Greetings, and welcome to ReposiTrak Fiscal First Quarter 2026 Earnings Call. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Jeff Stanlis with FNK IR. Mr. Stanlis, you may begin, sir.

Thank you, operator, and good afternoon, everyone. Thank you for joining us today for ReposiTrak's Fiscal First Quarter 2026 Earnings Call. Hosting the call today are Randy Fields, ReposiTrak's Chairman and CEO; and John Merrill, ReposiTrak's CFO. Before we begin, I would like to remind everyone that this call could contain forward-looking statements about ReposiTrak within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that are not subject to historical facts. Such forward-looking statements are based on current beliefs and expectations. ReposiTrak's remarks are subject to risks and uncertainties of which actual results may differ materially. Such risks are fully discussed in the company's filings with the Securities and Exchange Commission. The information set forth herein should be considered in light of such risks. ReposiTrak does not assume any obligation to update information contained in this conference call. Shortly after the market closed today, the company issued a press release overviewing the financial results that we will discuss on today's call. Investors can visit the Investor Relations section of the company's website at repositrak.com to access this press release. With all that said, I would now like to turn the call over to John Merrill. John, the call is yours.

Thanks, Jeff, and good afternoon, everyone. Fiscal 2026 started as a continuation of the success of fiscal 2025. We continue to execute on our business plan. Once again, the proof is in the numbers. Our strategy remains the same: Grow annual recurring revenue between 10% to 20% and grow profitability even faster, generating more cash to bolster our balance sheet and support our continuation of returning capital to shareholders. Simultaneously, without exception, we take superb care of the customer because when they are successful, they buy more from us. Let's get to the numbers. First fiscal quarter revenue increased 10% from $5.4 million to $6 million. Total operating expenses for the quarter increased 3%. This is largely due to investment in RTN, including Wizard onboarding tools, increased cybersecurity costs, database license fees and other direct costs associated with development. SG&A costs were up 6% due to higher payroll costs associated with higher revenues, increased insurance premiums and increases in employee benefit costs. We grew total revenue at approximately twice the rate of SG&A expenses and at 3x the rate of total operating expense growth. Simultaneously, we delivered $356,000 of revenue per employee on an annualized basis, twice the rate of the 2024 statistic software industry average of $175,000 per employee. This is due to our lean nature, efficient operations and our ongoing use and expansion of automation. It also reflects our methodical spending decisions based on return on investment and not hope. At the same time, we will never trade growth at the expense of delivering less than exquisite customer care. Income from operations was up 28% to $1.9 million versus $1.5 million. GAAP net income was $1.8 million, up 13% versus $1.7 million last year. The conversion of income from operations to GAAP net income was muted during the…

Thanks, John. As John said, the results speak for themselves. We continue to grow revenue, expand our operating margins, net margins, earnings per share and generate substantial cash. This has been and is the plan. Over the past 2 years, our prime focus has been on traceability. The result is that we've established ReposiTrak and the ReposiTrak Traceability Network, or RTN, as we call it, as the dominant player in the industry. We have some key competitive advantages in the area. And I think over time, those advantages will create an even bigger moat between us and any alternatives that might arise. But what I find particularly exciting is how effectively we have leveraged our presence in traceability, both at the top and the bottom of the value chain to grow and leverage all of our lines of business with, frankly, minimal additional cost. We're not just a traceability company. We are a food safety company with a business model that should lead to even greater dominance in the future. The traceability solution for our customers and emerging industry food safety requirements have pushed us to develop and use much more automation. This automation focus in turn, is helping our entire business. As you know, we've been using automation and AI for years. So what we've done is to simply add more and more of those to our base capabilities. Traceability requires each step in the supply chain to provide clean and accurate data and then hand that data off to the next participant in the supply chain. But here's a stunning fact. Did you know that on average, the initial data we received from either retailers, suppliers down to greenhouses all the way down, up and down has a 70% error rate before we're involved. Think about that for…

[Operator Instructions] The first question comes from Thomas Forte with Maxim Group.

Randy, John, congrats on the quarter. I'm going to ask 2 questions at once, but I'd appreciate your answers. So how, if at all, were you impacted by the government shutdown? That's my first question. And then my second question is, one quarter later, do you still believe your buy ingredient efforts are increasing your total addressable market? And if so, how could that impact your future operating results?

Let me take a stab at it. The shutdown does impact the industry that we're in, meaning the food industry because the FDA isn't working, lots of pieces, the SNAP part of it, a large amount of that SNAP money, as you probably have figured out, goes through the grocery stores because we're members of all the trade associations. There's an enormous amount of attention on what's happening to SNAP. So it does impact the industry. It's just one more of those things between tariffs, inflation, importation restrictions, blah, blah, blah that caused the industry to be a little bit more cautious than it might otherwise be. The impact isn't substantial, but it has some level of impact. In terms of the second question, we think it's foundational, meaning if you are in the place of having to create traceability records for your customers, you have to gather the information from your suppliers. And those suppliers have to gather information from their suppliers and so on and so forth. That's why the entire chain is, in fact, connected. It's also the opportunity because for us, and we talked a lot about the problem of errors, here's how it works. If you imagine a farm passing information to its packing house, growing some vegetable, passes on to the packing house incorrect data for traceability, that packing house is now going to pass it on to its distributor and then what's going to happen is it gets worse from there. The distributor passes it on to the next step and so on and so forth. So errors in the supply chain for traceability create an enormous problem in correcting errors. They don't show up in one place. They typically show up in 4, 5 or 6 places, and each of those is a different entity, a different business. So we believe, we could be wrong, but I don't think so, that years from now, the real problem in traceability is going to be data integrity. And it's really our sweet spot. We are extremely good at the detection and correction of data errors. John, do you want to add anything to that because it is a major part of our strategy going forward.

No. I think I had that in my remarks, which was, I think, where we are financially, cash generation revenue, the time is now to do these things. It will not have -- well, it will have a negligible impact on our expenses. We merely will reallocate our capital CapEx spending. As we've announced before, we've already expanded in 2 data centers that's behind us. So as far as the financial wherewithal, now is the time to do that. I think it's the right decision. We evaluate M&A opportunities pretty much weekly. And I think we're in a good spot now to build it versus buy it because we're good at building things. That would be my response to where we're going in the next 2 years.

It substantially expands our market is the truth of it. But it does it because at each level, you want the participants ahead of you in the supply chain, meaning your suppliers to participate as well. So we're pretty excited about it, and it seems to be working so far.

Thank you. At this time, I would like to turn the call back to Mr. Randy Fields for closing comments.

Thank you, operator. Thanks, everybody, for taking some time this afternoon to chat with us. You know how to reach us if you have additional questions, we're happy to make ourselves available. Thanks a lot.

Thank you.

Thank you. This does conclude today's teleconference. You may disconnect your lines at this time. Thank you for your participation, and have a great day.