Q3 2020 Magic Software Enterprises Ltd Earnings Call
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The.
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Ladies and gentlemen book of the Magic software enterprises, 2023rd quarter Financial results Conference call. At this time all participants are.
Doesn't listen only mode. A brief question and answer session will fall the for two intuition for a person operator assistance during the conference. Please press the Star Zero as a reminder, this conference is being recorded.
Magic quarterly earnings release was issued before the market opened the sporting and then as simple sit on the company's website at <unk>.
The W.W. the magic software Dot com.
For something Magic software to the Magic seal, Mr. Guy Bernstein Magic CFO Mr. software and the same a magic of VP of technology innovation Mr. Yu of I love It.
Before we start I would like for like everyone. The this conference call may contain projections or other forward looking statements. The safe Harbor provision provides the in the press release issued today also applies to the content of the school.
Magic expressly disclaims any obligation to update or revise any of these forward looking statements, whether because of the future events, new information a change in the twos or expectations or otherwise also.
Also during the course of todays call magic or for a certain non-GAAP financial measures.
A reconciliation schedule showing GAAP versus non-GAAP results has been provided in the press release issued before the market opened this morning.
Play of this call will be available after the call about ex off for investors relations section of the website I would now like to turn off of the call to Mr. software for instance, CFO of Magic software. Please.
Please go ahead.
Thank you Albert good. Thank you everyone for joining of some very of the for the quarter 2020 for luxury.
Medical opinions to the much longer confusion of course, all of flow of Universal business, Nobody finding new business and increasing our revenue for existing customers. During the first quarter revenue grew by 11% driven by solid performance. The experiment in Israel in the North America, and leverage or because some of the relationships the additional sales.
Well the we grew revenue by 23% you over the year North America by 8% annual by 7%.
Results were driven by the exponential of work for existing customers and the addition of new ones during the quarter and demonstrate the ability to deliver world for the solution and services for existing customers and close the new deal alongside of the compute sort of your confusion of low for your top line growth.
The new globally and part of the call. We'd like you know the business decision, making overall government team continues to move out of your small you book overall.
Total oil there are a couple of home.
Continue to work closely with the large customer base supporting them in the they kind of.
The challenge of <unk>.
Oh, the marketable trying to normalize for the initial you book of Colby might we see the the corn.
Option related to the <unk>.
We should of organizations membrane will find beauty the the information <unk> the largest from legacy systems more than they've been running for cloud based solution of loans the need for me because some of the expectation well did your dog and multiple from an army of experience for these moving the operation the few should.
The Salome driving future opportunities for magic software of the business the benefiting from the global trends the.
The driving the growth.
During the first wave of Colby line being with the second wave non leaving the main markets in which we operate we experienced much less doesn't do for customers in the <unk>.
<unk> GAAP gross customer of theirs southern decision for stock or used for project for us.
That's the sort of be mindful of ubrogepant expansion of existing projects much more normal.
For Magic point of view of direct government regulation of whatever the old trucks of the burden of the approach of being the beneficial the effect of all business.
Especially in this challenging business environment of weak.
Book up the most addressed the the new and unique challenges.
You know the terms these held for secure all of them, probably beating revenue while increasing so what do you know the existing customer base the meeting.
Additional services, we made the low customer growth and for sure.
Well the convenience to be Mutoh until the people Colgan line team, we remain focused on execution and for the remainder of 20 plenty of maybe the <unk> listing customers remain on track we continue to grow where we have all the laundry of 11 of drilling the well.
We continue to see the growth so to our existing got some of each group the but the viability of our position of the one stop shop for some of the market products and services for.
The only be mindful of offerings, we've heard of the beating revenue in the store we bought on cheap position book for success in this challenging environment.
Continued to see the business growth organic means women, where do we speak for other opportunities drink group operating infusion for you.
The gross margin we are confident that the of the global economy of the global economy recover magic software.
Stronger simple solution for the continued growth.
Turning now to the <unk> well first of all the business performance I would love for you on non-GAAP results all of my comments on the balance sheet cash flow and who the ultimate pull the remaining of 21.
The revenue in the third quarter of 2020 and grew by 11% to $94.9 million compared to 85.8 million in the so called the <unk>, where do you live.
Okay of the geographic of bringing all of our revenue during the third for the North America accounted for 46 for simple for the revenue use one of 42% of you almost 8% in any book and the rest of the world. The current at full price bankable folks what the revenue most of our road maps of the number of doing that so I wonder what's traditionally for local Mary Lynne.
