Good afternoon, everyone. Welcome to today's Conference Call to review the First Quarter ending March 31, 2022, for EZFill Holdings, Inc. At this all participants are in a listen-only mode. A brief question-and-answer session will follow management's remarks. I will provide instructions at that time. As a reminder, this conference call is being recorded. I would now like to turn the conference call over to your host, Kathleen Heaney from KCSA Strategic Communications. Please go ahead.

Thank you, Hector. Good afternoon, everyone, and thank you for joining us today for EzFill's First Quarter 2022 Financial Results Conference Call. Presenting today is Mike McConnell, CEO and Arthur Levine, CFO. After management's prepared remarks, we will open the call for questions. Before we begin, listeners are reminded that certain matters discussed during today's conference call or answers that may be provided given to the questions may constitute forward-looking statements from EZFill's management made within the meaning of Section 27A of the Securities Act of 1933 as amended and Section 21E of the Securities and Exchange Act of 1934 as amended. Words such as may, should, project, expect, intend, plan, believe, anticipates, hopes, estimates and variations of such words and similar expressions are intended to identify forward-looking statements. These statements are subject to numerous conditions, many of which are beyond the control of the company, including those set forth in the Risk Factors section of the company's annual report on Form 10-K filed with the SEC. Copies of these documents are available on the SEC's website as well as on the company's website. Actual results may differ materially from those expressed or implied by such forward-looking statements. The company undertakes no obligation to update these statements for revisions or changes after the date of this call, except as required by law. I would now like to introduce Mike McConnell, CEO. Please go ahead, Mike.

Thank you, Kathleen, and good afternoon, everyone. Thank you for joining us today to review our first quarter 2022 results. We began the year well positioned to advance our growth strategy to build upon our position as one of the fastest-growing on-demand mobile fuel providers. Our service offering is rapidly being adopted and recognized by many of South Florida's large fleet businesses. Additionally, we are beginning to see a key shift in the way that general public fuelled their vehicles, as they increasingly recognize the safety, efficiencies and convenience of mobile fueling, which gives us confidence to expand into new target markets over time. Before Arthur reviews our financial results for the quarter, I'd like to highlight a few key developments that have elevated our position and opened the door for EZFill to achieve increasing revenue as the year progresses. First, we have locked in several new commercial fleet fueling agreements with existing customers. Our ability to be further integrated and support our long-standing customers' businesses is a testament to the value of customers place on our unique service platform. Companies that we have established partnerships with such as SERVPRO, a cleanup restoration and construction franchise company and Easyscripts, a retail pharmacy with home delivery service throughout Miami Dade, Broward and Palm Beach counties, rapidly enter new markets and have come to rely on our mobile fueling services to support their expansion. For example, we first started working with SERVPRO at North Miami in November of 2021. The success of this partnership opened the door for additional opportunities to serve the franchise. In March 2022, we expanded our relationship by entering into an agreement with SERVPRO of Brickell to serve another one of the company's fleets. With Easyscripts, we began servicing their fleet in the Miami-Dade County and now support…

Thank you, Mike. Thank you all for joining us today. Overall, our financial results for the quarter continue to reflect the investment in infrastructure we are putting in place to support demand as our revenue ramps and new fleet and other customers continue to onboard in existing and new markets. Revenue for the first quarter of 2022 increased 54% year-over-year to $2.3 million. The increase is due to a 9% increase in gallons delivered, as well as an increase in the average price per gallon. Total gallons delivered in the first quarter of 2022 was $591,505. Cost of sales was $2.3 million for the first quarter compared to $1.2 million in the prior year period. The 67% increase is due to the increase in sales, as well as the hiring of additional drivers in the quarter in order to support our growth. We incurred operating expenses of $2.9 million during the first quarter of 2022 as compared to $1.2 million during the prior year. The increase was primarily due to increases in payroll, marketing, insurance, technology and public company expenses. A key metric that bodes well for reducing our cash burn is our average fuel margin per gallon. In the first quarter of 2022, we realized a 31% increase in average margin per gallon to $0.47 compared to $0.36 in the first quarter of 2021, which was primarily due to the addition of new fleet customers at significantly higher margins. We expect as we continue to sign on an increasing number of commercial fleet accounts and add more consumers, our average fuel margin per gallon will continue to remain strong. Our higher depreciation and amortization expense reflects the acquisition of a technology license and the purchase of vehicles to support the growing business. Adjusted EBITDA loss for the first quarter…

Thank you. At this time, we'll be conducting a question-and-answer session. [Operator Instructions] Your first question comes from Tate Sullivan with Maxim Group. Please proceed with your question.

