnel.

Development and a new food for all of us as a nine to 18 month process and as they go through that process, we see sign that they are increasing their investments.

They start off with small bags, maybe 200 or 500 grams and they get older or maybe a kilo in the order a full bag of our products over 30 customers have ordered at least a full bag paid for to advance our development efforts. Some as we've mentioned initial orders initial pilot orders for P pharma and canola.

Next step is leading to your recurring revenue.

And so it's a dynamic process customers moving through the funnel. It has great diversity in terms of type of customer type of fruit again across all of our products and this is really the lifeblood of our growth in the future. It was fantastic to see that first $500000 plus in orders.

Kip Underwood: As mentioned, this funnel has delivered $500,000 of orders since 1 October, subsequent quarter. It is dynamic. 200 active projects. We talk about a customer's development in a new food for all of us is a 9 to 18-month process. As they go through that process, we see signs that they are increasing their investment. They start off with small bags, maybe 200 or 500 grams, then they order maybe a kilo, then they order a full bag of our product. Over 30 customers have ordered at least a full bag paid for to advance their development efforts. Some, as we mentioned, initial or initial pilot orders for pea, fava, and canola. The next step is leading to recurring revenue. It's a dynamic process. Customers moving through the funnel.

Coming out above the funnel as wins.

People often hear me say one thing you must do before you can sell it as you have to produce it.

And working with our partner program.

Unbelievable.

Three months in the last quarter and then subsequent to the quarter so record production.

Commercialized three technologies again plant startup.

Technology commercialization, both hard individually done had done successfully at the same time validating our technology platform we have.

Have quality certifications third party BRC, which is one of the largest food.

Ingredients fabrication organizations in the World kosher allergen free we have a facility with our partner that has the capability and the people to deliver our technology our products at a cost of quality and the consistency.

Kip Underwood: It has great diversity in terms of type of customer, type of food, and again, across all of our products. This is really the lifeblood of our growth in the future, and it's fantastic to see that first $500,000 plus in orders coming out the bottom of the funnel as wins. People often hear me say, one thing you must do before you can sell it is you have to produce it. Working with our partner, ProMan, unbelievable, three months in the last quarter and then subsequent to the quarter. Record production, commercialized three technologies. Plant startup, technology commercialization, both hard individually, done and done successively at the same time, validating our technology platform. We have quality certifications, third party, BRC, which is one of the largest food ingredient certification organizations in the world, kosher, and allergen-free.

That meet or exceed our customer expectations and fully enable our business plan.

Okay highlighted <unk> had the opportunity to capture growing market demand for our plant proteins and we've undertaken a number of steps to strengthen our balance sheet such that we are positioned to capitalize on this opportunity.

The central pillar of our strategy here is the offering of the convertible debentures that were announced this morning.

Well the gone is undertaking a non brokered private placement of convertible debentures of up to $4 million.

Kip Underwood: Plant startup, technology commercialization, both hard individually, done and done successively at the same time, validating our technology platform. We have quality certifications, third party, BRC, which is one of the largest food ingredient certification organizations in the world, kosher, and allergen-free. We have a facility with our partner that has the capability and the people to deliver our technology, our products at a cost, a quality, and a consistency that meet or exceed our customers' expectations and fully enable our business plan.

We intend to use the net proceeds of this offering to invest in inventory and labor and production efficiencies to plan for both current and future infrastructure needs and to repay the short term loan.

I would further highlight that.

Significant support from insiders, who have committed to participate at a minimum of $2 million of the offering.

Kip Underwood: We have a facility with our partner that has the capability and the people to deliver our technology, our products at a cost, a quality, and a consistency that meet or exceed our customers' expectations and fully enable our business plan.

The convertible debentures themselves will be unsecured carry an annual interest rate of 15% with interest payable in full at maturity and have a 48 month term.

The convertible debentures are convertible at the option of the holder and all or in part into common shares in Hong Kong at a conversion price of $2 27 per share.