Continues to be our strongest other than North America accounted for 30% of of growth in the true for them and Ukraine accounted for 65%.
For the nine month period, most of any dark all good for 41% of our growth for the end user and accounted for 65.
Turning the multiple for <unk> non-GAAP gross ball for the third quarter of 2021 therapies for the seven media up approximately 6% compared to 28.9 million in the first quarter of of low.
Our non-GAAP gross margin for the so called the <unk> when the plenty of degrees for better.
Reported seven in the third quarter of when you know the 32.4 in the third well don't when when the decreasing our gross margin solely attributable to the change of the goal revenue mix related to all software solution versus professional services.
The big amount of our revenue mix for the nine month beauty of looks like the 20 was approximately 24% the latest all sorts of solutions. The 76% you need the global professional services compared to 26% of related to the <unk>, well and 74% of the Lakers local for short services in the 2019 of the.
And 25%, we like the ball software solution in 75 per cent. The laces local for self service is doing the set of capital to anybody.
The Burger until the <unk> well food mix for the nine month period of 2021 of the Brooklyn is 50% the labor to all sorts of solution of 50% for the majors.
For.
The same as the 29% of the whole.
Moving to a portion of total R&D expenses on the non-GAAP basis in the third quarter of or where do the 24.1 million same anything other than in the respective quarter and compared to 2.8 read any of the previous quarter Aegean expenses on the non-GAAP basis in the third quarter of a plenty plenty of built themselves the important coal museum comparable hoping for.
Any of the same quarter of last year, and full and 11 point for meeting of the previous work of the you know again ex person versus the second quarter of 2000, I mean, he's a good bit of <unk> to call out the measurement thinking with respect of the Cobi lighting business disruption during the second quarter and other remote box. The one of the only like business environment, we would use saving the bulk of.
<unk>.
Our non-GAAP operating income for the third quarter of 2020, <unk> increased 21% to hoping for to medium compared with 11.8 million tons of.
Good luck.
This is like the nobody the merger of wont be in the phone my per cent for the third quarter of 2020 compared to 13.7 for for the so called the formulating and full of pinpoint one per cent through the second quarter of 21.
Our non-GAAP tax expenses this quarter total of 3 million <unk>. If that's the expense of one point for meetings of the window for the Nike.
For the dark rent for the nine month period of Bernie Bernie was 18% compared to 19 recorded in the 2019 of the whole we expect Patrick the doctors and 2023 of the range of 19 to 21 for so long.
Non-GAAP net income for the third of what the increased 17% to 9.5 million or 19 cents of movie the loop the channel compared to 8.1 million of seven P.M. Central for do you of the move the chairman of the same.
During the melting the balance sheet.
The September 32020, cash and cash equivalents <unk> the long before the the marketable securities amounted to approximately 86 million compared to 92 moving in the previous quarter of total commercial debt as of September 30, 21 of your mortgage for 28.8 million compared to 25.3 million in the previous quarter for.
For the cash flow perspective would generate the therapy in point Threemillion from operating activities for the quarter, which will offset most of the by 8.6 million <unk> million or 17 for I'm sorry.
True related to the given a distribution for shareholders with respect to the first half of 2000 22.3 million related to the dividend distribution for local importing interest and pinpoint engineering of the Lake deployment activity. We continue to do all the high conversion from net debt to cash flow from operating activities. The.
Well do a represents 90% of conversion and the accumulated losses and loss of my mom represent one of the three per se conversion price for met for offered to adjusted operating cash flow.
In closing I would like to turn the outdoor garden for 22, when the global economy experienced significant disruption from called the banking and we of management.
The managed of Endemics effect for both of employees and I've got the Muslim like that.
For the old business had been of showing the vineyard challenging environment.
For me to Bush or perspective, we on the focused company average function of the along the wisdom of your work the 10 well from current sorry other the goals of the other very high visibility of our revenue stream from existing customers.
Mark the Youve of going through the we'll be mindful of the you know raising of the 2020 for your revenue guidance, which we expect to be in the range of 30.
For younger than the <unk> million for 365 million on a comes from going for basis the.
Looking at revenue growth with a 1.9 to 11.5 for thank you will the new as compared to Oh problem Angel regions of the 50 million for three other.
Moving them over loans, increasing the midpoint of the guy that by 1.8 per se.
I will now turn the corner over to open it to go for questions.
Thank you, ladies and gentlemen at this time well begin the question and answer session. If you have the question. Please press star one if he wished accounts you request. Please press the star too. If you are using speaker equipment kind of of the headset for pressing the numbers your price.
