Hello and welcome to the Paysign Fourth Quarter and Year End 2022 Earnings Conference Call and Webcast. As a reminder, this conference call is being recorded. This call may include comments that maybe deemed to be forward-looking statements under federal securities laws and the company intends that such forward-looking statements be subject to the Safe Harbor created thereby. All statements beside statements of fact included on this call are forward-looking. Such forward-looking statements include, among others, that we are pleased with the opportunities that lie ahead for us in 2023; our belief that 2023 is looking to be an exciting year across all of our product lines; and our belief that we are all well prepared to capitalize on new opportunities; our plans to continue to add new plasma centers; and our belief that the increasing demand for plasma by the medical industry will facilitate the increase in donations and fuel the continued growth of our plasma businesses; our belief that we are beginning to see real traction in our pharma copay business where we have built an industry reputation of providing reliable patient affordability programs to pharmaceutical companies; our expectation for total revenues, plasma revenues, new centers, pharma revenues, gross profit margins, operating expenses, expected legal expenses for our outstanding litigation, depreciation and amortization, stock-based compensation, interest income, net income, net income per diluted share, adjusted EBITDA and adjusted EBITDA per diluted share for full year 2023; our expectations for total revenue, gross profit margins, operating expenses and adjusted EBITDA for the first quarter of 2023; our belief that inflationary pressures for food, gasoline, rent and other products and services appear to be driving individuals back into plasma donation centers; and our inability to estimate with reasonable accuracy, COVID-19’s further impact on our results of operations, cash flows or…

Thank you. Good afternoon, everyone and thank you for joining our call today to review Paysign’s fourth quarter and full year 2022 results. I am Mark Newcomer, Chief Executive Officer. And with me this afternoon is Jeff Baker, our Chief Financial Officer. Earlier today, we announced our financial results. Our fourth quarter revenue was $10.6 million, an increase of $1.9 million or 21% improvement over Q4 2021. For the full year, our revenues increased 29% to $38 million. Additionally, we reported a net income of $713,000 or $0.01 per fully diluted share for the fourth quarter and $1 million or $0.02 per fully diluted share for the full year. 2022 proved to be a year of significant growth in our plasma business as the headwinds from COVID-19 and the associated financial stimulus eased and are now comfortably behind us. We added 91 plasma centers to our platform, of which 45 were established centers and the remaining were new construction. Of course, there were center closures and consolidation, and we ended the year with a net gain of 78 centers, for a total of 444 centers at the end of 2022. Additionally, we benefited from same-center growth as well as from the U.S. District Court’s preliminary injunction allowing for the resumption of cross-border plasma donations from Mexican nationals in late September. We are expecting continued strong growth in plasma from both existing centers and new openings in 2023. Most of our clients continue to have aggressive growth plans, and we are currently forecasting 45 to 55 new center openings in 2023. Turning towards patient affordability. We think that 2022 represented a true return to normalcy as our sales cycles time decreased dramatically and is now averaging around 90 to 120 days. This is quite the change from 2020 and 2021 where…

Thank you, Mark. Good afternoon, everyone. As Mark pointed out, we are pleased with our full year and fourth quarter 2022 operating results and the traction we are seeing across our two major business lines of plasma and pharma. Revenues, income from operations, EBITDA, adjusted EBITDA and transactional trends all showed meaningful improvement for the fourth quarter and full year versus the prior periods. With all of the details we provided in the press release and that will be available in our 10-K filed tomorrow, I will simply hit the financial highlights for the fourth quarter and full year of 2022. Full year 2022 total revenues of $38 million increased $8.6 million or 29%. Of that amount, plasma revenues increased 34% to $8.8 million; pharma revenues declined 10.6% to $3 million; and other revenue increased 56% to $289,000. Fourth quarter total revenues of $10.6 million increased $1.9 million or 21%. Of that amount, plasma revenues increased $2.2 million to $9.7 million; pharma revenues decreased $443,000 and other revenues increased $142,000. The average revenue per month per plasma center for 2022 was 6,994 versus 6,058 in 2021, an increase of 15%. For the fourth quarter, the average revenue per plasma center increased 7% to $7,293 versus $6,798 during the same period last year. As we had previously communicated, one of our clients closed 13 centers in the fourth quarter. With the addition of seven new centers during the quarter, we exited 2022 with 444 centers, an increase of 84 net new centers during the year. Gross profit margin for 2022 was 55.1% versus 49.9% in 2021, an increase of 520 basis points. For the fourth quarter 2022, the gross profit margin was 51.9% versus 54.3% in 2021, a decline of 240 basis points. The fourth quarter year-over-year decline was almost entirely…

[Operator Instructions] Our first question today is coming from Gary Prestopino from Barrington Research. Your line is now live.

