Financial Data and Key Metrics Changes - For the fiscal year ending June 30, 2025, total revenue increased by 11% from $20.5 million to $22.6 million [5] - Recurring revenue rose by 10% to $22.3 million, with setup fees increasing from $95,000 in fiscal 2024 to over $300,000 in fiscal 2025 [5] - Total operating expenses increased by 6%, primarily due to investments in RTN and other development costs [5] - GAAP net income increased by 17% from $6 million to $7 million, with earnings per share growing by 21% [6][7] - Cash from operations rose by 21% from $7 million to $8.4 million, and total cash increased by 14% from $25.2 million to $28.6 million [7][10] Business Line Data and Key Metrics Changes - Annual recurring revenue continues to represent between 98% and 99% of total revenue, indicating strong stability in revenue streams [8] - The company experienced growth across all lines of business, not just traceability, with significant momentum in compliance and supply chain solutions [11][12] Market Data and Key Metrics Changes - Deferred revenue increased by 30% from $2.4 million to $3.2 million, indicating strong future revenue potential [12] - The company is positioned as a leading solution provider for traceability requirements, with a growing network effect enhancing customer acquisition [25] Company Strategy and Development Direction - The company aims to grow annual recurring revenue between 10% to 20% while increasing profitability at a faster rate [4] - A focus on automation and efficiency is central to the company's strategy, allowing it to serve smaller accounts effectively [18][19] - The company is exploring a middle-out approach to market expansion, targeting both upstream and downstream customers [21][24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in continued growth and profitability, projecting the potential to double the company's size in the coming years [10] - The company remains cautious about external factors such as tariffs but has not seen significant impacts thus far [32][33] - Management emphasized the importance of maintaining a strong balance sheet with zero bank debt while returning capital to shareholders [15][17] Other Important Information - The company has terminated its $12 million credit facility and has redeemed a significant portion of preferred shares [16] - A commitment to return 50% of annual cash from operations to shareholders while maintaining cash reserves is highlighted [17] Q&A Session Summary Question: Did you change your pricing or billing strategy? - The company clarified that it has not fundamentally changed its pricing strategy but can now effectively serve smaller accounts due to automation [29][30] Question: How have tariffs impacted your business? - Management indicated that tariffs have not significantly impacted the business yet, but there could be future implications for parts of the food supply chain [32][33] Question: What are your thoughts on strategic M&A? - The company is open to exploring M&A opportunities that are accretive and provide access to new customers or adjacent industries [34][36] Question: Would you consider paying a one-time dividend? - Management expressed a preference for increasing regular dividends rather than issuing a one-time dividend, emphasizing long-term growth [39][40] Question: Do you have any crypto treasury plans? - The company has no plans to invest in cryptocurrency, citing a preference for stability and risk management [42]

Core Insights - Cargill has closed its cocoa processing plant in Yopougon, Ivory Coast, which had an annual capacity of 160,000 tons, highlighting the severe challenges faced by the cocoa supply chain due to climate change and structural issues [1] Industry Summary - Cocoa production and quality are declining, with a reported 31.2% decrease in cocoa grinding volume by July 2025, reflecting both a drop in arrivals and a high rejection rate of non-compliant batches [1] - From April to mid-August 2025, the quantity of coffee beans arriving at the ports of Abidjan and San Pedro was only 350,000 tons, a 30% year-on-year decline [1] - Unstable weather conditions have negatively impacted coffee bean quality, increasing impurity levels in trucks to 5%-6%, compared to the usual 1%, complicating operations for companies like Cargill and driving up sorting and cleaning costs [1] - The current vulnerabilities in the cocoa supply chain threaten foreign trade income and employment in Ivory Coast, making it difficult to achieve the goal of 50% local processing of agricultural products [1] - The state of the cocoa industry is affecting consumers, with chocolate prices in the U.S. expected to rise by 11.6% in 2024, marking a 41% increase since July 2021, prompting manufacturers to explore alternative products or adjust formulations [1] - There is growing concern within the market and cocoa industry regarding climate change, with calls for increased investment in agricultural resilience and traceability to stabilize this critical sector of the food industry in West Africa and globally [1]