And welcome to Freightos Q2 2024 Earnings Conference Call. A press release with detailed financial results and a press release announcing our acquisition of Shipsta were released earlier today and are available on the Investor Relations section of our website freightos.com/investors. My name is Anat Earon-Heilborn and I'm joined today by Dr. Zvi Schreiber, the CEO of Freightos; Ran Shalev, CFO; and Christian Wilhelm, Founder and MD of Shipsta. Following the prepared remarks, we will open the call for questions. We are sharing slides during the call, so we recommend using Zoom on a computer rather than dialing-in by phone. The slides, as well as recordings of this earning call will also be available on our website shortly after the call. Please be aware that today's discussion contains forward-looking statements which are subject to a number of risks and uncertainties. Actual results may differ materially due to various risk factors. Please refer to today's press release and our SEC filings for more information on risk factors and other factors, which could impact forward-looking statements. Copies of these reports are available online. In discussing the results of our operations, we will be providing and referring to certain non-IFRS financial measures. You can find reconciliations to the most directly comparable IFRS financial measures, along with additional information regarding those non-IFRS financial measures in the press release on our website at freightos.com/investors. The company undertakes no obligation to update any information discussed in this call at any time. Please note that in September, Management will participate in the H.C. Wainwright Annual Global Investment Conference virtually and in October, Zvi will be at the LD Micro Conference in Los Angeles. Participation in investor conferences and events may be updated from time-to-time, and upcoming events are listed on Freightos Investor website. In addition, on September 23 and 24th, we will be holding our Annual Freightos Conference for industry executives from around the world in Spain. If you would like to attend, please reach out to us via ir@ freightos.com. Today's earnings call will begin with an overview of Q2 performance by Zvi. We will then go deeper into the Shipsta story with Christian, and back to Zvi for insights into the current freight market trends. Next, Ran will present the financial results and the guidance for Q3 and the full year. We will conclude with Q&A. Questions can be submitted in writing during the call using the Q&A feature in Zoom. Zvi, please go ahead.

Good morning, everyone, and thank you for joining us today to discuss Freightos results for the second quarter of 2024. Today, our team is very excited to announce the acquisition of Shipsta, but let me talk about the quarter first and come back to Shipsta soon. I'm pleased to report that this has been a strong quarter marked by continued operational progress and a reaffirmation of the demand for our platform in the freight industry. In Q2, we facilitated 316.5 thousand transactions, that's a 32% increase year-over-year. This growth exceeded our expectations. We do believe it reflects the broader industry's shift towards digital solutions. The momentum we're seeing is not just about more transactions. It's about establishing Freightos as a critical part of the logistics ecosystem where transparency, efficiency, and scale matter more than ever. The success we're seeing in transaction growth was mirrored in our gross booking value, which reached $203.4 million in the quarter, a 31% increase compared to the same quarter last year. GBV, of course, is a metric that is affected not only by transaction growth, but also by the exogenous factor of market rates. For Q2, we had actually anticipated that gross booking value growth might lag transaction growth, due to softening of market prices, but instead we saw the ongoing Red Sea crisis propping up rates. As we continue to expand our platform, we have grown the sell-side of our network to 51 carriers, up from 37 in Q2 last year. On the demand side, our unique buyer users have increased by 16%, reaching approximately 19,000. This growth in both buyers and sellers on the platform highlights the network effects behind our sustained growth. The more users we have on both sides of the marketplace, the more valuable our platform becomes, and this quarter's…

Thank you, Zvi, and hello to everyone. When we started Shipsta, we recognized the challenge with global enterprise phase, fragmented systems, reliance manual processes and the growing complexity of a logistic landscape. The process of retailers and manufacturers negotiating annually all quarterly freight contracts for shockingly labor-intensive and aero prone of massive excess being e-mailed back and forth for many weeks. Shipsta was created to address this issue head on with the next-generation platform that brings together data, automation and AI to streamline the entire procurement process. At the head of Shipsta offering is a powerful rate management system, serving as a single source of truth for all negotiated rates with systems not only centralized data, but also enable real-time marketing monitoring, allowing clients to respond swiftly to market fluctuations. The platform flexibility is a key strength, supporting various procurement events from quick rate rephrase to complex global tenders, categorying to the diverse needs of a freight industry. Our platform is designed to be a comprehensive solution, supporting all modes of transport, air, ocean, road and rail, and integrating seamlessly with existing systems like ERP and TMS transportation management systems, with adaptability makes Shipsta a valuable tool for a wide range of industries, from manufacturing at pharma to automotive and retail and we serve companies of very sized procurement strategies, where that require frequent rate updates or prefer annual contracts with periodic rephrase. Today, over 4,600 users across more than 50 enterprise customers, 30% of which are Fortune 500 companies rely on Shipsta to manage their logistic operations more efficient and effectively. Among them are, for example, Puma, ThyssenKrupp, Rockwool, Master Builders Solutions and Allnex. Shipsta core value proposition at central and address the most pressing pain point in the logistics industry. We understand the challenge of logistics supply chain…

