Q2 2020 Resideo Technologies Inc Earnings Call
Excuse me everyone and thank you for your patience and holding today's conference will be getting momentarily. Please remain on the line.
Again, thank you for your patience in Honing today's conference call will begin momentarily. Please remain on the line.
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At this time I'd like to welcome everyone to the receipt of technologies second quarter 2020 earnings Conference call.
Today's call is being recorded all participants will be in listen only mode until the former question eastern portion of the call.
If anyone should require operator assistance during the call. Please press star zero on your telephone keypad.
I'd now like to introduce page Fortis director of Investor Relations Ma'am. Please go ahead.
Good morning, and thank you for joining us for studios.
Www Dot radio Dot com.
We'd like to remind you that this mornings presentation contains forward looking statements statements other than historical facts made during this call may constitute forward looking statements and are not guarantees of future performance or results and involve a number of risks and uncertainties actual results may differ materially from those in the forward looking statements as a result, the number of factors include.
He has described from time to time in recent years filings with the Securities and Exchange Commission. The company assumes no obligation to update any such forward looking statements. Additionally, during our call today, we will refer to certain non-GAAP financial information a reconciliation of our GAAP. non-GAAP results included income is included in the company's earnings press release and accompanying presentation.
Both of which can be found in the Investor Relations section of our website, we identify the principal risk and uncertainties that affect our performance in our annual report on form 10-K in other S.P.T. Farley I'd now like to turn todays call ever to Jay Jay.
Thank you bridge and good morning, everyone.
Like the begin todays call by thanking the entire reserve.
For the warm welcome Dave extended me and for the way. They have responded the challenge is brought on by the parent.
I believe we have dedicated passionate people that want to win and I'm very excited to get to work with all of them.
Well, our second quarter revenue and earnings were down substantially compared to last year, primarily due to cold. Good we're now seeing meaningful improvement in the business.
Sales improved sequentially each month through the second quarter in July sales were above last year in both P units and 80 odd.
We remain focused on the pandemic related restore employees in our business.
In particular, we're monitoring the reimposition of business restrictions in several states Andean countries, where we have important manufacturing operations as well as supply chain related risks.
That said.
Demand has returned to pre covert levels over the past few weeks.
<unk> products and solutions business.
A macro industry trends.
Appear to be improving.
Recent industry in.
Data and customer feedback.
Our pointing to positive trends in demand for both BNS and <unk>.
People are spending more time.
In their homes during the pandemic, which is great increasing usage of home systems as well as an increase in home renovation and repair projects.
Our product portfolio is well positioned to capitalize on these dynamics.
Our previously announced financial and operational review is on track to deliver 30 to 40 million of savings in 2020.
And over 100 million annually in 2021 and beyond.
On top of this great work, our new leadership team is already pursuing additional operating duties to improve our balance sheet.
Reduce our cost structure.
Prove margins and drive greater topline growth.
These initiatives are in their early stages, we look forward to communicating them with you as they come to fruition.
With that I'll turn the call over to Tony to discuss our second quarter results.
Thank you Jay and good morning, everyone.
I would also like to take the opportunity to thank our teams for their warm welcome and for all the work they did over the past few months keeping things operating in a very challenging environment.
I'm excited to be it was video and looking forward to the work ahead.
Consolidated revenue for the second quarter was $1 billion, a decrease of 17% compared to last Q2.
Yeah, I revenue decreased 10% as branch closures and modified or restricted operations resulted in lower customer activity in our stores.
Oh pianists revenue decreased 26% compared to last year due to a decline in demand early in the quarter encode related factory and supply chain issues.
Consolidated adjusted EBITDA of $63 million was down 48% in the second quarter compared to last Q2 on lower revenue.
Unfavorable product mix in both segments.
Yeah, Hi segment, adjusted EBITDA was down 40% to $28 million as a result of lower revenue.
<unk> as a well run business and we chose to take a more limited response to coven at 80, I compared to P.N.S. and our functional groups.
