Q3 2021 Logiq Inc Earnings Call
Good morning, and thank you for joining us today to discuss the results for logic third quarter ended.
September 30th 2021.
Turning us today logics President Brent.
And its chief Executive Officer, Tom Brokaw, and Chief Financial Officer.
The Companys <unk> subsidiary brought Granero.
Following their remarks, we'll open the call to your questions then.
Then before we conclude today's call I'll provide some important cautions regarding the forward looking statements made by management during the call.
I'd also like to remind everyone that today's call is being recorded and it will be made available for telephone replay following the instructions provided in today's press release.
Now I would like to turn the call over to luggage pressures.
Sir Please go ahead.
Thanks, Adam.
Thanks, everyone for joining us.
We just reported our financial results for the.
Third quarter ending September 30th.
We had an 11% increase in revenue over the same year ago quarter, reaching $7 8 million.
The growth this quarter demonstrates that we have here.
Pivoted back to the year over year revenue growth.
After coming out of <unk>.
Out of Covid and refocusing our efforts on higher margin higher quality revenue streams.
So as a result, our gross margins expanded to more than 29, 5%.
Which was nearly double from the gross margins of 15, 8% in the same year ago quarter.
Over the last several months, we have also established a stronger foundation for addressing the e-commerce opportunities worldwide and we believe the progress that we've made particularly with the expansion of our gross margins puts us well on the path to profitability and unlocking greater shareholder value.
As a further means of unlocking shareholder value, we recently announced the board's approval of our plans to separate data logic and App logic into two independent publicly traded companies.
We believe that by creating two standalone businesses data logic, and App logic, the business will be in a better position to capitalize on their respective growth opportunities in the rapidly evolving e-commerce and Fintech landscape.
We also believe that the separation.
We'll create higher peer evaluations as compared to where logic is today with app logic and data logic combined.
Based solely on our review of comparable public market valuations as private equity funding.
That we're seeing for companies in emerging markets Vince at.
We believe the Standalone valuation for App logic could be as much as 100 million or more upon completion of the split transaction.
There are other initiatives for increasing shareholder value that we're pursuing but first I'd like to turn the call over to our data logic CFO, Rob Green Arrow, who will take us through the financial results for the quarter.
Rod.
Thank you Brent and good afternoon, everyone.
Earlier today, we issued a press release with our results for our third quarter of 2021.
A copy of the release is available from the Investor Relations section of our website.
As many of you know, we manage our business under two reportable segments.
Up logic, as our mobile commerce enablement and data logic.
Our consumer marketplace and digital marketing platform.
Now starting with our statement of operations for the third quarter.
Our consolidated revenues for the quarter ended September 32021, total $7 8 million.
This compares to $7 million in the same period, a year ago, an increase of 11%.
As Bruce stated earlier, the revenue and most importantly, our gross margins demonstrate demonstrates the continued positive trends based on the key strategic decisions made by management.
<unk> contributed $2 8 million or 36% of our consolidated revenues in the third quarter as compared to $3 2 million for the same period, a year ago, a decrease of 0.4 million or 11%.
The decrease was primarily due to the strategic shift to target high margin and consumer customers compared to low margin high volume White label resellers.
Data logic contributed $5 million or 64% of our consolidated revenues in the third quarter.
This compares to $3 8 million or 54% of our consolidated revenues for the same period a year ago.
The increase was due to an increase in data monetization revenue.
Our gross profit more than doubled from the same quarter, a year ago to $2 3 million or 29, 5% of revenues compared to $1 1 million or 15, 8% in the same period, a year ago, an increase of $1 2 million or 108%.
<unk> gross profit increased 133% to 0.9 million or 31, 7% of its revenues in Q3 2021 up.
Up from 0.4 per million or 12, 1% of its revenues in the same period a year ago.
The improvement was primarily due to the company's strategic shifts to target high margin and customers compared to low margin high volume White label resellers.
<unk> gross profit increased 94% to $1 4 million or 28, 2% of its revenues in Q3 of two.
And in 'twenty, one compared to 0.7 million or 18, 9% of its revenues in the same period a year ago.
The improvement was due to an increase in data monetization revenues and an overall decrease of customer acquisition costs.
Our total operating expenses in the third quarter of 2021 increased 104% to $8 1 million compared to $4 million in the same period a year ago.
The increase in operating expenses was primarily due to increases in depreciation and amortization expense of <unk> 6 million as well as due to general and administrative expenses of $3 2 million.
