Good day, everyone, and welcome to today's New Ellis Third Quarter 2025 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, you may have the opportunity to ask questions during the question-and-answer session. Please note, today's call will be recorded, and I will be standing by should you need any assistance. It is now my pleasure to turn the conference over to Leah McMullen, Director of Communications. Please go ahead.

Hi, thank you, Operator, and good morning, everyone. Thank you for joining today's conference call to discuss New Ellis' financial results for the third quarter, ended September 30, 2025. With me on the call are John Erb, our Chairman of the Board and Chief Executive Officer, and Lynn Blake, who recently began consulting with us as our interim head of finance. Earlier today, we issued a press release that outlines our financial results for the quarter. If you haven't had the chance to review it, you can find it on the investor page of our website. Before we begin, I'd like to remind everyone that we'll be making forward-looking statements on today's call. These statements are protected under the Private Securities Litigation Reform Act of 1995 and are based on current assumptions and estimates. Actual results could differ materially from those described, and we encourage you to review the risk factors included in our filings with the Securities and Exchange Commission. The company assumes no obligation to update any forward-looking statements. Please do not place undue reliance on these statements. With that, I'll turn the call over to John Erb.

Thank you, Leah, and good morning, everyone. We entered the third quarter with renewed momentum and sharper execution. While Q2 is about stabilizing the business, Q3 was about progress, expanding adoption of Aquadex therapy and advancing our leadership in precision fluid management across the cardiorenal continuum. New Ellis is helping hospitals manage fluence balance in patients whose heart and kidney functions are closely connected. Our growth is anchored in three areas, critical care, pediatrics, and heart failure, including hospital-based outpatient therapy, where our technology is driving real clinical and operational impact. In critical care, hospitals are adopting Aquadex because it helps achieve more consistent outcomes and streamlines post-operative and ICU fluid management. That confidence translated into stronger performance this quarter, with year-over-year growth in circuit sales across all customer categories. Heart failure and critical care also saw higher console sales. The new 24-hour Aquadex circuit introduced in the U.S. this quarter was designed for hospital-based outpatient use, supporting same-day sessions and complementing our 72-hour inpatient option. Together, this choice in circuits gives hospitals flexibility to match therapy to the care setting while maintaining consistency for patients and providers. We also introduced a new dual-lumen extended length catheter, expanding access options and compatibility across care environments. These innovations make therapy simpler and more comfortable for patients and more scalable for hospitals. In pediatrics, progress this quarter was transformative. Through our NIH-supported collaboration with Corona's Biomedical Technologies, we're accelerating the development of Vivian, our dedicated pediatric CRRT system for children, weighing between 2.5 and 20 kilograms. A new U.S. patent allowance and recent notice of allowance for another Vivian patent further demonstrated our commitment to innovation in pediatric fluid management. Additionally, clinical data from the Ultra-Peds Registry being prepared for publication shows 92% survival in children treated with Aquadex. In heart failure, we reached an important milestone with the first Aquadex therapy delivered in a hospital-based outpatient setting under the new CMS reimbursement code, an early proof point of how this care model can extend therapy beyond inpatient admission and create a more proactive, accessible approach to fluid management. Operationally, we advanced several important efforts, initiating the transition of manufacturing to KDI precision manufacturing, exiting our European operations to sharpen U.S. focus, and continuing disciplined capital deployment through two successful capital raises this year. As we look ahead, we're building on this foundation, advancing precision fluid management across the cardiorenal continuum with a focus on clinical value, scalability, and growth. Q3 reflects real progress and growing momentum as Aquadex becomes an essential part of how hospitals manage fluid balance safely and effectively. With that, I'll turn the call over to our interim head of finance, Lynn Blake, to review our financial results in more detail.

Thank you, John, and good morning, everyone. Total revenue for the third quarter was $2.2 million, a 6% decrease from the third quarter of 2024, primarily due to one-time prior-year C-Star Medical Quell immune sales of approximately $200,000 and a decrease of approximately $100,000 in international revenues associated with the wind-down of international operations in the current quarter, also lower console average selling prices. These impacts were partially offset by a 15% year-over-year increase in consumables utilization. On a pro forma basis, revenue grew approximately 7% year-over-year after excluding the C-STAR medical revenue in the prior year and the decrease in international revenue. Sequentially, revenue increased 29% from the second quarter, driven by a 23% increase in consumables utilization and a four-fold increase in U.S. console sales. By customer category, heart failure and critical care were 41% and 15% ahead of the prior year respectively, while pediatrics declined 7%, largely due to lower console sales. All customer categories experienced year-over-year growth in circuit sales, with heart failure and critical care also benefiting from stronger console demand. Gross margin for the quarter was 65.2%, compared to 70% in Q3 of 2024. The gross margin rate decline was primarily due to under-absorption of fixed overhead from lower production volumes earlier in the year, which flowed through cost of sales in the current quarter as that inventory was sold. We do expect to realize incremental cost efficiency from the KDI manufacturing transfer beginning next year, which should support margin expansion once the transition is fully optimized. Selling general and administrative expenses for the quarter were $3.5 million compared to $2.7 million in the same period last year. The increase reflects increased payroll and compensation expense associated with rebuilding our U.S. sales force to historical headcount levels. Research and development expenses were $603,000 compared to $486,000 last year, driven by an increase in expenses associated with continued investment in sustained engineering and our quality systems. As a result of these investments in growth-focused initiatives in our U.S. business, total operating expenses for the quarter were $4.1 million in total, a 30% increase year over year. Operating loss for the quarter was $2.7 million, compared to an operating loss of $1.5 million in Q3 of 2024. Net income attributable to common shareholders was $469,000, or 56 cents per share, compared to $2.4 million, or $73.23 per share in the prior year quarter, after giving effect to the company's reverse stock split, which became effective in July 2025. We ended the quarter with $3.1 million in cash and cash equivalents and remained debt-free. The $1.9 million net equity raise in Q3 through our At the Market program, combined with the $4 million net equity raise in June, provides flexibility to support continued execution of our U.S. revenue growth strategy and operating plan into 2026. With that, I'll turn the call back to John for closing remarks.

Thanks, Lynn. As we look ahead, we're building a company at the center of cardiorenal care, one that unites technology, evidence, and the access to deliver better outcomes for patients and hospitals alike. Our focus remains on three growth engines, critical care, pediatrics, and hospital-based outpatient heart failure therapy. Together, these areas are defining a new standard for precision fluid management and positioning New Ellis for a long-term sustainable growth. Before we move into Q&A, I'd like to take a moment to recognize Rob Scott, who recently concluded his 12-year tenure here at New Ellis. Rob's leadership and dedication as Chief Financial Officer helped guide Noelis through significant transformation and growth. On behalf of the entire company, we thank him for his many contributions and wish him continued success in his new chapter. With that, I'll turn the call over to the operator to open the line for questions.

At this time, if you would like to ask a question, please press the star and 1 on your telephone keypad. You may withdraw yourself from the queue at any time by pressing star 2. Again, that is star and 1 for your questions.

We'll pause a moment to allow any questions to queue. Again, that is star and 1. And it does appear that there are no questions at this time.

I would now like to turn the call back to management for any additional or closing remarks.

Thank you. As we focus the company's efforts on delivering a strong fourth quarter, I'd like to thank all our New Ellis employees, stockholders, physicians, nurses, patients, and health care workers for your continued support. Thank you. Have a great day.

This does conclude today's program. Thank you for your participation. You may disconnect at any time and have a wonderful afternoon.