Marissa: As Kip has highlighted, Burcon has the opportunity to capture growing market demand for plant proteins. We've undertaken a number of steps to strengthen our balance sheet such that we are positioned to capitalize on this opportunity. The central pillar of our strategy here is the offering of the convertible debentures that were announced this morning. Burcon is undertaking a non-brokered private placement of convertible debentures of up to CAD 4 million. We intend to use the net proceeds of this offering to invest in inventory, labor, and production efficiencies, to plan for Burcon's future infrastructure needs, and to repay the short-term loan. We further highlight that there is significant support from insiders who have committed to participate at a minimum of CAD 2 million of the offering.

Alex Varty: As Kip has highlighted, Burcon has the opportunity to capture growing market demand for plant proteins. We've undertaken a number of steps to strengthen our balance sheet such that we are positioned to capitalize on this opportunity. The central pillar of our strategy here is the offering of the convertible debentures that were announced this morning. Burcon is undertaking a non-brokered private placement of convertible debentures of up to CAD 4 million. We intend to use the net proceeds of this offering to invest in inventory, labor, and production efficiencies, to plan for Burcon's future infrastructure needs, and to repay the short-term loan. We further highlight that there is significant support from insiders who have committed to participate at a minimum of CAD 2 million of the offering.

Silicon comparably holds an accelerated prepayment rate right, whereby if the common share price trades on the PSX or another stock exchange, where the shares are principally training.

If the prices above $4 54 for a period of 2014 consecutive trading days then broke on me prepay in the principal amount and any accrued and unpaid interest thereon.

Upon written notice from the company for such prepayment Beholder has 30 days to accept the prepayment failing which the company may accelerate the conversion of the convertible debentures into common shares at the conversion price.

Yeah.

And looking at the.

Marissa: The convertible debentures themselves will be unsecured, carry an annual interest rate of 15% with interest payable in full at maturity, and have a 48-month term. The convertible debentures are convertible at the option of the holder in whole or in part into common shares of Burcon at a conversion price of $2.27 per share. Burcon comparably holds an accelerated prepayment rate-right, whereby if the common share price trades on the TSX or another stock exchange where the shares are principally traded, if the price is above $4.54 for a period of 14 consecutive trading days, then Burcon may prepay the principal amount and any accrued and unpaid interest thereon.

Alex Varty: The convertible debentures themselves will be unsecured, carry an annual interest rate of 15% with interest payable in full at maturity, and have a 48-month term. The convertible debentures are convertible at the option of the holder in whole or in part into common shares of Burcon at a conversion price of $2.27 per share. Burcon comparably holds an accelerated prepayment rate-right, whereby if the common share price trades on the TSX or another stock exchange where the shares are principally traded, if the price is above $4.54 for a period of 14 consecutive trading days, then Burcon may prepay the principal amount and any accrued and unpaid interest thereon.

Next slide kept clean and looking at the financial strategy as a whole. In addition to the convertible debentures, we have undertaken a number of other steps to strengthen the balance sheet. Specifically, we have obtained a short term loan of $700000 from wanting bulk on sharp directors, which carries a 12.

On interest rate and is repaid at the earlier of four months and the closing of the convertible debentures. This loan along with our existing cash resources allow us to maintain the momentum the momentum and scale production through to the closing of the convertible debentures financer.

Lastly, we have also extended the maturity of tranche two of the secured loan which was provided by <unk> largest shareholder and we've extended that until December 2020 sacks.

Marissa: Upon written notice from the company for such prepayment, the holder has 30 days to accept the prepayment, failing which the company may accelerate the conversion of the convertible debentures into common shares at the conversion price. In looking at the next slide, Kip, please. In looking at the financial strategy as a whole here, in addition to the convertible debentures, we've undertaken a number of other steps to strengthen the balance sheet. Specifically, we have obtained a short-term loan of $700,000 from one of Burcon's directors, which carries a 12% interest rate and is repaid at the earlier of 4 months and the closing of the convertible debentures. This loan, along with our existing cash resources, allow us to maintain the momentum and scale production through to the closing of the convertible debentures financing.