Segment adjusted EBITDA was also negatively impacted by reduced supplier rebates and lower early pay discounts.
Mitigate mitigating these impacts was continued aggressive cost management always a hallmark at age.
Although we began the second quarter under widespread Lockdowns, resulting in many branch closures 80, I saw sequential business improvement each month throughout the quarter daily sales averages rebounded as restrictions lifted and branches reopened today, 80% of 88 branches are fully open in virtually all of our branches or.
But when including those under modified operations and curbside pickup.
Products and solutions segment, adjusted EBITDA of 35 million was down 53%.
You had asked adjusted EBITDA was negatively impacted by product mix increased factory costs related to cobiz, partially offset by transformation programs and covert 19 related cost actions.
It's just activity in orders Troughed in April and then improve sequentially each month of the corner.
I'll now speak to some metrics, we may not have highlighted on past calls the plan to incorporate going forward.
Please note that these are all on adjusted GAAP measures.
Q2 gross margin of 23% was down three points from Q2, 2019, and slightly down from 24% in the first quarter.
Due to lower revenue, coupled with increased factory costs.
Related to covert safety measures and unfavorable sales mix.
Selling general and administrative expenses for the second quarter totaled $242 million down, 14% or $40 million from Q2 last year down 3% from Q1 as the company benefited from covert related cost management ongoing transformation initiatives and lower spin related expenses.
It's all flow through to an operating loss of $6 million for the second quarter compared to an operating profit for $42 million for the prior Q2.
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Operating margin for the second quarter was a negative 1% compared to positive 3% last year as lower sales volume slowed all the way through the personnel and more than offset lower ASP DNA.
The company reported a net loss of $76 million were 62 cents per share in the second quarter.
As we've previously discussed the nondeductibility of payments to Honeywell under the reimbursement agreements result in higher tax expense and the company would otherwise incur.
Cash from operations for the first six months of 2020 $71 million, an increase of 108 million a year over year, primarily a result of lower working capital tied to the slowdown in business activity.
Accrued expenses increased as well, partly due to deferral of the 35 million dollar Honeywell reimbursement agreement payment and $6 million of trademark licensing agreement payments.
I'd like to note the company anticipates, an increase in working capital and decline in accrued liabilities in the third quarter as business conditions improve.
On July Thirtyth, we made our regularly scheduled 35 million dollar reimbursement agreement payment as well as a 6 million dollar trademark licensing agreement payment to Honeywell.
Anyone has agreed to defer the Q2 reimbursement agreement payment for an additional 90 days through October Thirtyth.
We remain in discussions with Honeywell and we'll update our stakeholders should there be any material developments.
What makes the remainder of 2020 as Jay noted, we're guardedly optimistic July was a strong month for both <unk> and pianists.
We're now seeing sustained order rates well above last year.
From demand, particularly in pianists appears to be driven by end user demand rather than channel restocking.
Our factories are working aggressively to meet demand and reduced backlog and we continue to build capacity by investing in new lines and recruiting more direct labor.
However, given continued elevated business risk, we're not providing revenue and earnings guidance for the remainder of 2020.
If business conditions stabilize it is our intent to reinstate guidance for 2021.
As I said earlier, we will continue to report and discuss adjusted EBITDA hasn't performance measure as we have in prior quarters. We will also report and discuss our GAAP results.
Beginning in 2021, we intend to deemphasize non-GAAP measures and instead focus on operating income.
Cash flow from operations and other GAAP measures.
As many of you know I'm a firm believer in the disciplined GAAP reporting imparts.
Reducing judgment around what adjustments are appropriate to include got presents a clearer picture and actual results against a known benchmark.
We will continue to provide all the necessary information to allow investors and other stakeholders to understand our financial performance.
For those of you interested in maintaining a version of adjusted EBITDA for modeling purposes.
Financial disclosure will support being able to do so.
