Mind Technology Inc Q4 2025 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Tyson Bauer - KC Capital - Analyst : Yes. Good morning, gentlemen. And congratulations on another strong quarter. Let's drill down a little bit on the on the pipeline and the backlog. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. APRIL 23, 2025 / 1:00PM, MIND.OQ - Q4 2025 Mind Technology Inc Earnings Call And what I refer to is the unofficial backlog which would include some of those aftermarket art services which appears to be anywhere between $15 million to $20 million that we could expect this year without knowing exactly when or but just historically that seems to be the range that we should get. So any backlog figure you provide is really that plus $15 million to $20 million due to the ongoing parts of your business. Another part of your optimism seems to be when you put items into backlog. Those are finite system sales that you have a PO for. But they say customer X comes to you and says, our intentions are to order five systems this year. Here's the PO for the first one. And as the year rolls out, we will get you those other four without if there's no hiccups. Is that something that gives you that optimism and that confidence that? Yes. It's not in backlog currently, but we've been notified of intentions that this strong repeat customer, almost like an accordion purchase order will give us further orders as we go through the year.

Question: Tyson Bauer - KC Capital - Analyst : And due to that customization of certain large systems, you may already be working on something in the design phase or to cater to that one vessel or use that you have it. It's just not, you don't have the actual final PO because those final customization details have not been ironed out?

Question: Tyson Bauer - KC Capital - Analyst : And I'm just going to get this one out of the way. The shelf registration, historically, that is what mine and previously, Mitchell has always done with a renewal with the [10K] each year. The only reason it was interrupted was because of the preferred stock events and converting. Otherwise, you would have been active all the way through this process. So we're just getting back to what we've always done in the past. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. APRIL 23, 2025 / 1:00PM, MIND.OQ - Q4 2025 Mind Technology Inc Earnings Call

Question: Tyson Bauer - KC Capital - Analyst : And I think in the past on calls when things were a little more stable, organizational structure, manufacturing capacity, technology wise, you have the structure organizationally to support two times growth or getting back. We've always kind of have the circle around that benchmark of getting the $100 million in revenue. Is that what you deem as where you want to get to, at least for the next step whenever that occurs?

Question: Tyson Bauer - KC Capital - Analyst : And I guess we'll put in quotes. Everything's on the table, not that it hasn't been in the past, but you've just officially put it in the press release that everything's on the table. You're not anchored to any one thing, whatever is best for the shareholders, that's what you're going to do. In the -- within the industry in the past years, purchased multiples had a huge spread. From say high single digits EBIDTA, multiples all the way to mid double digit EBIDTA, obviously, case by case and depending on growth and technology in there. And we've seen some that are highly correlated to yourselves, get some pretty healthy double digit multiples. Is that kind of the mindset if somebody comes in through the door with that kind of offer, you're going to take a serious look at it?

Question: Tyson Bauer - KC Capital - Analyst : Last question for me, just going through, we got a week left of the quarter, so we may walk back a little bit in Q1 on revenue due to the lumpiness that as part of the business. And then, as we get into Q2 and forward, we really start to pick up steam again. Obviously, there could be some lumpiness in three and some of those quarters, but we walk back a little bit in Q1, solid quarter, build the backlog. Q2, we start to see some acceleration. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. APRIL 23, 2025 / 1:00PM, MIND.OQ - Q4 2025 Mind Technology Inc Earnings Call

Question: Ross Taylor - ARS Investment Partners - Analyst : Thank you. It's always both taxing and exhausting to follow Tyson because many questions get checked off next time we'll let you.

Question: Ross Taylor - ARS Investment Partners - Analyst : No, I don't want to get Tyson angry. Probably be worse than getting my wife angry at me. Couple of questions in here. Your EBITDA margin for the quarter was 20%. Your EBITDA margin for the year was around [16 6]. It therefore indicates, a certain sensitivity on the EBITDA margin to volume. Would we expect or should we expect your EBITDA margin for the current fiscal year? You're in the January '26 fiscal year to come in somewhere between those two numbers as we see overall top line perform better than it did last year, but not the way it did in the fourth quarter.

Question: Ross Taylor - ARS Investment Partners - Analyst : Okay, well that's fantastic because that argues that we should expect to see the higher end, particularly as you grow. Can you give us a little bit more color on the potential order book outlaw? What types of outlook? What types of things are we -- are you looking at doing? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. APRIL 23, 2025 / 1:00PM, MIND.OQ - Q4 2025 Mind Technology Inc Earnings Call There's a lot of talk. I get people talking to me about the plan to map the sea bottom and lay 35,000 miles of cable and things of this nature. How do you fit into that? And where do you see the various industries you serve, there's been talked about sea mining for rare earths and other precious metals and all. Where do you see that going for you?

Question: Ross Taylor - ARS Investment Partners - Analyst : Okay. And yeah, it would make sense of it. Have you seen any progress in utilizing your systems in the defense space?

Question: Ross Taylor - ARS Investment Partners - Analyst : Okay, and I would also echo Tyson's comment, the shelf, everyone has one, it's prudent to do it, to have it out there. So honestly, I know some people get scared about them, but everyone does it, so why worry about it? So looking at, you talk about internal growth opportunities, things. Is that stuff that you guys have, you've worked on and you just, are you waiting for the market to come to you? Or is that something you need to go out and kind of convince the market or is this design work, R&D work you need to get done?

Question: Ross Taylor - ARS Investment Partners - Analyst : Okay, and so kind of sum up we move you're in, nearing the end of your fiscal first quarter for your 26th year. You're looking at this and you see `26, you believe it should be a better year for the company than `25 was on the top, middle, and bottom lines.

Question: Ross Taylor - ARS Investment Partners - Analyst : Cool. And one thing I would offer a thought to if you end up looking to raise growth capital at a point in time, consider a lot of smaller companies I've been investing in lately have been doing strategic where they bring in. Instead of going to the market to raise capital, which tends to get you a discount, they find a strategic buyer who's interested in establishing or building that relationship and pushing forward, and that tends to whatever price they take the stock almost never sees that price again. So I would recommend that, perhaps, you look at if you're looking at internal growth capital because you see that as an option as opposed to selling the company, I would agree company is too small to stay public as it is. So it needs to get a lot bigger or it needs to be monetized or some combination of the two in timing. But I would say, look for people who might be interested in making an investment in you and your future and might be a natural buyer of the company down the road and see if they could contribute capital to help build out some of these growth opportunities as opposed to going into the marketplace and issuing equity where people will show your stock in front of it, although that's not legally allowed so I didn't. (multiple speakers) And I said you guys, you've done a really the turnaround of this company has been pretty amazing. I don't think I've seen something turn so fast and so well since the Mariners traded Randy Johnson to the Astros.

Question: Ross Taylor - ARS Investment Partners - Analyst : Yeah, and you only took 300 points off the ERA, but hey, take care.