Q1 2021 PAR Technology Corp Earnings Call
Good afternoon, ladies and gentlemen, and welcome to the fiscal year 2021 first quarter financial results conference call. At this time all participants are in a listen only mode. Later on we will conduct a question and answer session and instructions will follow at that time and.
The one should require assistance during the conference. Please press star zero and so.
A reminder of this conference is being recorded although I turned the corner of it do you how all of US Mr. Chris Byrnes, Vice President of the first development, Sir you may begin.
Thank you Sarah and good afternoon, I'd also like to welcome you today to the call for part of 2021 first quarter financial results review.
For the complete disclosure of our results can be found in our press release issued this afternoon as well as and our related form 8-K furnished to the SEC.
To access the press release and the financial details. Please see the Investor Relations and news section of our website at Www dot parts ex Dot com.
And I also wanted to be sure all participants today and have access to our earnings presentation and business review slide deck that we will use later in the call to better communicate the momentum and our software business.
Individuals on the webcast sort of access to the deck when they logged on to the call. This afternoon.
For those just dialing in on the conference call. This afternoon. The presentation can be accessed on the investor page of our website and we also included as an attachment on the 8-K, we filed this afternoon and also.
At this time I'd like to take care of certain details in regards to the call today.
Participants on the call should be aware that we're recording the call. This afternoon and it will be available for playback also we are broadcasting the conference call and the worldwide web. So please be advised if you ask the question. It will be included in both of our live conference and any future use of the recording.
I'd like to remind participants that this conference call includes forward looking statements that reflect management's expectations based on currently available data and.
However, actual results and subject to future events and uncertainties.
The information on this conference call related to projections or other forward looking statements may be relied upon and subject to the safe Harbor statement included in our earnings release, this afternoon, and and our annual and quarterly filings with the SEC.
Joining me on the call today as part of the CEO and President of <unk> Singh and Bryan Mannar Par's Chief Financial Officer.
I'd now like to turn the call over to sort of need for the formal remarks portion of the call, which will be followed by general Q&A.
70.
Thanks, Chris Good afternoon, everyone and thank you for joining our call today.
Following the strong finish to 2020, we post the what I believe to be our best Q1 to date and our optimism continues to build around the coming quarters and years for our business.
<unk> made the distribute COVID-19 vaccines, the decline and infection numbers and the general reopening of the economy should lead to a strong 2021 for par.
We began 2021 and strong bookings and Q1 and continuing the strong momentum from Q4 and ended Q1 with our largest backlog of all time, which sets the groundwork for next for county, and Activations for the balance of 2021.
For the last 12 months presented many difficult obstacles for partner of restaurant customers. Many of those challenges created opportunities at par was well positioned to take advantage of it.
We invested in our software platform introduced new product innovations added top talent to our team completed a significant acquisition and were able to improve our financial and competitive position.
And we'll touch on the financials a bit later I wanted to touch on our recent acquisition of punch.
And I'm personally very excited about the deal and punch of the game changer for part of their customers.
Punches and market, leading customer engagement platform that provides cutting edge software applications, including loyalty promotional campaigns and marketing artificial intelligence for the restaurant and retail industries.
We signed and closed the acquisition simultaneously on April eight conscious of more than 200 brand customers 40000 customer locations and currently has $53 million and contract of a R and the 115% net dollar retention punched.
Hunch is of very high quality business with a very high quality team.
On a pro forma basis punch any Q1 with approximately $35 million and continues to fill a growth even with the headwinds of COVID-19.
There are many reasons, we are excited by the steel Punchestown chorus clouds for enterprise restaurants.
And of the industry, leading loyalty product now makes par of unified Commerce cloud platform for enterprise restaurants, and our combined company further expands the industry's largest innovation ecosystem.
This deal creates the unique opportunity to improve value within share and targeted customers and significantly better tech development team and increases and increases their innovation horsepower.
Adding punched position as part of the fast track, new customer wins and integrated point of sale back office payment and guest engagement solutions and as.
And the exciting step and the evolution of the par and the restaurant industry.