So I told them the orderly all the seats the standby only poll for your questions.
The first question if I'm Tammy Rosner of Barclays. Please go ahead.
Hi, good afternoon. Thanks for taking my questions Hurts, the just wanted to touch on guidance. So.
Your updated guidance.
Kinds of imply a slot our Q for in terms of revenue roughly 4% year over year in Q4. So I'm just wondering if you guys are being.
Oh conservative or if youre expecting some kind of slowed down in Q4 comfort for Q3.
We always the we always conservative there, but it's true you need to remember that the goal, but for example of that he's the ER and new year's day, the holiday season, moving East language. The they accounted for over 40% of our room revenue stream and the old sold the in November we the American we built for men.
Recall holiday season Christmas also having some impact the.
On the revenue we always we <unk>, we hope the definitely the we would meet the higher end of all of the garden, but I guess the.
You mean, the inclusive of the by the way for Us.
The work in the second quarter, where the thing that everybody knew that the <unk> is probably the garden.
That's a that's helpful and vendors of wanting to talk about your customers the nickel day so.
Oh Where'd you see most of the demand coming from in terms of surgical and the converse of the which we've already called I kind of pushing back in terms of budget.
Budget during the core non time like what what's what's driving most of the business for the moment.
All of them I think the magic used today, the very oriented to the health care of like so to the financial effect, so to the defense sector oil and we also oriented the need to be to the telecom for <unk>.
Welcome to the.
For which you know maybe the leaping pair of the.
You know we expected it would be much better than the we saw the because of the it's like regardless of you read the a set of quarterly.
So the fence will we see a solid demand I think the <unk> all of these sectors of the financial sector for the a and b for them all.
In the OCA affects all all of the ones that will the.
And then the.
The minimum of you know he is doing the from the covered my team of.
You need to remember that the fund I should do stick you know works.
For the local the money you know the two will update the legacy suits them we have the.
Turning the call book be better working on it you've already buying things moving short of companies and credit card companies.
The day to day areas.
Right and the legacy since the end things, we've solved the up and we start up you need for the today, we see it and we've seen in the third we felt that the knees not that start to generate revenue and start to grow the business and you never can give the goes the on the big data and cloud services. The ignore the name and the again the approach or for.
We've gotten the manage also true to grow business same who the healthcare Cvs and the two we've already begun for those the largest for your health care provider of also in the midst of of investment due to the Cold war being and handling the day the winter all of which also continued to do all of the 12 business.
So all of that no loans the drive of the holdings with the log.
And I'm sure that the we also continue to 2021.
Thank you I thought that's that's helpful. Then maybe other that's 25 of mail on Jimmy The news for you you reiterated your commitment to a total future acquisitions.
Have you guys seen any seeing a rather than lately in the pipeline and perhaps the valuations are too high or does the lots of competition for our for kind of trophy assets any color you could add.
Well I will answer about the software Oh, yes, we do have.
A lot of.
I mean the five.
Most of them or other.
The small.
The companies as you know we don't work for bankers.
Most of the businesses, we acquired the calming.
Our business is you know the all the branches around the world and the floor.
More conservative in the way we do it because you know we are talking about companies that we know the companies of we compete with but you know the these advantages because of most of them are other malls so low.
Oh, we do we are still we are looking for the won the which is like a game changer.
I'm not sure when the prices are.
Hi.
But.
I see okay.
Right that's helpful. Thanks, Guy and the stuff.
The next question is from Maggie Nolan definitely on line. Please go ahead.
Hi, congrats on the strong quarter.
I'm catching some kind of preliminary optimism on the 2021 can you maybe give us some preliminary thoughts just based on the conversations you've had with clients.
The around the you know what they are seeing in terms of their budgets for 2021, and how that may translate into your outlook for the software and services.
HM Okay, well that's true yeah, so I would.
Probably say the you know in the <unk>.
Well as we work like the you know do you have good he's definitely.
The old have like most of the plans for the 2021.
The ball the financing sector or you know the always have plans I know it was the best.
So we're trying to you know expand as much as the weekend we didnt.
The existing customers in the falls to the old <unk> doing some more on new logos.
So all in all the currently the the old.
Of Brady pulled the keys about the 21 you have to be seen you know, we we are not the.
Not true where diesel the fund them because of though is going.
The smell that.
No I didn't channel.
Thank you I do have a follow up so for.