Alex Varty: Upon written notice from the company for such prepayment, the holder has 30 days to accept the prepayment, failing which the company may accelerate the conversion of the convertible debentures into common shares at the conversion price. In looking at the next slide, Kip, please. In looking at the financial strategy as a whole here, in addition to the convertible debentures, we've undertaken a number of other steps to strengthen the balance sheet. Specifically, we have obtained a short-term loan of $700,000 from one of Burcon's directors, which carries a 12% interest rate and is repaid at the earlier of 4 months and the closing of the convertible debentures.

Across these three financing steps that we have taken again highlight that they each involve significant financial support from Perkins insiders and collectively they position us to be able to capture that growing market demand.

I'll pass it back to Kevin to go through our investment opportunity and our future outlook.

Thanks, Alex just to reiterate one piece again and I thought the overall theme is great business momentum and what Youre seeing from our insiders those who follow us closely and are participating with this is.

Belief and that momentum and full support for us to actually accelerate.

To raise money so that we can pull forward investments that were planned in 2006 into 2025, so that we are ready.

Alex Varty: This loan, along with our existing cash resources, allow us to maintain the momentum and scale production through to the closing of the convertible debentures financing. Lastly, we've also extended the maturity of tranche two of the secured loan, which was provided by Burcon's largest shareholder, and we've extended that until December 2026. Across these three financing steps that we have taken, I can highlight that they each involve significant financial support from Burcon's insiders, and collectively, they position us to be able to capture that growing market demand. I'll pass it back to Kip to go through our investment opportunity and our future outlook.

For those nice customer orders and we are prepared to truly accelerate our growth.

Marissa: Lastly, we've also extended the maturity of tranche two of the secured loan, which was provided by Burcon's largest shareholder, and we've extended that until December 2026. Across these three financing steps that we have taken, I can highlight that they each involve significant financial support from Burcon's insiders, and collectively, they position us to be able to capture that growing market demand. I'll pass it back to Kip to go through our investment opportunity and our future outlook.

The back half of 'twenty, five and into 2026.

Sure.

We've talked about.

The market sales production, our balance sheet investing for growth collectively we believe.

Yes.

<unk> positioned <unk> as a fabulous investment opportunity.

The last piece on one of them.

<unk> if you back up from March to now again, we've significantly Derisked burkhart again with the successfully commercialize the technology in place many people fail.

Kip Underwood: Thanks, Alex. just to reiterate one piece, again, I thought the overall theme is great business momentum. what you're seeing from our insiders, those who follow us closely and are participating with us, is belief in that momentum and full support for us to actually accelerate, to raise money so that we can pull forward investments that were planned in 2026 into 2025, so that we are ready for those next customer orders, and we are prepared to truly accelerate our growth the back half of 2025 and into 2026. We talked about, you know, the market, sales, production, our balance sheet, investing for growth. Collectively, we believe this positions Burcon as a fabulous investment opportunity.

We have started up a new production facility incredibly difficult.

Validation by customer activity, even within a project or if you're already recurring sales.

Oh.

We are investing for not just the days off for tomorrow screw so substantially derisked on one side with significant upside opportunity on the other side.

And we believe a great investment opportunity.

Looking forward into 2026.

People always ask me well how do we know your base successful where are you going what are you driving for and to reiterate to affirm, especially with the recent sales momentum is we are absolutely affirming our guidance of $1 million to $3 million in sales in 2025.

26 guidance 10, plus million dollars of double digit revenue and reaching cash flow positive state and the drivers for that are.

Kip Underwood: The last piece I kinda wanna make is that if you back up from March to now, again, we've significantly de-risked Protacon. Again, we've successfully commercialized the technology, a place many people fail. We have started up a new production facility, incredibly difficult. We have validation by customer activity, either within a project or through already recurring sales. We are investing for not just today's growth, for tomorrow's growth. Substantially de-risked on one side with significant upside opportunity on the other side. Again, we believe a great investment opportunity. Looking forward into 2026, you know, people always ask me, Well, how do we know you're being successful? Where are you going?