I'd like to again, thank the entire team into our investors and analysts I look forward to engaging with all of you moving forward.
With that I'll turn call back over to Jay.
Thanks, Tony.
Wanted to close the few things.
And I would like to mention yesterday's announcement from 80 Ci.
We have a longstanding relationship with 80, T. and they remain a valued business partner of ours.
Hey de T comprised less than 5% of our consolidated revenue over the last 12 months at approximately our consolidated gross margin.
There's no there hasn't been no change to the terms of our multiyear relationship and we look forward to continuing our partnership with <unk>.
Well the also indicate.
Well covert really iteris remain.
We were also very pleased to see the strength of demand and the recovery of our businesses have made over the past few months.
I'm truly excited by the potential of our business.
And the opportunity to work alongside our teams to make residual thrive.
We will build on our strong.
Very strong foundation of product breadth.
Customer relationships and the deep history of providing reliable quality products and services to our thousands of customers with additional focus on product innovation.
The fishing operations and building on action oriented winning culture.
In the coming weeks I look forward to engage with many of our customers globally suppliers investors and most importantly, our team members to build the relationship that are critical for our future.
Well. Thank you everyone. This concludes our prepared remarks.
I think we have to page is going to also discuss a few things once again before we get into Q1 day.
Thank you with us today for the Q anyway, we have Andy teach lead independent Director, Jay Guild, Walker, CEO and County Trinseo CFO.
If you would like to ask a question. Please signal by pressing star one on your telephone keypad, if you're using a speakerphone. Please make sure. Your mute function is turned off to allow our signal to reach our equipment.
Again, Please press star one to ask a question well pause for just a moment to allow everyone the opportunity to signal for questions.
Our first question will come from John Lovallo with Bank of America.
Hey, guys. Thank you for taking my questions and Ajay we appreciate the commentary on the Google G D to tie up I guess.
Obviously this is the elephant in the room here, you mentioned Gsix I present, raising revenue exposure.
If I remember correctly securities about 800 million dollar business you guys.
So is it really just 5% of that work, which is about new exposures that is at 5% in all the number I guess and then I guess more broadly what is the risks to two remedies content overtime, you know, including.
Sensors, you know must be most importantly, the control panels, and then ultimately being able to you know market your comfort products to the ATP network wants to go on T.T. start putting out joint product next year.
Yeah, I know a couple of things wanting me on as I mentioned, we have been our relationship with 80 GE is good it or you know just gets a long term relationship.
As I mentioned its.
Less than 5% over the past 12 months of our total was videos or sales.
And you know that's what we can share with you guys today.
I I and I'm looking forward to continuing our relationship with 82.
Okay.
Okay. So didn't just to be clear I mean, you don't see risks to to your content with 82.
Yeah, I think it's too early to comment I mean, our relationship is multiyear it's and.
It's pretty much what I stated I think you know it just strikes a good partnership and though and Oh No. We'll continue to communicate with all of the old view as we move Gordon and how that how that proceeds.
Okay.
And then it seems like a July trends were positive can you just help us maybe quantify what do you <unk> and P units were up on a year over year basis in terms of revenue controller.
Tony you want to comment.
Yeah sure Hi, John It's Tony trends are nice to a nice to meet you over a over a conference call. So we're not we're not going to be in a position to disclose a percentage increases month over month.
Other than to say that and it's unusual in this particular situation for us to make any comment on sort of the post quarter close a result, but we decided to call them out. This time, because it did you need nature of the pandemic and that the pretty fast moving or you know events that have caused our Ah Ah.
You know that have driven our performance and and others.
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Like I said in my prepared remarks, the trough was in April in both businesses May was better than April in both businesses June was better than May and in both businesses July is is proving to be better than June. So I. The momentum is clearly up the comps are clearly ahead of last year.
But we're not.
We're not in position to get into the monthly a year over year changes.
This is understandable and maybe one final one for me the 50 million of original as she had a savings of which you achieved I think 15 million in Fourq.
