DPW Holdings Second Quarter Business Update. This is Ron Parham of LHA Investor Relations. On the call today are Chairman and CEO, Todd Ault III; and CFO, Will Horne. They will provide a business update and touch on the preliminary second quarter results that the company announced earlier today. You will find that press release in the Investor Relations section of the company's website at ir.dpwholdings.com. Before I turn the call over to Todd and Will, please be advised that this presentation and other written or oral statements made from time to time are representatives of DPW Holdings contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements reflect the current view about future events, statements that are not historical in nature such as forecast for the industry in which we operate, and which may be identified by the use of the words like expects, assumes, projects, anticipates, estimates we believe, could be, future or the negative these terms and other words of similar meaning are forward-looking statements. Such statements include, they are not limited to statements contained in this presentation relating to our business, business strategy, expansion, growth, products and services we may offer in the future, and the timing of their development, sales and marketing strategy, and capital outlook. Forward-looking statements are based on management's current expectations and assumptions regarding our business, the economy, and other future conditions and are subject to inherent risks and uncertainties and changes of circumstances that are difficult to predict and may cause actual results to differ materially from those contemplated or expressed. We caution you therefore against relying on any of these forward-looking statements. These risks and uncertainties include those risk factors discussed…

Thank you for joining us today everybody. I know it's been a really exciting seven or eight months since I took over on January 1 as the CEO or January 2, give or take. Today we're going to continue to update our progress we made from our strategic plan laid out in the prior calls, these results are for the second quarter. And midway through 2018 we continue to execute on our strategy that we articulated in our December 21 webinar. That webinar outlined there we're creating a portfolio of assets through strategic acquisitions and investments. We were going to provide the necessary capital to each company to fuel growth and continue to evaluate portfolio opportunities into new markets and return value to shareholders, and I want to emphasize that returning value to shareholders is a key component we're going to talk about today, given the dynamics of the company from where it started to where it is now six months ago. Please go to Slide number 4, please. There are key holdings we have and we outline them as our key holdings consisting of three subsidiaries which you see on the slide today. I'm going to focus my comments on Coolisys Technologies and Super Crypto portions of our business because we expect them to be big contributors for 2018, and most likely to our performance in 2019. However, the one caveat to that is that Digital Power Lending we expect to contribute in a big way going forward in 2019, and we will eventually talk about that. Slide number 5, please. Our Coolisys subsidiary holds our advanced technology and manufacturing business and remains the largest group of DPW Holdings portfolio. We see this to continue to be the case going forward, it's important to realize and I know we…

I am, thank you Todd. So we're moving to Slide 7. And this is to remind you the figures we're sharing today are preliminary, and we expect to report final results on Monday, August 20, with a timely submission of our Form 10-Q to the SEC. A quick review of the key preliminary financial and non-financial metrics. On the income statement, preliminary gross Q2 revenues are between $7.1 million to $7.4 million, that's compared to $1.8 million in the second quarter of 2017. Gross margins during -- expected during the current quarter just ended, are approximately 18.2%, and that compares with 40.1% in Q2 of 2017. Obviously, Todd spend a significant amount of time discussing the cryptocurrency mining business and that had an impact coming back on our overall [indiscernible] and it was real simple; as revenues decreased and your cost of operating costs maintained, we ended up in a situation where we actually had negative gross margins. Our operating costs in crypto are primarily co-location costs and depreciation costs. Our net loss we anticipate between $7.0 million to $7.3 million, which includes a significant amount of non-cash charges of approximately $4.1 million to $4.3 million, this comes to the prior quarter compared to 2017, the net loss of $1.9 million with non-cash charges of $1.1 million. On the balance sheet, the company has made significant strides, one of our goals was to increase shareholders equity, that was one of our obligations, our requirements just [indiscernible] with the exchange, so as of June 30 we expect that our assets increased by about $14.9 million to $52.9 million and that's compared to $38.5 million at March 31, 2018. Obviously, when Todd first got involved with the company it was significantly less, total assets in total actually were really on the verge of being delisted. Stockholders equity were upto $30.8 million which is up approximately $9 million from $21.8 million at March 31, 2018. Again, the forward indicators; Coolisys order backlog, it stands at approximately $71 million. A with that I will turn it back over to Todd. Thank you.

