Q2 2020 Digital Ally Inc Earnings Call
This conference call may contain forward looking statements within the meaning of section 20, Sevena yet the Securities Act of 1933 and section 21 E. At the Securities Exchange Act up 1930 for.
The words believe expect anticipate intend estimate should may could we'll plan future continue and other expressions that our predictions about indication feature a bit.
And trends that do not relate to start matters identify forward looking statements.
These forward looking statements are based largely on our expectations or forecasts of future events.
Can be affected by inaccurate assumptions and are subject to various business race and known and unknown uncertainties, a number of which are beyond our control.
Therefore actual results could differ materially from the forward looking statements contained in the document readers are cautioned not to place undue reliance on such forward looking statement.
Digital ally undertakes no obligation to publicly update or revise any forward looking statements.
Whether I will result in new information future events or otherwise.
A wide variety of factors could cause or contribute to such differences I could adversely impact revenues profitability cash flows and capital needs.
There could be no assurance that the forward looking statements contained in this document went back transpire approved to be accurate.
Ladies and gentlemen, thank you for standing by welcome to the 2022nd quarter off lighter operating results conference call.
Oh I frequently in listen only mode. After the speaker's remarks, there will be a question answer session. If he would like to ask a question. During that time, you may do so by pressing star and the number one on your telephone keypad.
It is now my pleasure to hit the conference over to Mr. stand Roth CEO. Please go ahead Sir.
Thanks, Nicole Thanks, everybody for joining us today I also have but Tom heckman, our CFO with US today that'll do it real quick recap what the numbers but.
We're Tom jumps into the numbers I think that Oh, this has been quite a or an amazing.
90 days for for the company from what we've seen in regards to you know the demand in regards to law enforcement body cameras, and then car systems to us being successful in retaining the EPA approval and F.D.A. approval on a lot of our disinfectants and cleansers.
Two also being able to develop and assist with the the thermal Bu unit, which is I've been very exciting in regards to hopefully a assisting in helping.
All of Us get back to school backed work and back to safe environment, we've seen tremendous amount of of inquiries on the law enforcement side and tremendous amount of.
Current bids that are out there are a piece that we.
Responded to a I think you all have seen the the press releases in regards to let's call. It the shield products, which is the.
The liquids and a the thermal view how well it's it's done already for is it.
It's very very very short existence in regards to our marketplace and I think Tom's going elaborate on that as well, but you know and then the balance sheet.
I guess right place right time.
Tremendous amount of warrants were exercised as well so Tom will elaborate on that but you could tell were.
In a very very good position very strong position with our balance sheet to go ahead and continue to take advantage of two programs that we we launch both of them being subscription agreements to try to assist our first responders in regards to they the products that they need in and still the shortfall of capital that.
Sometimes takes a little bit of time to get into the marketplace. So we've been able to implement a program that was not only just for the body cameras on a monthly basis, but also the in car system and I think may seem to small tweet the went out.
Earlier this week in regards to.
A department that did take advantage of the the systems bars in car and body cameras. So well continue to do that with continued to have our marketing partners out there and utilized for this program very excited that.
The Dana group, a joint does that will give us a tremendous amount of coverage.
You know with limited mounted travel that is happening now to sit there and have the as many locations as they do throughout the country and the personnel in other words boots on the ground.
Within those regions and relationships, we have some real high.
Hopes and expectations at this partnership along with all our partnerships with the glad to see NASCAR is back at it and we're right in the middle of helping them. Obviously the teams are back at it we're seeing the NFL steel coming around their teams that are still looking at having individual.
At the facilities. So we have a real nice opportunity not only to utilize the body cameras and those environments, but also the.
Disinfectant in cleansers as well to assess their but all I quit rambling here, let Tom a jump into the numbers.
Thank you Stan and welcome everybody I appreciate you joining us today I do want to let you know that we filed our form 10-Q earlier today and please refer to that for a complete rundown of the quarter and the various items affecting the company what I'm about to go overseas is merely the highlights.
Thanks, I'd like to point out, but certainly the tend to is the best place to to go understand what's going on in its totality.
Obviously, the the second quarter was immensely affected by the Corona virus and I would say you for the most part adversely but I don't want to.
Overall look some of the good things that happened because of the kroner virus and our response to it. So yes, I guess probably from the topline our hardware sales were down 46%. That's that's a pretty large percentage, obviously and I would say, it's mainly because the customer delays. It's you know, we're certainly seeing a large an uptick in in our.