Customer loyalty and CRM SaaS has rapidly evolved from being a novelty for restaurants to now of business critical form of managing the customer relationship and revenue generation for enterprise brands.
Our existing par customers had been very positive regarding our acquisition of punch and look forward to reaping the benefits of the enterprise class and unified cloud Commerce platform.
My sense of living through a dramatic change and they're operating and business model technology will beat the tenor of that change it.
It is the specific reason that we believe pars new unified platform can and will be adopted by enterprise.
The technology continues to be deployed within the restaurant and in store environments become more and more complex enterprise restaurants are seeking true technology partners to manage the complexity.
There's no question and suffer required by restaurants will grow tremendously over the next decade, while the software trend surging, while suffered try and searching and restaurants are company continues to focus on capital allocation and of directing our researches on transaction products and people that will have will impact upon our addressing this opportunity.
Now to briefly review the first quarter reported numbers for for Brian gives further detail.
And Q1 reported revenue of 54, and a half million dollars.
Today, We also reported a GAAP net loss of $8 $3 million for 38 cents per share compared to a GAAP net loss of $10 $9 million for 61 per share for the same period and 2020.
On the adjusted basis non-GAAP net loss for the Corp. For the first quarter of 2021 was $7 $6 million or a loss of 34 per cent per share compared to a non-GAAP net loss of $4 $7 million of 26 per cent per share for the same period of 2020.
Now moving to our business performance he jumped the slide three of the presentation, you'll see a snapshot of brings the performance of Q1 and very pleased to report that we had 1300 and 25, new store bookings for the quarter and 85% improvement from Q1 and 2020.
I think this metric more than any other of truly demonstrates the momentum and velocity of our cloud point of sale offerings and.
And booking at par is a signed order from the store location pending rollout the strong pace of Q1 brink bookings highlights the continued growth and demand for of modern software for modest offer within the restaurant.
As the slideshow is reported on IRR of $25 $6 million, a 15.3% increase for the same quarter last year.
As the pandemic continues to slow we expect to see and acceleration of Activations as stores begin to open and normalize and the returns of our traditional activation pace as restrictions have come down we've seen activations pick back up which will help us turning our signed backlog to revenue and encouraged by the privacy of already seen in Q2.
If you had asked the slide for you can see that we now have 12141 act of stores and our reported backlog and open order number at the end of the first quarter was 3000 and 327 stores yet to be installed.
This record backlogs at the foundation for a very strong 2021 again, it's vaccination of Rollouts continue to favorably impact restaurant customer traffic and reduce travel restrictions will see an acceleration and activations that will lower the backlog number and drive more normal book to Bill pace.
And we installed 718, new brink start in Q1.
We believe this is below where we want to be as installations earlier. This year, we're being impacted by spikes and infections and specific regions and on state mandated travel quarantines will continue to work on our customers regarding the <unk>.
Implementation schedules along with the handsets are safety protocols to ensure a book to bill speak with the seamless and cost.
On slide five you can see the era of waterfall for the last five quarters and as we continue to grow our <unk>.
My fixture of the continued impact of COVID-19 related churn and prove out the nominal impact that COVID-19 has had on store closures and our Tam and the inspiring strength of our customers and Q1 COVID-19 related churn was 4% annualize. The overall base and we'll continue to work ssds affected customers to get back on of the stores. These metrics are very positive signs for our business and this is down from a peak of fifth.
18% during the early stages of the pandemic.
Slide seven shows restaurant magic bookings for the quarter were 231, and <unk> was reported at $9 million combined here on brink and restaurant Magic is now $34 $6 million at the end of the quarter and.
I come to the last quarter of restaurant Magic and our data central application were impacted more by the pandemic and customer facing technologies like brink and punch and we're encouraged by the sequential improvement and expect.
And more normal bookings pace of 2021 progressive and similar to our expected growth and Activations in Q2, we expect datasets of also accelerate.
Now at the quickly review, our product and hardware business and the quarter and as a point of sale platforms and drive for communication systems business.
Product revenues in the quarter of basically flat when compared to Q1 and 2020 price.
