Thank you very much, Constantine, and thank you everybody for joining our conference call for Q3 of 2025. My name is Alex Baluta, the CEO of Flow Capital, and I'm joined by Michael Denny, our Chief Financial Officer.

Last night, we reported Q3. You will find the results filed on SEDAR.

You'll see the highlight press release released on the wires, and you'll also find the results on our website under the investor section. Before I start the formal part of the call, I would like to say invite welcome PwC, PricewaterhouseCoopers, to our audit- to the company as our auditor.

We're thrilled to have them on board, and you'll see as well for this quarter when you look at our financials, we've changed the format and the presentation of our financial statements. From our perspective, you'll- it's much more readable and much more clearly and fairly represents the progress or just the performance of the company in any given period.

In particular, you probably remember in prior calls I would complain about IFRS making the presentation of revenue difficult to understand. It's, in my opinion, much clearer now in the revised format, and you will see us continuing to use that format going forward.

For the quarter, we had another strong quarter with record revenues again. Revenue was up 38% year-over-year to $3.4 million, and up 5.6% sequentially.

We continue to generate positive free cash flow. Free cash flow is up 15% year-over-year.

I think this represents our 25th quarter of profitability. I'll probably stop talking about that going forward because we expect to remain profitable.

We only deployed $4 million in the quarter. That was an excellent deal, positive that we did the deployment, although it was a little bit below our expected or targeted deployment.

Nevertheless, we did deploy $4 million. Book value per share was up 5 cents a share from quarter- from the immediately prior quarter, from Q2 it was up 5 cents to $1.22, primarily based on profitability with a little bit of push from FX.

Total investments grew year-over-year 24% to over $75 million now, and our perfor- I'll talk about it a bit more, but our portfolio continues to perform well. Some other highlights in the quarter include making progress on some of our legacy deals that go back 4, 5 years now in terms of helping them get to an exit that we expect will be positive for us over time.

We've deployed several new AI initiatives. We've really embraced AI and the opportunity AI represents in terms of both efficiency, growth, and marketing, really all across various operational sections of the company.

We're deploying it, competitive tracking, deal tracking. We're seeing a remarkable increase in productivity and even the the the opportunity to generate some new information that we didn't have to better manage our business.

Marketing, although I don't have a lot of details to provide, marketing continues to perform quite well. We've initiated a lot of new marketing activities over the last 3 quarters and even earlier.

Leads on a year-over-year basis at the top of the funnel and and actually in the middle of the funnel are up 26% year-over-year. Also, quite proud to say that we are number two versus all of our competitors in terms of organic search based on some of the tools that are out there providing those kind of statistics.

We've done a really good job on on a website, on content, on other activities in marketing that help generate brand and organic leads, and very proud of that. The portfolio continues to perform well, no real material changes.

Interestingly, we have had a lot of early buyouts this year that were a little bit unanticipated, and it's usually good news when that happens. Aerobiotix was a transaction that was repaid early in August.

In April, we had BallotReady, which was acquired by a competitor, that was an early, successful exit. One of our best-performing companies bought us out in October, company in the real estate space, a software platform for real estate, very- we we we continue- it's worth pointing out we continue to hold equity positions, very small equity positions in most of these companies, and and sometimes they work out, sometimes they don't, but for that one I'm particularly optimistic about their future.

They're they're they're a real rocket ship. They're doing well, and I wish management well.

A fantastic client, glad to have been part of their journey. We have a couple of other transactions that one company we've we've transitioned to an amortizing transaction, which should be a loan which should be repaid within the following couple of quarters, I count that as a buyout.

Then we also have a transaction that's close to closing some change-of-control activities, which I think will also be positive for them and for us. We did have a a a final exit in one of our companies that didn't work out.

I won't mention the name, but there was some very odd circumstances, unfortunate, not odd, but unfortunate circumstances around the company, the platform that they were built on and competition from that platform provider. Unfortunately the the company faced challenges.

We did recently close the sale of the assets of that company. However, a cash-on-cash return to date was approximately 90%.

The point I'm trying to make here is that as a senior secured lender, we do everything we can to work with our companies when they stumble. We worked with this company for a long time.

In the end, the customers found a home, we returned 90 cents on the dollar cash-on-cash to date, the new buyer has- is optimistic about the future, and we continue to retain a position in the new buyer and an obligation on their behalf to continue to pay us. To date, our cash-on-cash return was 90 cents on the dollar.

Even in transactions where it doesn't work out, and sometimes that happens, the type of investing we do provides us with good security and the opportunity- our our our our investments aren't, zeros or heroes. They don't- it's not like, we lose money on every on any investment, in fact, because we are a lender who takes cash interest.

Glad for the ultimate outcome for the company. There is still some opportunity, but I also count that as essentially an exit in the portfolio.

We're seeing a a couple more exits this year than we had expected, but overall the portfolio continues to perform well with a mid-20s long-term, 7-year IRR at the top of the portfolio. That is a fantastic number that I'm very proud of.

It is it is a function of the quality of the deals that we've chosen, the quality of the companies that we've worked with, and also the quality of the team that we've built here over the last several years. It's, we we really do focus on on making sure we make the right decisions, and sometimes that slows our deployment, but it does add to strong growth.

This was our ninth growth sequentially, on a sequential basis- sorry, let me rephrase that. Ninth quarter in a row where we've grown sequentially our revenue.