19, how is that progressed indices in the second quarter.
So.
I'm trying to track some some numbers that maybe I'm not I'm not sure exactly what you're referring to what I. What I can say John is you know as we indicated on the call. The the transformation programs that we initiated a earlier in 2020 that were addressed in the into Q1 call and we mentioned today.
We continue to expected the net savings for 2020 to be $30 million to $40 million, which is.
The which is on a net basis after all of the costs associated with those programs. The the vast majority. The large majority of those savings are going to be realized in the second half of this year. So a lot of what you saw in the first half of this year was particularly on a reported GAAP EPS DNA basis was not related to those.
That does a transformation projects because the cost to implement them more embedded in the in the in the numbers as well it was a slight positive but it wasn't a huge number in the first half of the year.
Okay got it thank you guys.
Thank you. Our next question will come from Craig Irwin with Roth Capital Partners.
Hi, good morning, and thanks for taking my questions.
Jay I know, you've only had or you know gosh list and not much 90 days on the job now.
But as you get a better feel for video and the potential of the company.
Do you do you have an idea or maybe a rough framework of what you think the ideal manufacturing footprint would be over the next five or 10 years.
And as you look at the product portfolio do you have a field for maybe I'm wondering what an ideal mix of internally produced versus outsourced products might look like for was video as you may be put together a plan to out to get to this future.
Yeah, that's a great question I mean, and we're looking at all those things right now.
My background.
Well its tonys and a filter your daughters background, the kind of new guys you kids in the block with our entire video team, we're reviewing all that.
You know I've personally about a lot of experience.
Uh-huh of working on those type of transformational programs to optimize.
Your your global.
Operational footprint as well as your global engineering footprint.
And what's the right balance so I'm really looking forward to be able to share more that with you guys is.
In the future calls, but that's definitely something that were rose from a lot of time with and.
And there's a lot of opportunities.
Great and then my second question, if I may since we are discussing tyco.
Many people follow video or former shareholders believes that the the tyco contract might have been mispriced. When it was we negotiated you know there is a very long term history of a close relationship between Honeywell video and Tyco can you maybe I'm just.
Got it with us whether or not you might see opening for a renegotiated contract or an amended contract with them.
Might allow better profitability given that this is really essential for their support you know at almost 30% of your securities business.
Oh, Yeah, I'm I'm, assuming you mean 80 G.
80, 82, sorry, yes, [laughter] yeah, absolutely yeah. So to answer your question I mean bottom line as we all we want to have any discussions about that today and in our agreements is a multiyear agreement has done so we're in that right now.
And and you know if any that changes then of course that what we would sure that with your but Ah. That's all I think that's all we can share with you today.
Great and then you know last question if I may focus on gap I really like that it say a pleasant change.
Compared to most of the out of the broader industrial University stays where everybody's trying to exclude the kitchen sink.
But from a GAAP accounting standpoint.
What do you think it's fair for investors to expect if we take the GAAP results.
Cost of 76 million. This quarter you know what do you think they keep moving pieces are that we should see taper down as expenses, obviously cultivated and the cobot related weakness.
Hopefully, we'll pass for all of Us pretty quickly.
But well some of these are.
Spin off expenses and other tax adjustment items taper down fairly quickly or you know do you expect quite a lot of volatility in your GAAP numbers you know as we do go into 21.
<unk>.
So certainly I get it Craig it's Tony Nice nice to meet you over a over conference calls well look forward to hopefully meeting in person at some point or in the near future.
Yeah. The I'm so glad to hear that you are a supporter of the migration to gap I in my prior public companies CFO days or I never get a a non-GAAP reconciliation and we did one this quarter.
We'll probably do want in Q3 in Q4, but I look forward to going back to not doing non-GAAP reconciliations ER and the associated disclosure and 2021 in terms of in terms of what to expect there are so so I highlighted.