The increase in G&A included increases of 0.5 million due to the pixel and rebel acquisitions, which we acquired in November of last year in Q1 of this year respectively.
The increase in operating expenses was also due to increases in R&D expense of approximately 429000, which was partially offset by a decrease in sales and marketing expense of 68000.
Of the increase in R&D, approximately zero point $3 million was due to the pixel with the remainder of the increase due dropped objects.
Our Q3 2021 consolidated net loss totaled $5 8 million or <unk> 25 per basic and fully diluted share as compared to a net loss of $2 9 million or <unk> 23 per basic and fully diluted share in the same period a year ago.
<unk> incurred a net loss of $3 million in the third quarter of 2021 as compared to a net loss of $2 million in the same period a year ago.
<unk> incurred a net loss of $2 8 million in the third quarter of 2021 as compared to a net loss of 0.9 million in the same period a year ago.
The increase is due to the additional net losses from the pixel and rebel acquisitions of $1 2 million offset by a decrease in the net loss of the legacy business.
Now looking at our performance for the first nine months of 2021.
Consolidated revenues totaled $24 2 million down 23% versus the first nine months of 2020.
The decrease from the same period, a year ago, primarily due to a decrease in crop loss.
Partially offset by an increase in data logic revenues, which included revenues from a pixel AI and rebel II.
For the first nine months of 2021, our op logic platform contributed $8 1 million or 34% of consolidated revenues, a decrease of 61% as compared to $20 6 million or 66% of consolidated revenues in the same period a year ago.
<unk> contributed $16 1 million or 66% of consolidated revenues in the first nine months of 2021, which increased 51% from $10 7 million or 34% of consolidated revenues in the same period a year ago.
<unk> revenues in the first nine months of 2021 exceeded all of the revenues are generated last year.
Consolidated gross profit increased 40% to $7 million or 28, 8% of revenues compared to 5 million or 15, 9% of revenues in the same period a year ago.
<unk> gross profit decreased 19% at $2 5 million or 31, 2% of <unk> revenues in the first nine months of 2021 from $3 1 million or 15, 2% of <unk> revenues in the same period a year ago.
The improvement in gross margins was a result of the change in strategic focus from bulk light level distributors to direct marketing end users.
<unk> gross profit increased 141% to $4 4 million or 27, 6% of data logic revenues in the first nine months of 2021 compared to $1 8 million or 17, 3% of Virologic revenues in the same period a year ago.
The increase is due to an increase in data monetization revenues and a decrease in overall customer acquisition costs.
Total operating expenses for the first nine months of 2021 increased 84% to $22 3 million compared to $12 1 million in the same period a year ago.
The increase in operating expenses was due to an increase in general and administrative expense of $8 million depreciation and amortization expense of $1 4 million sales and marketing expenses of zero point $5 million and research and development expense of zero.
Consolidated net loss totaled $14 8 million or <unk> 76 cents per basic and fully diluted share in the first nine months of 2021 compared to a net loss of $7 4 million or <unk> 60 per basic and fully diluted share in the same period a year ago.
Now turning to our balance sheet.
As of September 30th 'twenty, one cash cash equivalents.
<unk> totaled $5 3 million.
Compared to the cats.
Unrestricted cash of $5 8 million as of June 32021.
We believe our current cash levels are sufficient for the foreseeable future.
This wraps up our financial review now I'll like to turn the call over to Brent for an update on our business development Brent.
Thanks Rod.
All in all great trends emerging across our business lines setting the stage for a strong finish to the year and an even greater 2022.
I'm going to take a little different approach here.
There's an entire script that was painstakingly prepared by CMA, our IR firm and they did a terrific job.
That being said I want.
I actually wanted to get a little personal here.
I've been doing this for almost seven years now.
I turned down a job as head of Asia Pacific for one of the largest telecommunications companies in the world and I took below market salary for years and so is my team.
Sometimes there was actually none.
We were paid in equity of shares and we bought shares in the open market.
Over this time frame, we've met companies that were raising venture capital and private equity funding that if turned into multibillion dollar enterprises. Some of them are public recently like grab which is going into the agc's back.
Go Jack I know their founders there.
Going public in the U S. This year.
Meanwhile, we struggle and fight for every little scrap.
Most of the time, we get outbid, we get beaten to the punch, we lose the opportunity for whatever reason, yet we still keep coming back for more.