If you do it right, you have the right team, you make the right choices, the portfolio performs well, your returns are great, and you can grow. Having said that, we are seeing some pressure in the marketplace that's kind of crystallized over the last couple of quarters.

We're seeing some increased competition from new, smaller entrants. For example, we've we've in the past seen family offices try to enter this business, do a few deals, and then leave.

We're seeing a couple of those types of competitors come to market. Not a major disruption, but still, may add a term sheet or two to compete against in a transaction.

We're seeing broadly speaking more capital allocated to private credit. Now, we're a small sliver, corner of the private credit market, but there is capital coming into the market.

We've done a TAM analysis, sort of bottoms-up analysis of the number of transactions in our particular space, and we are seeing that actually year-over-year the number of transactions that are the type that we would do, which as a reminder are companies generating sort of greater than $3 [million?] or $4 [million?]

or $5 million in revenue, who need somewhere between $2 [million?] and $10 million, and are growing at 20% or more, the year-over-year count in deals is down 15%.

Now, I think that's because in the '22, '23, '24 time frame a lot of companies got religion in terms of breakeven and profitability while they, tried to during during the uncertain times around COVID tried to ensure that they got profitable so that they could live forever, and you're you're now seeing VCs pivot entirely to investing in AI-native companies only. Some of these companies in our target market are at a point where they continue to grow, but perhaps not as much as they could be growing if they had capital to deploy, they're not currently in the market looking for capital.

I actually expect that to change. I expect a lot of the companies who have now stabilized their businesses to come back to market to try and get additional growth capital, and given that venture capitalists are not necessarily investing in SaaS, unless it's an AI-native company that is directly in SaaS, I think that represents an excellent opportunity in our space.

I'm looking forward to the future, and given the progress that we've made on marketing, I think we'll be right in the middle of the pack in terms of of of seeing more and more deals that come to market in our target space. Couple of other things that we're seeing is is is is occasionally we've seen some I'll call it irrational competition from some of the major banks, particularly in Canada where they provide lines of credit that are that are not priced for the risk.

They seem to be priced for something else, meaning competing with other banks in Canada that are trying to enter this market as well. It's fine, it's a short-term disruption.

I don't think it'll end when- well for them. Nevertheless, there seem to be a lot of moving pieces in the market today that we focus in.

I don't mean to put a negative spin on it. I think it's- we've always had competition, but it has slowed our close rate a little bit.

I I I do- the the one thing I will say is that we're not- the type of structure that we are in terms of our capital structure, which is a evergreen fund, we are not forced to deploy capital. We can be patient.

Given the type- we we we we have a senior lender, by the way, one of the other highlights in the quarter is that we in- well, this is post-quarter, we increased the line of credit with our US banking syndicate to $25 million. We're only drawn- we're not drawn on that very much, and given some anticipated repayments we're going to have, I think we'll be drawn at the minimum by the end of the year.

We have a lot of spare capital, but we're also not in a rush to deploy. In some in some models where there's where there's captive capital and you have 8 years to deploy it, if you're not deploying it, it could be hurting your economics.

In spite of what are a little bit of additional competition than we normally see, it's not a challenge for us, is basically the bottom line. Having said that, the pipeline continues to be strong.

We've missed some deals, but we have a lot of deals that we're working on, and as I said earlier, our our leads are up 26%, and I think the growth in our leads is accelerating. Having said all that, I'll pause there.

If anybody has any questions, I'll well, I'll turn it over to the operator. Constantine, are you there?

Okay. That could be positive, I guess.

Most of the times, it's possible, but in this case there's very little. The positive perspective on that transaction is the long-term position that we hold in the equity, which, again it's worth pointing out that in all of our transactions we usually get a very small sliver of equity.

It's much, much smaller than a venture capitalist would take, and that's one of the value propositions is that our capital is minimally dilutive. With our auditors, we always try to fairly value the warrant positions and equity positions that we have, I wouldn't expect it to be any material impact one way or the other on our financial statements in Q4.

I do highlight it as the long-term opportunity in that company is one that I'm most excited about. It's an excellent company, so that was the point I was trying to make.

Okay. You're going to hang on to the equity even as they exit the loan.

In that particular case, yes. Sometimes we have a couple of different structures that we can deploy for, let's call it bonus, it's equity-like.

Sometimes it's warrants on common equity, sometimes it's exit fees, but in that case it's a long-term warrant. I see.

Okay. Just I noticed you're paying tax, which I guess is a good thing.

Is that going to be going forward that you're going to be paying tax, or is it going to be about that rate, or what does that look for tax going forward? Remember we continue to have operating losses that are legacy from before 7 years ago.

We are profitable. We are recording tax, but then that tax is sheltered by a reduction in our deferred, I guess, is that how you call it, Mike?

The deferred tax... Deferred tax asset.

Deferred tax asset. There may be small tax transactions related with small US taxes, I think, but at this point we're not paying cash taxes.

We are burning through that asset. Do you remember the top-line value of the asset, of the deferred tax?

$7.5 million. Yeah.

Basically, we still have $7.5 million of tax sheltering prior to us actually paying cash taxes. The short answer is no, we're not actually paying any cash tax today.

I see. Okay.

Thanks for clarifying that. Thank you.

Yeah. Thanks, Ed.

Thank you, Constantine. Thank you, everybody, for your attendance either live or listening to the recording.

As always, Michael and I are here at any time if you have any questions, and we look forward to speaking to you again early in the new year on Q4 results for the full year. Thank you very much.