Kind of where we're going to go on the on the gap or reporting a lot of the focus is gonna be on operating income operating margin in operating profit because it takes out two of the largest issues associated with our.
Our relationships with Honeywell and how they affect our financial the.
Reimbursement agreement payment the cash from that is pretty steady quarter to quarter, but the gap impact or is it can be volatile for reasons that are complex and.
We've I think we've been through before those are reflected in other income. So they do you see those below operating income so they're not.
They're not impacted by a discussion of up or operating income in the impacted by those that volatility. That's unfortunately, not going to go away well, we'll address that every quarter will take you through what the number is but that's we're going to we're gonna have that as long as we have the Honeywell reimbursement agreements and that's that's just part of the deal.
The other the other issue is those payments as I think you know are not tax deductible to us which means that it's not technically a discrete tax impact that we sort of have this large.
Aspect of tax that is driven by the fact that some substantial chunk of what we what flows through our KNL isn't deductible for tax purposes, the closer you get too.
Ah zero net income line the the the more proportionally that dynamic becomes becomes operated and it becomes bigger and again there are some complicated tax accounting and tax rules associated with that that you can take you through if you like.
In terms of the you know the other items that have been called out in adjusted EBITDA, you're right. It's been related cost or our tailing off we still got a little bit to go in terms of some of our I T programs. That's been related costs are tailing off pretty rapidly the.
You know we talked about the fact that the the the transformation projects currently underway are going to generate 30 to 40 million of benefit this year on a net basis as I said, a significant majority of that will be in the second half a year so coming out of the here will be at a at a run rate that you know weve.
That will be somewhere in that 100 million dollar a year plus range.
Costs associated with the current transformation projects will predominantly be in 2023, Saumen 2021, but it will predominantly be in 2020.
But you know as Jay said.
Where we're not stopping with you know the stuff that seems like now there's a there's a lot that's going on under the Hood in terms of making sure that we get our cost structure right make sure that we get our.
Supply chain, and our manufacturing efficiency and resiliency in the right place and drive margin improvement there sales activation activities underway. These are things that old they'll be expenses associated with those in 2021 I don't have a number for you yet as to what those will be but I anticipate that they will be meaningfully less.
Then they weren't 2020.
As I said when they when they occur we'll we'll call them out as part of that a part of that discussion around gap in the drivers of those GAAP numbers on a quarterly basis.
Great. Thank you very much for that.
Your next question comes from Jeff Kessler with Imperial capital.
Thank you. Thank you for taking my question then Jay it's good to meet you and Ah Tony and Andy It's like a reunion I guess [laughter]. So a few again [laughter] nice to read the data.
[laughter] V or if he can you talk a bit can somebody talk a little to me about some of the or the the product changes or product Oh, Yeah, Let's go product really <unk> formation that <unk> that came on.
In the first six months of the year, particularly in.
The way the you acceptance of the news thermostat that Youve that you had asked year that was probably brought out a little bit too early the the nature of Oh, the excess accessories for water for water heaters that were that that we're not that did not.
How about in terms of revenue last year that seems to be you know that doesn't have as now annualize through and some of the other types of types of products that or.
Giving you perhaps the improvement that's you're seeing on a sequential basis or in the last in the last several months.
Yeah. It's this is Jay nice to meet you.
Hi, and look forward to meet and face to face.
You know there's a lot you covered in the then that question in my response to you today is gonna be.
Somewhat breeze just from the standpoint that you know we as we evaluate all the products are in the pipeline as we all key business as well as the new products that we have on the in our.
Product Npis system and a in our product road map.
We're going through all those now and and and great great detail the terms of where we put our investments and how our investments are going and I would we plan to share that with a with the investment community in the in the weeks months ahead.
But today I'm not going to be able to do you know give you a blow by blow of exactly how the ball performed over the last you asked for the last six months and what our fourth look yes, but I.
Definitely I'm excited about being able to talk with all of you all our investors about our entire product road map and technology plays that were plant you know that a that are in in play right now and what what's coming.