Net sales were delayed and generate that range you to increase COVID-19 spread.
As we as we are seeing a favorable impact of the vaccine and proving capital purchasing environment for restaurants, and we'll see higher sales throughout 2021.
Now, let's review of our government segment, our government business and increased revenue by three 2% compared to Q1 'twenty.
Our contract backlog at the end of Q1 was $140 million as of March 31, 2021 are.
Our Intel solutions business of the driving force behind the growth and the quarter as ISR revenue decreased eight 8% from last year's Q1.
We continue to seek out contract opportunities, where we can leverage our decade long experience of the performance excellence, specifically and value added revenue contracts that include more direct labor and high Tech contract work within our Intel solutions business lines.
Now some teeth and takeaways for on our company coming out of Q1.
Restaurants are looking for a unified commerce platform the handle the rapid growth and digital transformation today restaurant separate from dozens of siloed different and disparate products that lack the modularity and make the solutions work, we've taken big steps and construct and the topline.
Second our acquisition of punch marries the guests for the transaction restaurants are we like and they need that they don't need of singer of loyalty program for their entire brands, but rather a loyalty program for each and every customer.
And with the growth of digital and off premise ordering restaurants now need to look at profitability and our life of the guest level rather than the individual store level.
The orders make it hard to measure ROI on the store basis guest engagement helps fill that hole.
Third the strength of balance sheet, we intend to continue activate M&A states and execute on our strategic initiatives.
Our continued focus is on adding meaningful software products that will allow us to increase our subscription rates and add additional functionality and features for our restaurant customers.
Early returns of the punch acquisition and are very encouraging and we're beyond excited to leverage their teams experienced across all par.
In summary, we started 2021 with considerable optimism I want to reemphasize and we'll continue to make bold bets going forward on future growth that you can expect for.
The focused investments across the product innovation marketing and people initiatives.
We believe this ambitious agenda at this time as warranted by the size of the market opportunity and where we stand today relative to it.
In closing I want to acknowledge the sacrifices being made by par employees across the globe and these difficult times and typically our current thoughts are with our new punch colleagues face of India.
India is presently in the midst of the work of the worst phase of the pandemic and its rare now to find the guy that is not impacted by the disease and that country.
And the face of the most difficult conditions, our business the India continues and our employees of finding creative ways to do their best for our company, while ensuring our customers get the top class and uninterrupted service the part punching on for <unk>.
Truly think and for that.
And with that I'll turn the call over to Brian for more details on the Q on numbers and then take your questions Brian.
Thank you Stephanie and good afternoon, everyone.
Product revenue and the quarter was $18 6 million consistent with the $18 6 million reported and Q1 and 2020.
Service revenue that includes revenue from our subscription software.
Reported at 18 million of decrease of four 8 million or for 3% and the 18 8 million reported and Q1 2020 day.
The decrease was driven by a $1 8 million decrease and implementation revenue, partially offset by $9 million increase and software revenue the.
The company continues to expand our recurring revenue base, which includes both software related services and hardware support contracts.
The total the recurring software revenue streams contributed $1 2 million of the increase and service revenue.
The company continues to gain momentum of the deployment of brink and restaurant magic date of essential applications, noting a $1 1 billion for 18% increase and software as a service revenue as compared to Q1 and 2020.
The quarter ended March 31, 2021 marked the one year anniversary of COVID-19 related restrictions on restaurants, those restrictions impacted the pace of which we were able to rollout our new sites.
Of the $18 million of service revenue reported Q1 2021 14.
$2014 9 million or 83% is comprised of recurring revenue contracts as compared to 13 million for 69% of service revenue and Q1 2020.
Contract revenue from our government business was $17 9 million and increase of $6 million of three 5% and the $17 3 million reported and the first quarter of 2020.
This is the result of and increase and the value and ISR contract and subcontract revenues.
Contract backlog continues to be significant noting the total backlog of over $140 million as of March 31 2021.
Now turning to margins.
Product margin for the quarter was 19, 8% versus 20% and Q1 2020.
Service margin for the quarter was 29, 6% compared to 32, 6% reported and the first quarter of 2020.