RFP isn't interest and calls and all that but on the same on the other hand, we can't traveled installs we can't travel to do the training and with what's been happening with our police forces and NAV.
Their attention is diverted elsewhere and in some cases, even their funding is limited so.
I'm not saying that you know everything is okay with it but these are our delays in my view not lost sales at won't ever occur.
Not the least the which is that international sale that we announced earlier this year 5000 up to 5000 units body worn cameras would have been the largest.
Order for body cameras, and the company history that isn't delay status.
The particular country that we're dealing with there is.
Is particularly hard hit with with the krona virus and obviously there their attention is diverted elsewhere and I just don't see that that.
Delay not continuing for a while hopefully by the end of 2020, if not it hopefully into 2021 and and we can pick that back up but it isn't pending status and we're not not completely sure where that is headed right now.
One good point is that our service revenues continue to trend up total service revenues were.
13% higher than year ago quarter, and I think thats merely because we're focusing on on services rather than than hardware sales for obvious reasons, our margins are much better.
In the in the service area, but.
The second hand, as Stan alluded to we're now offering subscription plans for both in car systems and body worn cameras and that has been pretty popular in its much easier for police department.
To go out and enter into a year long contract or two year long contract for services, rather than a capex item, where they commit to a product for a number of years. So we're seeing an uptick in service revenue I think it's going to continue for the balance of 2020.
And it's.
It is part of our overall plan to move more towards the service based company.
Because of the krona virus, we took immediate action on the expense side, we immediately reduce headcount in certain areas, we pretty much eliminated travel and we also looked at our facilities. We were at the end of our leases at the place. We were asked previously and we took the opportunity that to move to new.
And smaller facilities and as a result of that a couple of things happen number one we're going to we're going to have about a $400000 decrease in facility costs because the move we really picked up a nice location.
At a nice price and we got six months.
Free rent enticement, the beginning the second part of it is and you probably noticed in the cost of goods sold on products.
We leading up to the move during to move then unpacking after the move.
What is all expensed, so our manufacturing variances, we just didn't manufacturer anything during that time period, obviously because of the move and our manufacturing variances, we expensed through cost to sales and you saw a pretty pretty large uptick in cost of goods sold on the product side.
Beyond that if you look at total SGN eight.
And excluding the 6 million dollar Watchguard settlement that was included in last year's second quarter. The exclude that from results. Our total SDMA was was decreased by 1.8 million for the second quarter 2020 versus the prior year, that's a 42% reduction. So obviously, we did some good things on the expense.
And we expect that to continue through the balance of 2020.
Say it also talked about and I think we've been.
Putting out a few press releases on the two new premium branded products that we introduced to the market late in the second quarter and Thats really a direct result of what was going on with the Corona virus.
The first item is our shield disinfectants, it's our own brand of disinfectants and Sanitizers.
And it's showing some pretty good traction in the marketplace and we expect that to be a long term revenue driver for us. The second item is what we call. The thermal view, it's a self contained temperature screening and monitoring device that has an honorable alarm when when someone comes through that.
They are temperature exceeds a they preset threshold so.
It's a very advanced product.
We do not manufacturer, we have a third party manufacturer on that and quite frankly, we've been we've been struggling getting the supply chain.
Quickly because of the demand that we're seeing out there for that product.
It is shifted from overseas.
So it.
We have had a three or four weeks of ramp up and production, we're starting to get commercial quantities in and we're seeing the effects on revenue.
You know in total revenues because of the primarily because of the two new branded products.
Our Q3 revenues already exceed our Q2 2020 revenue so on a on a sequential basis, our revenues are going to be much higher in Q3 than than they were in Q2. Although Q2 was obviously adversely affected by the krona buyers and again, that's that's primarily the result.
The two new branded products and thermal view in the shield product, but I think also the subscription plans for both body worn cameras in Corp.
Systems is also have an effect I think the marketplaces really really adopting that.
That trend for us and it's going to helping our service revenues.
If you look at our balance sheet. We did we did a complete restructuring of our balance sheet. During Q2. Some of it was intentional we intended to do it somewhat was was really situational we had a high up tick in our market price during the quarter and we use that to to do a couple of or.
Offerings off off the shelf that improved our cash position and if if you look at our June 30 balance sheet, we now have $16 million with the cash and bank 16 million in cash, which we haven't had the number of years. So it's really nice.