And there isn't a as we finish up this year going into next year and well set up a time to do that.
Maybe do it like a a technology road show type or communication and I think they'll be the best time to really get into the detail I'd bring along.
Our president of the park in solutions group, because as you know, we we put a new person in charge of that at the beginning of this calendar year and he's done a lot different things since he's taken over so we have a lot to share, but I just won't be a we won't be able to cover that in today's call.
Okay.
Second question is on E.D. I as you as you noted the I was did not need as much list <unk> did not meet need as much remediation.
Help as perhaps the products I did historically for this company.
I'm going back to do your Demko days things like that AG I was a window on the world or for the <unk> for the product side of the business and a you know and I think that's what Rogers expertise was making this thing a window or on the world. So that you could have an idea of what was going on do you.
Industry are there wasn't that much visibility on the part of the product side relative to 80 I think in the first few months of the existence of the the new company I'm wondering if if you could discuss a little bit about what you're doing with they'd YOD should make it again a <unk>.
More of these kind of it I missed that keeps calling it a window on what's going on out theater in the in the business overall and if you could just maybe extend that to talk about what is 80 I sitting in terms of Oh product flow of demand flow from what is selling and what is.
Not is not selling currently.
Well as you know 80, Ais a big distribution business says your indicated is that thing because the company was built in grew.
It's a it's a window for not just our product and solutions business, but it's also window for a large numbers of a huge portfolio of companies.
But you know they go to market with on a global basis and as they continue to look at and review strategically what fits well with them.
Then, they're continuing to expand that and that footprint continues to get bigger and bigger and I think this is another area that as we when we do a.
A residential well road show Tech you know technology market, a pre set of presentations our investment committee will will share with you the types of things that they've done as they continue to expand their order total product offering along with what a of course Ah, that's where our products and solutions.
Pieces is part of that portfolio. So it's a <unk> yeah, they're very busy with a book with looking at what else. They can do to expand their footprint in a variety of different areas that they that they've traditionally been part you know that's been part of their portfolio from a technology standpoint, but then also what they can do to further.
Strengthen.
There are their existing segments and what new segments. They can.
Participate in as part of their total offerings.
Tony do you have anything you want to share on that piece.
Yeah, Jeff you know I hear your point is right and it's it's an interesting and to use your phrase a window in the world.
The recent dynamics it at 80, I I haven't had been interesting they'd been confirmatory of you know at some level of what we've seen on the piano side.
But the strength there has been.
It's been across the board, which.
Causes us to you know, we don't Wanna get out over a skis at all but ER, having that insight into both kind of a larger projects as well as the you know the smaller projects and seeing strength or even in those larger projects. You know gives us a little bit of perspective, the we cannot be feedback into the product.
Since solutions business I would say the linkage between the two businesses, while good today can be improved and creating a little bit of a feedback loop there in terms of our ability to.
You know to really position ourselves for even greater success at PNM us as a result of you know information that we're able to glean from behavior. The various markets Cidade de I is something that we can probably.
Take a step forward on.
Yeah.
One final question I know that you obviously can't comment on.
I can't comment the payments to the remediation payments to Honeywell.
Specifically, but number one is.
Is there any is there any possibility of leeway on those payments.
Perhaps your discussions with when you discuss things with Honeywell with regard to you know who's who's going to be up into so what what market whatever or when you get to talk to them. The does the subject of these remediation payments ever come up and number two is there any is there any way.
Or is there any is there any way that the the tax treatment of these payments.
Can't ever be changed or or modified or negotiated.
Tony.
Ah yes so.
As you guys know our relationship with Honeywell is complex or a lot of vectors to it. We're obviously in dialogue with them on a regular basis because of the complexity of that as you've seen a they have shown a willingness to work with us by deferring. The Q2 payment for another 90 days to lead to the end of October as we sort of.
