Greetings, welcome to Digital Brands Group First Quarter 2022 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] Please note this conference is being recorded. I will now turn the conference over to Hil Davis, CEO. Thank you, you may begin.

Yes. Thank you very much, and good day and welcome to the Digital Brands first quarter 2022 earnings conference call. All participants will be in a listen-only mode. This earnings call may contain forward-looking statements as defined in Section 27A of the Securities Act of 1933, as amended, including statements regarding among other things, the company's business strategy and growth strategy. Expressions which identify forward-looking statements speak only as of the date the statement is made. These forward-looking statements are based largely on our company's expectations and are subject to a number of risks and uncertainties, some of which cannot be predicted or quantified and are beyond our control. Future developments and actual results could differ materially from those set forth and contemplated by or underlying the forward-looking statements. In light of these risks and uncertainties there can be no assurance that the forward-looking information will prove to be accurate. The company will be hosting a Q&A session at the conclusion of prepared remarks. Please note that this event is being recorded. And that takes care of the legal part of the call. So let me start by saying we continue to build on our revenue growth from the fourth quarter and also leveraging our fixed operating leverage momentum from the fourth quarter, and that's both through the first quarter and through today. We believe this momentum is illustrated by our first quarter revenue growth of 740%, which is an increase from the 425% revenue growth we experienced in the fourth quarter of last year. We expect to continue to experience significant revenue growth year-over-year, throughout 2022, in addition to leveraging our fixed operating costs throughout 2022, as our fourth quarter and first quarter results illustrate. We believe 2021 was showing that we could acquire, integrate and grow the revenue of acquired companies, which we successfully did with both Stateside and Harper and Jones. For 2022, we plan to show that we can leverage our fixed costs to fully leverage our costs through our continued revenue growth, which is bolstered by our fall wholesale bookings. Again, we are already have fall hotel bookings based on the shows that we've done this year. Additionally, we announced our definitive deal to acquire Sundry in January this year, plus we expect to add other acquisitions this year. Importantly, all the acquisitions through reviewing our EBITDA positive. The results for the first quarter, net revenues increased 740% to $3.4 million in the first quarter of 2022, compared to $0.4 million in the first quarter 2021. This revenue growth was experienced across all our portfolio brands. The increase in net sales is driven by the increase of revenue at all our brands and the inclusion of Stateside and Harper and Jones on a pro forma basis. Gross profit margin increased 671% year-over-year to 42.9% from a negative 50.8%. Gross profit increased by $1.7 million, due to improved gross margins at all our brands. Additionally, our gross margin increased 5.5% sequentially from the fourth quarter. So we're seeing both gross margin improvement year-over-year and sequentially. We expect the gross margin to continue to increase throughout the year, both as a percentage and in absolute gross margin dollars. G&A expense margin declined by 333% to 134% from 467%, as we continue to leverage our fixed cost with higher revenue. We expect to continue to see significant improvement in this margin, driven by our revenue growth throughout the year. G&A expenses were $4.6 million in the first quarter of 2022, which included a non-cash charge of $1.1 million for amortization of loan, discount and fees versus 223,000 in the same period a year ago. Additionally, there was a non-cash expense of 682,000 for change in fair value of derivative liability versus zero in the same period a year ago, which is all in the cash flow statements. This resulted in total non-cash charges in G&A of $1.8 million in the first quarter of 2022 versus 223,000 in the first quarter of last year. Excluding the non-cash charges, G&A was $2.8 million versus $1.7 million a year ago, which is an increase of 65% year-over-year, while revenues increased 740%. We believe this illustrates the significant fixed cost leverage we are benefiting from as we drive our revenue growth. And again, we have very strong insight into our fourth quarter revenue given wholesale bookings. Sales and marketing expenses increased from 171,000 in the first quarter of ‘21 to $1 million in the first quarter of 2022. We saw a meaningful increase in revenue associated with this increased marketing spend, which allowed us to acquire a significant increase in new customers, who already showing a propensity to repeat purchase. All this was achieved without any cross-merchandising across our brands. Historically, we've seen a meaningful lift in products sold, when we cross merchandise our brands, which we plan to do this year especially using some technology and third-parties that are very good at this. Distribution expense as a percentage of revenue declined by 9.7% to 5.9% in the first quarter of 2022 versus 15.6% in the same period a year ago. Distribution expenses were 203,000 in the first quarter of 2022 versus 64,000 in same period a year ago. And again, significant leverage here, as well as on the G&A line. There was a $1.2 million non-cash charge for the change in fair value of contingent liability versus zero in the same period a year ago, which is also noted in the cash flow statement. Net loss attributable to common stockholders in the first quarter of 2022 was $7.8 million or $0.59 per diluted share. Please note, the net loss included $3 million in one-time cash -- non-cash expenses and there is not included in that also is it about additional 600,000 depreciation and amortization, which would have take in non-cash to $3.6 million. This compared to a net loss attributable to common stockholders of $3 million or a loss of $4.55 per diluted share in the fourth quarter of 2021, and again that's a loss of $0.59 per share versus a loss of $4.55, and it includes over $3.5 million in non-cash charges between one-time expenses and depreciation and amortization. In closing, I cannot stress enough that we're driving both significant organic and acquisition revenue growth, which we expect to continue going forward, especially given the wholesale bookings we have for the fall. Additionally, as our results show for the fourth quarter of last year and the first quarter of this year, we're getting significant operating expense leverage, which we expect to continue going forward. We have several revenue driver scheduled for the remainder of this year and we are excited to continue to leverage our fixed operating costs with our revenue growth. And we do expect to be able to get to cash flow neutral in the fourth quarter. So with that, thanks everyone for their time, we are excited about the continued momentum and we're going to open it up to Q&A, please.

Thank you. [Operator Instructions] There are no questions in the queue. So that will conclude today's conference. You may disconnect your lines at this time, and thank you for your participation.

Thanks, everyone.