Hi, thank you. Good afternoon. I thought I'd start with the fleet customers and you've been releasing and you gave details on additional fleet agreements. But Mike, can you talk about what it is the alternative for many of these fleet customers to your service. Were they using a competitor before signing a contract with you? Is this the first time they are using on-demand fueling? What are the fundamental drivers of signing up new fleet customers, please?

Sure. Good question, Tate. It's probably a combination of all three that you're talking about. Typically, if they use fleet cards or fuel cards, we can convert those pretty easily because the business case is just so strong, converting to easy fuel services. In some cases, they may have a previous provider, and they're dissatisfied with the service or they want to make a change. I think also, some of our features of feedback we're getting, utilizing our fleet portal and the technology that we use is a significant change than what they've had with some of their previous providers, which gives them a lot more insight to their fueling activity and how their businesses run. So it's probably a combination of all of those things as far as what's driving business to us. And I think also - with the higher gas prices and everything else businesses are looking for any way they can to be more efficient. Having a fleet fuel delivery driver or a company like us, as well as providing the technologies from the billing and the utilization of their fleet is seen as a real value add than what they were currently using.

You mentioned fleet cards, Mike. What was that? What is that...

Sorry, fuel cards, fuel cards. They have a gas car, fuel cards. I misspoke.

Oh, fuel cards. Fuel cards. So they would be going out on their own...

Correct.

Okay. Thank you. And then on the marketing and Arthur, I think you mentioned it too, on the future marketing efforts. Is most of the future marketing you'll do to consumers, whereas the sales reps will be directly to fleet customers? Or is the marketing for both consumers and fleet accounts?

We're going to do some marketing related to fleets, but the vast majority of the spending will be consumer-related.

Okay. And primarily social media and related types of marketing.

Okay. And then on the Marinas, you mentioned specialty and you previously released signing up the Marina deal. Marinas that do not currently use your service, do they have on-site gasoline supply? Or are these getting phased out? Or how meaningful is the Marina opportunity for you…

Yeah. We think the Marina opportunity is significant. We've just hired some more people as what we consider to be inside sales as far as working directly on some more opportunities. Marina is one of those. The Marina business, they can use different methods from us, one or tanks where they can do the service themselves, which we have those existing relationships than individual orders for consumers. But we're going to get more dedicated and more specific as far as the Marina opportunity, especially here in South Florida and also Tampa looks like a very robust opportunity for us as well.

Okay. Great. Thank you for that additional detail. I'll get back in queue.

Thanks, Tate.

[Operator Instructions] Your next question comes from Sean Oppen [ph] with - Private Investor. Please proceed with your question.

Hi. Just referring back to the question that you previously had regarding marketing. In terms of consumer marketing or even for fleet marketing as well, the only thing I've seen so far in print marketing is a 13B trucks driving around Golf Cart wrap in EZFill. Do you have any plans for any alternative plans or marketing? Or are there even a billboard on 95? And the reason I ask is because most people don't even know of the service that exists. You see it on a random street, you should have every house getting filled up with EZFill as opposed to just one house Tier 1 house there. I think if more people were aware of it, so obviously, more people would use the service in such a great service.

We agree. We think the awareness needs to be enhanced, and we're investing in that. We've got a campaign that we're in the process in launching on the consumer side. It's going to be very robust. It's not just going to be the one vehicle driver around town. So we're looking at outdoor, all the mains [ph] there. Arthur touched on social media. You probably recently saw the announcement where the branding with Victor Oladipo that we're doing from the social media side there. He's also an early investor and shareholder of the company and a customer. So we'll continue to use people that have large influencers in the Miami area and the areas that we're expanding in. But we will be this - it will show up in the second quarter, of course, but significantly enhancing our consumer presence. You'll see a noticeable difference.

Thank you.

Your next question is a follow-up from Tate Sullivan with Maxim Group. Please proceed with your question.

Thank you for taking my call Mike, you previously mentioned in some of your [indiscernible] the prior earnings call, some comments on New York, I believe. Are you still waiting for regulatory approval for your tank, your refueling tanks? Or are you still planning on entry New York potentially by the end of this year? Can you give an update there?

