During 2024, the economic situation in China, typically the second largest market for diamond jewellery after the U.S., continued to weigh on consumer demand in general, and on diamond jewellery sales in particular. Additionally, the disruption to the natural diamond segment stemming from the expansion of the Lab Grown Diamonds (LGD) market continued into 2024. These dampeners drove rough natural diamond production down significantly, with prices declining both for rough and polished natural diamonds. LGD prices also eroded significantly in 2024, particularly at the B2B level, but also at the B2C level. On the positive side, this has helped to further differentiate between the two products. However, it has also intensified competition for potential customers' spending, indirectly adding pressure on natural diamond prices. Currently, the retail diamond trade is seemingly at a significant crossroads, where retailers need to carefully strategise their focus - whether on higher-priced natural diamonds, with the inherent issue of consumers having to entertain higher price points, or on lower- priced LGD, which, with further price erosion, may not prove viable for their business in the longer term.

Notwithstanding the above, Sarine's new strategic initiatives gained traction throughout the year:

• The adoption of our Most Valuable PlanTM (MVP) for optimising the planning of natural rough diamonds up to 90 points has progressed well. More and more midstream polishers are using this revolutionary initiative, which both increases yield and automates the process. For smaller rough diamonds the issue of automation can be as important, or even more important, than the increase in yield our best- ever algorithms provide. We are already doing preliminary testing of MVP's application to larger natural rough stones, with initial results positive. We expect further expansion of MVP's adoption by small stone polishers in 2025, as well as the initial roll-out, most likely later in the second half of the year of the technology for stones over 2 carats. The overall industry economics will, of course, impact the rate of adoption expansion.
• The adaptation of our rough planning technologies to LGD has also proven to be technologically sound and has, indeed, created a new revenue stream. However, the rapid decline in LGD rough prices to less than US$ 100 per carat has made the pricing of this service more challenging, despite the efficiencies generated, and the adoption has been less broad-based than had initially been expected.
• The opening of the GCAL by Sarine lab in India has enabled us to offer LGD grading at more competitive pricing. Given the aforementioned dynamics of the LGD segment, this is of the utmost importance. In fact, as a result of the lab's opening, not only have we acquired new customers and are in the process of acquiring additional ones, but we are strengthening our relationships with our existing customers. With the maturing of our Color and Clarity grading technologies for the LGD market, we will be able to be even more aggressive in our marketing efforts. We expect 2025 to see additional growth in our grading business.
• Finally, traceability did not generate substantial revenues in 2024, as the issue of source verification vis-à-vis Russian sanctions was, in effect, put on hold. Both the U.S. and the E.U. continue to advance regulations requiring disclosure of a diamond's country of origin, though the dates of implementation remain unclear (in the U.S. from an initially mandated April 1, 2025 now seemingly later in 2025; in the E.U. on January 1, 2026). We believe our recently signed and announced collaboration with DeBeers' TracrTM platform a distinctively scalable cost-effective means to meet any newly mandated disclosures regarding diamond origin and provenance.

Through aggressive business streamlining and cost cutting measures, we have enhanced our financial performance, as reflected in our financials. We have recorded a net profit of US$ 1.1 million in FY2024, reversing the loss of US$ 2.8 million in FY2023. We have also reduced our receivables and inventories to free up more cash in our debt free balance sheet. In line with our streamlining efforts, the Group will migrate its manufacturing activities to India in 2025. This step will take avail of both the lower costs associated with the manpower employed in India and the existence of a qualified team of support personnel, who can relatively easily be trained to perform the necessary assembly steps entailed in the production processes. Our new strategic initiatives, coupled with our operational streamlining, have positioned the Group stronger to benefit quickly from any improvement in the natural diamond industry.

In accordance with our strategy of recent years, the Group's business continues to pivot to deriving mostly recurring revenues from its proprietary services, including the Gal3D inclusion mapping software (which processes the Galaxy® platforms' output), the Advisor rough diamond planning and MVP cloud-based solutions, as well as other pay-per-use services, such as the LGD planning solution. Our LGD-related recurring revenue alone has exceeded 15% of overall revenue in FY2024. Along with our Group's grading and traceability reports, all our recurring revenue initiatives now constitute about 77% of the Group's revenues whereas 15 years ago, close to 97% of group revenue was derived from the sale of capital equipment, with only annual maintenance service agreements generating recurring revenue.

I am also excited by our signing of a non-binding LOI Term Sheet to purchase, subject to the usual due diligence reviews and to reaching and executing a definitive agreement, a majority share in Kitov. AI against an all-cash consideration. Kitov.AI has developed a very sophisticated inline quality assurance and control (QA/QC) system with the unique advantage of applying AI to the process of defining the inspection process. This cuts the implementation time significantly. Moreover, the system's AI is designed to assist in recognising a design flaw in the inspected part, by collating repetitive flaws. In addition to being a company engaged in technologies similar to those employed by Sarine (optical inspection, Al, software, etc.), thus "speaking" the same language, Kitov. AI provides the Group with the means to diversify into new fields separate from the diamond industry. Kitov. Ai's parent company, RTC executed the image processing development work on Sarine's Galaxy system and participated in the development of our Clarity grading system.

On behalf of the Board of Directors, I would like to again thank our management and employees for their ongoing commitment to the Group. We would also like to thank our loyal customers and business partners. Lastly, I thank our loyal shareholders for their continued trust in Sarine and its management.