This quarter the September quarter can you give us a little more detail on the new client additions and the kind of the breakout of the growth coming from new clients versus your existing client base. Thank you.
I think the army's we'd moving or would be brought in from the <unk> Oh Jeez you like of a at least of Soc line because of you know magic is a working.
You know the.
Deals for the most of the deals the rather a small deals in the range of flow.
A few of tends to a few hundred thousand dollars of them, though for there is no significant oh the lie in the I'm, making a strong impact in the quarter. So its.
It's probably between now and you know.
A few tens of of clients of.
We definitely see the expansion in the healthcare and the in the financial sector.
Okay. Thank you for taking my questions. Thank.
Thank you.
The next question from Kevin Didi of H.C. Wainwright. Please go ahead.
[noise] Warren Jenson for afternoon over there.
So the softer you touched on telecom and a resurgence there I suspect that you're alluding to sprint T. Mobile can you give us a little more color.
How's that goal and are they sort of full throttle yet do you expect them to go maybe full throttle and.
You know the next stage of their integration next year and do you think magic will be more involved.
We hope to be moving all of I can tell you that starting from the second half of the mostly in the third quarter sales. The 29 gene the more by the basic basically stop everything.
And because of the is the merger with the spring we do see we do see improvements buckets fall fall for where we were.
You previously in previous years I think the in previous years I think that the five the GE. Once the related you know sort of driving more more of a investments seem day telecom. The interest only we would also benefit them and right on that for corn for meets the very small.
The became a smaller business for us we manage to and also just the of course.
Relative to that if you look at going out of the on all the opex on our sales and Gionee expenses versus last year. The entirety of the deduction alone 800000 comps for the telecom sector of the you know shrink significantly for them for what we were in five years. So to your question. We don't see it we see a slight improvement that's what's the most.
Yeah, well, we worry me probably for you.
[noise] I'm glad you mentioned you know the.
C N a debt.
I saw it was up almost 2 million Bucks from the June quarter.
The that just because of the bus sales mix and increasing the sales or.
You Walt.
25 per cent of the with what I said, the abrupt 30% of debt from the up you know going back to normalized like the activity or the identity for system the legal stuff ensuring the an old the prices went up for the last few where Oh premier was.
Good day and.
And and the Salvador Love to date say close to a $300000. So we use the we got something here on the on the in shouldn't the legal settlement and customers that client. The you know that we've got the dozen of making payments on time. So we met so you have to do something.
The bad debt provision of the home.
As you were point Sixmillion and bonuses you know the the one of the business the goal it does well since the barrel of getting.
You know getting paid for it so and this is all for both of the of the on the income. So I would take the person comes from the going back to normalized business and simple, although the financial results and 50 per cent legal insurance and bad debt.
All right. So do you think the sort of a new run rate for <unk>.
Sort of settle back down somewhere closer to sort of first half levels.
In terms of wasn't there was of the gene total of the Opex expense of <unk>, Yes, you know yeah, just for the December quarter.
Yeah, I think that the I think that people would the even reduce for the Q4 again I don't Yeah. We said that we of course several of you know I don't we don't give any guidance on on that but the I think that this is pretty much of the net so.
The question.
Okay all right.
Can you give us the same sort of color on T.V.S. too I mean, I I know, both you and Guy mentioned health care and I'm wondering if that's sort of the bucket that you talked to the CMBS deal into.
We see yeah. The the LCR. We also we have very strong the operation in the U.S line on the on the six or but yet CBS. They account for more than 10 percentage of all the although top line and we view it and again on the on day on the profit side.
You know the that brought in about the because of the rebates on CBS and stuff like that the students then we manage the being in the not huge numbers of increased level of the business. The we phase out of also to us and to the end.
Through the cloud.
[noise] [noise], Okay. So is that sort of more normalized now to the.
Set of fair way to look at it.
The hope there between the continued to growth Oh, okay. Okay. I mean, that's the better way the phrase. It is I think the operator mentioned that you've always on the t. on the call yes.
Okay could you give us a little more insight on.
The next generation of ex DVA and the integration of powwow How's that going.
Have you run beta or have any of your customers looked at it what's sort of the insight can you give us and.
How you think it emerges in the sort of the competitive.
World.
We are in the middle.
The kind of sales the R&D efforts.
Our average.
The third the two club for me on each side of what needs to be a connection.
And now we are kind of getting the is the what.
I called the developer journey the join clubs for.
And the yen definitely going to be a competitive the offering.
Two of the two other products into the market. This is where we all see the it'd be go for Jim If you to jump when new customers the.