Yeah, yeah. We're still planning on it. There are some unknowns from a specific point of view, Kate, but the situation that we're in now from what our fuel better teammates are telling this. Right now, there's an interim fire commissioner that's been, I think, started in about mid-February. With the new mayor, they're supposed to appoint a permanent fire commissioner. So we're pausing until that transaction happens and they name a more permanent commissioner, which is supposed to be any day. It's probably a lengthier process than it was originally thought to be. So until that happens, which I can't tell you exactly when that's going to happen. We intend to aggressively pick up right where we left off and feel confident still with the opportunity in the project that we have with the New York pilot.

Thank you. And one more quick from me. Can you review your comments about if it's the right term, onboarding additional trucks with the 33 that you previously announced, is there before they are out in the field? Is there a certain retrofit process or any training process? Or what's the time line? And how many can you take a month or through the end of the year, can you go over the timing, please?

Okay. Sure. Yeah. We've been taking anywhere from about 3 to 5 a month Kate, and we're planning to - as Mike said in his remarks, we're going to end up the year close to 50%. So just to summarize for you, we ended Q1 with 26 trucks in service. Since then, we've added 4 to service. As of today, we have 30. And between Q2 to the rest of Q2 to Q4, we're going to roll out around another close to 20 more, which will bring us almost 50. So that's been the cadence. There's - it's not a very long process once the upfitter finishes a new truck until we get it into service. There's some checking that has to be done, but it doesn't take that long.

Okay. Great. With the 26, did you get most of those delivered at the end of the first quarter towards the end of the first quarter? Just trying to figure out the back in the…

It was really throughout the quarter. And that's the way we've been doing it. We've been doing about 4 to 8 a month, okay, in that range, anywhere from about 4 to 8 months is what we've been taking since we started in the end of Q4.

Perfect. Okay. Thank you all. Have a good rest of the day.

Your next question is a follow-up from Sean Oppen with Private Investor. Please proceed with your question.

Yeah. Hi, sorry about that. Hello?

Yes, sure…

I have a follow-up. No problem. I actually had no follow-up. I appreciate it, thank you.

Sure.

[Operator Instructions] Your next question comes from Greg Rosen, Private Investor. Please proceed with your question.

Sure. Thank you very much. Appreciate it. On the 10-Q and the 10-K, I see in 2020 stock-based compensation was like 4,624, 000 million. And NIC in '21, it was $1.896 I missed part of the call, of course, they didn't - they disconnected my call. I didn't quite hear if you discussed that or you could give me some extrapolation of that number, what it relates to?

Well, the reason why it was so much higher in 2020 is the majority of that was - a very large part of that was to consultants. And we're not giving away that level of stock to consultants anymore. In fact, it's very - we're giving almost no stock to consultants at this point. But pre-IPO, when the company had much less cash, it was remunerating consultants to a much larger extent in stock. Okay, so that explains it. Most of the stock compensation now is either to directors and officers and occasionally to consultants.

That seems like quite a large proportion to what you raised that seems out of the ordinary from, I don't know the justification, but I guess is what it is. So your stock has lost as an investor after the IPO when the prices were much higher, not correlating to the market conditions today, the stock has dissipated about 80% to 85%. And it's a little bit concerning based upon the amount of increase in the G&A. So I have a concern, when do you think that you'll be cash flow positive here?

I mean it's going to take a while. Keep in mind that we're a low-margin business, and this business model works well at scale. And by scale, I mean well over $100 million. That's where our business model is really going to work well, and that's why we're expanding rapidly and buying the number of trucks that we're buying and entering new markets all the time. So it's going to take us a little while to get to breakeven and then to cash flow positive. We're a high growth company model.

Right. But based upon your burn rate, I see that you've increased the G&A dramatically. And from what I'm reading, if I'm accurate, 95% of your revenue comes from like three customers. Is that accurate? Or am I that an accurate statement?

No, it's much less. There's one customer that's over 50%, but that percentage is declining as we sign up many new fleets. So that number - that percentage has been going down.

But you increased the G&A...

Regarding the G&A, most of the increase in the G&A is because of public company expenses, which includes D&O insurance and Board of Directors and Investor Relations, which are expenses that any public company is going to incur. So it's not unusual at all that G&A increases after a company goes public.

Ladies and gentlemen, there are no further questions in the queue, and I'd like to turn the call back to Mr. Mike McConnell for closing remarks.

Thank you. Our top priority is to invest and grow our business, and we plan to accelerate our geographic expansion efforts. We're optimistic about the growth opportunities ahead for us, and we look forward to updating the investment community on the next earnings call. Thank you.