The decrease of margins, primarily due to the decrease and implementation revenue and increase and software related costs.
Government contract margins were six 7%.
As compared to six 9% for the first quarter of 2012.
The decrease was driven by our mission systems line of business impacted by higher labor costs compared to the first quarter of 2020.
GAAP SG&A was $14 $5 billion and increase of two nine and the.
The <unk> 6 million reported and Q1 2020.
Increase was primarily due to $1 1 million of variable compensation and <unk> 7 million of acquisition costs related to our acquisition of <unk> on April eight 2021.
Net R&D was $5 8 million of point 9 billion or 18% and the $4 9 million recorded for Q1 and 2020.
The increase was driven by additional software investments from a break and restaurant magic date of central product line.
Also included in the operating expenses for the three months ended March 31, 2021 of $4 4 million of proceeds received for onetime recovery of the C. Max.
No comparable reductions of expense for the first quarter of 2000 and twice.
Now to provide information on the company's cash flow and balance sheet position.
For the three months ended March 31, 2021 cash use and operating activities was $3 4 million versus $15 1 million for the three months ended March 31 2020.
Italy due to improvements in working capital requirements.
Cash used in investing activities was $1 7 million for the three months ended March 31, 2021 versus $2 million for the three months ended March 31 2020.
Capitalized software for the three months ended March 31, 2021 was $1 5 million of associated with investments for various hospitality software platforms.
Versus the $1 9 million for the three months ended March 31 2020.
Cash used by financing activities was $2 1 million for the three months ended March 31.
2021.
During the three months ended March 31, 2020, we received net proceeds of $49 $5 million and the 120 million issuance of the 2026 notes offset by the repurchase of the majority of the 2020 for notes.
Inventory increased from December 31, 2020 by $3 7 million and preparation for planned installations with some of our enterprise customers.
Accounts receivable decreased $4 3 million compared to December 31, 2020, due to continued improvement and the restaurant and retail accounts receivable.
Days outstanding improved within the restaurants and retail from 74 days at December 31 2020.
The 63 days at March 31, 2021.
Days outstanding increased with the government from 51 days at December 31, and 2020.
The 54 days at March 31, 2021.
This concludes my formal remarks, and we'll now move to Q&A.
Ladies and gentlemen, and if we have a question at this time. Please press the star and then the number one key on your Touchtone telephone and you felt.
<unk> has been answered or you wish to remove yourself from the queue. Please press the pound key again, ladies and gentlemen, if you have a question at this time. Please press star and then the number one key on your Touchtone telephone.
First question comes from the line of Samad Samana from Jefferies. Your line is open and you may ask for your question.
Hi, good evening and and thanks for taking my questions. So maybe first just.
And as we look at the the bookings number I mean thats still is basically just a hair shy of the record levels. We saw the walk you and maybe help us understand.
What's driving that sustained strength normally and the <unk> you see a little bit of a seasonal downtick and then you mentioned the case of spiked and suggest.
How should we think about that and the bookings and the quarter and were there any particularly large deals that accounted for.
Meaningful portion of that record or near record level number.
No large deal on.
And that's sort of swung it has that continued momentum Q3, Q4, and just give me of amazing momentum.
I would say the one of the things that I think we've gotten really good at and after we sign alert the logo, we've gotten much better at signing of the stores.
The cut off the wheel if you will so historically its taken us too.
And two three years to roll out of the concept now it's coming much earlier on.
I think that has these COVID-19 restrictions of come down and we see our activations pick back up which will obviously drive they are and it will also help us I think on the booking side because of the backlog comes down I think we've been pushing for more aggressively on these existing logos that we havent totally penetrated yet.
Got you and then I am and I apologize for making you do a bit of a math question here, but if I just think back the last quarter.
I think you had mentioned that <unk> should continue to accelerate and and this quarter and it actually decile of against the prior year. So maybe just help us think about what the shape of that should look like I know, it's tough to pin down because you can't control social distancing regulations on the bad debt, but.
Just maybe help us think about how we should think about that acceleration on a full year basis, just given the quarter to quarter variance, we might say yes.