In addition of that we have almost $15 million of positive working capital.
We also applied for and received a 1.4 million dollar PPP loan through the FDA program matures Cures Act DSP program at $150000 Eagle alone.
Which is a 30 year amortization alone it like 3%.
Because of the parameters around the cures act in the PPP loan we do believe that most if not all that pp low key PPP loan will be forgiven in the third quarter and again thats about a million for a little over million for of debt that that will likely be forgiven or at least a majority of that forgiven in.
Third quarter.
If you look at our stockholders equity section.
We have really done a turnaround there at the end of the second quarter. At June 30 were 13.3 million of positive stockholders' equity compared to a deficit at year end 12, 31, and 2019 of 6.3 million, so almost a $20 million reversal or improvement.
In our stockholders equity, which is obviously something that we're pretty proud of.
The reason that happened again, we undertook to stock offerings with raised net proceeds of about $10.3 million during the quarter.
We did issue 1.6 million dollar convertible debt during the quarter that because of the ramp up in the market prices stock was fully converted within the quarter. So we issued convertible debt in the quarter and it got converted during that quarter as well.
So that added to our stockholders equity and then thirdly and.
Because of the uptick in the stock price, we had almost 5.2 million a proceeds from the exercise of warrants during the quarter. So obviously, some good things happening there and our balance sheet is now very very strong.
Probably as strong as it's been for a number of years 5678 years I can't remember last time, we had we had that amount of cash on the balance sheet with the equity in working capital that we do so it's it's really.
Really a proud accomplishment of us now that will hopefully lead into better revenue numbers as well because.
We're not we're not foolish to think that our competitors havent used our balance sheet against us.
In competitive situations out there now instead of that being a liability. It's a it's a an asset for us because we are we are so strong balance sheet wise with.
A lot of cash a lot of capital lot of working capital.
And because of the changes we did in the balance sheet during the quarter.
We cured our NASDAQ listing issues, we did not and one point during the quarter meet the one dollar minimum bid.
Requirement as well as a two and a half million dollar stockholders.
Equity requirement because of the the offerings and that the turnaround on our stockholders equity, we now meat and extend well exceed both of those and we don't see those being an issue for the foreseeable future.
If you.
Once you to look at the 10-Q, you'll notice a couple of subsequent events that happened. After June 30, I'd like to touched on just a little bit.
First of all we acquired a 6000 square foot warehouse our process of according to 6000 square foot warehouse.
Very close to our new warehouse and office quarters, and that's primarily to be used for the distribution center of our thermal view and she'll products.
Those things take a lot of room, and we need we need some logistics and distribution capabilities that we just could not put in in this in the facility that we had and quite frankly, we couldn't even done it in our previous facility. So it was it was a must force we found a good property very close to our where our current.
Office facilities, and our purchase price was $420000. So certainly an affordable price for something that we believe is going to be a big revenue driving a driver for us in the future.
One thing that she will also notice is that we were able to negotiate a termination of our litigation financing agreement with became.
If you remember.
BTI loan to us or our gave us $10 million and litigation financing.
I think it was in 2017.
To be paid out of revenues or settlements or court awards out of the axon and Watchguard litigation.
We did pay them 6 million from the walk Watchguard litigation last year.
The axon litigation because of some of the adverse court.
Rulings that Weve receipt now does not look like it's going to pay out.
For that from that standpoint, so we took the opportunity to go to BK, ATI and negotiate a termination and settlement.
And what we came away with we agreed for a full settlement and satisfaction of that obligation for $1.25 million payment, which we've already paid so we've settled that and terminate the agreements $1.25 million.
So if you count up the numbers. They provided is 10 million and funding and we paid back 7.25 million.
Of that obligation so over the life of that obligation, we're going to have made $3 million.
On a roughly $3 million on that.
Financing.
Also.
As kind of a contingency in that contract.
There is a 2.75 million dollar payment, if we work to completely and successfully.
Acquire a specific company that was named in the termination agreement.
Thats unlikely at this point.
You know and.
I think it was out there just to if we if we work to do that then they wanted part of that transaction that was 2.75 million so that contingencies out there.
But again, it's very unlikely that transaction will happen.
At this point.
So at the end of the quarter June 30, we had $3.6 million recorded as an obligation to BK pursuant to the.
The litigation financing.
We settled that for 1.25 million.