One of the latest things that has happened and I think some of you who know us well.
I have heard this story.
Is that our IPO and the neo which instead of giving us more attention and visibility has instead created a scenario where there has been there's been the ability to.
Manipulate our share price downwards every time they try to go out.
Even today in this past week I see the selling in pressuring it lower and enforcing others to lose hope himself.
I. Unfortunately bear the brunt of this with people, calling me Emailing me and messaging me asking me, what the heck's going on and I'm not complaining.
I just wanted to tell you guys, what we're what we're doing.
For months now and also most of you know this if not all I've been doing virtual roadshows I've been doing interviews livestreams participating in market awareness campaigns.
I've invested company money and IR, PR and frankly I'd go out on a limb even further than most company leaders even to the point, where some of the public market awareness is considered low brower and sophisticated all for the sole goal of helping build stock value, which in turn will enable further growth of the business through M.
And a and expansion.
Our loyal and long term shareholders have seen this over and over again.
Literally yesterday I was on the phone with one of them and you know what he said he said Brent you know what every time you get to the one yard line something happens and it blows up you just can't seem to get a break and you know what he's right and again this isn't a complaint session. It's a here's what we're doing session.
So I I've been talking about valuation and where ours is and how it's so much lower than our peer group.
How are we going to narrow it and we've been trying to narrow that for a long time.
So trying to trying to narrow it to where we should be trading in terms of price and market value.
Is literally going to be done by <unk>.
Either forcing it or creating a scenario where value is achieved so when we talk about app logic and spinning off the business through an IPO or merger with a public company, we are absolutely doing that.
On data logic.
I just found out this past Friday, when I had a call with with an investment banker, they're recommending that we do have direct I P. O data logic directly the NASDAQ instead of up listing.
So we can actually do that and in terms of uplifting I'm going to tell you guys, where we are right now we did reapply.
Our application is in we meet all the criteria.
Hey, we just since the 10-Q, just now and our shareholder list of them. So hopefully we know quickly.
So whether we uplift or whether we take the IPO route of data logic, and we are absolutely going to spinoff app logic through an IPO or merger with public company. We believe that in any of those cases, it will help move the valuation upwards to where we should be.
And with that we believe that we'll see greater attention paid to us by analysts investors and institutions.
So.
For now I'll just say this and then we can go into questions. Our team is believed in the goal of getting to $1 billion company for years and have stuck with US we have a core group of investors, who I see many of you all on the list who are on right now.
And I. Thank you. Thank you for believing in us.
We're going to keep working hard on getting to where we want to be.
And I really appreciate you guys sticking with us.
With that we can open it up for questions.
Adam Thank you Sir.
Thank you, Sir ladies and gentlemen, if you have a question piece signaled by pressing star one on your telephone keypad.
If you're using a speaker phone. Please make sure your mute function is turned off to allow your signal to reach our equipment.
Once again.
If you'd like to ask a question. Please press star one.
We will take our first question from Stephen Weil scene.
Abbott Investor. Please go ahead.
Hi, Steve how are you.
I'm great how are you.
I'm fine. Thank you first of all if I make you.
They make a quick comment relative to the euro.
Statements regarding the uplift.
We kept our routes you choose I think that without question.
Most beneficial and more expeditious way to go.
Further in terms of increasing the value.
Separate from of course on the corporate side.
Development.
There's no question as you will know that by going to either NASDAQ or NYSE that'll allow and accommodate for a much more sophisticated investor.
Whether it be some funds institutions, no research rugs et cetera et cetera.
That I think will come a long way in.
Providing a much a longer term investor and not many of the traders that input.
Basically taken hold in the company and the stock. The other quick question I have is.
In terms of the spin off.
At what point will you be able to do a state publicly a data records of what a spin off because that itself could create some additional accumulation of the shields and also have sort of a carrot stick out there for those that are in the currently the stock not to sell.
Wow [laughter]. Thanks, no I appreciate that.
Well, we I think we have we have stated that we intend to.
Complete the first phase of the spin off by before the end of the year setting a record date.
We would like to do along with that.
So.
Hopefully before the end of the year I feel quite comfortable that we can get there.
Okay.
It would be wonderful I think that would go a long way in.
So basically giving a comfort level to the current investors and potential new investors as well.
Wonderful Thanks, Steve.
Okay.
We will take our next question from Lisa Thompson of Zacks investment Research. Please go ahead.
Hi, guys.
Hey, Lisa.