Keep driving sales driving revenue in this industry. When you achieve your first sales they are pretty much by definition recurring sale every time, a customer manufacturing the food they come back to us and buy your monthly or every other month as we drive sales and cell capacity, we get margin expansion.

Critical to our growth.

We'll be investing capacity be there.

More operating days more shifts more equipment or all of the above and we do all of these with a strong execution of event to always looking for efficiency to help us produce our products that are cost quality and consistency.

Exceed our customers' expectations as well as drive our financial plan.

Kip Underwood: What are you driving for?" To reiterate, to affirm, especially with the recent sales momentum, is, we are absolutely affirming our guidance of $1 to 3 million in sales in 2025. Our 2026 guidance, $10+ million or double-digit revenue and reaching a cash flow positive state. The drivers for that are keep driving sales, driving revenue. In this industry, when you achieve your first sales, they are pretty much by definition recurring sales. Every time a customer manufactures a new food, they come back to us and buy, either monthly or every other month. As we drive sales and sell at capacity, we get margin expansion critical to our growth. We'll be investing in capacity, be that, more operating days, more shifts, more equipment, or all the above.

With that Marissa I will turn it back to you for Q&A.

Excellent. Thank you.

Ladies and gentlemen should you have a question. Please press star followed by one on your Touchtone phone, you'll hear a prompt that your hand has been raised and then should you wish to remove your hand from the queue. Please press star followed by two if.

If you're using a speaker phone please lift the handset before pressing any Keith just a moment for your first question.

Kip Underwood: As we drive sales and sell at capacity, we get margin expansion critical to our growth. We'll be investing in capacity, be that, more operating days, more shifts, more equipment, or all the above. We do all of these with a strong executional bent to always looking for efficiency, to help us produce our products at a cost, quality, and consistency that exceed our customers' expectations as well as drive our financial plan. With that, Marissa, I will turn it back to you for Q&A.

And your first question comes from Rob Lynch with Stonegate Capital Partners. Please go ahead.

Hi, Good afternoon, Rob Kevin Alex Hi.

Hi, Ross sorry about that.

Kip Underwood: We do all of these with a strong executional bent to always looking for efficiency, to help us produce our products at a cost, quality, and consistency that exceed our customers' expectations as well as drive our financial plan. With that, Marissa, I will turn it back to you for Q&A.

Hey, good afternoon, guys. Congratulations on the quarter really appreciate you taking my questions here.

The first one you know it was gonna be round financing could you walk me through.

Our head count and logistics of bringing on an additional shift.

Yes.

It did lag to be reflected in revenue given the subsequent quarter end orders.

Yes, so I think the simplest way to equate an additional shift.

Operator: Excellent. Thank you. Ladies and gentlemen, should you have a question, please press star followed by 1 on your touch tone phone. You will hear a prompt that your hand has been raised. Then should you wish to remove your hand from the queue, please press star followed by 2. If you're using a speakerphone, please lift the handset before pressing any keys. Just a moment for your first question. Your first question comes from Robert Lynch with Stonegate Capital Partners. Please go ahead.

As additional operating days.

That's the simplest way its simplest way to do that.

Every time, you add an operating day you add.

107th more capacity per week and that translates for years for us to take to get ahead of that to hire and train a shift to <unk>.

Get to go to a base level of performance, that's a minimum of 90 days.

So it's really important that we get ahead of that we bring those people and get them trained to ensure they can execute their jobs. So that we can again produce our products or the cost quality and consistency.

Rob Lynch: Hey, good afternoon...

Robert Lynch: Hey, good afternoon...

Operator: Rob.

Rob Lynch: Kip and Alex. Hey.

Robert Lynch: Kip and Alex. Hey.

Our customers expect and the financial plan.

Kip Underwood: Hi, Rob.