So we're likely to see some some income gain if you will in the third quarter and potentially the fourth quarter as we reduce that obligation down of the amount that we've already paid 1.25 million.
So overall the the second quarter was impacted by Covance 19, both negatively and positively, but we believe we took that opportunity to cut our costs, which we did strongly and decisively by our move and also some of the other head count reductions and other cost reductions we've done.
And SGN a.
But more importantly, we've expanded our product offerings to include the shield and thermal be products, which we I think stand and I. Both believe will be major revenue drivers for the balance of 2020 and hopefully into 2021 as we go forward and with the termination of the litigation financing our balance sheet.
And as well as the PPP loan forgiveness, our balance sheet is only going to get stronger in the third quarter as result of those those transactions so with that I'll turn it back to stand. Thanks, Tom Yes, I'm just real quick because I know that we received a lot of emails over the.
Last 60 days was call it in that we want to address the questions that you have out there, but again when emphasize you know what needs to be taken away as tough as the second quarter was for so many people.
In our industry, we were able to do a lot of things that should be looked at on a very positive whether it be the service revenues up 13% whether it be you know the RFP is probably one of the highest levels that that we've seen as a company definitely far as many agencies and as many.
At the dollar amount to is quite large.
Regards to what what we have out there in August versus a key date in regards to a lot of law enforcement agencies in regards to there.
Their budgets, so we're very optimistic to start seeing.
Impact of affirms that came in on the federal fraud, and with our program on how it could greatly impact the third and fourth quarter and again would not.
When emphasize and hopefully everyone heard Tom's comments in regards to just Q3 now granted Q2 as.
Greatly affected the Q3 to sit there.
We're highly confident already at the point, we believe that have already surpassed Q twos numbers far as the revenue side and.
Enough said on the BK, you will see the impact on it and obviously the continued strengthen our balance sheet. So.
Good and open it up for you May now Nicole.
At this time, if you'd like to asking audio question you may do so by pressing star and the number one on your telephone keypad again that as far one well cost for just a moment.
Our first question will come from the line up for a mill.
The only the out.
Hi, good afternoon. Thanks.
I appreciate your comments in your comments to Tom on on how the industry is obviously, we've seen some dramatic changes in last 90 days I Wonder if you could just talked about though I certainly get how travel is going to be down in person mean issue to be down obviously, but.
How would the industry has changed what you guys are seeing in terms of.
The ability to to do some kind of marketing calls or things remotely. We assume calls Microsoft team cost could you just maybe walk through how you are adapting.
Customers are adapting.
It would just in last few weeks here. Thanks, Yes, exactly so great question and one of the things we did start doing and doing quite actively and I think a lot of.
Our investors are aware of this as well that are on on the line or maybe we have a lot of law enforcement investors, but.
We are very actively utilizing.
The zoom meetings, we utilize any type of webinars that we can can put together, but we're doing it more on a let's call it more of a national level.
We used to sit there and have meetings to where one or two departments are sheriffs departments would.
Want to know a lot more needs set it up that calls for them.
Because of the magnitude of agencies that are out there and with the new programs that we have launched in the products.
We're doing somewhere around two possibly will be up to three webinars a week in regards to reaching out to the agencies and what we will focus on when each of those webinars is a particular product. So we're not doing a webinars and you know just doing a generic overview of it.
The product that we carry but more so trying to concentrate on the features that the ecosystem may have or the body cameras or even getting into the difference in efficiencies of the.
What I want to say that the.
Different lines of disinfectant Sanitizers that we have in the purpose for those so we still have quite a few reps out there in sales support.
In the field, but theres a tremendous amount of the marketing is being done here in house and so when we did get.
You know everything pushed through as quick as we did on the EPA and FDA.
And were able to also get the development of the Thermo view unit completed.
We also see ourselves needing to add about 10 15 additional inside sales personnel and so we quickly.
Ran into the need for the new product and it's still very very optimistic we have got some internal goals on what we believe the shield product line was going to be able to to hit and it appears that.
Over a 12 month period, what we set out there as our goal.
Very possibly will happen in the first five months of us having this particular product products I should say.
In other words, we may hit that by the end of year. So it's been been quite dramatic.
But the marketing is changed a lot the way you go about it the sales support Tech support we're very fortunate we've you know because of the quality of our product that.
The failure rates been very very very low.
And even with our new products.
Very very little.
What we want to say adjustments or anything that we've had to do or tweak to.