Consumable the says the smokeless.
And also in the Japanese market you know we are it as opposed to the our usual behavior, where we first glimpse of the global markets of on the off the the up coming to the Japanese market the.
Since the.
The big demand on the web client development than the unblock the come all of GI and were going to look for the bringing it to is the jump on earlier.
With some of the prospects for [laughter] customers of our booking thoughts for both even though it implementing its due in the medium current user of smoke form where usually leads you to the never used to be our playground, but now we see it as our partner is the kind of putting the search and we are.
Yeah.
I'm, sorry, the Stalin's definitely [noise].
[noise] okay.
You've all thanks for the color can you give me just can you speak a little bit more the timelines and.
I don't know if you have early customer feedback or view you know the if you read of beta yet can you just sort of give us.
Your perspective on the timelines of when we might expect to see it in the market sold loans it for.
For Valeant will be.
The somewhere and is the second Q of next year, Okay. The idea.
Idea is to start.
Moving the kind of design partners, the theyre working with us for or early adopt for better sites.
The middle skew one around the sort of warrants and then sort of thinking of the customer and meet the Q2.
The doing the for blown marketing in the <unk> and the global availability at the beginning of the off too.
Okay Fair enough, yes, that's true.
Like you I think the way the portrayed it on the August call. So it seems like you're sticking to your timelines no you Bend shouldn't go into Japan early are you going to release it globally across your entire network or are you still thinking.
In terms of geographic release.
Oh, no im going to the global Oh, well all over the low.
What I said is the the against the tradition in the Japanese market. These referrals to blow with the book Zero version.
The global market the looks like its into Japan, and the Japan is taking is booked one of the two version.
And so for US because you know there are when we say it's perfect for them in the middle for.
Well that's the yeah. It's the you know jump on the inside.
But the but again, we have something towards the middle of the from the community. That's the were going to kind of what the net effort with the Japanese branch in order to shorten the the GAAP when the low bundle of the inability of the rest of the Wovens of all of it would be between the weeks two of the months for couple of more than the.
Okay on the development side, I mean, I, if I understand correctly, you've got developers in Israel, and then somewhere in central Europe too. So I imagine. It's a combined team effort are you are you having any trouble finding the resources that you need to stay on track.
Oh.
Not really the because it's been a thing was instead of we had them we overcome of by EPS in the emerging the existing team it to the new team. So we are working with the parts of the people in the coming for people in the U.S. the.
And we probably won't add the team in the in the in the Ukraine. This live in something for as book, but also the big in India. The we're shifting for more exist in the <unk> are in view of it yeah and pulling them to follow the technology with the again they are going to be emerge as one of the smaller the.
We managed to overcome the challenge of bringing new talent and this time of the book with my team with the it shouldn't be shifting a little bit spoken so for the.
The other products in sort of the.
Okay. Thanks, Thanks, you've all the <unk>, it's a soft can you give us or maybe of.
I mean, it seems like Israel's really bouncing back and I think the big question of my mind is how many of your consultants are actually going on site versus working remotely.
Did that change at all in the September quarter, I know when we talked about it in August it seem to me that most of your guys are still remote but I know I mean, I know the spend that make is really intensified and I'm just wondering if that sort of changed your.
Operating perspective at all.
Of course, the change the breakdown of operating a parakeets, let's say I'm. Most of other people are working from home. We are now doing the call for man for home, except for the defense sector. When we have when we must you know you to secure the reason then have other people.
Hi, the on site will always you know offices, they all day.
The most of all of those people are working and are working for home first the most simple because we don't want to have a situation where and when the one getting sectors or that's the positive than everybody else need to go home all the all in Texas.
No.
So this is something that the surely as the change.
I don't think the peaking for the shoulder. The on these loans going to change back you said you need to remember the steel on the second thing is the way of going back to the norm and so we went for me to a shutdown and we are now gradually only getting out of the on the shutdown and people the old book the wasn't anything bad debt.
The government. The now also of the same bags that the they want to do another curfew.
Stops you know when everything is seven Oclock pm.
So we have we changed the we change the if we look at the sale to smaller offices, where we could by the way and you also see of somebody on all the way there on all the margins.
[noise] using the small okay by the way the day, the problem with that and the.
We are trying to call because we are very good the deepen and you want to continue having them you know relates to the business.
And the ones that working from home down the losing some of the you know some of the there.
[noise] DNA and we didn't we of the business. So you know the keeps them you know identified with the we the magic way and you know and the.