Thanks, Will, I appreciate it. Obviously, Will covered some important parts that I want to say that are really important for the future and that is the $53 million in assets, up $14 million, continue to strengthen that balance sheet. Our shareholder equity is now 5x the requirement we need to be listed on the New York Stock Exchange. I frequently get questions like are we going to be delisted? I wish that whoever raised these things could actually read or maybe -- don't know how to read a balance sheets, but unfortunately, some people can't. So we have 5x the required equity to be listed on the NYSE America. The $53 million in assets; you're going to want to start seeing return in 2019 on those assets and that's something we're super focused on, and I see that backlog increasing. That backlog is the results in delivery and we've clearly been aggressive in deploying capital over the 18 months and let me talk about that aggressive behavior in front of where we are here; and that is our current run rate as of today for this quarter going forward is $40 million. We're encouraged by the progress we believe the advanced technology group, the designs of manufacturing the Coolisys is substantial potential for continued growth. We lowered our outlines only for 2018 because of Bitcoin to $34 million to $39 million from our previous guidance of $44 million to $49 million; this reduction was primarily due to softening of cryptocurrency markets that began in 2018, and our decision to pace our expansion in crypto mining platform as the market stabilizes. As we said, we have the capacity to go to 20,000. In addition, the acquisitions of Enertec and IM closed later in the second quarter than anticipated in our…

And the first question that came in is, why are you delayed in the submission of your 10-Q? And I will answer this for Will. Will works till midnight pretty crazily, he works very hard. With two acquisitions completed in the last quarter, our quarterly reports require more processing time, our reporting is more complex; we're a global company now with operations in England, operations in Israel. As we approach our filings, we want to take the 5-day grace period to make sure that the new integration of our Israeli subsidiary is done correctly and is reviewed in a little bit of a heavier manner. So with that in mind, I support Will 100% in his decision along with the audit committee's decision to take the 5-day grace period. I think Will has more than demonstrated to the shareholders that he's able to report complex issues and this makes sense for us to be cautious here. One of the factors that led to the trimming of your full year 2018 guidance. The primary factors -- let's see here, let me think about this; were a combination of decline of Bitcoin, our positive deploying of miners, and our existing -- with our existing platform, and we're generating less revenue in Super Crypto because of market factors that no one can deny, it's clear as day to the market, everyone is doing that, I'm sure if you look at competitors they're bleeding worse than we are. So that's one of the primary factors. I really -- I want to emphasize that I'm happy with the Enertec acquisition, I'm disappointed it took so long to close in the quarter; so we weren't able to benefit from their revenue for the second quarter except marginally, the same with IM. But now that those are…

Yes, it was really really preliminary for DP Lending only because we just doubled or went to these loans and -- but because of some the warrants that were issued in conjunction with the loans, with public companies, the current quarter was about 100,000 topline from DPW. And it's important to keep in mind, historically DP Lending primarily was facilitating financing in our company, originally.

So they just started making external loans in the last quarter. One of the things that started out as a subsidiary as we made an external loan to IM for $1.7 million, and then we got equity for that loan too; and as they pay us back the $1.7 million, our equity which is at 98% goes down to 51% and their equity goes to 49% but only when our $1.7 million gets paid back. And so that's going to start to meaningfully contribute to top line and bottom line, and that was -- that originated out of a loan from Digital Power Lending, so we see it is an important part of what we're doing. All right, with that in mind, Ron, are there any other questions? Joe, are there any other questions? Otherwise we're going to wrap it up.

I don't see any others.

All right, everybody, thank you so much for listening. We appreciate you being shareholders, those of you who want to contact me you know how to get a hold of me. Hopefully, next quarter we have a better quarter for Bitcoin and cryptocurrency. We continue to grow our manufacturing business and look for us to update you later on this quarter early in middle of September about where we are in terms of making progress with Super Crypto and any new developments. We appreciate all your time. Thank you so much.