VerifyMe, Inc. Q4 FY2024 earnings call

• 2024 was a significant year with annual revenue 4% below 2023, but had improvements in gross profit, gross margin, and adjusted EBITDA; cash net of debt grew. - Took steps to reduce investments in non-returning areas, completed $4.7 million warrant inducement capital raise in Jan 2025, retired bank debt, and convertible debt reduced. - Precision Logistics is cash flow positive, increasing efforts to expand the segment, has a strong balance sheet. - Authentication divested Trust Codes Global, and is reviewing strategy for the Ink business.

Precision Logistics: In 2024, PeriShip business is cash generating. Proactive customers increased 6% over 2023, but shipments by existing customers in proactive service line were down 6%. Hired additional sales resources and piloted marketing strategies. Authentication: Divested Trust Codes Global on 12/8/2024, which had an operating loss of $1.2 million in 2024 (excluding impairments). Ink business in Authentication represents less than 1% of overall company revenues. Fourth quarter revenue was $7.7 million vs prior year’s $8.7 million, a $1 million decrease. Gross profit decreased $0.5 million to $2.4 million in Q4 2024, gross margin was 32% vs 33% in prior year Q4. Full-year gross margin was 36% vs 32% in 2023.

• No 2025 guidance provided. - Stated that they are not giving guidance due to unpredictable external market conditions and difficulty in predicting the timing of resource deployment to create meaningful shareholder return.

• Factors causing actual results to differ from projections, including those described in Form 10-K and 10-Q risk factors. - Unpredictable market conditions affecting the Precision Logistics segment's performance.

Q: Could you help with expected share count for Q1?

A: Yes, it'll be about $12.5 million.

Q: Commentary on logistics in Q1 trends?

A: Previously announced loss of one customer will continue to be a drag on comparatives in Q1 and Q2; overall market conditions are down a bit, total number of shipments are down, but adding more customers which may balance out.