Thank you, Christian, and welcome again to you, your team and your customers into the Freightos family. Shipsta and Freightos share a vision of a digitalized freight industry, but we approach it from different ends. Freightos focusing more on spot procurement and Shipsta more on tenders, the long-term contracts. This marriage creates the world's most comprehensive platform. We're thrilled about the opportunities this acquisition brings, enabling us to offer a truly comprehensive procurement platform to both Freightos and Shipsta customers and to address the estimated 50% to 70% of the massive freight market, which is served by tenders rather than spot. We see not only immediate cross-sell opportunities but also significant product integration potential. Most immediately, Freightos Terminal, our data product is already a leader in stock price data, and now it will be rich with contract rate benchmarking. Over the coming months, we'll integrate our platforms to allow a truly seamless procurement experience across spotting contract. Let me now briefly discuss market conditions during the quarter. Let's take a look at ocean and air volumes. The chart on the left shows that global ocean freight container volumes for Q2 increased a healthy 6.5% compared to Q1 and were 5.7% higher than Q2 of last year. The relatively sharp monthly increase in May marked an early start to the ocean peak season, possibly reflecting importers seeking to avoid possible Red Sea driven delays later in the year by stocking up earlier than usual for the shopping season. While we're still seeing strength into August, we do expect volumes to start declining in September, although, rates will still be propped up by the Red Sea crisis. On the right side, IATA data for global air cargo volumes shows that global demand continued to grow in Q2, increasing 15% compared to Q2…

Thank you, Zvi. Our second quarter results surpasses expectations across all metric, delivering both revenue growth and improved operational efficiency, reflected both in record high growth margins and strong improvement in adjusted EBITDA, where the loss was more than $2 million lower than last year. We successfully completed an acquisition while maintaining focus on daily operations, showcasing our team's exceptional performance and adaptability. Revenue for Q2 '24 was $5.7 million, up 11% compared to Q2 of '23. With each of our revenue segments, Platform & Solutions growing 11% year-on-year. These two segments represent two different revenue models. But from a business perspective, they are closely linked with most of our customers using platform and solutions in tandem. Our SaaS product enhance our marketplaces by increasing user engagement and driving more transactions. This both strengthened user retention and support our platform growth. We're seeing more and more use cases where transaction fees joined SaaS and data subscription, which is helping us generate additional revenues. Shipsta is also fundamentally a platform, which connects buyers and sellers to freight services, but will be included in the future in our Solutions segment due to its subscription revenue model. Our gross profitability this quarter has exceeded expectations. IFRS gross margins rose to 65%, an 8 percentage point increase from 57% in Q2 '23. Even more impressively, our non-IFRS gross margins, which really represents the margins we operate based on achieved a record 72%, up 7 percentage points from 65% in the same period last year. This significant improvement stems from the economies of scale, realized by our business leads, which are growing and maturing as anticipated and from a higher degree of process automation. These results align with our long-term model, which projects non-IFRS gross margins rising to 80%. We are continuously improving the efficiency…

Okay. Thank you, Ran. We will now move to the Q&A session. First question comes from James Rush (ph). James you can unmute now.

Great. Thanks, guys. Congrats on the results and the acquisition. Can you talk a little bit about the revenue and cost synergy opportunities between Freightos and Shipsta? And maybe what makes Shipsta unique relative to other tender management solutions out there?