Yes, I don't think of we're going to have the quarter quarter variance and anymore unless COVID-19 picks back up.
I think us having 3300 stores and backlog creates a really really strong foundation for 2021, and it'll be hard for us the screw it up.
So I think you'll see acceleration in Q2 again provided the pandemic doesn't come back we've already seen as I mentioned activation and picking up.
And I think that will continue in Q3, and hopefully Q for it so I think.
I think this will be the low point, because I don't expect COVID-19 to come back and these restrictions to come because.
And so we had in January February were pretty pretty pretty significant and so that really limited what we can do I think we'll see.
The nice expansion in Q2 and in Q3, what does that mean dementia by the end of the year I think our air and growth by end of the year should be in line, where we've been historically.
And again I think just having that backlog of and these are signed orders. These aren't like of booking with the we've got to go build software for these are orders that are signs of rolled out, though I expect by the end of the year, we're back to more traditional ardmore traditional growth that we've had over the prior years.
The small, but I would just add one other piece of the 17th mention there right you mentioned and the year over year growth with this year being in essence, the end of March and the end of March of this year was the one year from the restrictions and the last year and so this will be our top our toughest lapping period.
And regards to post COVID-19 as of last year Q2 of last year as you recall, we basically had a pause of installations and Q2 of last year.
No. That's helpful color. Thank you for for and then on and then just switching gears, maybe on punch I know it hasnt been that long since the acquisition was announced but have you had maybe any interesting early reactions from either your existing customers.
And feedback on Hey that was really interesting we were looking at it or or vice versa, where maybe punch customers that werent using par.
Suddenly are taking your phone call.
And in that regard would be would be interesting as well.
Yes, so categorically I would say that the feedback was very positive I think of lot of our customers understood. The industrial logic of it I think they have a lot of respect for the punch team's ability to get product and ship it quickly.
And obviously the part they know par well.
You kind of going against very positive specifically, we've had a number of customers and I think we hadn't.
Land to the sort of one day.
And the pipeline that came out of the Hey, this is really interesting.
The thing to look at par and then we kind of category of customers that I would say.
The slept on current and I don't think that you will all of the change that was happening and this sort of brought them into the funnel as well I'd say the best thing is though that we didn't have any.
Massive customer anger, and we didn't have any customers think we're coming into the screw them and so in general it was very positive and our customers are and really supportive and obviously I think living through the pandemic. They understand the why behind us which makes it so much easier.
Helpful. And then Brian maybe this one might be for you, but just I know that youre, not giving guidance, but when should we think about.
Or how should we think about punch impacting the numbers going forward and will that be broken out separately like restaurant magic is or will it all be integrated together and one recurring revenue line Gist gist.
And just kind of getting out ahead of that.
Sure of what Youre going to see and the and the 10-Q, that's going to be coming out of the MD&A section as we are breaking out now away from where we had product lines and the past.
The core and break and looked at all of the various different revenue streams related to those customers that they have had those products and now we're actually going to be having and there within the segment revenue you're going to see.
Sure just hardware software and services and so the punch side of that will be rolling up into the software component of a little bit into the services.
Both software and services rolls into the services line on the financials. So that's what you're going to be able to see the more transparency going forward now.
Great.
Turn it over to the next person, but thanks again for taking my questions and thanks to the strong bookings performance.
Your next question comes from the line of of Stephen Sheldon from William Blair.
Line of cell phone and you may ask your question.
Hi, Thanks wanted to dig a little deeper on the visibility you have into the pace of Activations.
For break as we think about the next few quarters I know you expect them to pick up the can you maybe just help frame.
Expectations around what we should expect in terms of the activation cadence over the next few quarters, if you have visibility into that.
Yes sure.
Before the pandemic.
On.
And we sort of.
And I suggested that we kind of want our bookings and activation that's the kind of match and at the time of today. It should be around 1000, and I think we'll definitely get back to that and hopefully well beyond that as the <unk>.
Restrictions continue to come off.
<unk> seen our restaurant customers.