How are you.
Good.
So happy to see we're back to revenue growth, it's been a long year.
Yeah. It's yes. The team has done an amazing job it really it really does well.
So maybe you could talk a little bit more about what's going on I saw.
That.
Data logic has added some verticals and I'm wondering if that's going to change maybe seasonality or Oh, we're going to have a big Christmas where it doesn't matter because you're not really doing that.
And then also talk about Apple logic, and where you are as far as well.
Rolling out new services.
Mhm.
Sure Yeah, you know what I would love for Tom to to discuss data logic I know you've been spending a lot of time with the team and should be able to speak to that pretty.
Pretty well yeah sure thing I know Lisa you asked that question last Q and my answer is we're adding some [laughter]. So I actually have right. So we did I say.
And you know in terms of Q4. This is this is a for US it's all about Medicare.
And open enrollment and that is doing really really well so that will really continue to allow us to have another.
I would say I'm very very optimistic on ending the year really really strong.
The other verticals, we added in Q3, which is we're starting to see growth.
In the insurance space, so things around home insurance auto insurance.
It's a very tangential to Medicare and many of the consumers that we have in our in our data is very we can quickly adjust and create the profiles to be able to go. After these 10 gentle segments.
One thing that's nice about the verticals, we're adding as they are evergreen like something like Medicare does have seasonality and some of these had small seasonality here and there, but you know at.
At this point in time, I think we were comfortable with the total number of verticals that we have and will continue to increase revenues within those.
Do you think eventually you're going to start seeing some more maybe e-commerce purchasing kind of you know Christmas stuff going on.
Yeah, Yeah, Yeah, I think so.
But I think that's going to be more on the LDS side of the business I think going going forward, where we see the agencies really pushing the big consumer marketing north whereas data logic.
Consumer marketplace side, we see really these evergreen verticals with people wanting to fix up their house or renew their insurance and these are things that some of them.
We still have a lot of growth in those areas and then there's also different channels as well and so now we've also added additional ways to increase revenue in each of those verticals and so we've implemented those in Q3, we're starting to see new revenues from different channels are in the lead Gen space.
You are starting to bear fruit.
Right now since we're halfway through the quarter or do you have any insight as to what the fourth quarters going to look like.
It's going to be bigger than Q3.
[laughter] bigger than last year.
[laughter], yes bigger than last year, and I think that's bought had a cool statement. If you combine our data logic revenue Q1, Q2, and Q3, they're greater than all of last year.
So Q.
Q4 is gravy for us, but yes, it will quarter to quarter growth and then year over year growth is what we're expecting.
Okay, great and what kind of margins can you would prove to you are you where you're going to be or is there more room.
Yes, I think so we're going to probably Florida in the 30% to 32% margins.
Four four actually I'm, sorry bought the 30 or 29% to 31% margins.
Roughly in that area.
As a whole and then and did a logic you know where we're actually seeing.
You know kind of some improvements here and there but you know this is where we have a nice lever right. If we want to grow revenue, we kind of stabilize the margins.
Actually doing really well in certain verticals and other verticals have bigger margins than others, and we can adjust spending there, but I think if you see historically, we're in the 29 to 31, 32% I think we will continue to play in that area.
Alright, okay.
Just talk a little bit more about the cookies going away.
Is that going to change it.
Yeah. So cookies itself is really going to affect more on the digital marketing side, our <unk> product line.
And it is going away, where we're starting to see it not affecting our products because we are future proofing it.
And the things that you've seen I think.
In the past with things like sand casting Geo fencing.
Gum gum pure 39 <unk>.
All of those are cookie less solutions to get to where we have almost zero reliance.
On a browser side cookies.
So we are future proofing, our platform and these partnerships along with our own internal AI will allow us to effectively not have to rely on cookies at all and that's been our overall strategy that we've been focusing on this year.
Have you seen the industry shifting at all because I keep seeing those cookies every time I go to our website.
[laughter] well, it's starting to become you know if you think about the devices, it's really start to affect that area right and you saw those.
Little warnings, even today, where it says hey, you allows us to be able to attract you and its partners.
There's a significant amount of people, saying decline to that so on the mobile space I think you've seen the impact.
Desktop browsers, not quite yet, but that'd be browser asks the user to say hey, do you allow this cookies on this website majority of people are saying, yes to that one so I think that's been okay, but you know mobile towards that streaming videos, where it's at.
No I think.