Fixed any problems have been out in the field so far.
Great Okay.
I Wonder if I could just two quick follow up probably more for Tom So Tom on the.
As you move to more of a subscription model I get the revenue recognition changes the timing of that changes could you maybe walk us through the how that may change the expense recognition to match expenses to revenues.
Thats can change constitutes and so forth. Thanks, yeah, well you'd still record the net revenue over the time of the contracts. So if it's a one year to year three year service agreement you to amortize the cost against that revenue during that time period.
However, the.
The service revenue has been one of our highest.
Gross margin items, but what 80, no 74% margins in this past quarter.
So it does help it from a standpoint of.
Warranty situation, we're already doing that which we ship out products on the hardware sale. We have the two three maybe even a extended warranty up to five years that we have to bear the cost we do the same in the service model.
If.
When it goes down or or whatever and service period, we just replace it or are fixing or what have you. So our costs are pretty much the same under either.
Okay. That's very helpful. Thanks, so much gentlemen.
Thank you.
Our next question will come from the line Casey Livingston.
Hey don't this drop some good afternoon to quite up to domain.
First in your statement you had mentioned that you would employees.
On our employees to save money as well as we've been in place.
I just mentioned last question now you're hiring more people.
You said something about 15 people in sales personnel is it all in cells and.
Some of it manufacturing make more pilots and can you explain to me why now we're increasing the amount of employees.
Yes.
Absolutely good question and it's sort of.
Obviously, the sell side is because we are seeing a big in.
Uptick in regards to the demand in both law enforcement and the new products that we came out with so that is a pretty easy adjustment regardless of the manufacturing there are some personnel and purchasing people that are coming on back in that department because of the increase in regards to our law enforcement division, but as Thomas mentioned.
The the thermal view and some of the liquid side of things were havent manufactured.
Off campus and we're just utilizing our software in regards to the thermal view, so don't really to do anything on those adjustments, but a lot of it is around the the sales side of things and it is because of the demand the suit shield products side of things.
So we felt like you know where you'd be running along with maybe.
Three people to start with and then added as things just started to increase but.
Again, just the example of the thermal view.
The state of Kansas, and others, I think New York is a big when that the temperature reading.
Is such a big big part of the safety issues that they are looking to add in regards to going back to school and going back to work I mean, we've got everything on the thermal view everything from churches two restaurants.
Sporting events schools.
You know city buildings and just regular.
What I want to say companies that are buying this product because they want to make sure. The people that are coming in there or not run into fever to where they would be contagious whether it be.
Coated or whether it be.
Everyday flu, they're getting ready to be prepared it's just a new standard checks and balances in regards to their employees and their customers and I know you may have seen it if not.
Please email me would try to get should the link but.
They did a real nice story on this particular product and it was began.
Displayed at a sub shop here in town called good sense and an individual went there for lunch with back to where she worked which was a hair salon and said this is what we need the people that are coming here to get their hair done we'll feel lot safer known that everyone is coming through there.
As being tested for the temperature and we don't have to have someone setting up there are going up there and interrupting things, it's a self testing.
Easy to do and it let everyone know so the restaurants love it and no pushback on that let alone your Doctor's office Dentist's office and like you said the wide range.
Entities that are wanting it.
Evan as probably looking at maybe a tripling the number of sales personnel.
That we originally thought.
Okay. Thank you.
Due to quit Google search on one of those yet.
Different companies that are making us, but besides my second question.
Mr element of both stated that your Q3 Q3 revenues are ready higher than Q2.
We haven't seen any press releases.
Stuff coming out from other companies like I mean, I know you've you've spoken to pass about the.
Non disclosure at Nondisclosure agreements and stuff like that we really Havent I mean, if your Q3 revenues higher already.
We haven't seen any press releases.
Again, our customer base has always been sort of the mom and pops far as the police agencies. So the smaller entities.
We've we've always had that sort of been a niche that we've had as.
As you know I think 80% of all agencies have less than 25 vehicles out there and probably that is an equal number in regards to personnel Fars body cameras. So you don't have those earth shattering you know.
Big numbers that does come in all the time and when you're doing it in a subscription model granted we would go ahead and and announce something but at the same time unit. We did sector for instance on the thermal view unit. We received an order for 500, and you know where retail in that product out.
Now granted this was a distributor, but we're retail in that product out a 12 95.
All day long as fast as we get them and we have a still have a back order situation on those units and so we know what we had no what we have coming in we know has already went out the door.
