Greetings and welcome to Moving Image Technologies Fourth Quarter 2026 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. I would now like to turn the call over to your host, Mr. Chris Eddy. Thank you. You may begin.

Thank you, operator, and thank you all for joining today's call. MIT President Francois Godfrey will provide a business overview, and CFO Bart Bedard will conclude with some financial highlights, after which we will open the call to investor questions. Today's conference is being recorded, and an audio replay and written transcripts will be posted to the investor section of the Moving Image website in the next few days. As a reminder, except for historical information, Matters discussed on this call are forward-looking statements that involve several risks and uncertainties. Words like believe, expect, and anticipate mean that these are our best estimates as of this writing, but that there can be no assurances that expected or anticipated results or events will take place. Actual future results could differ materially from those statements. Further information on the company's risk factors is contained in the company's quarterly and annual reports. filed with the SEC. I will now turn the call over to MIT President Francois Godfrey.

Thanks, Chris, and thank you all for your interest in moving image technologies. I'd like to begin with the broader exhibition environment because we believe it provides an important backdrop for future opportunities. The summer box office was exceptionally strong. According to Variety, domestic ticket sales totaled $4.76 billion from May 1st through Labor Day, making it the highest grossing summer on record. This trend has also benefited individual theater operators, which are reporting their strongest ever summer season, including record attendance and particularly strong performance for premium, large format, or PLF auditoriums. Importantly, this improvement is not simply about higher ticket prices. Attendance has also been increasing, and the film slate has demonstrated that audiences will come to theaters when there is compelling content across a range of genres and formats. Echoing this trend, Bank of America's CEO recently commented that the discretionary consumer spending remains broad-based, including cruise bookings, restaurants, and out-of-home entertainment. As he put it, the movies have come back because they've had some good movies. To that, I would add that there is another important driver. Movies offer a far more affordable entertainment experience compared to other out-of-home options such as concerts, and many more. Exhibitors have an opportunity and increasingly a reason to invest in the physical environment and technology that make the theatrical experience distinctive. This is where we believe moving images' deep experience and decades-long track record allows us to play a highly differentiated role. We help cinema operators create the highest quality guest experiences. utilizing our unique design, engineering, technology, and product and service capabilities. We work with customers every step of the way, from facility and system design through product selection, installation, and commissioning. Whether the project involves a large format auditorium, a multi-screen refurbishment, a new theater build, or a single auditorium upgrade, we deliver solutions tailored to each customer's needs. In fiscal 2026, we made meaningful progress enhancing our capabilities and long-term growth potential, most notably through the acquisition of the DCS cinema loudspeaker business. DCS is far more than an additional product line for MIT to sell. It enhances our competitive position and market reach with a highly respected proprietary cinema audio platform with a global customer base established with over 20 years of success. DCS provides entree into an expanded base of customers and prospects, both domestically and abroad, including new customer relationships that have already generated initial revenues. Given MIT's historical focus on domestic opportunities, the DCS line provides a compelling platform to expand into international markets, where we are building out our dealer network to support that growth, DCS also provides us a proven proprietary solution that enhances our potential to build relationships with larger domestic exhibitors. Bottom line, DCS strengthens our offering, expands our customer reach and value proposition, and is already benefiting our results. while there have been some challenges in integrating the business and building out production and global logistics we are making solid progress managing the business which we expect to support future improvements. The response from the international customers and distributors has been particularly encouraging. DCS products have now shipped to more than 22 countries and order interest continues to build. As these relationships develop, our objective is not simply to sell more loudspeakers and audio solutions. We intend to leverage our expanding international network to offer other MIT products and capabilities. Turning to the domestic market, we are very encouraged by the breadth of project discussions and our confirmed project pipeline. We are advancing several significant opportunities across the United States, including a substantial multifaceted project in the Bay Area that is currently contemplating to be far larger than any single project we have undertaken in the last several years. We have received a meaningful initial deposit from the customer and expect work to conclude by the end of calendar year 2026. Throughout our customer discussions, there are several themes that reoccur. Premium large format auditoriums remain an important area of investment, and immersive audio continues to be a key component of how exhibitors differentiate the in-theater experience. Moviegoers expect the theater to deliver something memorable, better picture, better sound, and a more integrated environment to create an experience they cannot replicate at home. While I focus my comments on the key initiatives, I also wanted to update you on our thinking about initiatives we have discussed in the past but have not been addressing in recent investor communications. The overarching theme for these initiatives continues to be our capital allocation discipline as we work to move our business to profitability and positive cash flows. Once we achieve that, we will be able to revisit other growth initiatives and the investment required to execute them. First is our translator platform, which is designed to provide cinemas with a common technology platform to support accessibility and language translation, descriptive narrative and sign language capabilities. Our wholly owned ADA compliant MIT accessibility products are an important component of that offering and we continue to see sales activity in that area. However, the underlying translator platform requires additional software investment before we can pursue the opportunity at greater scale. We are evaluating the appropriate development path and required resources as part of our broader capital allocation priorities. But at this point, I have no additional clarity on next steps or timing. In esports, MIT developed a gaming hardware solution several years ago that was to be marketed to theater owners in conjunction with an esports league. Thank you for joining us. CineQC is another initiative with potential, but requires continued development and related investment. CineQC is a SaaS platform utilizing secure near-field communication NFC area tags to link places, people, connected equipment, and time with roles, responsibility, and tasks with a third-party developed platform.