As a general marketing product you want to be able to hit mobile you wanted to be able to hit streaming video services and not be reliant on desktop computers and browsers going forward.
Right.
Okay, Great Cool Brent can you tell us about Appalachia.
Apple logic indeed.
Yeah. So [laughter], so so you're asking about new product offerings and what we're doing right now the ones that you've been announcing and stuff.
And you are allowed or is everything shut down or what's what's going on.
That's that's a great question and I'm happy to elaborate on it since I went off script carefully.
Okay. So so.
So on on it and I want I want to frame. This because I think I think those who are listening.
Have been with us for a long time.
And they've they've they've heard they've heard me talking about how companies in southeast Asia are raising all this money, they're going to be coming public here in the U S. It's the hottest region in the world for Fintech and for App App businesses and in E Commerce, and it literally is and I and I'm not saying this.
Bose boastful way, but everything that I said, a year ago. Two years ago is clearly happening last week, there was an IPO of a Vietnam Vietnamese.
Company that is in Fintech and it's got a multibillion dollar valuation. Okay grab is up 40% in the past week, because theyre getting closer to the destock. So so the point of this is is are.
Are we smaller yes.
<unk>.
Are we operating in the region absolutely and.
What this tells people clearly is there is real interest in businesses that are operating there okay. So.
Going on to the product mix.
We've been operating that your wallet side of things Covid actually didn't hurt that so so we continued on.
It's competitive margins are small in that space that but what we what we've always pointed to is that that wasn't in in entry point into.
Doing business and in Indonesia, and certainly in the region.
And so that paved the way for a tosco the delivery app.
Which got really great traction in a short period of time pre COVID-19.
Again, I'm sure everyone's heard the story, but COVID-19 did hurt it hurt it hurt us a lot primarily because our our area of focus is in the central business District, and so Jakarta being a very highly concentrated.
Area in terms of population downtown.
Hurt us significantly because most of our business actually all of our business was deliveries to office buildings. So so the shutdown hurt us.
I think that certainly the positive part of it is that it enabled us to look around and see what are the areas represented growth.
One of those is the area that we have.
Announced last year.
In the fall the partnership with with the folks over at K, MSP, which have provided and in an entry way into the social security administration for.
For micro finance, so payday loans borrowing against savings.
Taking out a.
Loans for small businesses, who are all part of the social security administration that pilot had had been pushed out we are actually in testing phase now so.
It got pushed out a lot.
Pushed out about nine months, but but where we're doing it now.
We with that whats really exciting is some of the banks and in fact, one that we recently announced <unk> and Sonic.
So all of that and they came to us and said could we do.
Something just like B P. J S is going to be dealing with you guys and of course, we moved ahead with that and there are a number of other ones that are coming to us.
So I think that if you look at where we've come from.
Operating the wallet and then rolling out a delivery business that is.
Is still different from from the way that other people operate and then segway into micro finance, it's all been a natural progression. We've always said that this is the three areas we're going to go into we will.
Two new down down that path what.
What I can say is that we are looking at other markets as well we announced Nigeria.
We are talking to people in Vietnam, we're talking to groups and Malaysia, Thailand, and even some other emerging markets as well.
And as part of the spin off of that logic.
We are also in talks with people for merger and acquisition, who are either current partners or have looked at us on a strategic basis in the past and they're seeing other companies from from the region go public here in the U S and they want to be part of that so I think that there's a lot of really great stuff, that's going on not only with us.
But also just in the region and people cannot.
Sit and say Wow.
What's going on over in South East Asia as is or are there real opportunities there wall Street's clearly showing it.
Okay do you expect that to be sequentially up.
Yes.
I think I think it was.
Well if the risks.
Of getting in trouble I think it's going to be explosive is there's just there's just no way that it can't.
The population base the smartphone penetration the need for this then the need for real government mandated programs is absolutely there and were part of that so I would say that that growth is it sequential may not be it may be more like exponential, especially if we layer on other partnerships and acquisition opportunities.
<unk>, which we are absolutely going to do.
But that stuff hasn't quite kicked in right now right.
No yeah, just dial it back.
We are we are in pilot, but we're heading in a direction.
Okay.
Alright, good and then my I guess my final question is you talk about spinning it off and splitting have you made a decision as to whether you're going to be the majority owner or a minority owner.
Have we okay, well when we talk in terms of.
Shareholdings.
It will be the largest shareholders, who are who are the owners of it.