And so we're very excited about.
Q3, and what it's what it's going to be doing but I don't I don't want to get in a situation and I. Appreciate your question very much but I don't want to be announcing.
A 30000 40000 50000 dollar orders all the time.
And then you will you will pickup on the Big news when Big news happens because I'll be just bombarding with a bunch of.
Little stuff.
All the time so I appreciate your the question and in the totally understand where you're coming with on that.
Due to time restriction and final question will come from the line of Brian.
Hey, guys how are you.
Good good Brian how are you.
Thank you.
The Big question I have is roughly a month ago, we were alerted to the say contract to $12 million military contract can you guys expand on that we lock that down yet.
So we really can't expand on it too much Brian I mean, we were out there.
We've gotten.
Approvals and.
We're still at the wisdom of the process a of the agencies and.
Thats about really all I can touch on in that regards.
So, let's say they do wind up.
Moving everything and were jumping through all the hoops and.
It gets finalized.
Is this something where obviously it's sensitive information it's the military it's the government I get that so they may have NDS, but this is something we would definitely wind up seeing when the balance sheet, if its consummated with digital ally correct.
Correct, and it's probably one of those deals we would lobby pretty hard that it is material and would need to be put out there in some fashion that maybe is unknown.
You know end user or something along those lines, but in my opinion that would be considered.
Material in it would need to get out there in some way.
Okay Super.
Now over this past two months, let's let's just say since you guys ended Q2.
You guys and you alluded to it early you guys announced the 600.
[music].
Contract for asset tracking units, you announced 500 500 thermal views contracts with Danville, Galena Rod just fill Comanche.
All of these I'm not expecting a finite number but all these seem to be adding up in overtime you.
You're you're mentioning obviously, the disinfectant, having backwater and thermal view are you guys. Good to go back to potentially giving us guidance for the second half of this year.
Well I mean, given a little guidance on the quarter to quarter, but.
I think I think you could see us.
Yeah, I think I alluded to where we did sit there and have to sort of pull in our horns, not knowing exactly what.
To expect in the second quarter, but we did react very quickly in regards to the new products and getting that into the marketplace to where my comment I believe was that I feel like the the shortfall that may have occurred because of.
Cobot 19 in the second quarter numbers that these products.
Clearly could pick up the slack to where the guidance of the 13 and a half million that we gave.
For 2020 should be able to be met and.
I will.
You know I don't want to take that lead today, but the.
The tea leaves surely have shown a very very positive reception to.
The products and the fact that we have.
Casey made good question about our who are generally was it use cases made comment about the other products.
That are out there there are other products out there there's a lot of people out there touting that they can get these products and talton that they can.
Market these products, but at the end of the day were that that.
Let's say.
Company that has that last 100 feet of sidewalk that goes up to their houses or businesses were Jill sales I mean, we have that direct contact we have that distribution. We have that relationship that allows us a lot more.
Credibility and access to be delivering these products and getting them into the marketplace. So.
Let's just like to get a few more weeks underneath my belt, but just keep watching I mean, again I'm not going to be put nickel and dime is out there, but when we are land in those 500 unit thermal view units or.
Nice 150, 200000, 200000 dollar contracts I'll put something out there.
But there is a tremendous amount of overall numbers in RFP is that are out there and almost want to reach out and go as far as say and maybe the dollar amount, but I don't know that I can go that far but it's a big number.
Okay.
Now, let's shift back to the body cameras and listen I applaud you guys for bringing these two new products to the table the disinfectant as well as thermo view because.
Space at the market is calling for that.
The body cameras, you know, we've all seen what happened with George Floyd in the protests and.
The civil outcry et cetera, and now the hot the politicians getting evolved we've got 13 states that have made it mandatory.
Do you guys feel like when the federal Bill gets passed if that gets passed that's going to loosen up.
The Jamba logjam, one the funds for you guys get these these contracts done quicker or.
For those 13 seats for example, Chicago or New Mexico, I know you guys spoke about new Mexico will Colorado are you guys, making more of an effort to get to those states. While we're waiting for the federal money for the fourth to be turned on if you will absolutely absolutely and we clearly are are hitting those states real strong and.
And also making sure that if they want to even do something sooner than later.
The subscription agreement, we can be flexible on that too I mean.
We we were very fortunate that we have.