Rob Lynch: Sorry about that. Hey, good afternoon, guys. Congratulations on the quarter. Really appreciate you taking my questions here. The first one, you know, is gonna be around financing. Could you walk me through the, you know, headcount and logistics of bringing on an additional shift, and I guess the expected lag to be reflected in revenue given the subsequent quarter end orders?

Robert Lynch: Sorry about that. Hey, good afternoon, guys. Congratulations on the quarter. Really appreciate you taking my questions here. The first one, you know, is gonna be around financing. Could you walk me through the, you know, headcount and logistics of bringing on an additional shift, and I guess the expected lag to be reflected in revenue given the subsequent quarter end orders?

Great really appreciate that.

If I could pivot over to just customer base now.

Provide a little bit more color on the strategy around new customer acquisition versus the expansion among the current base.

Especially as there is a 200 plus active projects converting from the evaluation stage to purchase orders and recurring on top of that.

Kip Underwood: Yeah. I think the simplest way to equate an additional shift is additional operating days. I think that's the simplest way to do that. Every time you add an operating day, you add, you know, one-seventh more capacity per week, that translates per year. For us to get ahead of that, to hire and train a shift, to get to, you know, a base level of performance, that's a minimum of 90 days. It's really important that we get ahead of that. We bring those people in, get them trained to ensure they execute their jobs so that we can, you know, again, produce our product at a cost, quality, and consistency that our customers expect and the financial plan meets.

More color there would be great.

Sure.

So I think first.

The primary types of customer focus on are those entrepreneurial brands those brands that are on the cutting edge. Those brands that are that are on the forefront of innovation. They are the right size, we have common values.

Move the fastest there for the broker to sell so that's the type of customer.

For both our funnel and our current sales looking for diversity. So we want diversity in customers or customer type of customer size.

We want diversity and food types. So we have projects and sales going into a powdered beverage or rate it makes beverage and liquid beverage nutrition bars as well as the broader category and then in those who want diversity of our products we have.

Rob Lynch: Right. Really appreciate that, Kip. I'm gonna pivot over to just customer base now. Could you provide like a little bit more color on the strategy around new customer acquisition versus the expansion among the current base, especially as there's like 200 plus active projects converting from the evaluation stage to purchase orders, and recurring on top of that? You know, just kind of more color there would be great.

Robert Lynch: Right. Really appreciate that, Kip. I'm gonna pivot over to just customer base now. Could you provide like a little bit more color on the strategy around new customer acquisition versus the expansion among the current base, especially as there's like 200 plus active projects converting from the evaluation stage to purchase orders, and recurring on top of that? You know, just kind of more color there would be great.

Both projects and sales initial sales of <unk> protein cyber protein and canola. So the key for our funnel is diversity of those with a real laser focus on those cutting edge osteal brands that are why non values move the fastest.

Kip Underwood: Sure. I think first, the primary types of customer focus on are those entrepreneurial brands, those brands that are on the cutting edge, those brands that are on the forefront of innovation. They are the right size. We have common values. They move the fastest. They're full of quicker sales. That's the type of customer we're looking at. For both our funnel and our current sales, we're looking for diversity. We want diversity in customers, so customer type or customer size. We want diversity in food types. We have projects and sales going into a powdered beverage or ready-to-mix beverage, a liquid beverage, nutrition bars, as well as the broader category of plant-based foods. In those, we want diversity of our products.

And it should help drive <unk> growth in place.

Really appreciate that again.

I think the last one I have here just give me run guidance more or less you know you touched on it.

At the end of your closing remarks, but cash flow positive by the end of 2020 specs do any of these changes.

<unk> of that could be pulled forward a little bit.

Anything there would be great.

Right now we are affirming the guidance for 25 and 26 Rob.

Kip Underwood: We have projects and sales going into a powdered beverage or ready-to-mix beverage, a liquid beverage, nutrition bars, as well as the broader category of plant-based foods. In those, we want diversity of our products. We have, both projects and, you know, sales, initial sales of pea protein, soy protein, and canola. The key for our funnel is diversity of those with a real laser focus on those cutting-edge entrepreneurial brands that are aligned on values, move the fastest, and can help drive Burcon's growth in place.