Now and in the month of April and now May lighten up more and more which will help us accelerate the second thing. We've done is I think we put them on the best people on this problem to really say, how do we make the scope pass or how do we change that we didn't make it and they get better. So I would expect us to like I said I think this is the trough.
This was the last this is.
And I don't think and EQT of Q2, 2021 will be the first quarter and we havent had restrictions.
And sorry, we had and that's particularly we still have some change of ours that are limiting what we do until they get to the point that they can lift restrictions, but for the most part of this is the first quarter since the spin down of cabin that we can really push activations and like we did before the pandemic. So honestly just to get back to at least where we were pre pandemic and.
And hopefully accelerate beyond that as things get better and better.
Got it that's helpful and then what fraction.
Couldnt have you seen so far on the on the payments facilitation side, how interested the your existing customers seem to be about exploring using.
Using your payback capabilities.
Yeah, I think my hope is by the end of the year, we have real traction I think we've learned a lot early on I think what and who actually have been excited by some of the receptivity we had some some larger chains the.
The thing I think we've learned is our ability to.
The package hardware and the rest of our services at the time of the payments is very powerful for the end customer.
And we can provide more ROI provide them a lower cost of ownership.
And so that's really what we're working on it and so while we're still really early and we had on our sales kick off with the February.
And I'm pretty encouraged by what we're seeing.
And as I've said and it'll take us some time to get into these deals payment deals are on average three years. So.
But we are seeing good progress and particularly when we sell the full solution hardware software and payments.
I think we're trying we're making it hard for customers and say now so we're early but.
I'm not the.
And I'm encouraged and I think the other part of payments that will be exciting was how do we think about leveraging payments with what we have at punch and what we're building and the future where historically.
It's the only payments and point of sale.
Value is again, the ability of the packaged or bundled solutions, but when you're the front and guests. The solution you actually kind of control the payments. So it puts us on a different conversation.
Great. Thank you.
Again, ladies and gentlemen, and if we have a question at this time. Please press star and then the number one key on your cash down telephone.
Your next question comes from the line of chart Sutton from Craig Hallum. Your line is open and you may ask your question.
Thank you 70, just another.
Way to ask about the backlog of sites to install and the opportunity. There is there can you just give us a sense of what your structural ability to implement would be if if there were no COVID-19 restrictions your team was free to do.
And as much as they could do.
How significant could that be.
So it's.
It's all of our staffing getting front of it and so I think.
Could we do of thousands of quicker of course for it will also have to do that COVID-19 U 500, absolutely COVID-19. Your 2000, and we could we would have to sort of hire more around it and then it sounds simple and it's very manageable for us to do this and we are staffing up in advance of that so we've made some some.
And our highest specifically to the.
The parent debt activation and again as we've seen that activation of pick up and.
This month we've.
And you can see on our website and we push for it so.
And I expect that whatever on that cadence, we need to get to we can get to and.
Today, I think where do we Max out.
It's probably 1000 2000, the quarter, where it is sort of depends but I'm not that wouldn't be the EM. The word and I think we can set up for that quickly.
Got you.
On the restaurant Magic side. So if we think about what chipotle and others are saying about the cost of labor. When we think about supply chain costs going up restaurant magic seems like an ideal solution as part of your equation on them.
Curious if you are using that more as the lead weapon or how the reception is going relative to the restaurant magic piece of the business. It's more of a pull through so we pull that through.
And I think one of the things we're excited for US and if you think about our Q2 and Q3 with the pandemic restrictions easing.
It's pretty amazing that we'll be able to accelerate activation and also failure of restaurant magic, which got hit during the pandemic harder than brink, so and I expect us to be hitting on all cylinders and but that product is much more of a cooperative and we felt Brent gets a lot easier to pull that through and that's so it's not the break is more of the lead them.
Okay, and then final question relative to how you've discussed.
Those units that have.
Really the brink offering versus those units that don't have the break offering within the same brand.
Can you give us any update there from them and ROI or perceived ROI perspective.
So there's absolutely a perceived ROI I think one of the most exciting things we've seen is that some of the change the sign the last.
Quarter or so the.
The pace of which we're at which we are.