Get through some challenging at times and move in the marketplace. Unfortunately, Jeff we really can't go any further than that.
You know that it's a it's a critical relationship for US there are certain drivers to it that as we've talked about and as you highlighted our impactful to our to our financial or to the extent that theres any change to any of those we will of course be in a position to to share when it when it actually happens.
But in terms of really being able to speculate on any of those things out there wouldn't be appropriate.
Okay. Okay.
Okay. Thank you very much and look forward to talk with you a in the future in the immediate and see you guys again.
Absolutely and look forward immediately.
Thanks, Jeff.
Thank you.
Thank you. Our next question will come from Ian Zaffino with Oppenheimer.
Hi, great. Its a follow up in that last question would be but the Honeywell payments.
We used to make that entire team and once the deferral period and.
Or will that pain, and maybe be amortized over the life of the of the deal.
Thanks.
So so Ian it's Tony I can I can speak to what our current situation is which is Honeywell has agreed to defer the payment that was originally due in Q2. Two October 30 of this year. So currently the agreements stands in a in a format that we will have two payments to cash payments to Honeywell.
Now on October Thirtyth of this year totaling $70 million. There's nothing currently that includes any deferral or any repayment of that or any repayment of that overtime.
Just as an aside our liquidity position has improved over the last.
Over the last 90 days as you can see from our from our financials and we're approaching the we're approaching situation such that we can be prepared to make that payment or as per the current as pretty current agreement with Honeywell that changes, we'll certainly let you know.
Yeah. Okay. Thanks, Tony I think it's Tony I think it's Tony is already stated that you know we remain in constant dialogue with Honeywell and well update all of you on any developments as we move forward.
Okay, great great. Thanks to the color and then also I didn't know disaster right you have done a little bit late but on the security side can you maybe give us.
Oh, maybe a break down between you know your business. That's you know exclusively panels first is the periphery hills.
And then also how is the sale process need I'm, a bunch of St easy or even any other security company is it you know for the panel is it for the entire.
System. So it would be the panel plus the peripherals and maybe walk us through that a little bit. Thank you.
[noise] Tony.
Yeah, I mean the.
So so the security business has a number of different pieces to it and I'm not 100% sure I track what your what you were going through but obviously, there's the component where 80 t. as it is a big customer. There's there's a component that is you know our branded product and then there are some you know there's some recurring revenue in there and obviously some.
International pieces the.
Hi, I guess the way I'd characterize it as kind of Oliver the mapping in some chunk of it actually obviously goes through 80, I as well and it's really going to be a job by job basis going through 80, I, what what the mix of what the mix of product is I'm not sure that fully addresses your question maybe.
Maybe you could give me a little bit more color and we can.
Try to get you a little bit more.
Yeah, and I I guess, what I was thinking I guess asking all of them are clearly is if you think about your unleashing. The DTA you know how much of your your sales to 80 T., let's just say involved.
Platform compared to the poor feels like it didn't work tap a window or raking et cetera. Thanks, I see yeah. I. Unfortunately were not we're not in a position to get into that level of granularity with respect to with respect to 80 T.
No.
They're just not a lot of color. We can offer there we have a contract with them that obviously is a meaningful one for our for our business and we're we're pleased to be partner with them, but I I can't get into detail about sort of product mix and how that how that works.
No what I would say, though I think that as part of our to our technology.
Roche's I want to do as we before the next few months. So I want to capture that for you guys. So I think it'd be very important forget hep a deeper understanding of.
How we go to market globally through our various channels and understanding what hardware with software what see the sensors tied to this and I think I think it'll give you had a deep everyone a deeper understanding of that and I think we can do that.
And and be able to educate you guys a deeper way that went and show where are you also ties back to our product Roadmaps of where we go with the new products and technologies for so we'll definitely cover that.
Okay, great that'd be really helpful. Thanks, much guys.
Yeah. Thanks.
Thank you. This concludes the question answer session and today's call. Thank you for joining us and have a great day.