It will start off as majority owners and as we see opportunities to emerge in accretive businesses. We might we will we will end up being minority owners, but I can comfortably say that we will aim towards minority ownership of a much greater and much larger.
Company and platform.
So I was just wondering if you know we're going to consolidate revenues for the time being still right.
Yeah.
We will see yeah, I will do it the paas.
Yeah.
We haven't decided because because theres different ways, we can do it but in terms of speed and efficiency, which I think is first and foremost so we can either do it in an asset acquisition.
Or an actual acquisition of the business. So I think we're going to choose the faster route because what what with logic shareholders should get and what they deserve is the fastest path to getting this up and running within within a listed vehicle here in the U S.
Okay. So its good that be by year end right. So hopefully yellow shortly.
You will know shortly okay.
Good to hear alright. Thank you that's all my question.
Cool.
Okay.
Ladies and gentlemen, once again, if you'd like to ask a question you May press star one.
We'll take our next question from Chris <unk>, a private Investor. Please go ahead.
Hi, Brian Thanks for taking my call.
My question has to do with the Indonesian branch.
I read the.
T R. After hours here on the Super App, that's what I'm really excited about with the.
Spak happening right now big Buzz of AGC.
Now going on.
It could be very very bullish.
Bullish for us as a company if you can watch that super up near term.
Soon.
Before we can see that Super App actually come online.
But that's that's a good question so just to put it in context, when we say Super App. What what that is is it is an aggregation of a number of underlying apps.
And I would say comfortably that's probably at least three so so if we say are we are we well on the way to having a super App I think I think we're already there in terms of the base offerings.
Wallet logistics and delivery.
And then micro finance.
Platform as well.
The goal I think is to bring in things that are relevant to consumers.
And I think what makes it makes the most sense is to small businesses, because whether it's Indonesia, Chris or Vietnam, or Thailand small businesses there are really.
Really the whole lifeblood of our business overall, because they they don't have they have a handful of enterprises than ever when everyone else is a small business. So that that's that's where the the attraction lies in terms of <unk>.
Rolling out a super App, you want to be able to offer things that are going to be used.
Things that are relevant and things that are that are sorely needed.
What we're trying what we are doing is we are finding areas.
Gross and then things that are needed.
And either either layering them into our existing we can call it a super App platform.
Or acquiring it through partnerships or actual M&A opportunities does that answer your question.
That's excellent.
My follow up question to that is.
It's amazing to think doesn't know about sort of a company thats valued at $75 million roughly that we're going to be going head to head with grab a seat.
<unk>.
And if I, if I have read it correctly in the news recently, Indonesia halted all fintech permits and they just granted you a percentage that you'd be able to London.
That's a huge that's on a cap it just amazes me as an investor that.
This hasn't caught on that.
Little logic create app over there has been tech life.
Granted with the government of Indonesia, and they're giving you a lending rate.
Something has to happen you know what I mean someone asked to collect eventually.
Yeah, Yeah, you know as you're as you're telling me that and I'm.
I'm listening to it and I'm thinking Wow, where do I sign up no. It does it sounds great, but okay in all seriousness.
And I'll I'll just.
I'll I'll I'll I'll frame this out for for everyone else.
When Chris is talking about going head to head that's that's a tremendous.
Undertaking.
These companies companies like grab grabbed has raised I think $12 billion in five years, they've got a $60 billion market cap right now with the stack that they were about to go into 60 billion. I mean, we're just we're just a little rounding error to them, but but.
I say this because when you look at it.
And at an opportunity. Okay. So you look at Indonesia, If you look at Southeast Asia, There's really there's only two ways to succeed either you go in with scale and you raised a ton of money, which the top 20 companies there have done.
Sure.
You find a way to get defensibility.
And in the opportunity by way of of being very unique and very clever or you have you have you have entrees into into government.
People, who can help enable that it's and it's not easy to do.
Now the first to the first two endeavors, we did with with the E wallet and then with the food delivery.
There's a lot of competition, there tons and very well funded competition.
Think we did really well.
In the E wallet side, because instead of attacking head on in the in the in the tier one cities. We just took the approach that we're going to go to the poor areas because although they may not be immediately attractive in terms of revenue generation.
Over time as these emerging markets Bloom, what happens as they become very relevant and then the big guys come down the chain and they went to acquire the businesses that have gone and focus on that instead of trying to compete with them head on taking the approach on the food delivery business.