At the signing new stores is much faster than anything we've done and the path.
And that's going to continue and I think that's just us honestly having gotten.
Smarter about how we.
And all of that product, which is for as you said very ROI based we come in and we say hey, Here's what we're here's why this makes sense because what we've learned and I think.
All of the times, just being smart about how we think about incentives right. So.
And just make it up if we if we said hey, you get a month of SaaS free.
For the for installing and there for booking and the next couple of months.
And it's extremely ROI positive for par because they wait a year with all of our ease of doing now that we made on Monday back in spades and.
And we've done a lot smarter.
About how we.
And kind of again kind of sort of sign.
Of the stores and and.
And we saw real play really well and in Q1.
Alright, thank you.
Your next question comes from the line of our net powder, Sir from Sidoti Your line is open.
Hi, and thank you for taking my questions actually some of the Hum.
Already been asked.
And the punch and integration and and this.
Sales team there and how big is that sales team and how is that the integration going with the cross selling and Upselling.
In terms of the training and ramping that up.
Sure absolutely and it's relatively small.
The banks.
A dozen or so of quota carrying folks.
And.
We're really early into the so we've worked on what's it going to be our playbook too.
The cross sell with a playbook for.
Cost of kind of collaboration on.
We're really excited I mean, I think as I mentioned, when we told our customers there was quite a bit that came in.
Some customers that we weren't expecting.
Thinking through the last month.
There's a number of accounts, where IMAX the lean both from the clinical par side and vice versa. So it's been incredibly positive early going on as we move forward, we will see a much deeper collaboration because we'll have better mapped out, whereas whereas the overlap and where are the places we need the push points, where the place to be for spring.
And the other products that we have so.
I think that's the that part will be of all of the things that happened and integration that will be the parts of it.
We have the most success in because again, we're very much entering of customer need as opposed to creating a need.
Okay. Thank you and I was scared of it yet.
That's all for me.
Yeah.
Again, ladies and gentlemen, and if we have a question at this time. Please press star and then the number one key on your cash found telephone.
Your last question comes from the line of Adam Wyden from <unk> capital.
<unk> is open and you may ask your question.
Hey.
Congratulations on the.
On pulling out of <unk>.
COVID-19.
It's super exciting and obviously love to see the strength of the backlog of.
So my question is if.
If you look back kind of of the history of the company when it the Super Hurry and I got involved the company had no capital.
Got you and there you had the solve all of the Tech debt you were on pace to have your best bookings quarter, and then there's COVID-19 happened.
And you know if anything and obviously now everyone realizes they need that but.
But you've kind of solved all of the tech debt you know you talked a little bit about kind of getting the the implementation team up so you can start activating it.
And you know whatever 1500 2000, although I think during the <unk> of Karen and I think we probably activated close to 2000 units in the quarter.
You know you made a comment.
That you thought that the company by the end of this year would be able to get back to historical organic growth rates. So I mean, just to try and put some parameters around that I mean does that is that like of 50% to 100% growth kind of exiting this year or is that is that what you think you can get to.
We don't give guidance, but I think.
Historically, our business has grown at that point and 50% clip on.
And.
I think we've got the potential to do that depending on how we execute and COVID-19 staying where it is on.
I think.
Underwriting on for 2020 one is it.
It is very much completely tied to our ability to roll out the backlog right.
And if we didn't sign any more stores for the rest of the year and just rolled out our backlog and we'd be.
Very close to hitting the targets.
And I've never been more optimistic about our ability to drive the of our growth for what we've got sign already.
And to just be a matter of executing on and I think obviously the.
Adding punch it just helps us.
The continued acceleration and so on.
I think it is.
And again I hope this on our last COVID-19 impacted the quarter, where we don't the bookings aren't so far ahead of the of the Activations and I think it will be.
And so yes, I think we should be able to get the relatively.
Exciting growth rate.
Because there's so much already signed and we don't need to sell too much the rest of the year of its kind of hit of relatively high err on growth number.
Alright, Okay, and then and then my follow up question is you know look I, obviously been and this company for a long time, we were sitting with the large franchisee call. It about 100 units of a.