It's something that's where I see the the is now moving challenges.
I think thats. The we'd be then you know the you didn't have the Olympics today, because everybody wants to get other than the ones I think the monitoring.
Feeling.
Yeah. The understood I think all businesses are facing that.
You know the company culture or issue.
I I know we are.
EBIT in our New York off the since March.
I I guess.
My question was really whether or not things have changed for the second quarter and I I guess, they haven't right you're still maintaining the same sort of.
Operating conditions with everybody working from home [noise].
Yeah for change you said the atmosphere, we the client the client for them out more willing you know you don't confuse people are saying lets stop the let's stop project. So let me use the capacity. This is what the what the change from the kind of thing.
I mean, I think from the second quarter of the clients on the still of the debt.
The basically the new realities, so if that's the second quarter.
Oh, we face some force backs on the you know you project.
It's not the case anymore.
Well, Yeah, obviously guy I think you did a great job sales were up 10% almost 10% sequentially. So.
Clearly your you know what you said in August of stands true right. Because you you said that you know.
No you said your.
Clients aren't really holding back so.
Congratulations on the quarter. Thank you very much for taking my questions.
Thank you.
The next question some of my software out of Oppenheimer. Please go ahead.
Hey, guys. Congrats again on the strong quarter just to start off with maybe a housekeeping question can we get an organic growth number for the quarter.
Yeah on the the on the top line, we were you versus the Q you were.
40%, the non organic 60% the organic.
[noise], Okay, do you mean that sequentially or year over year.
You know the year, okay, great great.
Okay, and then on product mix.
You guys had no day, what you guys had noted on the on the breakdown implies a pretty strong results for the software businesses. The any update you can give us on that front I know, it's just kind of something we speak about less on the conference call also if there was any impact.
Some of the magic hands acquisition that was closed so any color would be helpful.
Oh I got married the Magic ends the acquisition, it's a very small operation for the company the Doug.
Kind of beat the on the 2 million during the year the the G. the logic behind the acquisition was day to a game to bring in around 20, M. magicians are too low and bringing a partner that has the in some kind of in the other application the old using the the magic to it but taking the amended.
Human being taking the magicians, Dean and and the upgrade the all the all the Dutch of computer Dutch Brunch and following the the leaving a the entitlement of one of the the manager there and the the bunch of manager. The so that was the of the logic behind the of smoking appealing terms of all in terms of other businesses.
This is not the them in terms of all the prospects for the from the Dod share it.
Losses.
Okay. Yeah, so maybe I'll just kind of reiterate the first part of my question, which is more important.
It it sounds like the software business is growing again I mean, you tell me if I'm doing the math wrong here, especially when I compare a threeq versus Twoq Q of.
This year, so any color on the software business would be helpful.
Yeah. That's also business is growing and grooming versus the versus last year.
You don't see of so much on the you you see any moving from the margins, but not so much because of the the.
The capacity of up professional services fees.
Because of the you know 75 per cent over there or the revenue sales come from the professional services, we'd be sales something like 20% warmer than last year in terms of the in terms of volume software and this is what the also helps to where the two green can improve the the bottom line.
Okay any kind of the drivers there or is it just a kind of a logical next step in terms of people are trying to become one of the digital.
I think the people of trying to get more of these yourself I see we will see of some day on the project side, we see it on the software side.
So so.
The voting.
Okay. Okay, great gross margins were quite strong this quarter for well above kind of the post acquisition rates of for Q 19, and even stronger versus the first half of 2020 any one time effect here can we actually expect this kind of number to continue or do we need to take.
Back down moving forward.
HM.
Say that the you know didn't seem to the same conservative of let's say that we normally the for what the Lisa Hook is Florida in terms of professional services and also in terms of the software. So so I hope you know the so do I don't expect any significant changes it for this year for next year. The first of all because of the type of the.
And prospect that we have on the M&A side. The I would I was the stealing the magic true suit should range between the 31 to 31.5% to 32.5% from day was for.
Okay, Great. That's very helpful. That's all for me thanks for taking my questions.
[laughter] for any additional questions. Please press star one interest accounts you know question. Please press the star cancer stem like Oh, My gosh debt.
There are no further questions at this time I missed the front seems like to make the concluding statement.
So thank you everyone for joining or cold the schools are Oh, and we definitely hope to.
Can you sum all good news of next quarter. Thank you very much.
Thank you.
This concludes the Magic software Enterprises Ltd third quarter 2020 results conference call. Thank you for your participation you May go ahead, and just kind of.
[laughter].