I think the way to think about it really is.

The guidance hasn't changed but it's been derisked.

As we've as.

As we have proven technology commercialize technology.

<unk> got customers to move from a project to a sale to a bi I think all of those things the risk our guidance and strength really position us for a strong close to account for 25, just an amazing calendar 'twenty six.

Kip Underwood: We have, both projects and, you know, sales, initial sales of pea protein, soy protein, and canola. The key for our funnel is diversity of those with a real laser focus on those cutting-edge entrepreneurial brands that are aligned on values, move the fastest, and can help drive Burcon's growth in place.

Alright, Great you know I think that might be it for me I'll get back in the queue and if something comes up I'll dial back in but really.

Really appreciate it congrats and good luck in the next quarter.

Rob Lynch: Really appreciate that again, Kip. I think the last one I have here is just gonna be around guidance, more or less. You know, you touched on it at the end of your closing remarks, but cash flow positive by the end of 2026. Do any of these changes give you indication that could be pulled forward a little bit? Anything there would be great.

Robert Lynch: Really appreciate that again, Kip. I think the last one I have here is just gonna be around guidance, more or less. You know, you touched on it at the end of your closing remarks, but cash flow positive by the end of 2026. Do any of these changes give you indication that could be pulled forward a little bit? Anything there would be great.

Thanks, Rob appreciate it.

Your next question comes from Bruce Lazenby with Ottawa. Please go ahead.

Hey get great presentation.

I'm thinking from a capex point of view, what's the capacity of the current facility if youre running at Max capacity. However, you define that is that going to gives you your $10 million to $20 million or do you need more than that.

Kip Underwood: Right now, we're affirming the guidance for 2025 and 2026, Rob. I think the way to think about it really is, the guidance hasn't changed, but it's been de-risked. You know, as we've proven technology, commercialized technology, we've got customers to move from a project, to a sale, to a buy. I think all of those things de-risk our guidance and truly position us for a strong close to calendar 2025 and just an amazing calendar 2026.

The current facility will get us beyond that.

So beyond that.

We're a few years away from tapping that out there as you move forward. So.

We will expand capacity in three different ways. So one is expansion of operating days.

You talked about shifts to people.

One is the addition of equipment.

And then third is just good old fashion process engineering, and gaining efficiency and will continue to stack all three of those.

Rob Lynch: All right, great. You know, I think that might be it for me. I'll get back in the queue, and if something comes up, I'll dial back in. Really appreciate it. Congrats, and good luck in the next quarter.

Robert Lynch: All right, great. You know, I think that might be it for me. I'll get back in the queue, and if something comes up, I'll dial back in. Really appreciate it. Congrats, and good luck in the next quarter.

In the months and.

Throughout 2026 and inventory seven appreciate it.

Okay. So you think the existing facility can take you to the $27 28, which would put you in the $40 $50 $60 million range.

Kip Underwood: Thanks, Rob. Appreciate it.

Operator: Your next question comes from Bruce Lazenby with Ottawa. Please go ahead.

Certainly takes us into into 2007.

Bruce Lazenby: Hey, Kip. Great presentation.

Bruce Lanzenby: Hey, Kip. Great presentation.

Okay.

Kip Underwood: Hey, Bruce.

Bruce Lazenby: Thank you so much. I'm thinking from a CapEx point of view, what's the capacity of the current facility? If you're running it at max capacity, however you define that, is that gonna get you your $10 to $20 million, or do you need more than that?

Kip Underwood: Thank you so much. I'm thinking from a CapEx point of view, what's the capacity of the current facility? If you're running it at max capacity, however you define that, is that gonna get you your $10 to $20 million, or do you need more than that?

But goodness.

Okay. Thank you continued good luck thanks, Chris.

Okay.

As a reminder, if you would like to ask a question. Please press star one.

Kip Underwood: The current facility will get us beyond that.

Bruce Lazenby: Beyond that.

Bruce Lanzenby: Beyond that.

