Good morning or afternoon to our European shareholders, everyone. Welcome and thank you for joining Nanalysis Scientific Corp.'s Q1 2026 earnings call. I'm Jake Bouma, an IR consultant for Nanalysis. Today on the line discussing Nanalysis' Q1 2026 financial results and company highlights are the company's president, CEO, and founder, Sean Krakiwsky, and interim CFO, Heather Kury. Following their remarks, we'll open up the call for an analyst Q&A session. Before handing over the call to Sean and Heather, please note that information we present today could contain forward-looking information that is based on management's expectations, estimates, and projections. Please consider the risk factors, including those in the filings made by Nanalysis on SEDAR when reviewing this information. Also, all amounts discussed will be in Canadian dollars unless otherwise noted. With that, I'd like to turn the call over to Nanalysis interim CFO, Heather Kury.
Thank you, Jake, and thank you to everyone joining us on the call for taking the time out of your day to allow us to share with you the progress we are making here at Nanalysis. I will begin by walking through the financial results for the first quarter, which ended March 31st, 2026. For the three months ending March 31st, 2026, the company reported consolidated revenue of CAD 10,667,000, an increase of CAD 73,000 or 1% from the comparative period in 2025. While there was a decline in product revenue due to lower benchtop sales and the termination of third-party equipment sales contracts, security services revenue increased primarily due to higher levels of project-related work associated with the airport security maintenance business. Gross margin percentage for product sales for the three months ended March 31st, 2026 was 58% versus 66% from the comparative period in 2025.
The decrease was primarily due to changes in product mix following the termination of the third-party equipment sales contracts. Gross margin percentage for the comparative period in 2025, excluding third-party equipment sales contracts, was 60%. Gross margin percentage for the security services business for the three months ended March 31st, 2026 was significantly improved at 19% versus 6% from the comparative period in 2025. This increase in margin was driven by operational efficiencies, including enhanced logistics processes and more effective management of overtime and on-call hours, as well as higher levels of project-related security services activity. Management believes the operational improvements implemented in 2025 position the segment for continued margin improvement throughout 2026. The company recorded Adjusted EBITDA of CAD 292,000 for the three months ended March 31st, 2026. This represents an increase of CAD 112,000 over Adjusted EBITDA of CAD 180,000 for the three months ended March 31st, 2025.
This was primarily the result of an increase in services margin, lower spending in sales and marketing, and general administrative expenses, offset by lower product sales. Net loss was CAD 1,281,000 for the three months ended March 31st, 2026, which is an improvement of CAD 26,000 from the comparative period in 2025. The decrease in net loss for the three months ended March 31st, 2026 was due to improved business margins. With that, I will turn the call over to our Founder and CEO, Sean Krakiwsky. Sean?
Thanks very much for that financial overview, Heather Kury. Maybe I'll just talk about some of the highlights from the recent quarter. First of all, we were successful in our equity raise, which closed in January, which allowed us to make a CAD 2.1 million repayment on our term loan with ATB, taking it down to approximately CAD 3.7 million remaining in the term loan. Very enthusiastic about the trajectory for our services margins. I'd like to commend Marc Tomlinson, the head of our services business unit, for achieving those numbers in Q1. We've worked really hard to fix some of the issues associated with our direct sales organization and also the management of our dealer network around the world. Although that didn't bear fruit in terms of revenue for Q1, we expect it to do so going forward and some fundamental changes being made there.
We're very proud of the amazing new directors that we've been able to attract to our company. Jonathan Ladd, a seasoned technology CEO and executive. Mr. Stephen Fyke, associated with the Mancal organization in Calgary, which is a very large and successful investment group. Also Dr. Werner Maas, who is the former president of Bruker BioSpin, the leader in magnetic resonance in the world. Just the fact that he was willing to join our organization and lend his name to our magnetic resonance company is quite a testament to what we've accomplished and to the potential that we have going forward. Lastly, just to continue to emphasize the operational improvements that we're making, largely led by Heather Kury, who's doing a fabulous job on those and making sure that we're focused in on.
A return on investment for every dollar that we spend. I'd like to thank Heather Kury for adding that ingredient to our company since she's joined. With those types of highlights, looking backwards, looking forwards, we're really excited about where we're going. We remain committed to the future of benchtop NMR, which is to take it from qualitative analysis in R&D type environments to quantitative analysis in quality control and manufacturing environments, and we have several exciting initiatives along those lines going forward, as well as also our broader magnetic resonance offerings. We've talked about the things that we've done in the clinical MRI space with partners, and we're by no means a clinical MRI expert, but we do have exciting platform technology that experts that in that space are very interested in, as well as also the high field magnetic resonance opportunities via our strategic partner in Switzerland.
With that, I'll turn it back over to the operator and welcome any questions or comments from investors on this call.
Thanks, Sean. Thanks, Heather. If anybody has a question, please feel free to unmute yourself, introduce yourself, and then ask the question you have. We do have a moderator in the back that if too many people jump on, we'll be able to mute. Feel free to unmute yourself and go ahead. Thank you. Give it another 30 seconds or so. Well, if we have no questions on the line, please feel free to reach out anytime to the company directly. I want to thank everybody for joining us today, and we look forward to talking to you again soon at our second quarter 2026 conference call.
Thanks very much, everybody. Have a wonderful day.