We cut the delivery time by a third because we had guys and gals on foot down down in the central business district that could run and pick something up without having to get on a scooter or motorcycle and park it and take off the helmet and all that other crap and instead, they could get the meals up into the to the buyers in 15 minutes. So that was a novel approach.
Till knows with with with the whole social security micro finance.
Platform that was more relationship oriented the group that we partnered with Hess has and has had governmental relationships with with the fleet. The police force the military.
Ministry of Telecoms, and then the social security administration, so even though that wasn't up for grabs for any of these unicorn.
Unicorns to go after.
We ended up getting it and it's these things happen in emerging markets. We aim to do create more defensive defensive positions and a couple of other areas as well so I hope that.
Long spiel kind of summed up what you were asking.
That does thank you Mike.
And my last question and sorry to a prolonged it is.
The newco of the Indonesian Division.
Now I'm going to turn.
How many public companies are actually traded that do business in Indonesia, do you know off your head.
We know like you said go John I'm going to go public or not.
Many.
They're okay. They're there's there's there's S E which is C C limited.
There's a G C, which is the ticker symbol for the stack that grab is going into.
Go Jack and telco PDL are merging together and they are in late stage negotiations with a certain spak of whom I I know very well Senate sell just just came public through a stock last month I also know that their IPO discussions going on with all the major investment banks.
And we will probably see another two or three come out before the end of the year. There. There's also a number of companies that are listed in Singapore and in Indonesia.
Theres not a lot.
But there's there's about to be more one thing I can say is that their valuations are coming out are all multibillion dollars in size. So.
Maybe that opens things up for us being a microcap and investors on the retail side go Wow I would rather invest in something at $100 million and then 40 billion.
So we'll see but we're really excited.
No. Thank you thank you too.
Awesome.
Ladies and gentlemen, once again, if you'd like to ask a question you May Press Star One we'll take our next question from Kristen Galati from face full research. Please go ahead.
Okay.
Hey, Thank you for your question.
Aye.
My question at the very high at the very end of the press release. It says that the Hunter is a potential for 55 or lets say 50 to 75 million. If everything goes right on the data logic side, maybe if you could just kind of expound or talk about how that could work or what kind of deals.
Would be Oh, yeah sure have at that point.
Okay, cool and I'm actually glad you asked that because I like to talk about it a lot, but that was the whole Reg S. D thing and what I'm supposed to say are not supposed to say I actually.
We want to talk about it so so thank you.
Hey, so organically we have we haven't we haven't come out and given guidance as you know being an analyst.
But I think in terms of targets from from the existing business as is what we like to target for next year.
Is somewhere around the $40 million, Mark and I hope I'm, not putting too much pressure on my teammates out there.
And with that I think what Tom was referring to earlier on the on the margin side.
In the low thirties.
Tom is very conservative which is great.
We have <unk>.
Cumulated push rebel and fix all through M&A.
During the process, we have seen other companies that are in the space. Some of them are very big some of them are medium size some of them are smaller.
And there's and there's a number of them that are revenue and profitable that would be a great fit we were looking mostly for defensible IP.
And in the recent initiatives that we've undertaken is let's go after some accretive.
Revenues and even EBITDA, if we see it so we really stepped that up and on a daily basis Christian we're having one to three calls a day I went to Chicago last week and I met with two companies and we like both of them.
There are there are another.
There's more than 20.
I'd say, we we like all of them will probably end up doing business with most of them.
But there's a good number on there that would be great merger acquisition candidates. So.
I think that that that targeting.
Another call it.
Tend to two.
$35 million in accretive acquisitions that we can pick up at an attractive valuation.
Given where we are in the pipeline and given the speed at which we're moving.
Is very doable.
Very doable.
Okay.
Yeah Yeah.
Yes.
Benchmark, helping you is again it is it a is it a mix of introductions how is that kind of landscape being introduced to you. So you could take advantage of you know that's kind of.
Roll up revenue growth go ahead.
Glad you asked.
Benchmark is is helping us and so our 11 other groups, whether they specialize in software and SaaS sell side representation.
Or are they are they are brokers on the business side or there are friends of mine and Tom and Hague, and John's from from Silicon Valley, or Silicon Alley, or Hong Kong, they're there there are targets of plenty and.
There are there are introduces a plenty.
Thank you looking forward to the split thank you for your time cool Thanks Christian.
We'll take the final question in line from Tony for a private Investor. Please go ahead.