Good morning everyone – good afternoon everyone, sorry, not morning. A couple of questions here. You had – it looks like you say you had a net gain – you added 91 centers, a net gain of 78 to 13. So, there is still three more to be closed down in Q1 of this year. But you said you are going to lose 16, am I reading that correctly?

No. So, Gary, this was all last year. There were 13 centers that were closed in the fourth quarter. This year, in the Q1, we have a few centers that got sold. We have some centers that are being closed in March. And then another center is going to get sold in the fourth quarter. So, if you read the – look at the press release, it kind of lays out by quarter when everything hits, but it’s 16 centers that are impacted in 2023.

Okay. That’s what I was trying, 16 centers in 2023, okay. And then what is this, when you are talking about the business, you had a thing in there, the gross margin was affected by supporting a new payment network. What was that all about?

Yes. We have – as we announced last quarter, we stood up Direct Connect to Mastercard. So, now we have connections, Visa, Mastercard, Pulse…

Discover.

Discover, etcetera. So, as you can imagine, until we get a lot of volume on that platform, there is a pretty big sunk cost, just monthly fees that we are having to eat.

Okay. And then just a couple more here. Are the Southern border locations, are they back to pre-COVID levels or are they still ramping up?

I would say some of them are back to pre-COVID levels. Some of them are still ramping up. So, we expect to see them continue to increase in volumes.

Okay. And I am just trying to rises on them. Alright. I will let somebody else jump in.

The next question is coming from Peter Heckmann from D.A. Davidson. Your line is now live.

Good afternoon gentlemen. I wanted to follow-up on the plasma – the operator of plasma collection centers that you noted last quarter. I believe that you won for the first time. I guess how are you expecting that to contribute to your net new of approximately 30 centers to 40 centers in 2023?

Yes. At this point, that new RFP that we had won, we are still going through the contract phase of that. So, there has been a slight delay in bringing those centers live in the first quarter as we anticipated. So, those are not baked into our numbers at this point, and we will bake them in as we get closer to a determined launch date.

Okay. Understood. And then in terms of the AAA deal, that sounds pretty interesting. If I heard you correctly, you have launched the gift card business, which – and you plan to launch the general purpose reloadable, any way to think about how many cards that might represent or the contribution that you might expect? I assume it will grow over several years, but that sounds like it could be significant, but I don’t want to get ahead of ourselves.

Yes. And neither do we at this point in time. So, we have been pretty comfortable in talking about the gift card side of it, but we really don’t have the numbers at this point to really get into where it can go. So, we are kind of waiting on some additional detail at this point.

Okay. Alright. And then last one for me is it sounds like there is some move within Canada to start compensating the donation of plasma, and maybe you have already started a pilot program there, but do you see opportunity there, or would that require a significant investment to accommodate the Canadian market?

Yes. We certainly could. I don’t know what the numbers actually – we would have to do an analysis to see if that’s going to meet the needs and compare what the numbers are. But yes, there would be an investment in order to support that market for sure.

Right now, I mean Pete, if you go and you look at the number of plasma centers that are in Canada, they are fairly benign. So, there would have to be a huge investment there. And we are looking to other areas to build out our plasma centers. So, we will add more in the first quarter than Canada will probably add all next – all this year, so.

That’s fair. Alright. Appreciate it.

[Operator Instructions] Our next question is coming from Jon Hickman from Ladenburg Thalmann. Your line is now live.

Hi. Just one quick question. If you guys add 45 to 55 new centers this year, what percentage of the market will that give you? It seems like it would be over 50% now.

No, Jon, those – the latest figures that we have out there is just under 1,100 centers in the U.S. We exited at 40 – 444 centers. I did the math for the 10-K, we had to disclose it. It was around 40%. So, if we add another – yes. So, if we add another 45 to 55, less the 16 that we are going to lose, so what’s that, put us around 29 to 39. So, we are probably going to hold market share because there is other – they open up about 100 centers a year in the U.S., give or take.

Okay. Thanks.

Yes.

Thank you. We reached the end of our question-and-answer session. I would like to turn the floor back over to management for any further or closing comments.

Thanks Kevin. Want to thank everybody this evening for joining us. A special thanks goes out to all of our employees and to our Board for the support that we have had and the support that we will get through 2023. I believe that 2023 will be an exciting year for Paysign, and we are looking forward to updating you on the next call. Thank you all very much and have a great day.

Thank you. That does conclude today’s teleconference and webcast. You may disconnect your line at this time and have a wonderful day. We thank you for your participation today.