A very strong balance sheet that we can work with departments in and are very flexible and wanting to work with them on what their needs are and understanding what their budgets are so we are absolutely doing what we can.
Like on the Webinars will sit there and in like so we'll try to do two maybe three week and you'll have 40 50 departments on there or at least representatives that'd be on these webinars and again it takes time and we're doing everything we can to quickly follow up with them when they follow up with us as well so we've.
Had a lot of lot of things really really of came out of this positive him.
And tried to give too much time, but we've had webinars that we've done and within a matter of two weeks body camera order all in all done signed sealed delivered on the under the subscription agreement. We did the Eva that's a much bigger commitment and dollar volume and everything else same thing lesson 30 days all Insein sell delivered we got us to deal were often.
Running on a three year contract with them so.
So there's there's things like that that are that are happening rather quickly and.
I don't know if I've told you this too Brian but the out for that you've talked about.
In the industry is.
So strong this time around much much stronger than Ferguson, we've had individuals call up and say, we would like to buy.
15, 20 body cameras for our law enforcement Department as.
As a donation that we're going to give to them and we said, okay and they've literally given us their credit card over the phone and had a ship them say 20 body cameras that they donated to their their law enforcement departments. I mean, it's just absolutely the cry for in car video and body cameras.
In my opinion never been is strong as it is now.
Awesome Awesome. So this high demand there and then the last thing I want to touch base with you on just reference your conference calls from the past.
The shield disinfectant.
Thermal view, obviously, you're looking hospitals, you looking schools schools I would imagine are going to look to do some stock for here in New York. The kids are going to days there often Wednesday and then the next two days different group of pits come in.
I didn't see disinfecting day.
What's what's the traction in terms of getting with the grocery store chains that you talked about or nursing homes and things of that nature, how how we do expect in terms of it isn't a matter of you guys can't produce enough of it to signing contracts or are these things that you're eventually get knocked down one by one.
Well the addressing the the products. The thermal view is a challenge those numbers had been big and as you know we've made some pretty big announcements out there on that.
And we still have a backlog.
Orders that were trying to feel but it does look like will start getting product in.
Almost a weekly bases, we dumped the software on it make sure everything's working correctly and it goes right back out the door.
So that looks like we have a shot at catching up but the same time theres some numbers out there in regards to.
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Where there is actually federal money again available for this type of protection for schools and hospitals and others.
That are coming into play that we just have to make sure that we are.
Very.
What I want to say aware of it and prepared to to react to it. So that we can take advantage of it but as we internally did as I mentioned, we set a year goal on this product and its and what we believed it could bring to the table and I will be surprised if we don't accomplish that goal by the end of this year.
Sure so in roughly a five month period of it being available.
In regards to your disinfectants.
That are out there and the hand, sanitizers and things along those lines again this product has no.
Chemicals no alcohol it is a.
Natural product that is food safe is the best word to use I mean, you can sprayed on your food to help with the bacteria mold and stuff I get to help and so.
That product is getting a lot of traction as well the education side of it of this product being a little more expensive than those that are chemical least is little bit of a learning curve, but the church that we're dealing with there is there's a very large Catholic church that's.
Buying the product they totally understand it and they don't want any chemicals and the jails or one chemicals, you don't want to sit there and have a product that's got a bunch of bleacher ammonia in and have some we get hold of it and throw it into.
Copper in major whatever space. This is a very very effective.
Disinfectant that is on the lowest level of trucks.
This toxicity.
And so yes.
Great expectations on it as well, but right now, but like I said were.
We're doing every week everything we can on a daily basis, just trying to meet the demand on the law enforcement side as well so we're going to two parallel paths.
That seem to be running very fast.
Both ends.
All right good stuff guys. Good luck tea in the third quarter.
Thanks, Brad.
With that I'll hand, the conference back for closing remarks.
Well again.
Sorry, this is such a short call.
We did want to go ahead and get to as quickly as we could you have the questions that were out there hopefully we've covered them all in with the 10-Q being filed just.
A few minutes ago I guess it was filed would you do it's more you've got enough you got it okay.
There ought to be go through that it's going to help.
Understand a lot about company and if you have any questions feel free to issued as an email.
Pick a phone call us, we'll do our best to be able to respond in.
Do the best we can to continue to build this company for for US all so thank you all so much for your time and look forward to talking again in the near future. Thank you.
This does conclude today's conference call. We thank you for your participation and ask that you. Please disconnect your lines.
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