How are you Brent.
Hey, Tony how are you Sir great I think this is the best conference call you've had since you've been doing these things.
Oh excellent presentation. Thank you.
Because I always am I here.
It is cringing.
I know that you are doing everything possible.
To enhance shareholder value and I know that.
You don't have to really answer this but.
I know the problems inherent in knee and hip and knee offering.
In terms of what they did to how they place to stack and what they did to the price as a result of placing the stack in those hands over the last four and a half months.
I assume that.
If you do a public offering that a logic you probably will not do it the same way.
You don't really have to answer that.
The other thing I wouldn't flag.
No Youre right Youre right, we will not we will not replicate because they understand that.
Is that a I know you are talking about the possibility of spending less at logic I know you're also talking about the possibility of doing a new public offering.
Data logic.
So assume you might even have other alternatives do you have a personal feeling about the way you want to go.
I do I do I I think that what we learned in the Neo IPO route is that we cannot put our we will not put ourselves in a position.
Where we are either beholden to or.
At the Mercy of certain arbitrage yours are hedge funds that that that the fray on microcap stocks.
And at the same time, I think I think that what's happened recently with.
With all the introductions, we've gotten as we've met we've met.
We've met some very capable people on the.
Investment side.
And the advisory side that I think can can create a lot of value with us whichever route we go.
So I've been really do you expect to make a final decision within the next week or two.
I think youre going to see some things happening in that timeline, yes, okay, well, thanks very much.
Great job today.
Terrific. Thank you thanks, Tony Okay Bye bye.
At this time. This concludes our question and answer session I would now like to turn the call back to Mr. Son. Please go ahead.
Thanks, Adam and.
And thanks, everyone for bearing with me I hope that wasn't too arcane.
But that's how I feel and I think everyone deserves to hear here that.
It's been really frustrating and at the same time, it's been incredibly exciting to see the opportunities that are coming up and the things that we're pursuing right now and the way that our teams.
Our executing.
And I, absolutely believe that over a short period of time, we will reward everyone's patients.
So with that I will start to read the script and tell everyone. We had a very strong third quarter highlighted by the fact that we have finally pivoted back to year over year growth after emerging from the severe impact of the global pandemic. We believe this reflects how we've established a stronger foundation for <unk>.
Addressing the abundant e-commerce opportunities worldwide for the rest of the year and beyond we look forward to keeping you updated on our progress and in the Meanwhile, please feel free to reach out to us with any questions or thoughts you'd like to share. Thanks, everyone and Adam If you want to go ahead and wrap up the call that's great.
Before we conclude today's call I would like to provide the company's safe Harbor statement that includes important cautions regarding forward looking statements made during todays call Steve.
Statements made by management during today's call May have contained forward looking statements within the definition of section 27, and the Securities Act of 1933 as amended.
And section 21 E at the Securities Act of 934 as amended.
These forward looking statements should not be used to make an investment decision all statements other than statements of historical fact include hearing all forward looking statements, including statements regarding the continued growth of the E Commerce segment.
And the ability of the company to continue its expansion into that segment.
The split of App logic and data into two separate publicly traded companies, including the structure of such transaction.
The ability of the company to attract customers and partners and generate revenues.
The ability of the company to successfully execute its business plan.
The business strategy plans and objectives of the company and any other statements of non historical information.
These forward looking statements are often identified by the use of forward looking terminology such as beliefs.
Expects.
<unk> intends or similar expressions and involve known and unknown risks of uncertainties.
Although the company believes that the expectation reflected in these forward looking statements are reasonable.
Do involve assumptions risks and uncertainties and these expectations may prove to be incorrect.
<unk> should not place undue reliance on these forward looking statements, which speak only as of the deep of this conference call.
The company's actual results could differ materially from those anticipated in these forward looking statements as a result of a variety of factors, including those discussed in the company's periodic reports that are filed.
Filed with the Securities and Exchange Commission and available on its website at Www Dot FCC Doug <unk>.
All forward looking statements attributable to the company on person acting on its behalf are expressly qualified in debt and poverty by these factors.
Other than as required under the securities laws. The company does not assume any duty to update these forward looking statements.
Before we end today's conference I would like to remind everyone that this call will be available for replay starting later this evening.
Please refer to today's press release for dialing and replay instructions available via the company's website at www.
With W at logic Dot com.
Thank you for joining US today. This concludes today's conference you may now disconnect.
Okay.
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