I would like to turn the call over to Paul Lang Director of Investor Relations and communications for questions from the webcast.

Kip Underwood: We're a few years away from tapping that out as we move forward. You know, we'll expand capacity in three different ways. One is expansion of operating days, which we talked about, shift people. One is the addition of equipment. Third is just good old-fashioned process engineering and gaining efficiency. We'll continue to stack all three of those in the months and, you know, throughout 2026 and into 2027 for sure.

Thank you Martha.

We have one question from the webcast. This is from Harry <unk> from Edison International.

Hi, longtime investor Thanks for all the hard work, we keep hearing $1 million to $3 million revenue this year.

There is a huge difference and what is the forecast one two or $3 million in revenue or maybe even more.

Bruce Lazenby: Okay. You think the existing facility can take you to 27, 28, which would put you in the CAD 40 million, CAD 50 million, CAD 60 million range?

Bruce Lanzenby: Okay. You think the existing facility can take you to 27, 28, which would put you in the CAD 40 million, CAD 50 million, CAD 60 million range?

Thank you Harry for the question and it's a good one so.

Kip Underwood: It certainly takes us into 27.

For us what we're what we've worked for us I'll be very Frank as a new company. We believe it's very important that we are consistent in our guidance.

Bruce Lazenby: Okay. Good. Good news. Okay. That's it. Thank you. Continue. Good luck.

Bruce Lanzenby: Okay. Good. Good news. Okay. That's it. Thank you. Continue. Good luck.

Very important that we build credibility we talk a lot about say, what we do and do what we say that.

Kip Underwood: Thanks, Bruce.

Operator: As a reminder, if you would like to ask a question, please press star one. I would like to turn the call over to Paul Lam, Director of Investor Relations and Communications, for questions from the webcast.

Operator: As a reminder, if you would like to ask a question, please press star one. I would like to turn the call over to , Director Paul Lamtor of Investor Relations and Communications, for questions from the webcast.t

That is our mantra inside of <unk>, So we're going to hold fast.

On to our guidance of $1 million to $3 million 25.

At the same time communicated to reality here, we are $500000 in orders from October 1st to know and then as we continue to have success in the marketplace, we will communicate that as well. Thank you.

Paul Lam: Thank you, Marissa. We have 1 question from the webcast. This is from Harry Yu, from Ares International. Hi, longtime investor. Thanks for all the hard work. We keep hearing CAD 1 to 3 million revenue this year. There's a huge difference. What is the forecast? CAD 1, CAD 2, or CAD 3 million in revenue, or maybe even more?

Thanks for the question Eric.

I do not see any further questions from the webcast.

Unless anyone is putting in question now.

MRSA back to you I think we are okay for questions from the webcast.

Kip Underwood: Thank you, Harry Yu, for the question. It's a good one. For us, what we want for us, I'll be very, very frank, as a new company, we believe it's very important that we're consistent in our guidance. It's very important that we build credibility. We talk a lot about say what we do and do what we say. That is a mantra inside of Burcon. We're going to hold fast to our guidance of $1 to 3 million for 2025, and then at the same time communicate the reality of where we are, $500,000 in orders from 1 October to now. As we continue to have success in the marketplace, we will communicate that as well. Thank you.

Excellent. Thank you everyone.

That's all the time, we have for questions. Today. So this concludes our question and answer session I would like to turn the call back over to Mr. Underwood for any closing remarks, Sir. Please go ahead.

Thank you to everyone on the phone today in the conference today. Thank you to you investors for your confidence in us prospective investors for your interest.

Certainly thank you to our team members that have.

Applied the work and the discipline and the creativity to get us to where we are today, which is a business with great momentum.

Exciting days are certainly ahead for burkhart.

Have a great day, everyone. Thank you again for your time tiers.

Paul Lam: Thanks for the question, Harry. I do not see any further questions from the webcast unless anyone is putting in question now. Marissa, back to you. I think we are okay for questions from the webcast.