Of what I would call it a tier one chain that is probably larger than anything you already have the and we were sitting there and they said well we hate changing our point of sale because every single time, we change it's $50000 of hardware and.
And we both know that it's not 50, it's probably 6789 10, which maybe is and education education program, but but when I sit and I'm like well, what if what of par could give you the hardware for free would you do it and they said, yes, and you know I guess my question really is and it's kind of a threefold question, but I mean, if I if I look at the success of punch right to me it for.
Like you know punch integrated with with the restaurant chains that basically said look we're going to guarantee you the sale of our another doing that through a true.
We're running the the software expense for a lot of these changed through the the loyalty ponds and all of these AD funds, where the franchisees are already paying and the dollars of.
You know I guess my question to you is you know you have and find out about of implementations you know.
What do you see as kind of innovation in terms of rollout to brink and restaurant magic visa E. Having these change put it into the loyalty funds or.
Making people take it with payment I mean, you know or where have you been just prioritizing who you're integrating with based on price I mean, it feels like you know we shouldnt be waiting on everybody else. Like this is the product that everybody needs and so how do we think about kind of prioritize and the change that are going to pay us the most of <unk>.
And she has the stores' innovation in terms of payment either through payment processing of running it through the royalty fund I mean.
It's clear like you said everyone needs of its almost I don't want to all the kind of like a jerk, but like when someone says what's the ROI I mean, I don't know if anyone on this call knows but we were personally invested in checkmate and we think it's a wonderful asset, but I mean people are paying $100 above $200 of year that arguably generates anywhere from 60 to $100000 of need.
<unk> per location based on you know reduce food waste I mean, the fact that people are even asking if there is an ROI is kind of and the same. So to me. This is like how do we educate the consumer debt. The they need this and that the return is multiples on itself and then you know, making people do it faster and making it easier right and making it easier whether it's the payment or royalty front of me how do you think.
Those things.
Yeah, So listen I think it's well underway right I mean, the bookings and we have are very much. The result of getting out there and letting the story of me known and understanding where we are the addition of pumps or accelerate that because now it's coming in and solving a much bigger problem.
And to and unified Commerce platform, So I think its well underway book.
Bookings out of the best indicator for the health of our business our bookings for challenge that would be nervous and and theyre not the again.
Q1 of the best Q1, and so I think it's one of the way and I think it's happening and I think specifically for the larger change it sounds like the new met.
On the.
And I would say I always thought they would take longer to kind of morph the cloud because of the legacy infrastructure, they have and how hard and potentially painful on that is but I think the ROI now is so significant whether it be the ability to have that are on the ordering but of royalty and <unk>.
And our kitchen, and so forth, but could you all of the things that they are desperately looking for do interviewing and and having on a modern platform.
And I'd be shocked if it was and priority one or two on every CEO and CIO and a realized gain and so I think those are.
All underway and we will see more and more larger and larger chains and kind of make that switch and made the decision and again, we benefit a lot from <unk>.
Punch of being a lot of these brands already and on how are you, having the point of contact and a product that drives significant part of life.
Yeah, and I'll look punch being and with Yum brands and Taco Bell and all of these great companies, great I mean look it.
And if it's lost on on you, but Mcdonald's is the putting up dynamic yield dynamic yield I mean, they were the four runner and in terms of investment and restaurant Tech and now they are basically taking a step back and for those of US who studied this company and the par was basically formed on developing the modern point of sales system for Mcdonald's and so look if anyone's and pole position to sign and Mcdonald's and stuff. So.
And I'll look I'm Super excited dairy Queen and 5300 and I'm looking forward to the next you know the first 10000 unit train and the.
And taking over and taking over the rest. So thank you for working hard and the and that's it for me.
And I'm showing no further question at this time over the like to turn the conference back to Mr. Submit the <unk> for closing remarks.
Thank you everyone for joining and we look forward to talking to you next quarter.
Ladies and gentlemen. This concludes today's conference call. Thank you for your participation and have a wonderful day you may all disconnect.
And then.
And.
And.
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