Thanks, James. This is Zvi. I appreciate the question. I think, in terms of revenue, we put in the press release our specific expectations in the short-term before we have a chance to really work on the synergies. So I think we said for the balance of this year, about $800,000 of revenue for the remainder of this year. Ran, correct me, if I get anything wrong. And that gives you an idea of what the current run rate is. However, of course, we didn't buy them for their current revenue, but because of what we can do together. So there are really good synergies we're selling to some of the same customers, big enterprises, big retailers, big manufacturers, and we believe that our data products and their platform can be cross-sold starting almost immediately. So we didn't assume that for this year because it's already almost September. But going into next year, we believe that we can grow together a lot more than we could have grown by ourselves because the products really do complement very well. In terms of your second question, which I think was, what's unique about Shipsta. Look, two things. I mean the first thing and the most important thing is that they really have a modern solution. This was -- the company was founded in 2015, and it's built a modern software in the cloud, fantastic customer base, as you heard, really top tier customers. Some of the tender -- there are other tendering platforms. You're quite right, but many of them are decades old. So this is really a modern solution. And we've come across it in the market before and had very -- we had fantastic things from the customers, both just being in the market and also in our due diligence, we really heard great things about the product, about the technology. So that's the first and most important thing. It really is one of the best modern solutions. The second thing, of course, is that there is an opportunity to acquire them. We're being careful with our cash. We can't go out and do some huge acquisition right now. But the start of the line that we were able to acquire them at this time for a price which we can afford, which I think is an attractive price. So that was very fortunate, and we jumped when we saw that opportunity.

Great. It looks like good deal.

Does that answer your question, James.

It does. That was perfect. And then this is probably the first time I've heard you mention U.S. trucking in quite some time. It sounds like you're seeing some green shoots there. Can you talk about recent trends in that segment of the business? And then could you -- could we also get an update on your Ocean initiatives? Thanks.

Yeah. Okay. Good questions also. So well, to be perfectly honest, we sort of summed a little bit into U.S. trucking because we acquired a company called 7L Freight, a couple of years ago. And we mainly bought them for their air. They've got a very good solution for air cargo, which is our strongest segment, and we bought them for that. But they do trucking, in particular, LTL, less than truckload, which is a big market in the U.S. So the last estimate I saw was $80 billion, I think, but that's all up to date. So don't quote me on it. But if that kind of order I mentioned, it's a big market. And it does complement what we do because we're less interested -- we are seeing green shoots in just pure LTL, and that's fine. It's not strategic for us because we're not focused on air and ocean, but of course, there's nothing wrong with having a growing business in trucking as well. But the strategic part, of course, is that when you do air, then there's a first mile and last mile, you've got a truck to the airport. You've got a truck from the airport. So obviously, trucking does connect, every shipments needs trucking as well. That's why it becomes strategic. Secondarily, within the United States, we've just been growing -- just starting to really see some momentum also with domestic air cargo within the U.S. And whenever someone is looking at domestic cargo in the U.S., they want to look at an LTL alternatives as well. So anytime somebody wants to track something from New York Airport to LAX, they say, well, 1 second, what's the time and cost by air, what's the timing cost by truck. So having those alternatives just makes…

Okay. Thanks for taking my questions.

Thanks, James.

Okay. So the next question is from Jason Helfstein.

Hi. This is Steve (ph) on for Jason. So two questions from us. One, you drove significant leverage in gross profit this quarter. Revenue was up 11%, year-over-year cost of revenue down 9%. So just talk a bit, if possible, about how you achieve that leverage? And then second question, you raised your full year revenue guide while lowering GBV a bit. So are you seeing more strength in platform take rate or is it more a meaningful acceleration in solutions revenue, that's kind of offsetting that and getting the model to kind of foot? Thanks.

Okay. Sure. I'm sorry, you were a little cut off. I didn't hear who was standing in for Jason. Still not hearing that. Sorry, I'm just going to call you Jason. If that's okay, I apologize, but the little crackle on the line. Thanks for the question. So look, I mean, the revenue -- the increase in revenue guidance for the year is also due to the Shipsta acquisition contributing. So that was the main thing that how -- the revenue is growing, as you see on -- according to our expectations, a little lower in the first half. And -- but the extra, the raising of the expectations for the second half is also driven by the Shipsta acquisition, which is going to contribute to that. In terms of the increase in gross profit, I think there's two things there. One is scale. The bigger we get. So I think that's what you're asking about the increase in sort of the profit margin and that's partly scale. The bigger we get, the more economies of scale that we have. But also, of course, it's a factor of our continued investment in research and development. We're investing a lot of money in software. And partly, that's -- of course, most of it is providing features to our customers, but some of it is also automating our own operations. And so we're able now in air, for example, well over 90%. I don't have the number at my fingertips, but one of the 90% of bookings go through with no human interaction at all. And some of the things that used to need human support because our biggest cost of goods sold is actually customer support people, that's our biggest cost of goods sold. And that's just getting less as we just get more and more automated in how we support our operations, if that makes sense.

Yeah. Perfect. And it’s Steve – on for Jason. Thanks, everyone.

Thanks, Steve.

Okay. It looks like there are no more questions. So thanks, everyone for joining. You're always free to ask us additional questions at ir@freightos.com. Have a good day.

Thanks, everyone.