We completed an initial customer deployment in 2022 and 2023

The program was suspended. To restart the program, we believe additional software development and a new technology partner would be required to create a platform capable of scaling effectively. Finally, with respect to eCadi and electronic advertising concept for stadiums, we are reassessing our investment strategy and development roadmap. As part of this process, we are evaluating the technology requirements, development costs and potential business model before committing additional resources. We continue to evaluate each of these initiatives based on the investment required, customer demand, and our ability to achieve meaningful scale while maintaining our focus on the core cinema products, projects, and international opportunities that are driving the business today. While fiscal 2026 included periods of slower project activity and customer timing delays, We are entering fiscal 2027 with broader capabilities, a stronger international presence, and a growing pipeline of domestic projects, all complemented with the disciplined view on margin and expense management aimed at improving our bottom line. Industry trends provide us increased confidence in the business prospects ahead, which we are well positioned to pursue given our track record helping our customers deliver reliable, memorable experiences to their audiences. Now, I'll turn the call over to CFO Bart Bedard to address some financial highlights.

We published our financial statement in this morning's press release and expect to file our Form 10-K later today. Now I'll walk through our financial results, including our progress further trimming our full-year net loss. Starting with Q4 of 26, our revenue was $4.55 million compared with $5.88 million in Q4 of 25 and below our prior expectations. The timing of projects into future periods, which resulted in lower-than-expected revenue than we forecasted this past May. As we have mentioned in the past, the timing of customer projects, particularly larger ones, can have a meaningful impact on our quartered results in comparison to other periods, as was the case in our fourth quarter. Q426 results included 399,600 of DCS sales compared to 460,000 The sequential decrease in revenue was largely due to limited availability of some products related to some onboarding challenges and the build-out of our production and logistics efforts, which we are working to resolve. Our backlog of DCS product orders stands at approximately 458,000 today, following a recent significant shipment to a customer in Argentina, and our outlook remains very positive. and the DCS line. Q4 of 26 gross profit was $1,010,000 compared with $1.2 million in the prior year period with a decrease primarily attributed to lower revenue. Gross margin percentage in Q4 of 26 however improved to 22.2% compared with 20.4% in Q4 of 25, primarily due to our focus on higher margin opportunities and related changes in our revenue In the area of operating expense, we continue to find areas for improvement, even with the new DCS business, enabling our Q426 operating expense to decline to $1.32 million from $1.39 million in Q4 of 25. Our Q4-26 net loss was $296,000 or $0.03 per share compared with a net loss of $156,000 or $0.02 per share in Q4-25. The increase in net loss is primarily due to a lower-than-expected project activity offset somewhat by the gross margin and operating expense improvements. Turning to fiscal year 2026, total revenue was $70.32 million compared with $18.15 million in fiscal 2025. The year-over-year decline was primarily related to reduced customer project activity, including the shift of some projects into the future periods. This was partially offset by $822,000 in initial revenue from the DCS cinema loudspeaker business, which we acquired in the second quarter of fiscal year 2026. Fiscal year 2026 gross profit increased 10%. to $5.03 million from $4.57 million in fiscal year 25, with gross margin expanded to 29.1% from 25.2%, reflecting our ongoing efforts to focus on higher margin opportunities and a particularly favorable revenue mix. Fiscal year operating expenses declined to 2.3% from $5.53 million from $5.66 million in fiscal 25, primarily attributed to lower credit losses Thank you very much. or 10 cents per share in fiscal 25. Our performance, which included costs related to DCS purchase integration, shows meaningful progress toward our goal of reaching profitability and positive cash flow. Turn to our balance sheet. MIT continued to have a solid financial position with no long-term debt. We ended fiscal 2026 with approximately $4 million of working capital, including $2.4 million of inventory compared to $4.3 million of working capital at June 30, 2025. Our net cash stood at $13.19 million at year-end 2026 compared to net cash of $5.72 million at June 30, 2025. The decrease is attributable to our $1.5 million cash investment to acquire the DCS loudspeaker assets as well as nearly $1.7 million reduction in accounts payable versus a year ago. We believe the company is in a strong financial position with an appropriate level of financial flexibility to achieve our business goals for fiscal Our revenue outlook, MIT currently anticipates revenue of approximately $4.5 million in our fiscal 2027 first quarter, ending September 30th, as a few larger contracts are currently slated for later in the year. Some of the novel opportunities in our domestic project pipeline for fiscal 27 include refurbishments for an existing cinema exhibition customer across 16 screens at two of their locations and a separate significant multifaceted project in the Bay Area. We expect these projects to contribute primarily to our Q2 and Q3 results. In summary, we believe that foundational work undertaken over the past year, including revitalization business, developed efforts and strategic acquisition of DCS positioned us to unlock cross-selling opportunities, achieve greater operating leverage, and pursue sustainable growth and profitability in fiscal 2022. With that overview, operator, we are ready to begin our Q&A session.

Thank you. At this time, we'll be conducting a question and answer session. If you'd like to ask a question, please press star 1 on your telephone keypad. Information and tone will indicate your line is in the question queue. You may press star 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment please while we poll for questions. As a reminder, if you'd like to ask a question, please press star 1 on your telephone keypad. One moment please while we poll for questions. There are no questions at this time, and this concludes today's conference. You may disconnect your lines at this time, and we thank you for your participation.