Before we conclude today's call I would like to take a moment to read the Companys Safe Harbor statement. This call contains forward looking statements are forward looking information within the meaning of the U S. Private Securities Litigation Reform Act of 1095 and applicable Canadian Securities legislation forward.

Operator: Excellent. Thank you, everyone. That's all the time we have for questions today. This concludes our question and answer session, but I would like to turn the call back over to Mr. Underwood for any closing remarks. Sir, please go ahead.

Looking statements or forward looking information involve risks uncertainties and other factors that could cause actual results performances prospects and opportunities to differ materially from those expressed or implied by such forward looking statements.

Kip Underwood: Thank you to everyone on the phone today, in the conference today. Thank you to you, investors for your confidence in us, prospective investors for your interest. Certainly thank you to our team members that have applied the work and the discipline and the creativity to get us to where we are today, which is a business with great momentum. Exciting days are certainly ahead for Burcon. Have a great day, everyone. Thank you again for your time. Cheers all.

Forward looking statements are forward looking information can be identified by words, such as anticipate intend plan goal project estimate expect believe future likely can may should could will potentially and similar rough similar referenced.

As to future periods.

All statements other than statements of historical fact, including this call are forward looking statements. There can be no assurance that such statements will provide prove to be accurate and actual results and future events could differ materially from those anticipated in such statements or information.

Operator: Before we conclude today's call, I would like to take a moment to read the company's Safe Harbor statement. This call contains forward-looking statements or forward-looking information within the meaning of the US Private Securities Litigation Reform Act of 1995 and applicable Canadian securities legislation. Forward-looking statements or forward-looking information involve risks, uncertainties, and other factors that could cause actual results, performances, prospects, and opportunities to differ materially from those expressed or implied by such forward-looking statements. Forward-looking statements or forward-looking information can be identified by words such as anticipate, intend, plan, goal, project, estimate, expect, believe, future, likely, can, may, should, could, will, potentially, and similar references to future periods. All statements other than statements of historical fact, including this call, are forward-looking statements.

Important factors that could cause actual results to differ materially from <unk> plans and expectations include the actual results of business negotiations marketing activities adverse general economic market or business conditions regulatory changes and other risks and factors detailed herein and from time to.

Time in the filings made by <unk> with securities regulators and stock exchanges, including in the section entitled Risk factors in <unk> annual information form filed with the Canadian Securities administrators on Www Dot Cedar Dot com.

Any forward looking statements or information only speaks as of the date on which it was made and except as may be required by applicable securities laws <unk> disclaims any intent or obligation to update any forward looking statement, whether as a result, as a result of new information future events or otherwise.

Operator: There can be no assurance that such statements will prove to be accurate, and actual results and future events could differ materially from those anticipated in such statements or information. Important factors that could cause actual results to differ materially from Burcon's plans and expectations include the actual results of business negotiations, marketing activities, adverse general economic market or business conditions, regulatory changes, and other risks and factors detailed herein and from time to time in the filings made by Burcon with securities regulators and stock exchanges, including in the section entitled "Risk Factors" in Burcon's Annual Information Form filed with the Canadian Securities Administrators on www.sedar.com.

Although <unk> believes that the assumptions inherent in the forward looking statements are reasonable forward looking statements are not guarantees of future performance and accordingly investors should not rely on such statements.

Finally, I would like to remind everyone that this call is being recorded and the webcast will be available for replay on the company's web site. Starting later this evening.

Ladies and gentlemen for joining us for today's presentation you may now disconnect.

Operator: Any forward-looking statements or information only speaks as of the date on which it was made. Except as may be required by applicable securities laws, Burcon disclaims any intent or obligation to update any forward-looking statement, whether as a result of new information, future events, or otherwise. Although Burcon believes that the assumptions inherent in the forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance. Accordingly, investors should not rely on such statements. Finally, I would like to remind everyone that this call is being recorded. The webcast will be available for replay on the company's website starting later this evening. Thank you, ladies and gentlemen, for joining us for today's presentation. You may now disconnect.

Q2 2026 Burcon NutraScience Corp Earnings Call

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